Founders at Work.pdf

364 Founders at Work
question is, “Would you rather read 20 reviews from people you don’t know, or
1 review from Frommer’s?” Near as I can tell, most people, when given the
choice of only one piece of information, will take the Frommer’s—even though
they might be suspicious it’s a little old or a little vague. But when you have 10
or 20 reviews, and you have a half a dozen written in the past couple of weeks,
you know you’re getting an unvarnished and up-to-date version of what you’re
looking for. And colorful.
Livingston: Were the people originally gathering all this content TripAdvisor
employees, or were they contractors?
Kaufer: A combination.
Livingston: You said it took a couple years to populate the site. Did you launch
the site before it was fully populated?
Kaufer: Oh yeah. We started in February 2000, and in October 2000 we
launched the site, but it only covered the United States. Over the course of the
next 2 years, we rolled out the rest of the world geographically. Of course, we
were always adding more and more content as we found it. When we launched,
if you picked the 20th hotel in our popularity index in Boston, there might have
been one or two articles about that hotel, which is a heck of a lot better than
none, but nothing compared to what we have now.
Livingston: How did people find TripAdvisor when you first launched?
Kaufer: When we started TripAdvisor, the notion was TripAdvisor.com was
actually just going to be our demo site, because we never planned to appeal
directly to end users. We were going to be selling this rich database to travel
portals, online travel sites. They would be querying our database to find the
best information and surfacing it to their users, and there would be a little
“Powered by TripAdvisor.”
Because we would have the richest database of travel information, our hope
was that it would become a requirement that, if you were in the travel industry
or offering a travel section of your site, you have access to our content. And we
would license it out and/or get a share of the revenue generated on the page
views from that. Lycos Travel, Yahoo Travel, AOL Travel, Expedia, Travelocity—
all the players would have to have it. No one would try to build it themselves,
because we’d always be able to stay ahead, since we were entirely focused on it.
That would be our business model, and that’s the model that got us some funding
to begin with.
After a year and a half, we had closed one licensing deal, with Lycos, where
they were featuring our content on their travel portal, and we were getting a
revenue share on what they made selling advertising on the pages that we produced
for them. Everyone else basically wanted to be paid to feature our content,
and we wanted to get paid to have our content featured. So there was a
pretty big disconnect. Then it turned out that with the Lycos deal (even though
Lycos was a major web property at the time), the joke was the quarterly
revenue check wouldn’t buy the weekly free lunch that we offered to our
employees. We had a rather fundamental problem in half of the business. It was