OnStartups

Web 2.0 Crashes: Another Startup Being Sold On eBay

Posted by Dharmesh Shah on September 7, 2006 in startup web20 failure 28 Comments


First, there was Kiko (which was widely covered all over the blogosphere, including here at OnStartups.com).

Now, we have HuckABuck being offered on eBay:  http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&ih;=008&item;=180023313880 ..  This one looks like it’ll be quieter (current high bid is $9,100 and the reserve hasn’t been met).

I’m going to be that most of you have not even heard of HuckABuck.  So, why am I writing about it?  Because I found a number of things about this particular transaction interesting.

Here are the things that kind of piqued my interest (and that I filed away in my brain for future consideration):
  1. I was amused by the opening sentence of the eBay offering:  “We are proud to be offering HuckABuck.com, a Web 2.0 search interface for sale”.  They’re actually proud of having to auction off the company on eBay.  Now, if they had a ton of users that would be one thing.  But, they don’t.  See below.

  1. The product is what I would call a search engine aggregator (so it goes and searches for you on the primary search engines and customizes the results).  Relatively broad target market.

  1. Got some positive mention in the blogosphere, as they noted in the eBay listing.  If it hadn’t been the fact that they had been mentioned on LifeHacker and Seth Godin’s blog, I would have figured it was just a couple of guys that whipped out some Ruby On Rails code over a weekend.

  1. Despite the above two points their daily page views were still less than 3,000 on average. 

  1. Because of this, their average advertising revenue is only $1/day.  [Web entrepreneurs take note:  This is a company that had actually launched a product, had relatively broad appeal, got some positive press and that’s all they could manage to generate.  Traffic generating and advertising revenue by AdSense is not easy].

  1. Seems the team was at it for about a year (which seems to be about the time it takes for some Web 2.0 founding teams to get bored of their idea).  Why are they selling it?  “We have several projects that we are currently working on that are demanding more of our time, and we want to find HuckABuck a new home with owners who can take it to a new level.”  For some reason, this irks me.  If you’re running a startup, you shouldn’t have “other projects” that are demanding more of your time.  A startup is an all-consuming process.  If you start straddling multiple things, you’re almost predestined to fail.  It’s hard enough to get a startup off the ground when you’re totally focused on it.  It’s almost impossible if you’re juggling multiple projects.


I wasn’t a HuckABuck user, so I can’t attest to whether they actually created a cool product or not (just tried it out now while writing this article, and it didn’t really blow me away).

Moral of the story:  Clever Ruby On Rails code, some honorable mentions by A-list bloggers and a potentially sexy product are not enough to make a successful startup.  

It’ll be interesting to see how much this one goes for.  My guess is not that much.  Then again, I didn’t think Kiko would sell for over $250,000 either, so what do I know?