Slashdot Mirror
Craigslist Eyed for Possible Future IPO
An anonymous reader writes "Eric Hellweg wonders if everyone's favorite want-ad site will join the ranks of eBay, Amazon, Yahoo, and, yes, Google. Hellweg guesses it makes $25 million a year by charging for only 12 percent of its ads. If it ramped up payments on more ads throughout its many-city network, it could hit $100 million. That's a monster margin for a 14-person staff! And they may even consider going public."
Or is Craigs List the ghetto of the internet? It's always appeared to be fairly trashy to me with it's ugly ameturish interface and rampant crappy advertising.
AccountKiller
It's precisely the ads that no one would bother to post if they had to pay which are the reasons I read craigslist.
Sometimes advertisers charge a fee to raise the bar to keep quality up -- like a coffeeshop requiring a dollar tip to the waiter to post a flyer, to keep the place from being plastered in Christian rants. With some forums, it's exactly the opposite, if you charge the good stuff leaves. For example, if I couldn't set my viewing level to -1, I'd miss the good stuff on slashdot.
It seems OK to continue to charge the SF area though. Those people basically pay to breathe, if they are dumb enough to keep paying California taxes and cost of living, they might as well subsidize one of my favorite websites too.
Lets start with Yahoo. How do geeks and nerds see Yahoo? A wealth of information? Or just a pile ads with some search results in the middle?
Google? Well, I have noticed as well as others have the current search results have not been as good as before.
It seems that greed and advertising always tarnishes everything it touches. It will be interesting to see what the 14 staff memebers of CL.com decide to do with their up and coming fame.
Good luck.
Useless sig.
want an ipo. Lets say Craiglist is making 25 million a year in profit and they file for an ipo. So what will the market capitalization of the company? Most likely some where between 250 million (p/e of 10) to 2.5 billion (100 p/e which is about yahoo p/e ratio) depending on how fast people will think your revenue will grow. By ipoing you can get the next 10 years of profits now. There are tons of details (ie founders have limits on how fast they can dump stock) but effectively you can get the next 10 years of profits now and the best part is you don't have to work for the next 10 years.
Personally I think they will have problems charging for a lot of thier services. The reason people use CL personals is because they are free not because it is a great service. Same thing for a lot of other categories where people are trying to get rid of junk
BTW It is the VC which prcess really founder equity more thab ip process.
Selling shares on the public market is NOT the only way to cash out. A large number of companies--internet notwithstanding--are acquired privately. In fact it might make sense as a private acquisition for a company that would be able to leverage craigslist's user-base profitably, perhaps more so than others. Thus craigslist would be *particularly* valuable to them, making them willing to pay more than perhaps the going market price--because often companies are afraid that their competitors will get there first if they don't.
Well Craigslist finally made it to Indianapolis, and it sucks. The only buy/sell ads listed are SPAM. Perhaps this could change in 5 years, but doubtful.
I use CL NYC quite religiously, found my apartment, couch, vacuum, and even a few surprisingly good dates there (no really). I've surfed it daily, and placed one or two ads, never once have I seen a paid advertisement or been asked for money. There's a lot of gak to sort through, but you can find what you need if you search right. So... how are they making 25 mil a year?
If all the world's a stage, who's buying tickets?
never drink kool-aid from a big vat
Why is it news when a stupid columnist points out the obvious? Yeah yeah, the craigslist people could make a lot of money if they chose to exploit their site as much as they could. But they've shown no interest in doing so. If that every changes, then we'll have a news item.
Craigslist has pretty much made moving to a new city bearable, and I didn't have to put up with the commericial bullshit on other sites. If Craigslist dies (which it would were this to happen), I would be willing to invest my time in creating a new non-commercial craigslist-ian type site so I could give back what it gave to me.
I'm not kidding either, I got my current job through Craigslist and my apartment. I didn't get any responses from any of the crappy commercial job posting sites and the apartment results sucked from other sites.
Anyone willing to make a new craigslist when (it's only a matter of time, let's be realistic) craigslist either dies or kills itself (IPO).
I dunno about anyone else, but I got pretty worried when they expanded to new cities, I figured the more exposure it got, the chances of it becoming commercial became greater and greater.
After making X millions, you got to find something interesting to do - and in the business world, an IPO is one of those interesting things.
Personally, it seems to me they still enjoy their jobs; so I don't see this happening anytime before all the key employees are in their 60s.
So, they get $250 Million cash. What do they do with it? If they are lucky they can invest it in shares that returns a steady $25M pa ... i.e. what they started with. At the same time, they have dipped out on the opportunity to grow the company from one that returns $25M pa to a $250M or $2.5B pa.
This might make sense if they thought that the long-term growth and profit prospects were poor. However, the fact that the VC's are sniffing around is indicative that prospects for growth in particular are actually pretty good.
If they simply wanted to get out of the grind, they could hand over management responsibility to someone else ... like Bill Gates has done. If they get a good CEO, the money will roll in regardless. AND, the CEO won't have to keep looking over his shoulder at the stock price. Which will be more conducive to a sound long-term strategy.
BTW It is the VC which prcess really founder equity more thab ip process.
Sorry, I can't parse that.
One time while using craigslist, I emailed the default e-mail address about some spam problem on one of the personals pages. I got an e-mail back the next day, in a very conversational tone, from Craig himself! So i wrote back to say thanks, and he actually took the time to have a normal e-mail conversation with me, right out of the blue. He is so uncorporate, the only way he would sell out would be if he was convinced it would help his business.
(With homage to Please, we all understand that you can build a "Most Excellent" PC with glowing neon lights and water
Until now I thought Craigslist was nonprofit, but I guess not. Its "mission and history" page seems to support that: "After being approached toward the end of '97 about running banner ads, he decided to make craigslist non-commercial. 'Some things should be about money, some shouldn't, and I make enough doing contract programming.' He was joined by other folks who proposed running face-to-face parties to make the sense of virtual community more physical, and who proposed creating a nonprofit foundation as part of craigslist." Also, the author of that article didn't mention that craigslist also charges for rental and real estate listings posted by agents.