Business models on Facebook Stanford Facebook Class Nov 15 th , 2007

Download Business models on Facebook Stanford Facebook Class Nov 15 th , 2007

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Business models on Facebook Stanford Facebook Class Nov 15 th , 2007. Jeremy Liew Partner, Lightspeed Venture Partners jeremy@lightspeedvp.com www.Lightspeedvp.com Lsvp.wordpress.com. Its cheaper than ever to start an internet or app company. $ 000s. - PowerPoint PPT Presentation

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  • Business models on Facebook

    Stanford Facebook ClassNov 15th, 2007Jeremy LiewPartner, Lightspeed Venture Partnersjeremy@lightspeedvp.comwww.Lightspeedvp.comLsvp.wordpress.com

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    Its cheaper than ever to start an internet or app company$ 000sSource: Carsonified.com/SXSW Presentation

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    and cheaper than ever to run an internet companySAMPLE EXPENSE BUDGET

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    As a result, getting to breakeven isnt too hard* Assumes ad sales by an ad network or ad rep firm

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    Advertising RPMs* depend on your ability to deliver a targeted audience$10-40$1-5$0.50 - 2** Facebook revenue estimate well over $100m, Fandango revenue estimated to be around $50m with half from advertising and half from ticketingSource: Myspace, Merrill Lynch; Facebook, MSNBC; Fandango, Techcrunch; Traffic, Comscore; Lightspeed Analysis* RPM = Revenue per thousand pageviews, taking into account multiple ad units and all forms of advertising: CPM, CPC and lead gen

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    Pageview targets get progressively harder as revenue aspirations increaseRPMAnnual Revenue GoalMonthly Pageviews needed to hit Revenue Goal

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    requiring stretch targets for installsRPMAnnual Revenue GoalTotal app installs needed to hit revenue goal** Assumes 5% active per day, 3 pageviews per visit21m installsVS.

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    Implication for ad models get big or get expensiveGet bigMultiple appsMultuple platformsGet expensive (High CPMs)Endemic categories (Movies, Travel, Health, Shopping etc)Standard ad unitsTargeting

    Lightspeed Confidential - Not to be copied, distributed or referred to without the prior written consent of Lightspeed Venture Partners

    What about digital goods?Purchase rateAnnual Revenue GoalTotal installs needed to hit Revenue Goal* Assumes 5% active per day, $1 per item