Simply Seven (eBook)

Erik Schlie is Associate Dean and Professor of Marketing and General Management at IE Business School in Madrid, one of the world's leading business schools. As a strong believer in the power of deep learning, Erik broadens the minds of MBA students and executives alike and pushes them beyond their perceived limits. Previously, Erik helped create a new international business school in Berlin, where he was the first member of thefounding faculty. He formerly quit a management consulting career to pursue his PhD at Cambridge, started researching the Internet, and later fully embraced the world of learning. Erik's Twitter handle is: @erik_schlie. Jörg Rheinboldt is a serial entrepreneur. While studying management in Cologne, he co-founded the Internet consulting company denkwerk and later alando.de, a marketplace which was acquired by eBay. After the acquisition, Jörg served as Managing Director of eBay in Germany for five years. Today, Jörg focuses on early stage investments in groundbreaking Internet, telecom and media businesses as Founding Partner of M10.Jörg is a Founding Donor of Betterplace.org, a platform for social projects. In addition, he is an advisor to companies and governmental institutions and teaches strategy at the Humboldt Viadrina School of Governance. Jörg can be found under @joerg on Twitter. Niko Marcel Waesche is a consultant, investor and a 15-year Internet veteran. With Cafelido Capital and Consulting, Niko works with enterprise clients to think through and define their business models. He is the Founder and Managing Partner of GMPVC, a media-for-equity fund, which helps entrepreneurs finance breakthrough advertising campaigns. Previously, Niko helped establish one of the first US venture capital funds in Central Europe, GRP Partners, and worked later as an executive for IBM. Niko is the author of a previous book, Internet Entrepreneurship in Europe, and was a columnist for the Financial Times Deutschland. Follow Niko's Tweets on @cafelido.

Cover 1
Contents 6
List of Tables 9
Acknowledgments 10
1 Think outside the box, constantly experiment and evolve 13
The Airbnb story 13
"Dance like an idiot and don't sell anything" 14
Don't think, just test 19
The search for the perfect business model 25
Getting started 28
SimplySeven – that's it 31
The making of this book 35
2 The first building block – services sales 38
Plain and straightforward 38
A business model with problems 43
"Can I skype you?" 46
3 The second building block – subscriptions 50
The heaviest weapon in the arsenal 50
The rise and fall of AOL 52
The "Bouncer Effect" 55
In the "dog house" 57
The future of clubs 58
Getting people to subscribe 59
4 The third building block – retail 60
Don't treat online like offline 60
The million books project 62
Early death in May 2000 63
Being good at bricks is not enough 65
The "Long Tail" vs. "superstar economics" 67
Fighting the clutter 69
The future of the shop is personal 70
5 The fourth building block – commissions 73
Don't believe your clients are stupid 73
The beauty of C2C 76
Listings * ASPs * Conversion Rates = GMV 78
Fraud 79
The B2B trap 80
Beware of the smart client 82
Reports of the death of the intermediary 84
6 The fifth building block – advertising 86
You force it, you lose it 86
Spam and pushy banners 89
Search revolution 90
"The wisdom of money" 92
The death of the newspaper 94
The sexiness of statistics 96
Advertising as a service 99
7 The sixth building block – license sales 102
You will need all your friends 102
Intellectual property 300 years after Queen Anne 103
The indecisive history of computing platforms 106
Distributed distribution 109
"Stay hungry. Stay foolish." – the rebirth of Apple 110
Platform building best practice 114
The "Battle of Platforms" in entertainment 117
Micro license sales – evolution continues 120
8 The seventh building block – financial management 123
Making money with money 123
The mysteriously slow growth of financial services online 125
George W. Bush wrecks the party 128
The brave and few 129
Investment in Internet real estate 130
Investment in Internet traffic 131
Spread betting services 131
Internet-based B2B, B2C, C2C and even C2B loans 131
Substitute for the informal economy 133
Our favorite so far: Weatherbill 133
9 It's a freemium world 134
Paying nothing 134
You can live on love alone 135
Chris Anderson's 5%/95% rule 136
A web powered by small deeds of heroism 139
The reciprocal donation economy and innovation 140
A fairy tale with a GNU 142
One million lines of code 144
Three million articles 146
Donated power for business 149
Competing with free 151
The Facebook dilemma 153
It's a freemium world 156
10 The future of web business is personal 159
Methods and tools to guide customers 159
Flexible payment infrastructures 160
Payment as web services 161
Fast-track companies taking advantage of payment web services 163
Virtual currencies and coupons 164
Mobile payments everywhere 167
Guiding the customer 169
Examples of personal businesses on the web 171
Reputation and trust as an opportunity 172
Back to the basics 173
Appendix: Stress-testing the SimplySeven 175
The selection criteria 175
Initial results: seven confirmed and unevenly distributed 176
Retail leads in sales 181
Market valuations – advertising, again 184
Margins – the beauty of aggregation 185
Key financial indicators 186
Interviews 189
Notes 191
Index 200