Weblo, which lets users buy virtual real estate, has just raised $3.3 million from VantagePoint Venture Partners, which is based in the valley but has an office in Montreal as well.
Weblo has an original business model. Take Montreal for instance, pictured in the screenshot above. You can buy it for $5000, and then you can earn revenues when the Stade Olympique, the Cirque du Soleil or other key properties are sold.
VentureBeat calls it a pyramid scheme, although weblo answered back by saying they are “paying users for user-generated content” (thanks to Austin Hill for the tip)
I get all the hype about 2nd Life and its virtual economy. People go there to have fun, get some social interaction and live their “dream life”. I have more trouble understanding what’s the basic incentive behind weblo. Officially, the weblo team says you will get “real profit” when other users sell properties on real estate you own. But this reminds me of startups from the pre-bubble era more than anything else, and still leaves me wondering about the system.
So I am asking your opinion about it. There is a very short poll below about weblo’s business model. Choices are:
- it’s innovative and will get more users
- it’s a marketing hack and can get down any time
- it’s a complete waste of my time and money
By the way, if you have any explanation about weblo, please comment below.
Update 18 of July: results of the poll
- 71% it’s a complete waste of my time and money (10 votes)
- 21% it’s a marketing hack and can get down any time (3 Votes)
- 7% it’s innovative and will get more users (1 vote)
Comments
Weblo gets real funding for virtual monopoly game played with real properties » Billions With Zero Knowledge July 16, 2007
[...] MontrealTech Watch has a post up discussing the service. [...]
Fagstein July 16, 2007
The differences between this and a pyramid scheme are trivial.
Mat July 16, 2007
Incidentally, who are the people behind Weblo? Have any of them ever participated in our local web tech events?
Fouad July 17, 2007
Sometime stupid idea can make you a lot of money.
To get an idea , Google “second life buy island”
You will be surprised.
take care.
heri July 17, 2007
@austinhill thanks! – i posted it http://tinyurl.com/yq35sr
Heri July 17, 2007
@fagstein. I would have agreed with you, but they just got 3.3 million and that’s a lot for a pyramid scheme. unless investors are betting on “alternative” startups.
@fouad. yes, i know stupid ideas can go far. take milliondollarhomepage.com for instance. the problem with these are that they are not sustainable in the long-term. i call them “marketing hacks”. and yes, i know a lot about second life, even though i never played it. and i am sure second life is going to close next time there is a crisis in the industry. they build on hype and media.
justinottawa July 17, 2007
Social networking combined with virtual reality world is the future of internet business. Whether call it a stupid idea, a pyramid scheme, weblo is a reality which is attracting a considerable portion of the crowd. No doubt weblo does need to add a number of new features and provide intractivity with the sites, however, it is still fasinating the people. Recently Enlgand was almost auctioned for over $50,000.
Heri July 17, 2007
Mat July 17, 2007
“Social networking combined with virtual reality world is the future of internet business.”
That is not a fact, nor a good idea. That is your own self-serving speculation.
Heri July 18, 2007
apparently, most people agree weblo is a waste of time and money, and I would agree with that.
now, the question is how they managed to get $3.3 million from a VC fund…
Mike Jameson August 06, 2007
Ease of use,Global marking,Global,networking,great for fans,
people can express there thoughts on there best star,movie,domain,city,state,country,etc,etc,.
With worldwideweb domains reaching all time high sales again Weblo is one better!
if you buy the city you get paid back for traffic,ease of use,
you can load 100s of photos,info,news,no server fees,no
webmasters,you can market globally or network.
A city in this site is far better than a domain name in
the worldwideweb this has global mapping of the world
in everyones mind.Worldwideweb domains have nothing
but the need for 1,000.00s of $s in marketing,then you need
a server,a webmaster,backup,and your still lost on the web!
This is a great idea that will reach far into the future and
pay users for years to come.
A GREAT IDEA AND LOTS MORE PLUG INS TO COME!
MY THOUGHTS THE NEXT INTERNET!
MIKE JAMESON
REALTOR CT&MA
DOMAIN NAME BROKER
WEBLO OWNER OF 100S OF CITIES WITH A GREAT
RETURN ON INVESTING ALREADY!
ER SHEN August 19, 2007
Carl Mercier August 22, 2007
Heri August 22, 2007
Carl Mercier August 22, 2007
Regarding the waste of time, one word: Twitter.
Dude August 23, 2007
:-)
Shaper August 25, 2007
Tools available on the website are constantly improving, and the advent of venture capital will increase site development options as it will allow for more servers/programmers etc.
The concern appears to be with the relatively high trading costs of cities and states compared to their revenue. Weblo is growing at an accelerating pace (increasing steadily at 10% + per month), and cities and states have lifetime ownership until transferred.
Many players purchase cities where they live although there are also many speculators in the game. Site development is encouraged by the ranking engine, so there is incentive to update on a regular basis. This will build quality content which will attract viewers from around the web.
While cities currently have a relatively low return, many of them are fairly inexpensive for a lifetime website. They also generate revenue based on any players that live in the city and a share of traffic revenues from any site within the city. As weblo grows, people will develop many base level sites for reasons of personal interest.
Since there is only one real world address associated with each virtual address, there are people who will contribute to the directory by listing their home, business or favorite hangout. A large number of people will develop this content for the pleasure of doing so and for the gratification of recieving feedback and using the messaging system to communicate with other players with similar interests.
Over time, this will “populate” the cities in a systematic fashion. Eventually these cities and their associated states will earn revenues from traffic and usage of the base level sites. During this time content will constantly improve and search engine competition will become more competitive. Something akin to a real world directory will evolve, and the nature of the site is such that there is incentive for weblo to increase the potentials of the site.
While weblo generates revenue from base sales and a commission on site transactions, the real money is in advertising. Recently there are a number of other social networks arising which actually pay their users to provide content and generate traffic, so it is likely a viable model.
The beauty of weblo is that it has excellent potential for a wide range of highly targeted advertising, as well as an internal system that encourages cross traffic within the site. Ultimately advertising will be the model that sustains weblo, long after upper level site ownership stabilizes.
These are the reasons weblo will work, and a few of the reasons that people play it. There are investors, speculators, causual traders and an increasing number of people who just want to carve out their place on the internet.
Weblo is a relatively young site, with an interesting revenue model, but it is far from having reached its full potential.
It is also significantly different than a pyramid scheme, and those who see it that way are looking at it on a very superficial level, and are perhaps not visionary enough to see the long term potentials of the site and what is being built there.
This is exactly the sort of game/internet social experience that a lot of adults will find to be an entertaining and immersive internet experience, a more sophisticated and appealing social site than myspace, facebook or twitter which is largely associated with a younger, less affluent demographic.
Personally, I enjoy the game immensely, and feel that there are excellent long term potentials as well as an intrinsic entertainment value.
Whether weblo becomes ultimately profitible or proves to be nothing more than a casual hobby, does not overly concern me as I enjoy the game on its own merits. However, I think the game does have potential, and I feel it will evolve considerably over the next year or so.
I do feel fortunate to be involved early enough to have a wide range of selections available that suit my interests, although I am certain I would be enjoying the game if I entered it a year later. Though, admittedly some of the higher potential opportunities will be more difficult to pursue at that time, I know that I would find a niche that interested me even at that point.
Ultimately, I feel it will be a successful business model, and am encouraged that other sites are taking the advertising sharing model seriously enough to use as the basis for their own designs.
So call it what you want, but I wouldn’t say that calling it a pyramid scheme is an accurate assessment. Its much more far reaching both in terms of the economic model and range of appeal than many of you are giving the game credit for.
Like all new ventures and business models, it will be greeted with skepticism from some quarters, but it is unique enough and well managed enough that many people will not grasp its true potentials until it becomes a cultural phenomenon.
My prediction is that the site is going places, is a viable revenue model and has a significant future on the internet.
Carl Mercier August 27, 2007