Saturday, October 18, 2014

Pinterest Dwarfing Facebook?

Pinterest dwarfing Twitter is yesterday's news. But Pinterest dwarfing Facebook?

Inside Pinterest: The Coming Ad Colossus That Could Dwarf Twitter And Facebook
A visual social network where people create and share image collections of recipes, hairstyles, baby furniture and just about anything else on their phones or computers, Pinterest isn’t yet five years old, but among women, who make up over 80% of its users, it’s already more popular than Twitter, which has a market capitalization of more than $30 billion. Pinterest’s U.S. user base is projected to top 40 million this year, putting it in a league with both Twitter and Instagram domestically ........ To date, Pinterest’s users have created more than 750 million boards made up of more than 30 billion individual pins, with 54 million new ones added each day. During the 2013 holiday season Pinterest accounted for nearly a quarter of all social sharing activity. Among social networks, only Facebook, with its 1.3 billion users, drives more traffic to Web publishers. ...... on the basis of average revenue per user, it’s only a matter of time before Pinterest blows past Facebook, Twitter and the rest of the social pack. ...... As Silbermann explains it, Facebook “is about your connections, your past events, your memories.” Users on Facebook volunteer a staggering amount of retrospective information such as birthplace, alma mater and vacations, data the company can use to power its highly targeted ad offerings. Twitter can’t offer that level of detail, which is why its revenue per user, at around $3.50, is only half that of Facebook’s. Twitter’s value remains stuck in the now, promising advertisers a presence in real-time conversations about the World Cup, a presidential election or Orange Is the New Black........ If Facebook is selling the past and Twitter the present, Pinterest is offering the future. “It’s about what you aspire to do, what you want to do down the line,” says Silbermann. And the future is where marketers want to live. ..... that delicate moment when browsing becomes shopping ..... For now advertising is Pinterest’s only revenue line. But it requires only the tiniest leap to conjure a scenario in which the company acts as middleman for the hundreds of thousands of retailers already showcasing their wares on its platform. ..... This is Amazon’s turf, but Facebook and Twitter have been making incursions, with both companies conducting tests of “Buy” buttons for frictionless shopping. ..... In his Cannes keynote Silbermann dismissed Google as “the ultimate card catalog,” an outdated technology useful only if you already know what you’re looking for. ..... Pinterest, he says, “exposes people to possibilities they never would have known existed.” ..... Silbermann grew up thinking he’d be a doctor like his parents, both of whom are ophthalmologists. An accomplished cellist and debater, he spent the summer before his senior year in high school at MIT’s elite Research Science Institute and then enrolled at Yale, where he took premed courses. Halfway through college, though, he caught the business bug. Instead of taking the MCAT upon graduation, he took a job as a management consultant at the Corporate Executive Board in Washington, D.C. “Like a lot of young people, I just wanted a job at the beginning,” he says of taking the road more traveled. ........ After three years as a consultant he scored “ the only job I could get at Google,” as a product specialist, and moved out West in 2006. Silbermann spent his days translating customer feedback into product refinements, acquiring a skill he considers crucial to Pinterest’s success. ...... Silbermann was visiting New York when he met through a mutual friend a Columbia architecture student named Evan Sharp. “We both had the same hobby, which was the Internet,” Sharp says. “I grew up in rural Pennsylvania, and Ben grew up in Des Moines. For both of us, in a way, the Internet was this really precious window into worlds outside our day-to-day experience.” ....... Sharp told Silbermann about his collection of thousands of architectural drawings and photos, which had become increasingly hard to organize. That resonated with Silbermann, who’d noticed that Tote’s users seemed more interested in saving photos of products than in buying the products themselves. ...... the three launched the first desktop version of Pinterest in March 2010. Users could save images from anywhere on the Web to thematically organized boards ..... As the work progressed, Sharp moved to the Bay Area and took a job at Facebook to support himself while the three worked from their makeshift offices, a “dirty apartment” in Palo Alto. ..... Its early gains were the result of laborious word-of-mouth marketing, with Silbermann leaning on everyone in his network to spread the word and personally contacting several thousand users to quiz them about what they liked and disliked. “If he hadn’t done that, my guess is we would’ve given up in a few more months,” says Sharp, 31. “It’s kind of ridiculous how long we worked on it, given how little success we were seeing.” .......... Nor was it an overnight sensation with investors. “He had a hell of a time raising money in the beginning,” says Ron Conway, a perpetual member of the Forbes Midas List, whose firm, SV Angel, invested in April 2011 at the urging of fellow angel Shana Fisher. Yelp CEO Jeremy Stoppelman was one of those who failed to see the potential. “A friend sent it to me, and I didn’t even take the meeting,” he recalls. “I was like, ‘Ehhhh, this is interesting, but I don’t know what to do with it. It’s too conceptual for me.’ ” ...... To date, Pinterest has raised $764 million in seven rounds from a group of investors that includes FirstMark Capital, Andreessen Horowitz and Bessemer Venture Partners. In May it closed that blockbuster $200 million round that provided fuel for its international expansion. At that valuation–and given the mania for fast-growth companies over the ensuing six months, a raise in the range of $8 billion to $10 billion is possible–Silbermann’s estimated 15% stake and Sharp’s estimated 10% would make them, on paper, candidates for the FORBES billionaires list. ........ “ I spend a lot more of my time trying to clearly communicate where we’re going so everyone can march in the same direction,” Silbermann says. “Technology has made it easier for small teams to scale fast, but no one’s ever released something that makes it easy to build a culture proportionately as fast.” ...... “My mind is like a warren, whereas Ben’s is like a f–king database.” ..... the phases of the so-called purchase funnel: awareness, consideration, preference and purchase. ...... More than 90% of Pinterest usage is on mobile, higher than Facebook (68%) and Twitter (86%) ...... Every Promoted Pin has to start out as an ordinary pin, living on the partner’s boards, and stunts like price promotions and contests are off-limits. ..... “How do we do for discovery what Google did for search?” Silbermann muses. “How do we show you the things you’re going to love even if you didn’t know what you were looking for? We think if we answer that question, all the other parts of the business will follow.”
Okay, so the metric is revenue per user. I can see Pinterest going past Facebook on that.

Ben Silbermann On How Pinterest Slowly Grew To Massive Scale
In June 2010, more than two years after Ben Silbermann left his job to start what became Pinterest, and three months after launching, the site had 3,000 registered accounts.

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