Edgeio Bids Start At $250,000

I’m looking to pick up an Aeron chair. Any good condition ones left?

Arrington, you my friend are a magician. You helped turn 5M in VC into $250,000. Like David Copperfield and the cash in his safe!
I am dissolving mine. I would rather the quiet dignity.

Why didn’t they just liquidate the assets? Did you guys own anything besides IP?
Like computers, desks, chairs, MSDN licenses, Mac Dev stuff?
That stuff can all be liquidated.

Eliot Noss paid $225k for Kiko for Tucows, and look what happened a year later.
http://www.alexa.com/data/deta.....ize=Medium
Deadpool IP ain’t worth a single dime.

Sell the chairs buddy. I’m reopening under the same name in a different country. My country.

FWIW, http://wiki.edgeio.com/display.....geioAssets provides a very fascinating look at the intimate details of a startup. Tech roadmaps, patents, traffic reports, docs. Kudos to the transparency.

Funny how when it comes to one of your friends, selling your website on a no-name site auction site, this action is not seen as being the closest thing to just abandoning ship. I was really enjoying your blog but your two-faced attitude towards certain actions just turns me right off. I may no longer be reading TechCrunch because of this hypocrisy. Secondly, if they company is so good, and so valuable then why is it up for sale? You’re using this blog as a way to save face for your editor, and his failed business venture. I think I need to find a new blog to read my tech news from.

why is the currency for the Youaretv auction in Aussie dollars, if the location states NY?

Gavin, if you really want to be disgusted into never reading a blog again, you should read my last articles.
Duncan is trying to help Edgeio with this post. Deadpool IP will never get a bid unless the word gets out. Worst case scenario it pays for some free pizza. Not a bad get. The guys from Kiko got enough cash to do justin.tv, and my little deadpool wonder got me enough cash to create a search engine and a sh1tty office for a couple years.

Question… Do you get to keep full server hosting ?

Because advertising this on TechCrunch isn’t sleazy or anything…

@Chris R, Why doesn’t TechCrunch then give it impartial advertising instead of playing it up like it’s some hot product, which it’s not because they went bankrupt!

46% of edgeio’s traffic comes from TechCrunch, according to the analytics. Will this continue to be the case for whatever sucker buys edgeio??

wait Chris R are you saying your search thing is up for auction now, or is that still going strong? i’m still waiting to try it.

Gavin
I made no comment on the assets of Edgeio one way or the other so how I’ve allegedly played this up is beyond me. It’s interesting because you don’t see these sorts of companies at auction very often, and we also had a significant number of comments/ people (directly) asking about if the assets would be sold. Domain-Tools is also one of the leaders in the domain auction market so it’s beyond me how this is on a no-name auction site.

Lawrence
apologies, the link defaulted to ebay.com.au for me, try this link

> “The coding utilizes Amazon EC2 for storage”

Do you mean Amazon S3 for storage, or EC2 as web-servers ?

Man that is sad to hear. Shocking too. I mean, with the publicity that TC has you would think edgeio would succeed.

But I guess the business plan just wasn’t there.

Best of luck to those now looking for work.

cbmeeks
http://codershangout.com

Will be interesting what the story for this startup is at the end of the year. Will it be bought, by who and for how much?

Jon

The problem with Edgeio. It sound like Porn website or Geocities homepage.

Oh, how the mighty have fallen!

Pratham (#13)
I’ll take your word for it, although I was quoting that part from an email exchange I had with the owners so can only go on that.

Jon (#15)
very much so, particularly if they can bring it back from the dead.

Anyone see the irony? It’s like a blogger running for office.

Those who can, do.

Those who can’t, write. And, presumably, those who take everything on this blog with a grain of salt seem quite justified.

Being a failure does *not* suggest writing about others’ successes and/or failures is worth more than a real journalist.

Gavin Schulz — that is not a no-name website it is being auctioned off of. If you are into Domains, which it doesn’t sound like it, you’d know about it.

Also, perhaps somebody needs to conjure up a secondary market for deadpooled traffic of sorts. Done properly could be a novel idea.

third, somebody buy edgeio and make a damn wordpress plug-in that it easy to use and customize and you might see some value created.

When you buy can you change domain name?

I would like to make a prediction for the fun of it:

Unless there are lots of valuable hard inventory items, like fixtures, furniture and Servers, etc., I don’t think that it will fetch the 250k.

Gut feel.

No wonder Edgeio failed… they were trying to use EC2 for storage!

250K for this crap??

I hope mike come back and attack all venture capital companies who invest startup. I waited one year to find rocky startup that I want to read. Nothing All I get is Facebook and Google wars, and lots of VC funding companies.

Edgeio should offer blip’d videos instead of selling off. You could revive your business in video advertising/classifieds. Check out blipd.com because soon, everyone is going to get blip’d! LAUNCHES TODAY!

http://wiki.edgeio.com has all of the information for interested buyers.

Keith Teare
ceo/edgeio

Does anyone know if the Justin Kan of kiko is the same Justin of junstin.tv fame?

I did a very lengthy video interview of the kiko team that is still on-line, and I think it figured into their sale to Tucows. hmm, where is that post….long tail….ahhhh-ha!

http://bizcast.typepad.com/cli.....op_on.html

I agree with Alaska that Edgeio should be commended for their transparency with the wiki page. Has anyone else looked into their Google Analytics data?

Although I like the transparency, I’m still a little concerned about the privacy issues. Data includes partner’s traffic, keyword searches, etc. I wouldn’t be too happy if I were a partner and this was exposed.

If you look at Dec 1 to Dec 11th, the site (including the network) had 1.4M visits. It was very interesting that Techcrunch brought about 800K and Superherohype.com (who the hell are they anyway, but must have a lot of traffic!) brought 440K - bringing over 80% of the traffic from two sites.

Justin Kan of kiko was a grad student at Harvard. Justin of justin.tv is a moron. So no. They’re no the same person.

Total revenue: $57,071
Total expenses: $3,552,007

I would shut this POS down too

Is there any chance the code base would be shared. I was working on RSS and other content syndication standards library some time ago when edgeio was launched. I was really excited when edgeio was launched.

Its quite an unbelievable burn rate! I still believe that classified aggregation does have a future. It has to happen.

It would be interesting to look at the feed parsers, subscription managers, search algorithms and crawlers for edgeio.

But i guess someone would be paying a lot of money for that!

Amit

After reviewing a number of the docs on the Wiki I found Edgeio to be pretty darn interesting. Perhaps bad timing…

That said. I do agree with Michael that the expense side of the house was just nutz. Talk about putting the cart in front of the horse.
I always find it difficult to understand how VC’s keep their jobs. The board of directors of a company has the fiduciary responsibility for ALL. This includes employees who are common share holders. Spending like drunken sailors is just completely irresponsible. However, since it’s not the VC’s money who cares (that’s the attitude, I guess).

Mike also mentioned that he attempted to keep some sanity on burn. However, he was out voted every time. Hmmm, well looking at the Wiki it only looks like Mike and Keith (ceo) on the Board. Of course, the other Directors have resigned in disgrace. Pathetic! So, who else was on the board? Keith maybe you can tell us which way you voted when it came to managing the burn…..

My heart goes out to the employees at Edgeio who got completed blind sided. Always a nice gesture during the festive Holiday Season. The conversation in short goes like this: “Johnny, how was your weekend..well, I’m glad we didn’t tell you before Thanksgiving because the last thing I wanted to do is ruin your holiday, but, now I’ve got bad news. You are fired. Have a good Christmas andnHappy New Year”

MEMO TO FOUNDERS: Look to cash in “some” chips at any stage of the financing (i.e. series A or get a new generation fund to invest like Founders Fund with FF shares). Once you take money from the devil it’s OVER!!!!

I read thru all the thing in the wiki, there aren’t much assets.
the IP they “File”, a dim a dozen, nothing unique. You can reverse engineering them and tweak it in 15 mins.

The traffic, is it a joke? most of them are widgets from their publishers. Revenue 12K a month? what about expense? 2mil/yr?

except the domain have a PR rank 7, but does it cost 250K?

I think TechCrunch just found a new niche: DeadPool Liquidation Notices. (I’m serious…this could be a great place to find good deals on bits & pieces of IP)

once you paid 250K, you get a 10 years contract with rackspace that you have to pay, no more widget traffic as all theh publisher leaves u. and you have to follow up with those “IP” with all the amendments with your lawyers.
you probably have to relocate to take care of the crap.

if you want all theses, pay me 20K i can make craps like these for you to experience.

I guess that’s more of a convenient way to say, sorry, no open source, don’t expect any..

which, of course, is more than fine.

I know this off topic, sorry, but in connection to the person who said that Justin Kan of Kiko.com was not the Justin Kan of Justin.tv…..you are wrong.

They are the same person - big dummy. Because Emmett Shear is listed next to Justin as the CTO of the justin.tv venture. Same Kiko team.

In the name of Michael Milken… Hmmmm…. I read about you in dan of theives. It says you were caught 1986 “junk bond king” scandal. You were named 458th richest person in the world. Sadly, some people see you as poor role model. With billion dollar fortune, aging times — have you ever done something chartible and create new schools for poor?

If not… Scrooge wannabe… Good luck with christmas ghosts…

Peter
You’re probably taking the piss but you’re right, I’d been sitting on the YouAre.TV sale for a couple of days trying to find the right time to run it. Seeing how or if failed…or no longer loved startups sell is an interesting sport.

holy 60 servers batman. best of luck to everyone from edgeio.

does it really take 60 servers to support 8Mil page views??? how does the math work?

It’s too risky to buy failure product that will not succeed. The forecast sales in 2-10 years could give the owner a heart attack. Many.. Many small business books tell you do not buy an existing product from scretch. Reason for this. You don’t have much of experience understanding search engine, Sales, marketing, etc.

You buy it… Next thing. The software cog up & crashes. How are you going to fix source code that you can’t see or understand everything? You email the Admin or Founder. They don’t have time to fix the problem.

I recommend “edgeio.com” should be purchase by experience user who have knowledge programming skills, debugging, search engine, etc.

Don’t buy this product without exprience…

Please reduce reserve price. I have $23.98 in Paypal account. When can I have admin priviledge….?

who decided to spend 200K on that http://www.aresmls.com site? Michael, you? where is ur judgment skill?

To bad, it is a failure.

Ok, while this is not exactly on topic it is something that has been bothering me for months. Duncan you need to learn how to use apostrophes ( ‘ ).

Above you say “As several commenter’s note..” when it should really say “As several commenters note…”, with no apostrophe.

Mostly, apostrophes are used to denote ownership. For instance: “This is Michael Arrington’s TechCrunch.” If something is plural, no apostrophe is needed.

I bring this up because it is distracting and I think TechCrunch is professional enough and should have high enough standards to strive for mostly correct grammar.

Thank you.

~Robert

@47 Robert,

does Duncan use note as a noun rather than a verb? =) hahaha.

Alexa rank for aresmls.com is 5,129,411
There is no functionality on the site and it seems no one has ever seen it. 150k starting bid, you have got to be kidding me. No need to go to comic clubs anymore.
60 servers to run edgeio.com, no wonder they went under, traffic in that timeframe could have been hosted on 1 dediacted server for $99 a month.

OMG. I have a site generating income for me only 3K / month(not my full time job ) =), and it ranks at 110,000 range at Alexa.

The cost of running it every month is like 150$.

how much should I sell it for? I don’t really want to spend the 2 hrs a week to manage it.

ROFL @ 44

Where did you guys read that they used 60 servers?

That does seem high for the amount of traffic (same people said 8 mil views).

I wonder if those servers were mostly harvesters because isn’t that what edgeio did?

cbmeeks
http://codershangout.com

@cbmeeks:52.

Dude. RTFW

@52 cbmeeks

from the wiki. http://wiki.edgeio.com/display/ExternalWiki/Home

The costs of running the edgeio service have been about $35,000 a month in hosting and bandwidth. We have about 60 servers, located in texas, with ThePlanet.com.

@53 jamboree,

I agree, but I feel good tonite…

Duncan’s grammar. I don’t think that’s his fault… It’s school system should be blamed. Why? Evolution versus Creation.

My old college taught me evolution science rather than state of fact. My science professor said moving cloud is consider intelligent design.
Even my English banned word like “God”, “He”, “Thee”, etc..

I dropped out college. I flip back of dollar bill. I see it. But I don’t get it.

@Ted: Look at how much traffic comes from Techcrunch over the lifetime of Edgio.

70%

What a sleazy conflict of interest.

Guys guys guys…. Calm down okay?

I just want to know if I can buy some Aeron chairs.

35000/60 server, 582 / server? who signed the contract?

btw,
“if i can get 250K out of this crap, i would probably tolerate all the facts you guys are digging out “

if they have 60 servers, what were they using amazon’s web services for? S3, EC2, etc should make you need fewer servers…

ok ignore that last one. from the wiki:

It is currently hosted at The Planet and plans are in place to transition to a virtualized environment like Amazon EC2

In answer to some of the questions:

The 60 servers

These are needed for various reasons. Only 2 are front end web servers.

-We have a large ingestion system for advertiser feeds (about 20m records from feeds, about 2m changing daily). This system also caches listings from eBay, Amazon and CafePress (about 120m listings). This is somewhat like Googlebase. A BIG system

-We have an intelligent facet extraction system that normalizes the data and provides structure for front end structured search.

- We have an in memory database that feeds the search engine.

- We have a front end query server that allows for partitioned data and front ends.

- Finally we are fully redundant. That is, the entire system is in 2 data centers that can run independently of the other.

Secondly, revenue and costs

edgeio was a pre-revenue company. That was entirely within plan. We are building an Internet scale classified ad platform for ALL publishers. That is a big effort. We had 11 full time employees, almost all engineers. No sales or biz dev staff yet. Our costs ($6m over 3 years) are well within normal limits for a venture backed company with a big idea and plan. Despite that we had begun to get revenue (I would characterize it as early stage accidental revenue).

Our plan for 2008 was $1.6m and for 2009 about $16m. Last Thursday we pushed the first part of our publisher facing revenue platform. Check out http://www.edgeio.com/cb-intro to see it. By mid January this was to include a CPC and CPA component. This platform is all but finished. A buyer would own it for a fraction of the $6m it cost to build, and without needing the 3 years it took to build it.

Interest in the auction

Our decision to auction was taken because of the overwhelming interest in the companies assets. There was no good way to determine who to sell to. An auction seemed the fairest and most transparent way to go. My personal belief is that our investors pulled the plug WAY to early and that a buyer will get a huge bargain at almost any price up to $6m. We had term sheets within the last 2 months and interest at valuations around $10m. unfortunately they could not be consummated in time.

Hope that helps

Keith Teare
ceo/edgeio

Top Traffic Sources
techcrunch.com (referral) 2,017,526 46.73%

So, basically, Edgio is worthless without TC plugs.

#64 Mikebl

The total pvs in Nov was 8m plus. TC is 46% of widgets served, not pvs

Keith Teare

Now we understand the value of TC…a part from Edgeio’s demise, it is easily made to seem another day just another post…

Keith, Thank you for the additional information. In the face of all these asinine comments, you are clearly an honest businessman and true gentleman.

Good luck on all your future endeavors. It will be very interesting to see what you take on next.

A big fan,

Charles

12 engineers and 3 years! thats a lot of time!

content syndication market hasn’t even taken full shape yet… navigating thru so many conflicting standards is really a pain… you guys should have used a lot more open source libraries…

you guys are going out of business too early in the game… its sad…
i don’t think most of the people commenting here even understand what goes on in the background and what is the potential here… but that ultimately doesn’t matter…

burn rate…burn rate…burn rate…

didn’t you guys think of outsourcing some stuff… may be you would have if you wouldn’t have gotten that “accidental funding”…

best of luck Keith for future ventures… its sad to see an end to a great initiative…

@68 amit,
stop over complicating what edgeio does. It gets data from external sources in many different formats and reformats to a structure they can use.

“We have an intelligent facet extraction system that normalizes the data and provides structure for front end structured search.”

page scraper? neat.

@63 Keith

“buyer will get a huge bargain at almost any price up to $6m”

Oh come on Keith. Anyone involved in tech will tell you that the IP without the core engineers to operate it is worthless… ESPECIALLY one so complex as Edgeio (60 servers).

I don’t doubt that had you gotten the money to continue the venture it might have worked out well provided you meet your targets. But there’s no way in hell someone will be able to come in and assume such a complex operation and STILL leverage your 08/09 strategies.

@69,
good one~ heeehee. if we get pay 250K for a bargain up to 6mil, why dun Keith take it himself and make it private? or Michael? seems like you can get rid of the 12 engineers and just let the site sit there and get $

As spoken by many before me:

It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat

@63: “This system also caches listings from eBay, Amazon and CafePress (about 120m listings).”

Depending on what you’re caching from Amazon (and probably eBay/Cafepress) it may violate their T&C unless you’ve got partnerships w/ them.

Might want to make mention of such partnerships/deals in your wiki.

Hey guys,

We at IZEA are willing to pay $5 million to buy Edgeio. But we do not want to hurt Michael Arrington and his loyal readers by doing this. Last time, the readers rejected our offer to advertise on TC. If the readers do not mind this time around, I am very much willing to buy Edgeio. After all, Michael is a nice buddy of mine.

I agree with @67

Why the need to sell in one weeks time? - is it the investors want the write down for tax purposes in ‘07?

….will get a huge bargain at almost any price up to $6m.

Why start the auction at $250k if you believe it’s worth 7 figures?

Have you been retained by the investors to sell the assets?

Reading Keith Teare’s comment (#63) I see that a lot of care was taken to do it right, and I do feel your pain. At the same time it is hard not to feel smug about the fact that my listings engine, which got all of $1,000 in funding, is still standing and growing, while a $6 million project crashed and burned.

Editor Arrington, now that the conflict of interest is well and truly over, wouldn’t this be a good time to cover ALL the real estate listing portals, including mine (even if it is Web 1.0)? Just a suggestion.

Arrington,

You’ve been mentioning a lot of your investments lately. Now you’re even trying to hawk the ones you’ve deadpooled.

Just so you know, this is post-post-modern internet culture now, and we all know that just because you introduce your association with a company in the lead paragraph of a story you are covering does not anymore clear you of shamelessly trying to recoup some lost funds.

From now on, in the sake of your trademark honesty, you should perhaps preamble such attempts with: I am now going to shamelessly try to fundraise for a company I personally am associated with - that would be honesty.

Anyhoo, from one honest bloke to another, Tally Ho!

We’re all reading you closely out here in C Space,

Alex

OK I’ve bought and set my latest venture called TheArringtonTouch,

We have one of these thingies …

“We have an intelligent facet extraction system that normalizes the data and provides structure for front end structured search.”

http://TheArringtonTouch.com

can anyone explain how come they get so many mliions uniques a month and they still are just 37,000 on alexa?

And by the way, Michael dissapeared?

Man… this is sad to see. I met some great people from Edgeio. It’s too bad it didn’t work out

Plus it’s Michael’s baby… on sale for only $250,000 to start? I sure hope it goes for much more than that.

Cheers,
Aidan
http://www.MappingTheWeb.com

Sad to see the demise of this site before reaching it’s full potential.

A few more answers:

If it is worth $6m why don’t I buy it

If I can find a backer to help me bid I would consider that. I can’t think of a whole lot that is better than acquiring 3 years of effort in a large market ($50 bn US and $200 bn worldwide) and, staring with 100% of the equity when it is ready to go to market. Anybody reading who would put up $2-3m for 30% of a newco should contact me. keith [at] edgeio dot com. Of course if that was to happen I would disclose it and be transparent. Right now I am not a bidder because i do not have the cash. And my role is to maximize the return for my investors.

With the engineers gone it isn’t worth as much

Myself, Matt Kaufman (head of engineering) and Vidar Hokstad (head of operations and most senior engineer) are still together working with bidders in the auction to provide answers etc. We had 6 engineers in Beijing who will still be available. And several of the other 6 may still be available on 12/21 when the auction ends.

Again, hope that helps clarify.

Keith Teare
ceo/edgeio

“We have an intelligent facet extraction system that normalizes the data and provides structure for front end structured search.”

page scraper? thats neat.

Alex - you clearly don’t understand how these things work. My equity has been wiped out, and it would take something like a $10+ million sale before any money came to the common. This sale is to pay back creditors, and anything else will go to the venture guys. I have no financial interest in Edgeio moving forward. And frankly, I wouldn’t have covered this story since it’s non-news. Duncan picked it up and ran with it over night.

I think the auction is not the best move for edgeio. I don’t know your position about what I’ll propose here, but I hope you read the following lines with an open mind, I’ll try to be short.

Instead of doing an auction and practically killing what could be a successful classified advertising platform you could do a very important move for the web2.0 history: release it under the *new* FSF GNU Affero GPLv3 license (http://www.fsf.org/licensing/licenses/agpl-3.0.html) - please read about that.

Why? Because this license extends the rights of the “normal” gpl to remote web users, which means that if anyone improves edgeio and makes it available online, they should provide a link to the new source code, thus generating a positive improvement cycle on web applications (just like gplv2 did for desktop applications years ago).

That’s amazing now, because as you might know, successful free softwares are mostly “generic” platforms serving different markets (openoffice, firefox, mysql, pidgin, gimp…), and edgeio has yet no parallel in the free software world (just a matter of time tough).

This combination could lead edgeio to a renaissance in the hands of passionate developers willing to improve the system, and would enable current users to stick with their current system (maybe ask for donations - build a foundation like mozilla does) and prevent advertisers from running away before the auction finishes. Along with this changes, the need to provide support and related services will come (if still your interest or interest of your past employees) or - at least - you’ll just get some free publicity (which will probably worth more than $250,000) and a very good image around the world for your future startups.

I hope you think about it seriously…
Best Regards,

Giovani Spagnolo
http://www.webyes.com.br
http://www.tvgio.com

edgeio, good luck getting anything for that pile of junk. 60 servers, $200 a piece, I’ll give you 12K.

Merry Christmas

plentyoffish serves 1.2B pageview with 3 servers. edgeio servces 8M with 60 servers???

is it the worst engineering team or what?

@ Keith

Off topic but what made you go with China as opposed to India in your outsourcing. Did you have any trouble with the communication aspects?

This auction is looking worse and worse each day.

… we got most of the furniture for our new Huston office.

http://fakesteveballmer.blogspot.com

It’s always sad when something innovative goes down I can only hope that it was not because of money being mis-spent etc..

If it was just a bad business plan, its very forgivable, and all the best to the folks behind it. keep at it, an idea will pan out eventually.

(look what i had started… Internet TV and live video in 2000? that was a bummer! http://web.archive.org/web/*/http://www.catchuslive.tv) when broadband speeds meant isdn 128k

I only discovered edgeio’s demise today when i downloaded the classifieds plugin for wordpress
(ironically im on the verge of doing something related to classifieds using yet unproven methods.. ummm.. no VC funding

Cheers!

“And frankly, I wouldn’t have covered this story since it’s non-news. Duncan picked it up and ran with it over night.”

Ya, right

I think someone need to write a book of how MC turns $5M into $250,000

MC, you are not alone, we all learn from our mistakes. I hope you can share your lessons learned. Please post it as comment.

Thnx

I guess my question is, who is next on auction block? Digg.com?

Edgeio was a great idea but several years ahead of its time. I blogged about this demise at Edgio’s launch but it’s sad to see great ideas with a lot of potential go up in smoke.

I think Looksmart got an incredible deal if they scale back a bit and wait for the concept to be more accessible - probably in 2 years when blogs are totally mainstream.