Comments on: Monster Delivers Sweeter Second Pay Day for Affinity Labs Founder

By: No One’s Laughing At Tickle | crown.MONKEY

No One’s Laughing At Tickle | crown.MONKEY — Thu, 24 Apr 2008 11:16:26 +0000

[...] completely shut down while Tickle will be absorbed into Affinity Labs, a content verticals company recently acquired by [...]

By: No One’s Laughing At Tickle

No One’s Laughing At Tickle — Thu, 24 Apr 2008 02:08:31 +0000

[...] completely shut down while Tickle will be absorbed into Affinity Labs, a content verticals company recently acquired by [...]

By: Ted Rheingold

Ted Rheingold — Mon, 07 Jan 2008 03:15:36 +0000

Very well done Chris and Affinity Labs! Congratulations!

Though, after reading the comments I can’t help but offer a couple points for people questioning why this is a success everyone should be applauding.

a) Growing popular community sites is about as hard as launching unpopular ones is easy. Monster *significantly* reduced their risk by buying instead of building. The fact the two parties had an existing and on-going relationship meant Monster has even less risk in the deal.

b) 500,000+ uniques a month is *a lot* of people. Most communities never consistently break 50k. Yet where there is half a million, there are millions more.

c) Selling your business to your biggest partner at a strategic price is not an inside job, it’s great business.

By: Jason Davis

Jason Davis — Sun, 06 Jan 2008 20:30:40 +0000

I have no idea as to how the price was determined and it makes me real happy to see that it seems like a high number. There are lots of monster people who know that industry specific communities are important places to be active.

Now it would seem that monster can press buttons and create communities. Not a bad button to have.

In the next 24 months, there will be big changes to the way companies utilize the internet to find talent and to promote why someone should come work for them. Just seems to me that Monster is covering their basis.

They have started a new group within Monster to come up with new ideas and new technologies. It woud seem that maybe they are going to start spending instead of protecting.

Anyways, I am happy about this and all of us who think and create in the online recruiting world feel a little bit of a buzz right now. Good things to come in 2008

By: Ben S.

Ben S. — Sat, 05 Jan 2008 19:37:07 +0000

I think it is bold and necessary step. Although it may be somewhat overpriced that is irrelevant in the scheme of things if Monster is looking to change its business model and reposition itself.
I think the job board model of charging hundreds of $ for a job ad is out of date so good luck to them in adapting themselves.

By: MJ

MJ — Sat, 05 Jan 2008 03:59:29 +0000

IMO, it seems like the founder’s connections with Mayfield/Monster drove the deal value much more than the intrinsic value of what Affinity had accomplished from a revenue, users, traffic, and technology perspective. Something about the $61M figure just doesn’t jive. Monster surely could have acquired or built this for much cheaper than this.

By: Jon

Jon — Sat, 05 Jan 2008 01:45:36 +0000

Is it just me or does this whole thing seem rather “insider-job’ish”? Not to take away from Christopher’s accomplishments but it seems like Monster had it’s paws all over this startup from almost the beginning. Buying it out when they could easily crush them using existing networks seems kinda odd - is he already planning on going for a three-peat? I may be wrong but my spidey senses are tingling… if anything, they should have purchased Christopher instead of the start-up, he seems to know how to build things that add perceived value to Monster.

Jon
http://buzvia.com - Share Influence

By: Stan Chudnovsky

Stan Chudnovsky — Sat, 05 Jan 2008 01:01:55 +0000

@Mark – here is something from inside I’d like to share. I am obviously extremely happy for Chris and the team, but chances are high that this company could be worth a lot more money in a couple of years. I believe all the prerequisites of a billion dollars company are in place. So, investor part in me feels a little sadness for that potential that we won’t realize – and I know there are others who share the same sentiment. Good for Monster - they were close to Affinity all the way and realized its potential very early. 61mm is a lot of money – but Monster REALLY needs what Affinity is doing. it’s not like there are many companies that are doing the same thing, are there? It’s not like Monster could have bought Affinity cheaper, it’s not like they could have built it inside and it’s not like they could have bought a competitor for less money. Hence the price.

By: Jen

Jen — Sat, 05 Jan 2008 00:37:59 +0000

congrats to Chris. say what you will, that guy stuck to a plan and built something that was of value to another company. have many of you can say that about your own company, regardless whether it’s 1.0, 2.0, or whatever.

re: his military.com deal, i think they’d raised $30 mil or so? so maybe it wasn’t the massive payday.

By: James Currier

James Currier — Sat, 05 Jan 2008 00:04:46 +0000

As an investor, I got to watch this from the inside. There was indeed innovation at Affinity, but I’m not sure that matters in this case as much. Chris Michel and the team did something very valuable, very smart, and they did it fast and with excellence. Whether Monster paid too much, hard to say, only time will tell. I believe the statistic is that across all industries, 72% of acquisitions don’t pay for their cost of capital. This acqusition may or may not fall into that 72%, but it’s a fair bet the new management team at Monster feel that Chris and his team can increase Monster’s valuation and cash position by more than $61M in the next few years. Also, we have to factor in the fact that Chris Michel is a unique person and uniquely valuable. He’s like the perfect storm for a large, acquiring company because he has vision and can start projects from scratch, but he can also lead large groups and navigate large bureaucracies. Tough to find that combination. That’s also one of the reasons he was able to raise money from investors like Mayfield and Trinity with just a powerpoint.

By: Mark Hendrickson

Mark Hendrickson — Fri, 04 Jan 2008 23:33:23 +0000

John Philip Green - I agree with you that there is always more to any story than what is provided by the media (we are not all knowledgeable) but it’s rash for you to suggest that I just did a “little googling” for this story - I don’t think you’d find a lot of this information elsewhere on the web. If you have more to share from the inside, please do.

As for the post being negative, I don’t think it is. You seem to be offended that I’m not impressed by Affinity Labs’ websites. I think they’re well enough constructed but $61M is a lot of money, and it’s a question of whether they are worth that much money (which, obviously, I doubt).

By: markg

markg — Fri, 04 Jan 2008 23:33:19 +0000

Chris is a star and Monster is lucky to have him back for a few years. Did they overpay? Maybe; but obviously they see this is their growth track and lately Monster hasnt exactly been a growth stock.

By: marzipan from toledo

marzipan from toledo — Fri, 04 Jan 2008 23:27:36 +0000

Affinity will be a loss leader for monster. That’s what they do with acquisitions.

By: John Philip Green

John Philip Green — Fri, 04 Jan 2008 23:14:04 +0000

@techLunch: I invite you to have a look through the sites. We built dozens of features specifically for this type of community. For instance, PoliceLink has a “Gear” section which is pretty popular. The same section is called “Tools” on ArtBistro. Careers is another good example. Ning can indeed accommodate lots of types of communities, but it can’t do everything as well as something purpose-built.

@iSee: I won’t contradict any of your observations, but you may also notice that discussions aren’t always the most popular parts of each community. Check out the Portfolios section on ArtBistro, for instance, which was a hit. (Its my favorite section of all the sites.)

@everyone: My experience when reading about acquisitions is that the media only gets a partial picture. I left Affinity 3 months ago when I got funding for my own startup, so my picture could be more complete, but I can tell you there is much more to this than what Mark highlighted in this post.

Speaking of which, why is this article so negative? Is it more likely that the folks at Monster are idiots and like giving away $Millions, or that Mark doesn’t get the whole picture after a little googling?

By: Stan Chudnovsky

Stan Chudnovsky — Fri, 04 Jan 2008 23:09:08 +0000

Amazing success creates a lot of jealousy. Affinity Labs is very different because from the very beginning it didn’t define success as getting press, mentions in Silicon Valley blogs, creating buzz and pleasing everybody. Instead, they focused on building business the good old way - heads down execution on building the team, technology, sites and communities. As friend, investor and adviser, I watched this extremely impressive ride from the very beginning (or even before). And let me tell you – a few people could replicate this success, regardless of who you know. It is true – things often are about who you know, but you know people you know because of who you are. Chris Michel is amazing and that’s why the whole thing worked.

By: techLunch

techLunch — Fri, 04 Jan 2008 22:38:08 +0000

John Philip Green: how is this different from Ning or any number of other CMS systems? Couldn’t Affinity be summed up as 10 Ning sites?

By: Frank Gruber

Frank Gruber — Fri, 04 Jan 2008 22:25:51 +0000

That seems like crazy money to me but maybe Monster has something else in mind.

By: iSee

iSee — Fri, 04 Jan 2008 22:03:51 +0000

The 2nd sentence above should ended with “in the __last__ 24 hours.”

By: iSee

iSee — Fri, 04 Jan 2008 22:02:22 +0000

This seems crazy to me… from some searching, this appears to the full list of sites:

http://www.PoliceLink.com
http://www.theApple.com
http://www.FireLink.com
http://www.NursingLink.com
http://www.ArtBistro.com
http://www.TechCommunity.com
http://www.GovCentral.com
http://www.IndiaOn.com

Except for PoliceLink, none of them appear to have great traction. The forum sections for the others have only had between 5 and 20 posts in the 24 hours.

So basically, it seems like Monster paid $61 million for PoliceLink + a nice social network script/system.

I think it is a *very* nice system, but the price is way too high… I think even $10M would be high, but $61M is crazy imho…

By: Micheal Beevo

Micheal Beevo — Fri, 04 Jan 2008 21:51:42 +0000

its teh early market domination factor.
Similar to ebay. People go to monstr because they have the largest selection of jobs from across the globe. advertisers like monster because all those swarms of people go to monster so more chance of value for money.

In turn monster has more money with which to maintain its brand dominance. Love it . The only way to beat monster is to come up with something that is viral. Like facecrap have done. Something that makes you stand out and gets you hundreds of millions of dollars worth of free media coverage across the globe which in turn makes people want to be part of it.

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http://www.xenbet.com

By: John Philip Green

John Philip Green — Fri, 04 Jan 2008 21:37:48 +0000

As the former dir of engineering at Affinity, I can assure you that’s there’s quite a bit more to the tech than “simple CRUD with Ruby on Rails”. Hehehe.

You can see from visiting the various Affinity sites that the platform is pretty flexible. We built a ground up content management system, templating engine, and localization subsystem. We launched 10 highly customized major sites in under a year. And lots of stuff I can’t really speak about.

Congrats to Chris, Curtis, Will, Eric, and the entire team!

By: Fake Tech President

Fake Tech President — Fri, 04 Jan 2008 21:29:49 +0000

The issue with Monster is it’s a public company. We’re not simply talking about surviving in a pool of startups. This is Wall Street, how do they compete with open platforms while they try to create barriers to traffic such as charging $770 to post jobs when others are not charging anything.

Aside from this aquisition, Monster needs an overhaul of their own business model. If this is in the works, cheers…to a super late welcome to web 2.0!!! NOT LIKELY TO HAPPEN? Oh well, let me just build something that will cream your crop of job applicants…

By: Micheal Beevo

Micheal Beevo — Fri, 04 Jan 2008 21:24:45 +0000

I think what annoys most readers on TC is that we all blatantly know Techcrunch has a huge pool of possible articles. They have the contacts in the industry , contacts within companies , and they get tons of tips each day yet they choose to write about non stories. Just take alook at the last 2 days stories then at other times TC can produce great pieces like this monster one.

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http://www.xenbet.com

By: Micheal Beevo

Micheal Beevo — Fri, 04 Jan 2008 21:21:56 +0000

there are sadly companies outhere who still pay for job advertisement.

despite the fact there are tens of thousands of jobs site out there even many who aggregate jobs from hundreds of sites.

then again I use monster at times because there are one of the biggest in terms of listings.

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http://www.xenbet.com

By: Bemused

Bemused — Fri, 04 Jan 2008 21:21:54 +0000

“Affinity Labs didn’t build anything worth mention in the tech press,”

which is TC’s way of saying you hadn’t covered it, and Affinity ends up with a good outcome while many of the companies you cover slavishly vanish without a trace.