I did have a free membership to Angie’s a while back but let it lapse. I just didn’t see the value in reviews only. While Yelp’s nice for finding he scoop on bars, I prefer using Kudzu to find service people. The reviews help, but it’s the profiles that really let me narrow down my decision. I’ve found a variety of folks from a tile guy, to a great photographer for holiday photos, to a maid service I’ve kept for longer than my subscription to Angie’s list. For the maid service, the reviews were key, but for the other ones, it was the profile. - imagine hiring either of those without being able to preview photos!

I finally put a profile up for my design firm and have gotten business out of it. As a business, I’m happy to pay Kudzu, but as a consumer, I just don’t see paying Angie.

The next service directory site is http://www.mycityfaces.com no reviews, clean, simple and easy to navigate. Profiles are like “Electronic Billboards”

It’s true that Angie’s list is alone in its model (i.e. not a clone) — could there be a reason? And do you really think it’s like Mercedes?

Whatever, obviously Battery does — given the luxury class price.

Angieslist is not a clone . The site is 13 years old for goodness sake .

They Bring in about 15M a year .

A lot of people think that making money on the internet is all about eyeballs . This is not true .

A busier site does not mean a more profitable one . If I open up a free restaurant beside one that charges for food I am sure I will have more customers .

Free sites are not necessarily competing with paid sites even though there can be an overlap of potential customers . There are those who dont mind paying and there are those who are just cheap .

Its like saying a Mercedes dealership will flop because a Hyunda dealer just opened next door .

Or

Saying that Brusters with their $5 ice cream will flop because you can buy a whole bucket of ice cream from Walmart for $5 .

Or ..Ok last one

Saying that no one will pay for 1st class when there is economy .

Ok …Last One

Its like saying no one will go to private school because there are public schools .

The list is endless . You just have to know your market .

Their site is sparse.  Their traffic is light.  Their monthly .pdf magazine is quaint, I guess.  Probably just a case of having selected a name close enough to Craig’s to get some halo effect.

There’s heat in this space no doubt.  ReachLocal and Yelp are overvalued too. Blame it on the $14B in print yellow page advertising that sits waiting to be poached. 

Kudzu.com is interesting. Not really “national” yet — only has critical mass in markets like Atlanta, Phoenix and San Diego. But when you look at its depth in those markets, it makes Angie look quite weak. And unlike Yelp, appears to have real advertisers — not just restaurant reviews.

But, in fairness, this is hard.

But anyways…I can see how the reviews could be much better because those in the system are paying to see the reviews so are probably offering better reviews themselves.

I’ve never had much need for sites like these myself as word of mouth between friends and family has been able to connect me with everything I need.

But you can’t argue with the success of Angie and Yelp.

I met someone who loves Angie’s List. She had 1 kid, 2 nannies and also paid to watch her kids play in a public park. Oh to have money. If this is Angie’s demographic then there is more value possible around that subscription fee.

Maybe it’s what’s not there that Battery is after. Isn’t that what invested capital is for…

Angieslist is not a clone . The site is 13 years old for goodness sake .

They Bring in about 15M a year .

A lot of people think that making money on the internet is all about eyeballs . This is not true .

A busier site does not mean a more profitable one . If I open up a free restaurant beside one that charges for food I am sure I will have more customers .

Free sites are not necessarily competing with paid sites even though there can be an overlap of potential customers . There are those who dont mind paying and there are those who are just cheap .

Its like saying a Mercedes dealership will flop because a Hyunda dealer just opened next door .

Or

Saying that Brusters with their $5 ice cream will flop because you can buy a whole bucket of ice cream from Walmart for $5 .

Or ..Ok last one

Saying that no one will pay for 1st class when there is economy .

Ok …Last One

Its like saying no one will go to private school because there are public schools .

The list is endless . You just have to know your market .

References -
http://en.wikipedia.org/wiki/Angie’s_List
http://www.collegenews.org/x5883.xml
http://www.angieslist.com/angi.....aspx?i=114

But, if you’re company is bringing in $21MM in revenue annually, and you’ve taken $13MM in investment thus far, taking $35MM in another round makes zero business sense. Unless, of course, those revenue numbers are potential, i.e. based on the 1-year free registrants, but not actually being collected.

They’re doing a good job in a tough business (local search), though. Got to give them credit for that.

Contrast that with ServiceMagic, which I used before to get new central air, gutters and some interior ceilings replaced. It’s no contest.

As much as the “free-tard” comment made me laugh, I too don’t understand why consumers would pay $50+ a year just for reading other consumer’s reviews of local service providers. One would think that the long term availability of free content that is not only comparable but better will be a strong head wind for Angie’s List. I say better because free consumer reviews sites will eventually get more reviews from more consumers because their audience will be larger than 500,000 subscribers.

All that said, I can tell you as an entrepreneur who has raised $5 million dollars in the last 18 months to launch a consumer reviews start up, there is a siginicant amount of room in the space for innovation. At Viewpoints we have built an audience of 500,000+ uniques in our first six months since launch.

Angie’s List publication might be a bit dated, and the premium subscription product out of step with the current thinking, but you cannot argue with their success in generating real paying customers and in the process building a understated, credible and well known brand.

As is the case with many of web business models, it comes down to execution, innovation and staying power. With this latest raise, they certainly have staying power. We will all have to stay tuned to see if they can be innovative and execute in a constantly changing competitive enviornment.

Grow a brain folks. Angie’s List is a real business.

Also, stop this idiotic “marginal cost is 0, so don’t charge me for content” b.s. Marginal cost does not equal cost. Cost does not equal price. Learn economics. You charge what people are willing to pay, not some percentage above your cost.