ChaCha CEO Scott Jones tells the local business newspaper that ChaChaCoupons is a ‘logical extension’ of its core service, which allows users to call or text questions on mobile phones and receive answers from human guides quickly and free of charge. He adds that the service currently attracts about 9 million unique users per month through mobiles and its website, but forgets to mention that the model doesn’t appear to work out all that well for the startup. ChaCha has cut guides’ payments quite a few times since its inception and was forced to lay off a significant part of its staff earlier this year.

Anyway: ChaChaCoupons aims to make it easy for people to search for local companies and offers by business type, area of the city, alphabetical listing, newest deals, and more. Like most online coupon services, visitors can print coupons at their desktop or send them to their mobile phones to be redeemed at their favorite businesses. They can also send a coupon via text messaging to a ChaCha in-store coupon printer.

At launch, hundreds of local offers are on the site with special coupons and discounts in some 13 categories ranging from beauty to restaurants. Conceivably, ChaCha will be expanding the service to more regions and cities across the United States in the future.

The new ChaCha service has also been integrated with the company’s text VIP lists where users sign up to get cellphone offers and news from their favorite businesses. Users can choose to instantly join an advertiser’s VIP List by either text or online at ChaChaCoupons.com, giving local businesses a way of retaining their loyal customer base.

In all fairness, I actually agree that this could be a worthy extension for the regular ChaCha service that the company could turn into dollars, which it is hard-pressed for. That said, ChaCha basically raised approximately $62 million for a mobile answer service, and I can’t shake off the feeling that this new addition is actually the company desperately trying to do new things because its primary focus turned out to be, well, worthless. Time will tell if all this branching out can help the company’s investors get something out of the startup in the long run.

On a sidenote, I had a good laugh when I looked up the most recent question from a mobile phone that was featured on the ChaCha website. It was: “where do squirrels poop?” and I’ll let you check out the guide’s answer and more in the comment section on your own, for shits and giggles (pun intended).

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Human powered search startup ChaCha has been the subject of a little bit of ridicule at TechCrunch since its launch, thanks to its entertaining snafus and some issues with its business model. Despite its various problems over the years, the company has been able to raise a boatload of money, as much as $62 million, adding another $4 million to the pot most recently.

Unfortunately, some of the human “guides” who find the search results for visitors to ChaCha are taking a pay cut once again. Last summer, ChaCha implemented a “Pay-For-Performance” system, that forced guides to work five or more hours per week if they want the higher payrate (20 cents per question), which we said would alienate the site’s more casual (but accurate) users. Regular guides would make 10 cents per question. Now, ChaCha has decided to cut the rates of “Voice Transcriber” guides from 4 cents (people who transcribe voicemail questions and answers) to 3 cents per transaction, with the pay cut taking effect last week.

ChaCha said that because the startup is answering nearly 600,000 questions a day, they need a workforce of more than 55,000 guides to answer the questions properly. The startup claims that their budget is too small to compensate transcription guides with higher payout. In an email sent to guides, ChaCha said that Transcribers have enjoyed the “relative” highest pay of all guide roles, with other types of guides (i.e. the guides that answer questions) and even ChaCha headquarters staff enduring pay cuts beforehand.

We contacted the company to inquire about these cuts, and were told that the “Pay-For-Performance” system was eliminated in February and replaced with a pay system based on the difficulty of the question answered. Many of these guides are only interested in making a quick buck, which is why there are frequently poor search results. But for other guides, ChaCha is an extension of the workday, offering some relatively easy money to help supplement their incomes. Under the new compensation system answering a math question would get a guide 20 cents but answering a more simple question would only get 10 cents. This seems like an improvement to the previous flawed system, which seemed to alienate many guides who actually answer questions correctly.

Regardless, the cut from 10 to 3 cents for transcriber guides over the past year is considerable and will likely see some backlash from that faction of guides. Last year, guides were apparently not being paid on time by ChaCha.

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In an interview with the Indianapolis Business Journal, Bostic stresses that he will stay involved with the company as an advisor and strategist, saying ChaCha has matured enough for him no longer to be needed for day-to-day operations.

“I’m doing some evangelism for the company at trade shows, at conferences. [To say I] ‘left’ is not the appropriate characterization,” Bostic said.

More interestingly, Bostic openly discussed the fact that ChaCha is struggling to become a profitable company in the current economic climate, despite the fact it fired 1/3 of its workforce and brought on salary cuts for the rest of the employees earlier this year.

ChaCha lets people ask questions from their mobile phones to have humans (so-called Guides, often part-timers working from home) attempt to correctly answer them by text message. ChaCha makes money by embedding advertisements in those answers, and advertisers pay only when users respond by clicking through to the text ad. In the past, we’ve questioned the scalability of its business model, and we’ve also made fun of some of the answers that have been sent to users by Guides.

We pegged the company’s total funding at $58 million, but Bostic in the interview says only $43 million was poured into the company, among others by Amazon founder and CEO Jeff Bezos. He also said the company is not yet cash-flow positive, but that there is a consistent growth in audience and revenue is starting to come in.

Let’s hope for ChaCha that Bostic’s evangelizing at conferences spurs more thereof.

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IMshopping has launched a human-powered shopping search site and Twitter shopping service designed to help consumers find niche products on the web. It’s sort of like a shopping 411 service, which human guides on call respond to product questions and provide personalized recommendations for users about what product best suits their needs. IMShopping tries to simulate the experience of going into a store, speaking with a sales person and being guided to the item that works best for you. IMShopping also closed a $4.7 million Series A round of funding from SK Telecom Ventures.

IMSHopping hopes to fill the gap pf personalized, detail-oriented service that e-commerce sites don’t have, since these sites are focused less on answering technical questions about a product and more on price and reviews. Twitter users can directly ask questions by messaging @imshopping. The shopping guides in the community and trained experts offer detailed responses within minutes. Shoppers can use these responses to instantly make purchases or save to their own folders before making a product decision.

Shoppers who are asking questions on IMShopping’s site can search IMshopping’s database for product questions that have been already answered, or pose their own shopping questions (the site currently has an archive of 20,000 questions). As the shopping guides craft their response, they review a detailed analysis of the product, including specifications, reviews from third-party sites, blog buzz and price. This response is then delivered to the shopper and also archived anonymously for review by future shoppers. All public questions and responses are searchable via Twitter or can be viewed by following @imshopping. Consumers can also ask direct questions via Twitter that are not made public.

The guide will give you an answer of where to find your desired item and also provide you with links to sites where the item can be purchased. You can also rate the response you received from the guide-the guides are paid based on the quality and etail of their responses. The site is really designed to get answers on where to get hard to find or obscure items-like what electronic toy is best for a hyperactive two year old. If you already have a specific item in mind, the site may be useless to you.

As a business model, IMShopping collects revenue when consumer buy products that are recommended through the site. The problem is that when a consumer finally gets the right product for their needs, what is there to stop them from then searching for the produt on Google. The company is staying quiet on future business plans we are told that over time the company will roll out programs for general consumers to earn value from assisting on searches and getting rated for the quality of their answers.

Human search hasn’t done well in the past; take a look at ChaCha’s former business model. It’s hard to understand how human guides could do better than Google or Yahoo unless the guides are experts in electronics, clothes etc. IMShopping is hoping to add the human touch to the online shopping experience but increasingly retail sites employ staff to conduct live chats with potential customers.

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Mobile Q&A answer service ChaCha is shedding one third of its employees. We’ve confirmed with the company that it laid off 25 people, leaving it with 56 employees. ChaCha cited the layoffs as necessary to ensure profitability in the future. The layoffs have been added to the TechCrunch layoff tracker. From one tipster who says she was let go today:

Wanted to drop you a quick line informing you of layoffs at ChaCha today. There were 25 people layed off, leaving the company with 56 employees. Some very high ranking people were let go today, including 2 Directors of Development, the Vice President of Engineering, 2 Product Managers, a Sr. Director of Product Management, Director of Marketing Communications, 2 Linux System admins, and a Senior Program Manager. These were some of the larger layoffs. The rest of the company will also be taking a 10% decrease in pay, along with Upper MGMT taking larger cuts.

The news today about the $12 million is a ruse. Its just confirmation of a round we closed back in October.

These cuts come in the face of a drowning company. The ex VP of Mobile Ad Sales at Yahoo, Rob Wilk, has been in the NYC offices for 8 weeks now, and has not closed one single deal for any advertising on ChaCha’s platform. After I was let go, there was a company meeting in which Scott Jones layed out a pretty bleak estimate for the coming times. If the company can’t get to a crossover point and make money in 2 months, the whole thing is over.

Strangely, ChaCha hid the layoffs in a press release announcing a $12 million equity financing round, which may or may not be an extension of the $30 million round we reported on in January. (We are awaiting more details)

UPDATE: ChaCha informed us that they never officially announced their C funding round, but the amount was approximately $15 million and closed in October 2008. The company closed their $12 million Series D round last week, with funding from Morton Meyerson, Scott Jones and other investors.

We haven’t been big fans of ChaCha in the past and cited many reasons why the startup needs to reevaluate its business model. Still, the company was growing on us and their occasional snafu was always entertaining.

UPDATE: ChaCha issued this response to the tipster’s assertions about Rob Wilk: “Rob Wilk was a top performing advertising sales leader for Yahoo and he is leading an advertising sales effort for ChaCha that is resulting in significant revenue growth each month. Rob started 6 weeks ago and opened our New York office.”

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Here’s a question for you. How many Q&A sites does the Web really need? Already, there is Yahoo Answers, WikiAnswers, Mahalo Answers, Linkedin Answers, ChaCha and dozens beyond. But Wikia (and Wikipedia) co-founder Jimmy Wales thinks there is room for one more.

We learned from a tip that he has quietly launched Wikianswers, a Question & Answer site that attempts to create one true, consensus answer for each question, wiki-style. If this sounds familiar it is because Wiki Answers, which is part of Answers.com, does the exact same thing and had 26.7 million unique visitors worldwide in December (comScore). (Yahoo Answers had 144.7 million worldwide uniques in December).

And then there is the little problem of the name. It is supposed to be Wikia Answers! (see second screenshot below), but in the current logo the last “a” of Wikia shares the first “a” of Answers, making it Wikianswers. The already established WikiAnswers might have a problem with that. (The URLs are different: http://answers.wikia.com and http://wiki.answers.com/, respectively)

Update: Wikia Gil Penchina responds in comments:

Wikianswers started at Wikia in November, 2004. The other site with the same name was called FAQFarm back then and changed their name without getting our permission.

Wikianswers is built on the same wiki platform offered by Wikia, and it is already being promoted from Wikia Search. Building up a searchable Q&A repository is a natural add-on for a search engine or any online information database. (See our post on Mahalo Answers).

But, really, How is Wikianswers different than any other Answers site? Unless Wales can satisfy that question, people will ask look for answers to their own questions elsewhere.

Update: Wikia CEO Penchina’s explains below in comments:

Wikia’s Q+A service is in keeping with the wiki-way and that’s what makes it different
- The content is freely licensed under GFDL unlike other answers sites allowing it to be re-used and re-purposed by others for free
- Anyone can contribute (other answers sites require you to register)

We believe that a more open, freely licensed community will always do better than a corporate site that takes customers contributions and copyrights them in order to take rights away from the contributor.

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Update: we exchanged e-mails with a company representative, who informed us that this is actually “old news” and that the Series C round of $30 million has actually closed a couple of months ago.

The company raised $6 million in Series A financing exactly two years ago from Jeff Bezos and Bezos Expeditions, followed by a $10 million round by Morton Meyerson and 21st Century Technology Fund. If ChaCha closes the $30 million Series C round (see update above), the total capital invested in the company will amount up to a whopping $46 million.

In case you’ve never heard of ChaCha, it’s essentially a search engine that lets users ask questions to a real person, called a “search guide”, via the web, text message or a mobile website (answers are only provided by mobile). We’ve called it a dumb idea in the past, and unscalable on numerous occasions, but it’s not the only startup that’s taking a crack at a human-powered Q&A service (Mahalo launched a similar service last month, Answerly is another one).

We’ve reached out to the company to confirm that they’re raising more venture capital, as well as the names of the investors. (see update above)

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Scott Jones, the CEO of human powered voice/sms search engine ChaCha (our recent coverage), has one of the awesomest computer setups I’ve seen.

It can be seen, along with everything else in his house, in this MTV Teen Cribs video (also embedded below) that focuses on his fifteen year old son. For the computer, jump to the 3:25 mark.

They don’t say anything about the processor, but the guy has an eight-screen (Dell) setup and stationary bike pedals to get exercise while working.

To get more details, I’ve sent a text message to ChaCha asking for the hardware specs (they love answering random questions). Their tagline is “answers to anything, on the go” so this should be no problem. Alas, it’s been ten minutes and there’s no response. I’ll update later if they do.

Thanks for the tip Shawn.

Update: Ok, ChaCha’s awake now and talking to me. No answer yet but I’ll add screen shots of messages as they come in.

Update 2: We’ve got our answer! 3.4 GHz P4 CPU, 2 GB RAM, 8x Dell 19 in. monitors, Colorgraphic Xentera GT display with ATI, Schwinn 205p recumb bike, Ergotron frame.

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To use the service, call or text a query to 1-800 2ChaCha (1-800-2-242242).

We’ve questioned the scalability of the business, which uses human guides to answer questions. And we’ve also made fun of some of the answers that have been sent to users.

ChaCha says that they are approaching profitability on a per-call basis, though. And the usefulness of the service is undeniable.

What we’re digging to find out is how deep this relationship with AT&T goes. AT&T says “The two companies also will work together to further enhance ChaCha’s free mobile-answers service and explore opportunities in both text and voice ad-based services.” This may be a first step towards an acquisition. ChaCha has raised $16 million in capital.

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Despite attempts to evolve search into something more human friendly, there’s still a big hole there. As useful as Google is, it doesn’t answer questions very well, and it isn’t good at making highly subjective recommendations (where shall I eat dinner tonight? What’s the best show to see in London right now?).

That’s where people come in. We ask them stuff all the time. It’s part of being human, and social, and works very well in the offline world.

A bunch of sites have tried over the years to create “question and answer” portals to address this need in the online world. The questions range from requests for recommendations to research-type stuff, and they tend to do very well in search engine rankings. Yahoo Answers is the most successful example, with 152 million unique worldwide visitors and nearly 1.3 billion page views.

But the quality of answers, to put it plainly, sucks. We’ve heard that internal Yahoo estimates say only around 10% of the content created on the Answers site is of any real use. A quick perusal of the site confirms this. There’s also no way to guarantee fast answers to questions.

That’s where ChaCha and Aardvark come in.

ChaCha

ChaCha first launched in January 2007 as a web based human search engine. They hire guides to answer incoming questions.

It’s had a very rough time since then, with angry guides writing about their experiences, and angry or amused customers noting the disparity of results compared to normal search engines (our complete coverage is here).

But ChaCha does provide an amazing mobile version of the service (as I grudgingly admitted here). You can either text a question to 242242 (ChaCha) or call it in at 1-800-224-2242 (2ChaCha) and receive a text message back with the answer a couple of minutes later. Most of the time the answer quality is very good, particularly if you compare it to the difficulty of using a browser based search engine on a mobile device.

The company is also doing quite well, they say. The service is free for up to twenty questions each thirty days, and they get half a million of them per day.

Guides are paid ten or twenty cents per question they answer, and are simultaneously creating a knowledge base for commonly asked questions. The company says revenue is starting to come in as well – some answers contain unobtrusive ads. One example: in a recent question the response said “*Reply RTONES for Ringtones.” When I replied with that i got a link to the thumbplay ring tone site.

Guides aren’t paid much, but some seem to look at is as a hobby. In a comment on a recent post, a ChaCha guide wrote:

I work part time for ChaCha as a guide. I consider the earnings from this job, my coffee or play money. I am a systems analyst for a large financial investments firm. Due to the nature of my job, I couldn’t have a part time job out in the public for various reasons. So– this ChaCha guide job fit the bill. Might as well do something while sitting watching tv at night and surfing the net. Many other guides are stay at home parents, folks between jobs, students, and those sort of like myself just looking for a way to make extra money for whatever reason. It ends up bringing in about $300-400.00 a month for me in extra funds. For me, I can find MOST anything on the web so the job is much like a game– how fast can I accurately answer a question back to an infoseeker. To go from generic info about the size of a whale’s penis to the difference between felsic and mafic magma types, to does billy really like me, and finally to provide me the differences between obama and mccain’s environmental policies– it keeps the brain snappy and things interesting during time I would have spent just randomly surfing.

Mechanical Zoo

Mechanical Zoo is the new kid on the block. They just raised a big round of financing and are in private beta with their Aardvark product (get an invite here).

Aardvark is a way to get quick, quality answers to questions from your extended social network. You can ask questions via an instant message buddy or email. The questions are then farmed out to your contacts (and their contacts) based on what they say they have knowledge of. If you ask taste related questions about music, books, movies, restaurants, etc., they’ll ask people who tend to show similar tastes as you in their profile.

You’ll use Aardvark differently than ChaCha. Aardvark is for getting recommendations on things, whereas ChaCha is best at answering questions that have some definitive answer. But both leverage humans to get information to you that search engines don’t have an easy time answering.

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The ChaCha service was absurd in its original web version, which has since been discontinued. The mobile version is actually very useful, although we questioned its scalability when it launched. New information from the company suggests they’re keeping costs low enough to make a business model out of it. More on that soon.

Now about this image.

Some fairly funny answers occasionally come back from the human guides, who early on at least had to deal with a lot of prank queries. But none of the ones we’ve seen compare to the one to the right, which is a Digg favorite tonight. It describes the Eiffel Tower sexual position (yes, you learn something new every day) in response to a completely unrelated query about a Randy Newman show in Seattle.

I contacted the company about it and got the following message:

I appreciate your reaching out to me regarding this iPhone prank. We researched this as soon as it came to our attention and our logs indicate that the answer displayed was definitely to a question previously asked by this same user. So yes, this is a fake as this person is misrepresenting what actually occurred. They actually asked one question (to which the answer was sent) and then a second question shortly thereafter and then received the answer to the first question which, due to the way messages are threaded on an iPhone display, the answer is appearing below a different question than the one that was asked to spawn the answer that is displayed.

So in the end this was a bit of a trick apparently used to misrepresent what happened in order to get some laughs – which appears to be working as this is getting some serious play across the Web!

Ok that sounds more than reasonable. But when I go to the URL in the image, it shows the question and answer linked (see below). I understand how text messages back and forth can get out of order, but not how the wrong answer can be linked to the wrong question in ChaCha’s own database. I also note the guide was on the job for one whole day before this happened. I’ve emailed the company for further clarification.

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They raised a boatload of money from Jeff Bezos and others and eventually switched to an all-mobile interface. They also began offering their platform to third party marketers.

But now there are indications that the company is having cash flow issues, even after a recent pay cut to guides. As before, the information is coming from their poorly-paid and poorly-treated human guides.

Employees are simply not being paid, says one guide, asking to remain anonymous. And he sends several screen shots of ChaCha’s internal forum for guides, which show dozens of complaints about slow or non-existent payouts. A selection of comments:

I have been with ChaCha since the end of July and still haven’t gotten paid. I’m not even getting the runaround because I’m not getting a response from anyone…I have kids to feed and need to be paid. I’m not even tripping about the cut in pay…

I became a guide on August 6. I submitted my paperwork that day and then faxed my signature card on August 18. I heard nothing. I email FIB on August 28 and they wanted utility bills as I have a P.O. On the 28th of August I emailed them again as I had heard nothing. I still have no account!

ChaCha doesn’t seem to care about taking care of their Guides, which is really sad. It’s only due to our work, they are able to grow and make money. You think ChaCha would take better care of us. It’s pathetic to see them spend so much time on stupid hot minute contests and such things, while they don’t take a single second out to help us guides who are long past getting paid what we worked hard to earn.

For the love of God. It’s been 5 weeks and no pay me now button. No response, no anything. What’s going on here? I want my money. Can I get any help at all?

I have been waiting an extremely long time for them to get back to me over my earnings which I WANT NOW! And I am thinking about small claims because I contacted them MORE THAN enough times for them to respond, and gave them soo much time.

The comments go on. The guide who sent them to us also says the complaints are being deleted from the forum almost as fast as he can take screen shots.

I’ve emailed ChaCha for a comment.

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We’ve never been big fans of ChaCha, the human powered search engine that pairs you up with a “guide” who attempts to answer your questions in real time. The search model was obviously unscalable from the outset, but ChaCha’s botched implementation hasn’t helped much. When it first launched, ChaCha allowed users to initiate full on chat sessions with their guides, which predictably led to a flood of pranksters who overwhelmed the service.

After a year of trying to make the ridiculously flawed system work, the company abandoned the chat sessions in favor of one-off question and answers, primarily targeting users through a mobile service.

Despite its glaring issues, ChaCha has managed to ring up $16 million in funding, which is probably why it has survived this long. And to the company’s credit, it has amassed a following of loyal “guides” – the people who do the heavy lifting and find the search results for visitors to ChaCha.

Many of these guides are only interested in making a quick buck, which is why there are so many laughably bad search results. But for some, ChaCha is an extension of the workday, offering some relatively easy money to help supplement their incomes. And now ChaCha is going to screw them.

Yesterday ChaCha sent out a message to its guides explaining that it was introducing a “Pay-For-Performance” system that was designed to improve search quality – not a bad idea, given the shoddy results we’ve seen before. Unfortunately, it seems that ChaCha has blundered this plan too.

Under the new program, “Top Guides” will receive 20 cents per question, which has been the standard rate for experienced guides for some time. Everyone else gets 10 cents per question – half of what they would have gotten under the old system. To become a Top Guide, users must do the following:

* >95% Quality Measurement.
* 95% and above completion of answers to questions:
* Minimum 300 Searches a week.

That’s a lot of searches, given the fact that most experienced users average around one search per minute. In effect, ChaCha is forcing users to work five or more hours per week if they want the higher payrate – something that will totally alienate the site’s more casual (but accurate) users. What’s worse, there’s currently no way to readily see your accuracy score, so users are forced to trust ChaCha’s word.

Users are up in arms on the site’s private forum (you can see some of the complaints here), with many planning to abandon ChaCha entirely. It’s clear that ChaCha is trying to trim their workforce down to a small army of accurate and hardworking searchers, but enraging its entire community only seems to solidify its place in the Deadpool.

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Stumpedia

This is how they spin it:

Stumpedia.com, the social search engine that relies on human participation to index, organize, and review the world wide web is launching another human-powered search feature similar to the guided search model that was recently ditched by ChaCha.com. Our approach to the guided search model is dependent on crowdsourcing and the benefits of social media participation.

They don’t provide any details on their site, but given the “DOWNLOAD PLUG-IN SO YOU CAN ALSO ANSWER QUESTIONS” link on the page and the mention of crowd sourcing I think this translates to users also provide the live answers.

The wisdom of offering a service like this, unless simply a publicity stunt, is flawed: as we know 90% of the users on ChaCha were pranksters and as ChaCha eventually found out, the model doesn’t work. Stumpedia adds another dimension though to the process: now you can not only torment the person giving the answer, you can suprise those asking the questions as well, offering a whole new world of joke blog posts and corresponding screenshots.

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The idea is that you do a search on ChaCha and a real person works with you via a chat interface to give you results. In theory those results would be better than Google. In reality, they weren’t (see image to right), and ChaCha still had to pay all those guides.

Today, according to an email sent to ChaCha’s guides titled “The Future Is Here,” they announced that guided search will be discontinued in favor of the one product they offer that isn’t monumentally dumb – mobile search. They claim that “new users are growing at a staggering rate every day” (most likely due to cell phone spamming).

So what happens to all the guides who worked on desktop search? Some of them, at least, can now apply for new positions on the mobile product.

The full email is below, and details of the company and their funding are here. Thanks Luke Kling for the tip.

Check out ChaCha’s Extreme Makeover! Click Here!

What you need to know:

• Thanks to the success of our Mobile (SMS) Answers, our new users are growing at a staggering rate every day as our loyal customers spread the word about ChaCha. Repeat users are addicted to texting ChaCha, and we want to duplicate that magic on the Desktop.
• The chat sessions of “Search with a Guide” will no longer be offered.
• Customers on the Desktop can type their query, and as with a Mobile question, Guides will provide a concise answer with a supporting link.
• With all our services aligned in a consistent customer experience, we can provide better training and tools. New users will know what to expect. And it will be easier to provide excellent answers!

Current Desktop Guides – join us in building the future of search!
If you haven’t had a chance to read the full communication regarding the change (sent last week), which includes next steps for becoming a Text Guide or Voice Transcriber, please read on!

ChaCha Desktop search is getting an extreme makeover!

Thanks to the success of our Mobile (SMS) Answers, our new users are growing at a staggering rate every day as our loyal customers spread the word about ChaCha. Repeat users are addicted to texting ChaCha, and we want to duplicate that magic on the Desktop.

Based on extensive customer feedback, we’ve learned that ChaCha users want fast answers they can trust. What this means is succinct answers to queries, backed up by high-quality source citations. This model has proven a big hit with our Mobile users, and the natural next step in our transformation is bringing the Answers model to Desktop search.

Our Guides, of course, continue to be the key differentiator for ChaCha, inserting a human element in every question and answer. Your search skills and dependability as Guides will, I’m sure, turn the new Desktop Answers into a popular feature that generates far more traffic than the current Search with a Guide.

Why the makeover?

While “Search with a Guide” was a key part of ChaCha’s initial growth, the time has come for a change in direction. As I mentioned, our customers have told us they want answers they can trust. The current model of guided search only gets us so far to that goal.

With the coming national launch on April 1, 2008 of our experimental Voice service, we will be able to deliver the same Answers experience by text, voice, and desktop search. Now that’s powerful! No other company delivers this killer combination – not Google, not Yahoo, not Microsoft.

Given that “Search with a Guide” represents less than 10% of our daily query volume, we want to let our loyal Desktop Guides expand their portfolio of roles. With all our services aligned in a consistent customer experience, we can provide better training and tools. New users will know what to expect. And it will be easier to provide excellent answers!

So here’s what is changing:

* The chat sessions of “Search with a Guide” will no longer be offered. Instead, customers on the Desktop can type their query, and as with a Mobile question, Guides will provide a concise answer with a supporting link. Once registered, customers will have their own personal account page where all of their questions and answers may be viewed.

* The role of Desktop Guide will be merged into the Text (SMS) Guide role. All current Desktop Guides will have the opportunity to train for the Text (SMS) role, and on successful completion of a brief test, will be able to answer all queries — text, desktop, and voice.

* Current Desktop Guides will also have the opportunity to become a Voice Transcriber by testing for the Transcriber role. This is different from the Text (SMS) role. Desktop Guides may apply for both roles.

If neither role is a good match, Desktop Guides will continue to have access to training and materials in Forum and will have opportunity to train and test for new roles (coming soon!)

Note that traditional (non-guided) web search, which we’re calling “ChaCha Classic” will still be available at ChaCha.com.

Desktop Guides have been notified via e-mail regarding the Search University resources to prepare them for the test and next steps to participate in the testing for new roles.

Thank you for your ongoing commitment to providing magical experiences for our customers. With your help, the new Desktop Answers will join our Mobile Answers as a buzzworthy service that keeps customers coming back to ChaCha every day.

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I tried the service once to test it, and haven’t used it since. But today I received a text message from them saying “Ever wish you could actually know everything? Now you do. Just text another questions to 242242 (ChaCha) for the answer now.”

This is pure spam, sent without my request or permission. Text spam is horrid – not only does every message actually cost the recipient money, but you can’t specifically block specific addresses like you can with email.

Text spam is coming to the U.S. (and anyone who’s lived in Europe already knows all about it), but for a respectable, venture funded company to do this is inexcusable. For anyone who tried the service based on my post about it, I apologize.

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The new feature is a mobile interface to the search engine – try it virtually here. Users can text a search query to 242242 and receive text results back on their phone. Like the main ChaCha service, the answers are sent by a live search guide. For now, it’s free.

Example searches given by the company include “I’m at the corner of 42nd & Broadway in New York City. Where can I get a cup of coffee?” or even “Where can I get some great sushi in Palo Alto, CA?” ChaCha also says that shortcuts and misspellings are not a problem, since a real human is reading and responding to the message.

I texted “What is the temperature in New York City?” to the service (I’m flying there tomorrow). Within moments I received a text message back welcoming me to the service:

Welcome to ChaCha’s FREE txt trial! Your phone just got smarter. Ask away. Your first answer will come shortly. Std txt charges apply. Send HELP for help.

Four minutes later I got the following reply:

Current temperature is 17 degrees F, Clear, Wind: W at 10 mph, Humidity: 45%. Thursday 24 degrees F 16 degrees F. http://www.chacha.com/u/a6xii7j9

Useful? Definitely. Scalable? Not a chance. But the upside is that if you are ever lonely and have no one to text with, ChaCha guides are there for you. You’ll never be lonely again.

The company has raised $16 million in funding, including an investment from Jeff Bezos’ Bezos Expeditions. Look for them to hit the deadpool by end of year 2008.

Just kidding, ChaCha. Keep me on the PR distribution list. I promise to be fair and balanced. On a side note, we have a running thread in the forums for people to post their most entertaining ChaCha guide exchanges.

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It is rare to find a company offering such a game-changing disruptive equation, even in the context of giants like Google, Yahoo and Microsoft.

These are the words of Morton Meyerson, the man who just led ChaCha’s $10 million Series B round of financing.

What is ChaCha? It’s a new search engine that lets users ask questions to a real person, called a search guide, via a chat interface. The search guide then returns results that are supposed to be more relevant than what Google, Yahoo and others provide.

The problem, as we’ve noted, that most people who go to the site are just screwing around (one ex search guide said 90% of the traffic is pranksters). And as you can see from the image, the search guides aren’t particularly knowledgeable about the web. In this case, the search guide answered a query about a UK version of Digg with “What is Digg?”

The fact is, ChaCha is a bad idea that has been poorly executed. In a sea of dumb startup ideas, ChaCha stands apart as more awful than just about all of the rest. And that didn’t change with today’s funding news. They simply went from being a bad startup, to a well funded bad startup.

As an aside, we have a long standing thread in the TechCrunch Forums where users are encouraged to post their most ridiculous ChaCha search experiences.

Update: Wow. That’s a fugly Comscore traffic chart. 24 million page views/month in January, down to 2 million in October. The good news is that it can’t possibly go much lower because it is not possible to have less than zero page views. Solid investment, Morton:

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In the meantime, negative tidbits about the company keep hitting my inbox. I came across this post by a former ChaCha guide, which claims that 90% of searches are done by pranksters.

I was also sent the screen shot to the left of a ChaCha search where the guide didn’t know what Digg was, and asked the searcher (original source seems to be here). You can’t expect the guides to know everything, since they’re paid $5 – 10/hour, but you won’t find Google asking you what Digg is when looking for a UK equivalent.

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There are two ways to search on ChaCha. They have a more traditional search engine that has good but not deep results. But the cool service is guide driven, via an instant message screen on the page. While I found that the results were not nearly as good as Google, it is a lot of fun to talk to the guides.

The company, which is based in Indianapolis, announced a $6 million round of financing today that included an investment by Jeff Bezos through his Bezos Expeditions fund (the same fund that invested in 37 Signals). This is a perfect fit for Amazon’s Mechanical Turk product, and I expect the company will be using that service at some point for the search guides.

While it isn’t clear to me how the company can make money inserting human labor into the search process, they now have at least $6 million to burn while trying. If you’d like to be a ChaCha guide, you can apply here.

As an aside, ChaCha has a linking policy that forbids linking to any page other than the home page. I’m not sure what misguided lawyer told them to do this, but I’ve blatantly violated that policy in this post, including by linking to the policy. Note to ChaCha – links aren’t bad and this policy isn’t enforceable.

Update: Here’s a post from Michael Wales, one of the ChaCha guides.

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