Bob Rosenschein Surviving While Getting It Right

Bob Rosenschein

CEO, Answers Corp. NASDAQ:ANSW

MIT Forum — יום היזם1-Apr-2009

Surviving While Getting It Right

Why Do It?

• Fame?

• Fortune?

• Be your own boss?

• Change the world?

• Because it’s there?

• … because you have to!

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The Fun

• 4 E’s: Entrepreneurship, Energy, Enthusiasm, Excitement

• You’ll need: Vision

Sacrifice

Patience

Passion

Single-mindedness

• “Any sufficiently advanced technology is indistinguishable from magic.”—Arthur C. Clarke

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The Fear

• Quotes: “Experience is what we call the accumulation of our

mistakes.” –Yiddish proverb

“Most of the important things in the world have been accomplished by people who have kept on trying when there seemed to be no hope at all.” –Dale Carnegie

“A CEO’s job is hiding the terror behind his eyes.”–Scott McNeally

“Life is what happens to you while you’re making other plans.” –John Lennon

“Safe is risky!” –Seth Godin

“It’s difficult to predict, especially the future.” –Yogi Berra

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History

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Startup

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Searching for the Right Business Model

• 1999: ? ? ?

• 2000-2002: Enterprise Software (Atomica)

• 2003: Software perpetual license (1-time)

• 2004: Software subscription

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10/04: IPO

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Answers.com

• Jan. 2, 2005—launched Answers.com

• 5 risks: Brand (GuruNet to Answers.com)

Business model (free vs. paid)

Web focus

Look & feel (1-page)

Include Wikipedia

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Traffic Jumped

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WikiAnswers: Q&A the Wiki Way

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WikiAnswers: Q&A the Wiki Way

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Search Engine Results

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WikiAnswers Daily Questions (4 week mov avg)

16

3,800

7,600

15,200

30,400

60,800

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WikiAnswers Daily Answers (4 week mov avg)

17

1,800

3,600

7,200

14,400

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Market Share Unique Visitors – U.S.

18

Source: comScore U.S. January 2009

96.1%92.5%

90.3%

83.5%77.5% 74.7% 77.0%

68.1%65.4%

3.9%7.5%

9.7%

16.5%22.5% 25.3% 23.0%

31.9%34.6%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Yahoo! Answers WikiAnswers.com

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Today

• Combined properties: 33rd in US, with 25.5M unique users (comScore, 1/09)

• WikiAnswers: 10.9M questions

3.5M answers

4,700 categories

500 supervisors

Top % growth in 2008 (top 200) & 2007 (top 1500)

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Advertising Revenue - Quarterly

20

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

Q-1 05 Q-2 05 Q-3 05 Q-4 05 Q-1 06 Q-2 06 Q-3 06 Q-4 06 Q-1 07 Q-2 07 Q-3 07 Q-4 07 Q-1 08 Q-2 08 Q-3 08 Q-4 08

Tho

usa

nd

s

Answers.com WikiAnswers.com Total Ad Revenues

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Answers Historical Financials

21

-$1,500

-$1,000

-$500

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

Tho

usa

nd

s

Total Revenues Adj. Expenses Adj. EBITDA

* Note: Q1 2007 excludes one-time subscription revenue of $425,000.

*

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Top 10 Lessons Learned

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10. Common Sense… Isn’t

• The dangerous spread of wishful thinking

• Optimism / pessimism / realism Knowing the difference

Knowing when to trust your gut

• “Men and nations behave wisely, once they exhausted all the other alternatives.” –Abba Eban

9. Products the Market Needs

• Create products people can’t live without• Balance technology & marketing• “If we’re not a lot better a year from now, we’ll be

forgotten.” –Larry Page

• “Our goal is to run between the legs of giants.” –Efi Arazi

8. Raise More Money

• … than you think you need

• … and earlier than you need it

• Otherwise The pressure grows, and

The valuation drops

… exponentially

• “If you have money, you are wise and good-looking— and can sing well, too.” –Yiddish proverb

7. Do the Right Thing…

• … and ask questions later!

• “You don’t know what you can get away with until you try” –Colin Powell

• Use the formula P=40 to 70 Where P stands for probability of success and the numbers indicate

the percentage of information required

Once the information is in the 40 to 70 range, go with your gut

• Don’t be afraid to challenge the “experts”

• Leadership is lonely

• Be a mensch

6. Focus!

• Do fewer things better• Core competency must be obvious to you and to

your customers• “By all means, put all of your eggs in one basket and

then watch that basket!” –Mark Twain

• “The main thing is to keep the main thing the main thing.” –Barksdale's Law

5. Execution Risks

• Startups need to excel at everything: Development, marketing, sales, admin, finance…

• A company is not a democracy or a kibbutz

• Don’t be perfectionist

• “A good plan, violently executed now, is better than a perfect plan next week.” –George Patton

4. Adapt

• Change that business model

• Eat lunch or be lunch!

• Kill the wounded

• Understand market windows and timing… But don’t expect immediate results

• “Strength is not absence of weakness, but how we wrestle with weakness.” –Noah Benshea

• “It takes twenty years to make an overnight success.” –Eddie Cantor

3. Never Believe Your Own Hype

• Wishful thinking kills

• But we worked so hard!

• There’s a difference between: PR success

Financing success

Real success

• “Man has an infinite capacity forself-rationalization.” –Sigmund Freud

2. Choose the Right People

• “It’s the people, stupid!” –John Doerr

• Never just settle• Understaff with the brightest• 1 bozo can stop 10 good people• Ability to anticipate / see around corners• 3 things to keep employees happy

1. Be Optimistic!

• Perpetual optimism is a force multiplier

• “If you dream, dream big.” –Spencer Tracy

• Don’t think you can change the world—know you can change the world!

Conclusion: Enjoy the Ride

• It’s good to still be here!

• http://jobs.answers.com

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