Singaporean Entrepreneurs

As more and more people fill the internet space … supposedly at a rate of 160,000 blogs per day, 2008 is looking like the YEAR OF THE AMATEUR. Or, should we look at the first 10 years of the new millenium, the DECADE OF THE AMATEUR.

All these amateurs, well maybe 80% of them if we take the Pareto Principle as a rule, expect to get paid for their work online in some form or another. Most are content with a few dollars in their pockets every month, but a big enough group would like to make enough money to be able to quit their day jobs or at least supplement their income enough so that they can make some real changes to their lifestyle.

So WHERE IS ALL THE MONEY GOING TO COME FROM to support all these new players?
The first source is clear: Advertisers. The shifts in the advertising industry are obvious for anyone who has been blogging for even just a few months. More and more companies, from big to small, are moving away from traditional above and below the line advertising mediums (tv, radio, print publications, exhibitions) and putting significant resources into blogs or social networks instead. It’s the “word-of-mouth” phenomenon in organized (and paid) form. It’s also a few dollars in a hundred pockets instead of a few hundred dollars in one pocket.

The second source is not as obvious: the Bloggers themselves. Where it wouldn’t make sense for a blogger to place a 1/4 advertisement in the New York Times, it makes perfect sense for a blogger to pay other blogs to market him/herself. The funding here is even smaller, often in the form of $1 – $10 “tips” where you find bloggers asking you to buy them some milk, beer, etc. if you like their work. Another source of revenue is paid links or advertisements on a fellow blogger’s site.

The third source which is completely unapparent unless you’re fully ensconced in the Web 2.0 world is simply: the global internet crowd. Yes, the people who are probably not blogging, who don’t care about making money on the web, but are thrilled, excited, and entertained by all that is in it, are amazing sources of funds.

START-UPS WHO HAVE PROVED THIS CONCEPT
(1) Movie making has always belonged to a very elite domain. But now, companies such as A Swarm of Angels can “create a £1 million feature film, give it away to over one million people in one year,” by asking anyone in the world who is interested to fund their project. They are already in Phase 3 as of this writing which means they have received at least 6,000 members and £27,500. Will they make it all the way? We shall see.

(2) Software is expensive to develop, test, deploy, and sustain. The internet has made collaboration possible and there have been many free software and programmes that have resulted out of this. But what if you had a brilliant idea but you’re not an engineer and you can’t afford to pay one? How do you get this notorious bunch of elite people interested in what you want done without having to pay through the nose? Enter Micropledge, where “software get made and developers get paid”. One of the current projects is a Microsoft Entourage Email Search Utility that enables users to sift through gigabytes of old mail efficiently. It has attracted US$399 in funding so far.

(3) Lastly (there are many more examples but for our list this is the last), we’ve seen the rise of many social enterprises in 3rd world countries who have benefitted greatly from being able to gather funds from the global crowd. For as little as US$25 for example on Kiva’s network (and its a loan, not a donation), you can help a 3rd world entrepreneur rise out of poverty. And the amazing thing is, the rate of loan delinquency is less than 5% with many of Kiva’s field partners reporting 0% default rates. There are many others, most of which are listed in Social Actions.

WHAT WILL THE FUTURE LOOK LIKE
Will all this change the way new products and services are developed? You bet it will. Angels are now anywhere and everywhere and some early adopters have already created websites such as Crowd Funder to help put funder and start-up together. You still have to have a solid product/service offering, extraordinary marketing skills, but you don’t necessarily have to wait in line for a power breakfast meeting with a potential investor anymore. (You still might want to, but you don’t have to.) Exciting times for start-ups, anywhere in the world.