Fred Wilson on del.icio.us

As I hoped,  Fred is posting about his recent investment in del.icio.us. He shares with us how he got involved in the deal, and the motivations behind it.

Joshua needed capital for the two major priorities.

The first is scale.  The service is taking off and it needs to be configured like the popular web service that it has become.  That means boxes, bandwidth, redundancy, etc.  That costs money.

The second is ease of use.  That means tweaks to the user interface that make the service easier to use for non-techies.  That means new features that users have been asking for.  That means spending time writing code, testing it, making the service work better for its users.

Joshua's hope is that by dedicating himself full time to the service it will become better for its faithful users and better for new users.  That feeds right back into the community because more tags means more shared information which is what this is all about.

The question everyone asks is "what is the business model".  To be completely and totally honest, we don't yet know.  This was a seed investment and none of the investors put up very much capital.  Joshua retained complete control of the service and is going to focus on making it better.  That is all anyone wants to see happen right now.  In time it will become clear what the business model should be.  And there are a number of them to choose from for sure.

In summary, we believe tagging is important, its here to stay, del.icio.us is a very important participant in the tagging phenomenon, and we are really excited to be part of its development.

I find it commendable that Fred admits that the first priority is to enhance the product and the scalability, and then worry about the business model (even though I am sure they have a few ideas).

Congrats on the deal, and best of luck with the next steps.

Comments

[anon]

man, just can't figure out how the decision made it past due dilligence. just seems there are more textbook crosses than there are ticks...

but, like you said Jeff- they probably have a few ideas