Comments on: Grayboxx: 50,000,000 Mentions Can’t Be Wrong

By: The Local Onliner » Burlington’s Wood-Lewis: Local Grayboxx Results ‘Bad Advice’

Fri, 31 Aug 2007 03:22:28 +0000

[...] mentions it receives on online consumer services has finally launched, almost a year after I first wrote about it. The service, which assumes that people generally only mention services they like, has [...]

By: john reznor

john reznor — Tue, 24 Oct 2006 16:33:59 +0000

Finally someone has said it–and in italics, too!

” (Why would a VC invest millions of dollars in a local concept company that hasn’t hired an executive or consultant without any kind of local experience, or even exposure to a local media company?)”

Exactly. It’s all about SALES. Who is going to hire and manage –let alone compensate–the Yellow Pages-type sales force required to extract small amounts of money (pay per call/click–whatever), from large numbers of very small businesses, all of whom need personal attention? Judy’s Book has already thrown in the towel on that part of the equation, Insider Pages has let their CEO go.

We’re back to the “If you build it, they will come” mentality. But the small businesses are not going to come (self-provision). You have to go to them. In order to make sales that will only generate a tiny amount of revenue from each business. There is a massive disconnect between the VC’s/CEO’s and the mom ‘n’ pop market they have identified as easy pickings. None of these titans of industry has never sold advertising, and they have no understanding of the small proprietor who is bomarded daily with sales pitches from print, radio and TV, most of which they have least heard of.

The other problem is, it’s “LOCAL”. Most of the VC’s projections are based on rolling out some kind of national model, whereby lots of small markets each providing small amounts of revenue, begin to ad up (like Google AdWords). But each local area is finite–there are only a certain number of plumbers, restaurants, etc.

These companies need more than a consultant. They need to go out in the field on a daily basis, get in the trenches and try pitching their idea to Joe’s Shoe Repair and get him to commit to paying hard money, i.e. $200/month or thereabouts, because that’s about all they are ever going to pay. Good luck with that!

By: AhmedF

AhmedF — Tue, 24 Oct 2006 07:26:46 +0000

To get at your question (why would a VC invest millions of dollars in a local concept company that hasn’t hired an executive or consultant without any kind of local experience, or even exposure to a local media company?) – why is an executive important? Even more importantly – why is a consultant important?

As I see it, VCs are out to invest in projects they believe will make them money. If Grayboxx can really do what it claims (and also gain traction) – a lot of money could be made.

To wrap it up – local is so disintegrated (and still so immature) that an executive/consultant is even less important imo.