To: indiaentrepreneurs@egroups.com
Date: Wed, 29 Mar 2000 12:15:13 PST
Re: Questions for VCs

May I gently disagree with the "only 2 possible revenue streams" assertion?

Here are a few revenue streams one has seen:

1. Advertising revenue (aggregating an audience that advertisers will pay to reach). This too varies by cost-per-thousand impressions, cost-per-click, cost-per-timeperiod etc models)

2. Commerce revenue (selling goods and/or services to users). These might be business users, home consumers

3. Subscription revenues (being paid by users to use your site/product/service)

4. Referral revenue (being paid by advertisers for sending users to look at and/or buy their products/services)

5. Database revenue (collecting information about your users to sell to advertisers etc.)

6. Licensing revenue (renting or otherwise offering your services/site to other users - usually online businesses

7. Services revenue (charging other businesses a fee to build their site/improve them etc. Further, there might be legitimate reasons to not make any money online at all - instead, to use it only as a marketing medium to sell offline goods and services.

Perhaps the readers of this email may point out more models.

My $0.02

Mahesh

>From: "Rakesh Saraf" rsaraf@vsnl.com >
To: indiaentrepreneurs@egroups.com >
Re: Questions for VCs >
Date: Mon, 27 Mar 2000 13:54:46 +0530

Dear Abhishek

I can tell you from personal experience that VC's are very wary of Revenue models of Dotcom sites. The reason is that there are only 2 possible streams of revenue without putting in an e-commerce feature on the site. Advertising is viewed with some concern by VC's now, as many dotcom sites have failed to live up to the revenue projections. Database revenue is also of concern, because of imminent privacy laws. Personally, I think a VC who has "been there, done that" would be a better bet in terms of getting him to look at a dotcom project thru realistic eyes. Dotcom funding is deep, and revenue models uncertain, so the size of the fund, and the experience of the fund managers is important. If you are using an intermediary, he should be able to evaluate a VC for you better than you can perhaps. There are some good intermediaries around also. I dont know if this helps

Regards >Rakesh >-----

Original Message----- >

From: Abhishek Verma abhishekv@itspace.com
>To: indiaentrepreneurs@egroups.com
Date: Monday, March 27, 2000 1:35 PM >
Questions for VCs >
Hi : Last week , I had posted a question about some cash flows needed in setting up a dotcom. I will be meeting with VCs in Bombay next week , can any one provide any last minute advice as to how do u evaluate one VC versus another, any key questions to keep in mind etc .Thanks
Abhishek