RACY WEB SITE HAS HIT ON A REAL BUSINESS: PERSONAL ADS.
Nerve.com's dilemma was not unusual: With its high-brow
take on sex, the site had plenty of readers, but how
could it make money from them? Internet ads weren't
working for anyone. T-shirt sales weren't enough. And
charging for content -- titillating though it might
be, with features like "Position of the Day"
-- wasn't working either.
Then Nerve fastened onto what it now believes could
grow into a billion-dollar business: personal ads. The
site's experience shows that people are in fact willing
to shell out cash for access to eligible people, with
the Net allowing for a kind of human shopping mall --
one that print personals can't match. "It's absolutely
a case study of what the Internet is good at,"
says Nerve CEO Rufus Griscom, who oversaw the paid-personals
launch in February. "It's the eBay for people."
Nerve's are hardly the largest selection of personal
ads on the Web, though they win for edginess and wit.
Industry leader Match.com's membership has nearly doubled
in the past six months. But Nerve's formula is different,
resting on the idea that it attracts like-minded people.
The company is now raising money to spin off its personals
business, with the aim of attracting investors less
than thrilled with the growth potential of a media company.
The new company, People Network Technology, will supply
its software to other media outlets such as Salon and
Time Out New York.
Without personals, Griscom admits, Nerve would be facing
hard times. Instead, it just achieved "a small
cash-flow-positive position" last month, he says.
The company is on target, he adds, to meet its projections
for $575,000 in revenues from personals this year; it
expects $3.5 million in 2002 and $11 million in 2003.
While the ads are Nerve's largest single revenue stream,
the company also has sold two movie ideas, has a TV
program in development with HBO and has begun selling
Niagara, a bottled drink with supposed aphrodisiac properties,
online. Sex, as Nerve is showing, still sells. Why you
should gel to know me: i am full of sassafras. i love
fashion and makeup and shopping but i can deconstruct
a mean chantal okerman film. popular culture fascinates
me. i think youth movements are amazing and powerful.
i lava new york despite the annoying little things like
the sprouting neighborhoods - like DUMBO. what the hell
is that about? i grew op listening to dc music and hate
but can appreciate fugazi. i unders tand the concept
of holding back in friendships, more about who I'm looking
for: you know all the '80s sitcoms i do. you can and
do dance. you are fun and serious. you can talk for
hours. you know your movies and music. you eat sushi.
you like going out but you also like staying in. you
appreciate irony but you know when enough is enough,
you were into sassy magazine and you remember some of
the cute band alerts. you are not looking for booty
of any kind, you just want a platonic Friend. ahem!