To test or not to test
I read a great article on testing written by James Golick. There’s always a debate about doing unit testing or not. Most of the we-don’t-write-tests-because-we-don’t-have-time-to-do-it evangelists say that they have to implement features and release the product and that’s the reason they don’t write tests. I’ve felt this too, but that was before starting to write tests. It’s just like your old Honda, why buy a new one what the old one works so well.

I started writing tests when I begun working with Ruby and Rails. Before this, I worked in C, C++, Java, where you have to look for a testing framework, then learn how to use it, and then using it. Probably that’s why I’ve never done it. But when I started to learn Rails, and Ruby, and I saw the unit testing embedded into the language itself, it became so obvious and easy to try it. It’s hard to change the old habits. Even now when working on a new project I want to keep implementing features and never look back. But with mind discipline, I keep reminding myself that I need to write tests. Test-driven or not, during development it’s great to have tests. It’s assuring and comforting. And you’ll even sleep better at night.

We don’t need tests
Even though it’s been proved that writing tests is good, a lot of developers never write tests. And they always say that they don’t have time to do it, that they have to implement features, that they have to release on time, that they feel much comfortable with manual testing. Correct me if I’m wrong, but all the developers that started to write tests changed their mind about testing. And they keep writing tests for everything they do. To all the other developers: I don’t want to argue with you. I just have a suggestion: for your next project, do write tests and do it for a while. Never say Subaru or Honda is not a great car unless you’ve driven one. It’s the same thing. Never say testing is not good unless you’ve tried it. And not for a day or two. Do it for a couple of months. If you still feel it doesn’t help you than it’s fine. But unless you’ve tried it, don’t say it it’s not good.

Writing efficient tests
It takes some time to write efficient tests. The more you write tests, the better your tests are. Don’t expect to write efficient tests from the beginning. Just keep doing it, and you’ll see that your tests get better in time.

Testing is great for startups
When you have a small team, you can’t afford to spend time on testing…or better, on manual testing. Manual testing takes more and more time as you add features. So you have two options:

• having a testing team, which means more money, and it’s a bad idea for startups;
• developers test manually, which takes more time as you add features.

Having tests which run automatically saves you a lot of time, because you write a test, then a feature (or viceversa), and then another test, and another feature, one step at a time. At the end of the day you’ll have less features, but all of them are tested, and protected from now on by regressions. And this saves a lot of time you’d spend later on debugging and bug-fixing.

Another good thing when you have tests is that you can refactor your code more often and with more confidence. That’s because you have a suite of regression tests to back you up. And every time you refactor something, you can run the tests to see if you broke something. And the chances there’s a hidden bug which will appear on you live app decrease.

There are some basic rules that the web and branding on web works. Probably you’ve heard about them. Though I’ll tell you that they aren’t always true. I mean they’re not true everywhere. There’s a difference on how the web is perceived US or Western Europe, and on how it is perceived and understood in Easter Europe, specifically in Romania.

What’s in a name

Let’s think about the domain names. Generic domain names versus specific domain names. The most visited web pages don’t use generic names. It’s like an unwritten rule. Most of them use specific names, like Google, or Apple, or Amazon, Ebay, and so on. Using a generic name is like having no identity. There’s no cars.com, or dating.com, or books.com. Or maybe there are, but people don’t use them. You want to buy a book, you go to amazon.com, not to books.com. You want to search for something, you go to google.com, not to search.com. You want to sell something, you go to ebay.com, not to sell.com. Well, you get the point.

This is basic rule of branding, especially internet branding: don’t use generic names. You have to use clear names, something that sticks into the readers mind. And cars.com or books.com won’t.

Well, not exactly. You see, in Romanian web, and probably others also, you have a good chance to succeed with generic names. We have a lot of web pages like cars.ro, dating.ro, jobs.ro, blogs.ro and so on (of course, the names are in Romanian). What’s more interesing is that these pages have success and attract more and more visitors.

Why sometimes choosing a generic name is a good thing?

If the rules are so clear, if the generic names don’t usually work, what makes them work sometimes? I guess it depends on the culture. It depends on how a society (US society, Romanian society, and so on) and how it’s people understand the web. It depends on how long they’ve been in contact with it. It depends on how they know to benefit from it’s usage. As long as that society still sees the internet as nothing more than the last possibility or finding information, as long as companies in this society use the internet and have a web page only because “they have to”, they won’t be able to use it properly. For know we as a society still use the internet only to get information. We’ve started to understand that we can also promote our products, that we can get very easily to the entire world through the internet, but we’ve not quite understood it’s full potential. That’s why for now, generic names are good for us. Because if I want to look for an apartment, I’ll go to apartments.ro. If I want to find something about some car model, I’ll go to cars.ro. And so on.

If generic names work in your country, I’ll say it’s a good thing. They’re working because you don’t have yet your version of google.com, amazon.com or apple.com. So there’s lots of room for new services. Exactly as in Romania.

A lot of people would like to run a startup but think they don’t have what it takes to succeed. They think they don’t have enough experience or enough knowledge to build a startup. Though how do we get the needed experience? By building a startup, of course :). So, instead of looking for reasons why we cann0t build something from scratch, we should look for reasons why we should start right now. It’s like starting to learn a new language. You take it one word at a time, one experience at a time, and each day is a new lesson.

There might be a lot of people telling us a million reasons that we’ll fail. But who are these people? They’re the ones that never had the guts to try to do something from scratch. Actually it’s their fear speaking, not their experience. When you talk to someone who did a startup and succeeded, they’ll never tell you not to try. They’ll tell you the problems that they faced, the solutions that they found, they’ll tell you it’s hard, but also rewarding. There’s few better feelings than the one you have when you realize you’ve build something from scratch, something that’s working and growing under your eyes.

What are the key ingredients for success? There’s not a clear list of all these, though there’s one important point here. If you start doing something that you don’t really like, you might succeed. Though the odds are not very good. Nevertheless, if you start doing something that you really love, you’ll find a lot of resources in it, and if you don’t give up as problems appear, eventually you’ll succeed.

What’s this post about? It’s about deciding on something you’ll like doing for the rest of your life, focusing on it, and building something from scratch around it.

Advertising on mobile phones or How to create a user-centric community - the free SMS service. Why the “How to create … ” alternative? When I think about developing a service, I think about the users of this service and I ask myself: what would be their benefit from using this service (value added), what would make them keep using it (usability), why would they tell their friends about this service? And the most important question: “Would I use this service?” I think the best way to create a great community is to give people access to things that they already use or would like to use on a daily basis, and give it away for free.

Why?

I have started exposing the idea of services that split money with the users in Advertising Industry Crossroad - why not sharing the money with the consumers? I’ve also started to describe my business plan in Advertising and Communities - Developing a Business Plan. The first step in my plan is developing a free SMS service. This might sound pretty simple or unimportant, but SMS is the second most used service by mobile phone users, voice being the first. So it has a lot of potential. Advertising on mobile phones is a pretty hot topic these days so there’s already a need for this kind of services.

How?

Telf is a service which allows the users to send SMS messages for free. They can send as many messages as they want to as many friends as they want. All they need to do is log in, and they’ll be able to type the message, type one or several phone numbers, and click Send. Remember the holidays, when you have to send a lot of messages to your friends and family? It would be very simple to do it with this service.

Registration for the service I want to avoid “SMS spammers” so the service will be available only to registered users. The users will register, they will receive an activation code on their phone and they’ll use that to activate their account. And because this concept (of giving stuff away for free) is pretty new, the users will not be able to register as they register to a normal email or other type of service. The users will be able to join only by invitation (only at the beginning, until the service is well known). I want people to hear about this service and wish they were able to access it. So I’ll send invitations to 100 users, which will be my beta testers, and then I’ll give them invitations to send to their friends, and so on. I’m pretty sure a service that looks a little exclusive is more desired than another one with free access. Remember Gmail, it was in beta version for 2 years and it was available only by invitations.

Where do the money come from? I know, I haven’t told you yet how will this service pay for the SMS messages. It will insert short ads at the end of each message. One SMS message has 160 characters length, so the users will use 120 chars and the last 40 will be used for short ads. like “visit www.sergiutruta.com” or “open your own blog at…” or “visit the new club…” and so on. Each ad message insertion will be charged the cost of the SMS message. And that’s how the service will give SMS messages for free. The ads will be related to the message, so for example to a message saying “Let’s go to that new club that just opened” will be appended a related ad: “Visit www.clubs.com” or something like that. The ads will be contextual adds, related to the message. There you go, targeted ads And of course, the users will know when they register that short ads will be inserted at the end of the messages, in order to pay for the messages.

Will the SMS message recipients agree to receive the ads? The SMS messages are not unsolicited ads messages sent by Telf.ro They are actually messages sent from friends to friends. If I send a message to a friend saying “Meet me at the coffee shop downtown”, the final message might look like this: “Meet me at the coffee shop downtown. Telf.ro: Try the new Frappucino from Starbucks!”. It might look odd to the users at the beginning, but they’ll come to accept it pretty quickly.

The last, but not least It sounds nice being able to send messages for free to your friends from a web page. But what if I’m on the move? What if I’m waiting for someone in a coffeeshop or in a park? Well, I’m also working at a simple J2ME client which will be deployed on any java enabled mobile phone. That J2ME client will have a really simple UI, with a textbox for recipient’s phone number, textbox for message and a send button. When the send button is clicked, it will send the message through GPRS to Telf.ro, which will do the rest. This means I’ll be able to send SMS messages from my mobile phone really really cheap. Imagine typing the message, then typing 10 phone numbers, and clicking send. Normally it would cost probably 40 - 50 cents, but with this solutions it will only cost 1 cent or less, for the GPRS traffic.

In How to evaluate a Startup Idea I’ve described a criteria for evaluating a startup-idea. Here’s what Telf looks like analyzed through these criteria.

What effort is necessary to implement the idea?
As you can see the first page, it’s really really simple to implement. There’s a little more work at the profile area, where the users can send invitations, the publishers (the ones paying for their ads being inserted in the SMS messages) will be able to manipulate their ads and will know all the time what messages and how many of them have been sent. Also, the admin of the entire service will be able to manipulate users, publishers and global settings. I’ve chosen Ruby On Rails and it should take like a week.

Also, for the J2ME client, a midlet doing this is a 2 hours task. So no sweat here either.

What is the initial investment?
If we don’t count web hosting, no initial investment is necessary. At the beginning I’ll support the costs for the messages sent (I’ll promote my own products, of course ), and after I make sure everything runs as planned, I’ll start inserting ads from other publishers. For 5 cents a message, 1000 messages cost 50$, so it’s not a big deal while in beta testing.

How will the new service/product attract users?
I see two reasons that will attract users: sending messages for free and sending them directly from the phone or from a web page.

How will the new service/product make money?
If the cost for a message is 5 cents, I’ll charge the publishers 6 cents for each inserted ad.

Are there any other external dependencies?
There’s one external dependency. The connection to a company like Orange, Vodafone or others. Because they make money when the SMS service is used, I don’t see any problem here.

Once your service is running, what effort will it need from your side?
Very little, admin check-ups once in a while.

I’m only developing this service for Romania, so I’ll upload the source files for both the web service and the J2ME midlet and attach them to this article as soon as they’re working.

Advertising and Communities

A lot of the successful businesses have learned how to use two very important tools: the advertising industry, and the power of communities.

These both become more and more important and more and more powerful. Google for example became one of the mostly known companies in the world by making money from advertising. On the other hand, communities become more and more important, even to the point to decide the industry evolution or to help a company grow and evolve.

The purpose of the advertising industry is simple: taking the message to as many people as possible. It can use many types of media: television, radio, printed papers, internet. No matter how it propagates, the final goal is always the same: taking the message to more and more people.
The purpose of communities is always to grow by attracting more users. As they grow, communities gain visibility, they gain power, they draw attention and start to be heard and listened to.

When someone finds out how to join the advertising industry and the communities successfully, they have a good chance to develop a great business. Let’s take (again) Google as an example. They focused on the community first, they had millions of users long before they started thinking how to make money. When they found the solution with using advertising, their users community was growing so fast that it was pretty easy to predict where they were heading.

Nowadays, a lot of people look for successful solutions from combining advertising and communities. Though each of these two has at least one fault which have to be overcome in order to create a successful business.

The problem in the advertising industry is that people pay less and less attention to the ads. No matter what the ads are (video, audio, printed, text), people are getting better at ignoring them. One reason might be that the ad campaigns become more and more aggressive, so we have to protect from them somehow. On TV, when a show is stopped for ads, people start changing the channels. They avoid (consciously or not) being fed with more and more ads, so they start changing channels. The percentage of people who really watch the ads is smaller than the people watching tv. On the web, almost every page displays ads because it’s a good and easy way to make money. But the readers develop like a 6th sense and get better and better at reading the articles between the ads, without even noticing the ads.

In order to overcome this problem, the ads campaigns have get smarter and more interesting, in order to be noticed by people. The video ads have to present a story which sticks into our minds, the printed ads have to have more color and some layout that draws attention. The text ads have less possibilities to draw attention, and probably will be replaced by video ads. Though these are not real solutions, because as they become better, we become better at ignoring them.

In communities, drawing more users is pretty easy. Most communities attract users by focusing on general topics like cars, music, movies, blogging, sports, sex, money, or more specific topics like: bmw, porche, gm, ford (cars), football, basket-ball, baseball (sports), and so on. The more general the addressed topic, the more users will want to join that community. Probably the best topics for growing communities would be the ones addressing our needs: money and sex. With money we can eat what we want, we can drink what we want, we can buy what we want, we can go in vacations wherever we want, and so on. With sex, well…you know

My suggestion to solving these two problems is giving money to the users. I’ve already exposed this idea in Advertising Industry Crossroad - why not sharing the money with the consumers?. Let’s look at this now from the Advertising and Communities point of view.

Advertising: the money for ads will be payed without doubt to the ones broadcasting/displaying/printing the ads. So the costs are already in place and this will not change too soon. What if a part of these money will be payed to the users, to the consumers. Let’s say that displaying an ad on TV costs 2 cents for each user that sees it. What if 1 cent goes into the user’s account and the other goes into the television’s account. What if clicking on a link on a web page will make money not only to the page owner, but also to the reader, the one that clicked the link? What if seeing an add on the street can make me money, or hearing some ad on radio can make me money? The money are already payed to the television/radio/web page owner, so there’s no extra expenses. This might be a solution to attract more users. For example I see an ad on TV or on the street, I call a number, I answer correctly to some question, I get payed (this is not new, but probably was not looked at from this angle). Or I click on some links, I earn some money. Or I watch some video, I get some money.

Using this idea, I’ve developed a business plan for my startup, and I’ll share it with you. I’m mostly developing services for Romania, so it’s ok if you use my ideas for your own startup.

Developing a business plan

Giving users stuff for free might sound too weird and they might run away from your services (hey, we have to work hard in life in order to get what we want, right? ). So you have to be careful and do this in really small steps. Start giving them little things, of less importance, gain visibility and trust from your users. Then take it a step further and give them something else, more important, and so on.

My plan contains at least 3 phases:

Phase 1 - SMS Free Service
I’ve started developing a Free SMS Service. The users will be able to send text messages (SMS on mobile phones) to their friends for free. The costs will be supported by inserting short ads at the end of the message.

Phase 2 - Free music & movies download Service The users will have to watch an ad, and at the end they’ll be able to download a song. If they want to download a movie, they will have to watch several ads. Here you’ll have to make sure that they are watching the ads. Otherwise they might leave the computer and come back in 5 or 30 minutes and then download what they want.

Phase 3 - On-line making Service by watching video ads
If you can pay for music or movies when your users watch ads, why not giving the money directly to your users? And maybe you’ll find an ingenious way for them to make important amounts of money by spending only one or two hours in front of the computer.

The concept is so simple that it’s easy to find a lot of other applications where you give stuff for free to your users. They’ll be happy getting it for free, and the advertisers will be happy because their message gets to the consumers.

I’ll detail each one of the three phases above into separate articles.

I have outlined here some questions that I ask myself when thinking about a Startup idea. There might be others too, you’re welcome to list them.

What effort is necessary to implement the idea?

How many people and how much time is needed for implementing this idea? This is important because the sooner you get your product’s version 1.0 released, the better chances it has to succeed. If your idea is brilliant but it will take years to implement, it’s hard to predict if it will still be successful or not.

What is the initial investment?

Do you need an initial investment for your idea? If that initial investment is over your budget, you’ll need to find some investors. What equipment do you need for your idea to run (PCs, Servers, something else)? The less money you need at the beginning, the easier it will be to launch it.

How will the new service/product attract users?

Do they have to pay for it, will they have to register, will the registration be free or based on invitations? And most of all, what will make the users register? People will not pay easily for your product. It’s a good strategy to create a service or product which is free for your users and which is also valuable to them. And still, what will attract the users?

How will the new service/product make money?

Do you need to attract investors, ad publishers or something else? Why should they publish with your service? If you give something free to your users, you must make money from something in order to cover the costs. Google makes money from advertising, you might be thinking about this too. You’ll have to talk to different companies and show them how working with you will bring benefits to their business.

Are there any other external dependencies?

Apart from your users and the companies paying you, do you have dependencies on other external services or companies? For example do you use services from other companies (publishing video to YouTube, or photos to Flickr, do you use profiles on MySpace, do you use Google Docs, will you need to interract with some external service, and so on)? There might be other external dependencies. You’ll have to be aware about them and evaluate the risks.

Once your service is running, what effort will it need from your side?

Is it growing by itself or does it need your continuous attention in order to grow? For example, a service which counts on user’s contribution (YouTube, Flickr, del.icio.us, reddit, digg, and so on) grows on it’s own. It’s a good strategy to develop something like this. Also, if it’s something that people like, they will be the ones bringing you new users, so you’ll basically need no publicity. Your users will be your PR.

The questions from above (and others) can be used when evaluating a startup idea. I will start writing ideas about new services and I will use these questions as an analysis for these new services.

My next article will be an idea for a Free SMS Service.

Earlier today, I was in a restaurant and I was reading an article in Business Week about the first Starbucks opening in Romania. The article was telling about the great experience that Starbucks is trying to offer to their customers. The idea behind the business is simple: selling coffee. How did people come to love so much the Starbucks coffee? What differentiates Starbucks from other coffee shops? What makes people get in line in order to get a coffee from them? What makes them so special? In the same context, what makes people choose Google for search over other services? Or what makes them choose iPods over other mp3 players, Amazon over other on-line book stores, Coca-Cola over other drinks, and so on. All of them use pretty simple business ideas: coffee, search, music, books, drinks. Though, something makes them different.

Starting a new business

When thinking about starting a new business we tend to think we need a great idea for that. We are most certain that if we have a great idea the business will succeed. And we keep searching and searching for that great idea. Sometimes we might find it, but most of the time we won’t. It took me a while to realize that waiting for that brilliant idea will not get me anywhere. Most of the successful businesses use simple ideas and focus on improving the experience of the consumers. Starbucks focuses on offering a unique experience, Google focuses on offering the best and most relevant search results, Apple focuses on design and experience with all of their products (I’m writing from my iMac so I had to say something about Apple ), and so on. They’ve all started from simple ideas and focused on creating a unique environment around their products. It took a while for these companies to influence our lives and experiences, but they did it eventually.

On the other hand, there are also companies which started their businesses from brilliant ideas: Microsoft (operating system), IBM (personal computers), and so on. And they are successful businesses. What these companies have in common is that they came up with something new, with something a lot different that what was available at the time. They offered a different and better experience in personal computing, OSes and they had a lot of impact on how people work right from the beginning.

So there are two roads you can take for your startup: great ideas or great experiences.

If you have a brilliant idea, you can start develop your business around that idea. You’ll know if your idea is brilliant or not by the reaction of the ones around you. If you tell them your idea and they love it, there’s a good chance that the idea has a lot of potential.

If you don’t have that brilliant idea but you still want your startup, you can start from a simple idea and then focus on offering a great and unique experience to your customers. And always do something that you’d use. If you don’t like the services you offer, you customers will also dislike your services.

What should I choose for my startup?

I don’t think one choice is better than the other. I’d rather say they are both good. It’s just that one is more accessible than the other. It’s easier to start from a simple idea and make the best of it, than waiting for a brilliant idea. And it’s always better starting your business and developing it than not doing anything.

Most of us live our lives by some predefined patterns. We tend to do default things only because we’re taught that’s how it should be. Our parents, our teachers, most of our guides teach us these default things; we’re always told we have to do them. They are never tagged as default things, instead they are tagged as normal things because everybody does them.
Starting from childhood, we’re taught by our parents that we have to go to school; in school we’re told we have to get good grades to get to a good high school; in high school we have to get good grades in order to get to a good college; in college we have to study hard and specialize in some field; we keep hearing that if we’re good enough we might have a chance to get a good job in an important company and for a good salary. We accept these default things as normal things and they become our way of life; we do them without question and then we start our own family, we have our own children and we teach them the same default things.
Ok, so let’s recap. We study hard in school, we get a well-payed job, we go to work and get payed for this. We’re taught that that’s the way the society works so we have to follow the rules. We’re taught to work for money. We’re even taught that the harder we work, the more money we get.

Let’s analyze these default things one by one.

Go to school

Don’t get me wrong here, I’m not stating that our children shouldn’t go to school. They should, but it’s important why do they go to school. Most educational systems teach the children a lot of things. Which is good in primary and secondary school. But starting from high school, we should focus on what we need to do next. And when we go to college we should know what we want to do and what we’re good at. I met people who went to college because that’s how it should be. They didn’t even chose the college, their parents did. And they didn’t like what they were doing, but for them it was impossible to drop out and start something else. It’s ok to go to college, as long as you are aware that you can do anything you want. The default path is to go to college, study hard, then get a well payed job and work for others. Start another path. Go to college to meet new people, go to college to learn new things, go to college to find your path. But don’t go to college just because everybody says you should.

Get a job in an important company

Starting from high school most of us dream of a good job, with a well known company. Working in a big company might be very helpful. We can get in touch with new technologies, we can learn faster to interact with people, we can learn how to manage people or projects, we can learn how to interact with customers. Working for a big company might help us learn faster a lot of things. But most people remain in companies even after they stop learning, even after they stop enjoying what they do. Most people stay with their jobs for safety. Leaving a well payed job might be hard and it might be risky. Though, if you stop enjoying your job, if you stop learning and evolving with your job, why stay? Most of us prefer working for a company because it’s safer than starting our own startups. But starting a family business might be a lot better on all aspects. Ok, you might have to allocate a lot more time for doing a startup, but you’ll certainly learn a lot more. You won’t be frustrated with being payed a lot less than what the project you’re working for is worth. You stop complaining about your boss or about the company because you’ll be the boss and the company will be your own company.

Don’t go to work because everybody else goes to work, don’t look for a job in a company because everybody else does it. Get a job if you don’t want to start your own business or if you feel not ready to start your own business. But if you want to start your own business, why wait? Start it right now. It might not work from the beginning, it might be hard, you might fail several times before you succeed, but you’ll learn a lot more than you’ll learn in a regular job. Unless you’re a CEO, right?

I’ve faced the idea of doing a startup. And I kept saying that I have to wait for that genius idea for a great startup. And I kept waiting and I kept waiting. And after a while I realized that a great idea might come after 10 or 100 small ideas. So there’s no point in waiting for that great idea. Try small ideas first, and each of them will be a step toward that great idea

Work hard for money

This is one of the defaults that we all hear every day. Most people say that you can’t have money without working. But there are a lot of people around which work hard and are always in debt. Ask around you what do you have to do for more money and the answer you’ll get is “work harder”. So the harder you work, the more money you’ll have. Actually that’s not entirely true. How come there are a lot of people who make money very easy? Most of them are rich people. And they’ve probably worked hard to get rich. But being rich is not really having a lot of material money, it is in fact a state of mind. All rich people who worked hard to get rich worked hard to believe they’re rich. They worked hard to see themselves rich. They didn’t work hard for the material money. They worked hard to come to believe they’re rich and they worked hard to understand what wealth is all about. The faster we come to understand what wealth is, the faster we’ll get rich. When we get there we’ll understand that working hard for money is just a big lie.

If you can think of other default things, add your comments here.

Advertising

What is Advertising? What does Advertising focus on? What is it’s purpose? We all know the answers to these questions. Shortly put, advertising means letting the consumers (people) know of new products, services or even new companies. Every day we are fed different audio, video, pictures, banners, text or other types of adds on several information channels. What I want to talk about in this article is the efficiency of these information channels (from the advertising necessities point of view) and some simple ways to make them more efficient.

Existing types of advertising

The most known types of information channels, used also as advertising channels, are: radio, television, magazines/news papers and internet. Let’s say a few words about each one of these.
Radio ads are mostly listened to while driving. They are not the most efficient type of advertising, but they get the message to a lot of people. When we play radio ads, we have to make sure that the target people are the same or a big part of people driving cars.
Television ads are probably the most expensive type of ads. Even if the consumer likes it or not, an interesting movie or a tensioned sports game is interrupted for advertising. We’ve come to accept this and it’s almost natural now.
All types of magazines and news papers use 50% or their space (probably even more) for advertising. They are pretty much targeted ads because you’ll rarely see a dog food ad inside a business magazine.
Nowdays the internet is already a very efficient advertising channel. It has started displaying ads by using banners and pictures and links. Now the best way to advertise on the internet is by context ads, which are basically text ads which provide links to different sites with products and services.

All these type of channels have a very important characteristic: no matter the channel, when an ad is broadcasted / played / displayed / clicked, the channel owner will charge the ad owner. So all the money from the ad go into the channel owner’s pockets.

Problems with the existing type of advertising

Existing types of advertising get ignored by a lot of people each day. Some of us change the TV channel when the movie is interrupted for ads, some of us do not read or even look at ads inside printed magazines, and probably a lot of us have developed a sense in reading web pages without even seeing the ads (I know I have). How do we make people pay attention to our ads, how can we increase the efficiency and return of investment of ads campaigns? What can we do in order to make more people pay attention to our ads?

Solutions

Let’s think about Text Ads. They are probably the youngest type of ads. They tend to change a lot but something remains the same: who cashes the money. It’s always the one that displays the ads. These text ads haven’t embraced the Web 2.0 concept (I used this “Web 2.0″ tag because it’s so used these days that we all know what it means). They haven’t adapted to the “empowering people”, “collaboration” or “social networking” concepts. They have given power to the publishers, so they’ve made a few steps ahead, but they do not bring anything new to the readers, to the users.

The money on ads get to the channel owners without doubt. But you, as a channel owner, how can you make more people pay attention to the ads that you broadcast or publish? It simple: Start sharing the money with the users. Start giving money to your consumers. You don’t have to give your own money, you just have to take less than before and give to your users or viewers a part of the money that you’ve charged for broadcasting or publishing the ads. Is this a crazy idea? I’m sure it sounds like a crazy idea right now, but I don’t think it will sound like a crazy idea in a couple of years. Sharing the money with your users gives you the guarantee that they will start watching the ads. It gives you the guarantee that the users will start noticing the ads. The problem that you need to figure out is how to do that. How can you share with your users the money from advertising? How can you be sure that there’s no fraud? How can you attract people and also ad owners?

If you understand my suggestion and then figure out a solution, you’ll have your idea for a golden startup.