Startups Stack Exchange Archive

Is revenue from advertising enough to sustain a social networking site

I’ve made up a social network site which has a USP of connecting people via different way. Though, I am on the verge of finishing the product but now I am worried about the amount of money I need to invest before and after I start earning money. Below are my questions:

  1. I am expecting it to increase exponentially for next 6 months. But I don’t have any source of income yet. How can I sustain within that time period until I start getting money? As my database will keep growing along with bandwidth.
  2. Does showing advertisement is enough for a social networking website to run? I have no idea about this area, I only know google ad words which doesn’t fulfill my ROI.

Few things which is important for me:

  1. I am not going to sell my user personal data at any cost. No matter it comes under monetization or not.
  2. My website has a potential to grow overnight. As per my current knowledge I have build that site in ASP.NET MVC with SQL SERVER. I am planning to host that on Amazon server.

Answer 7946

Make plans to switch to different technologies. Once you get to a hundred million users, there will be no choice but to develop your own (in house) technology based on your own model.

About bandwidth, the same - I don’t know your implementation. Could be a generic, wasteful protocol, could be an optimized one…

Anyway, be prepared for losses until you hit 10 million users. Be prepared to lose for 2-3 years. Advertising will cut some of it but you will still be losing big money. So, I guess no, advertising won’t make you profitable until you become a leading social network.

If I was paying for ads, I would pay facebook 1000USD for one volume of exposure and you, 50USD for the same volume of exposure.

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