As we discussed several weeks ago, Slide and RockYou are doing exactly what all smart, well-funded emerging companies do when their original business models aren’t turning out as planned: Switch horses.
Slide has fired its ad-sales team and is now selling “immersion” experiences and virtual goods. RockYou, meanwhile, is no longer a “widget company.” It’s a “distributed media company.”
Go ahead and snicker. Last we checked, both companies had huge reach and millions of users, as well as tens of millions of dollars in the bank. The cash gives them time to tinker. And with that many users, if/when they get it right, revenue will soar.
Emily Steel, WSJ: Slide opened an ad-sales office in New York last summer and hired a team to sell standard online ads, such as the graphical ads that border a Web page. It typically sold such ad campaigns for $50,000 to $200,000.
Now, Slide is scrapping those ad efforts. It recently fired its ad-sales team and instead is focusing on selling so-called branded entertainment campaigns, where an advertiser is incorporated into games that are already popular among consumers. It is also ramping up its virtual-goods business, such as spoofs of famous works of art. It hopes that segment will account for the majority of its revenue this year.
“Think of us like an e-commerce business,” says Keith Rabois, Slide’s vice president of strategy and business development.
Slide is among a group of companies, including RockYou, Zynga Inc. and Meez, that are diversifying their businesses by selling virtual goods to consumers and branded entertainment ads to marketers…
The changes have meant scrapping the term used to describe some of these companies.
“We are not a widget company. We are a distributed media company,” says Ro Choy, chief revenue officer at Rock You. “The reality of our company is that we were not a widget company. We make money through our relationships with advertisers and partners.”
Photo: Max Levchin, Slide boss.
NOW WATCH: Tech Insider videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.