Lookery.com

Having the Betaworks guys on board has already been a lot of fun. Andy Weissman can’t seem to resist providing great answers to any little question I ask, and John Borthwick blogs things like this:

Balancing capital raises with audience growth and monetization One of the things the Fotolog team did right since the first day the site was launched was managing the cost base of the company in a way that was appropriate to the audience, monetization and funding. At no point did Adam, Fotolog’s co-founder, misjudge the balance between these drivers. This is hard to do particularly if VC’s are offering funding based primarily on audience metrics. There are sites who have audience growth comparable to Fotolog with 4x or more the headcount. In 2008, I think, striking this balance will be as important as ever — in particular re: businesses who are building audience on the back of platforms like Facebook or Twitter — eg: indirect vs. a direct (non-mediated) form end-user interaction.

Lookery is building Demographic Marketing Services that today help Facebook apps make money. Next week, we’re sending ~$40k to publishers for December’s campaigns. In our first net revenue month ever, we’re keeping a whopping $352. Our margins are going to improve from here, because our eCPMs to publishers will too, but we’ll always keep only a small fraction of what we send to publishers. Per John’s analysis, we’re an indirect business, based on data-enhancing huge traffic flows that we run through rented, virtual servers.

Last month, we served >40M ad and API calls per employee. I expect to raise that ratio ~10x by the end of 2008 — four billion monthly transactions orchestrated by ten employees would make Lookery break even as far as I can tell today. Those kinds of numbers keep us very focused.