Top 7 indicators of consumer Internet success

written by Nisan Gabbay, posted on February 5th, 2007

A few weeks ago, Tom Shields of Woodside Fund contributed a post to VentureBeat listing his criteria for investment in a Web 2.0 company. This spurred me to write an alternative version based on the recurring themes that we have seen through the case studies on Startup Review. I would encourage you to go read the full article on VentureBeat, but below is the list of the top 7 indicators, at least for the time being. If I were working at a VC firm (which I used to) or contemplating pursuing an entrepreneurial idea (in pursuit now), these would be the things I would look for in an Internet company. I’d be very curious to hear thoughts from Startup Review readers. If you have ideas for additional indicators, please leave a comment below.

Top 7 indicators of consumer Internet success

1. Product that fits the needs of an underserved niche

Update: Per comments from readers, I am amending #1 to:

1. Define a previously unrecognized niche

2. Strong ability to leverage natural search as the primary means of user acquisition

3. Service that empowers people to make a living

4. Free (or near free) alternative for a previously high cost service

5. True viral distribution potential

6. Ability to jumpstart user acquisition through distribution partnerships

7. Story that lends itself to mainstream PR

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