How Betaworks is leading the new wave of intelligent media

Oct 03, 2012

Table of contents:

A collection of companies
Social
Real time
APIs
Betaworks companies
Betaworks positioned as the leader in intelligent online media

Betaworks is a hybrid incubator and investment fund that takes fledgling ideas and products and helps them grow into fully mature technology companies. Betaworks are the creators of Bitly, Chartbeat and SocialFlow and are looking to build a collection of companies that all fit into the Betaworks vision of the future of the Internet.

The structure of Betaworks allows the company to take in young companies and ideas and build them into finished products. Betaworks also makes seed stage investments into early technology based companies. However, Betaworks does all of this off it’s Balance Sheet and does not work in the traditional investment model of Limited Partners. Instead Betaworks is a stock company with shareholders.

Betaworks’ thesis is structured around the real-time social web and how information is able to flow across the Internet. The vision for Betaworks originates from the monumental shift of the new real-time wave of the Internet. The Internet can now be categorised as a flow of information rather than static pages of content. Each of the companies that Betaworks invests in and builds fits into this vision of the future of the Internet.

Betaworks was founded by John Borthwick and is based in New York City.

A collection of companies

The Betaworks thesis is to create a collection of companies in the vision of the real-time social web. Instead of having one company that dominates in a single vertical, Betaworks aims to create a collection of separate companies that are loosely connected. These companies are then able to work together whilst still concentrating on their specific vertical.

A large part of the Betaworks thesis is structured around Web Services and APIs (Application Programming Interface). The majority of the Betaworks companies are available as both a website and a web service. This allows the companies to share data laterally and fits into the Betaworks thesis of information flow and pushing data through the real-time social web.

Social is obviously a huge part of the Betaworks’ thesis. Twitter’s growth can be attributed, at least in part, to the huge growth of the real-time social web and has become the real break out company that represents this new vision. Betaworks was an early investor in Summize and TweetDeck, both of which were acquired by Twitter.

The social web really shifted the emphasis of online discovery and dissemination of information away from search. Whilst search will continue to remain an important structure of the Internet, the social web enabled an entirely new approach that has completely changed how we consume information.

Real time

The real time web has come about thanks to a number of new technology innovations and ideas meeting at an intersection. As the cost of server computing has reduced, mobile internet has finally matured, and services like Twitter have become popular, the real time web has emerged as a new wave of technology innovation.

Web 1.0 can be broadly categorised as information on static pages whereas Web 2.0 is the real time broadcasting and consumption of data through new technology and protocols that allow information to spread.

APIs

APIs (Application Programming Interface) are an integral part of the real time social web.

An API basically allows external applications to use data and information from another application. Web APIs have become common in the last couple of years as web services look to grow and widen their usage by allowing external applications to request and create new data within their application.

APIs have fuelled the growth of services like Twitter and Facebook and are an important aspect of new services for the future.

Betaworks companies

The second part of this post will be talking about some of the more prominent Betaworks companies that are changing the face of online content, consumption and intelligent media.

Bitly

Bitly was really the flagship Betaworks product and has come to truly represent the company’s vision.

Bitly started out as just a link shortening service to be used on Twitter. Bitly was never intended to become a huge property, but due to the explosive growth of Twitter, Bitly quickly began being used for millions, and now tens of billions, short links each month.

The real value of Bitly is of course much more than a shorter link. When you shorten a link using Bitly you get instant access to real time analytics of that link. You can see when people click on it, where they click it from and where in the world they are located.

As Bitly has grown and the number of links it is tracking has increased, Bitly can now generate a real time layer of what is happening on the Internet. At any given moment, Bitly knows what is trending and where the activity is and where it is coming from. This powerful real time dataset has become one of the integral pillars of the Betaworks model.

News.me was a product that Betaworks spun off from the data that was generated from Bitly. News.me is a daily summary of the top stories from your Facebook and Twitter accounts.

Bitly goes to show that a small germ of an idea and product can truly revolutionise an industry.

Chartbeat

Chartbeat is a real time analytics engine for websites. It allows website owners to track and analyse their website and their content to gain instant real time insights into what is happening and what is popular right at that second.

In the fast paced world of Social Media, Chartbeat allows companies to react to what is happening in real time. It allows website owners to understand their traffic sources and take action when it deviates from the norm.

Chartbeat also spawned an enterprise version Chartbeat Publishing that is being used by major publishers like The New York Times. Chartbeat Publishing allows huge content publisher and news services to gain deep insights into what is happening right at that moment and to take real time action if there is a sudden surge in interest in a particular story.

Socialflow

SocialFlow is another Betaworks property that uses real time data and analytics in an interesting way. SocialFlow allows companies to target contextual advertising by looking into the language and conversation users are having across the social web.

Traditional contextual advertising looks to match advertisements with the demographic of a user, their age, gender, interest and aspects of their profile. This is however still going down the old interruption model.

SocialFlow aims to give a better Return On Investment for companies looking to target advertise online by understanding the context of existing conversations to gain trust.

Digg

Digg was one of the very first crowd-sourced news aggregators and was really the first wave of the social internet. Digg grew to become one of the largest online properties, but has suffered in recent years as it lost relevance to Twitter and Facebook.

Betaworks purchased Digg for $500,000 and decided to completely reboot it into a startup again. Betaworks wanted to take the fallen giant back to it’s roots as a social news aggregator that collects and surfaces news based upon activity and interest across the social web.

Although it is too early to tell whether Betaworks’ reboot of Digg will be enough to revive it, Betaworks is probably in the best possible position to really make a relevant crowd-sourced news aggregator.

Back in February 2011, I suggested that Twitter would be well advised to acquire Digg to create a crowd-sourced product to aggregate news across the social web (Twitter and Digg - A match made in user submitted news stories heaven!) so I was very happy to see that a company with the ability of Betaworks also believed in the value that I saw.

Betaworks positioned as the leader in intelligent online media

Through the companies that have been founded and the investments they have made, Betaworks has positioned itself as the clear leader in social news, real time data analysis and intelligent online media. Betaworks is not a single vertical company that has had a breakout success, it is a representation of a vision of the future and how a collection of companies can fully realise that vision.

Through the success of Bitly, Chartbeat and SocialFlow, Betaworks can look to give a fallen giant like Digg a new lease of life by empowering the old vision with a new technological outlook. Digg clearly has future value as a way to crowd-source and analyse what is happening and what is popular on the web right now.

Betaworks is very much like the initial beginnings of Google. Google re-imagined online search to create the undisputed product leader. Google was able to build an extremely healthy company from that one source of revenue, but every other Google product has failed to even come close to that success.

Betaworks, on the other hand, has been able to accomplish the huge goal of real time analytics across the entire internet through a number of aggressive approaches through multiple companies in adjacent verticals. This re-thinking of that traditional one company dominant leader has positioned Betaworks to be able to continue to grow through various smaller initiatives. I believe in the long run, Betaworks would be better positioned than Google to transition as the Internet evolves in the coming years because of this loosely defined structure. I also think you will see a lot more innovation and smaller bets that have the potential to grow into huge product defining leaders who disrupt traditional industries.

Here are some interesting interviews with Betaworks CEO John Borthwick as he talks about his company, his vision and the future of the real-time social Internet.