While I was traveling Backfence.com suspended operations, and now a lot of people are drawing conclusions, some publicly and some not. At the risk of further muddying the water, here are some of my own fairly random, jetlagged thoughts:
First of all, we should expect and even welcome failure. The trick is to fail forward and inexpensively. The Innosight folks counsel us to "be patient for scale, but impatient for profits." What that means is that we should make sure the business model works before pumping cash into it. We need more and faster failures that help us find a model that works, and only then pour significant money into the machine. This is easy to say and incredibly hard to do when a gaggle of competitors are launching nationwide.
It's still early in the game and the game is changing quickly. For example, the Backfence folks sunk a lot of energy and some significant amount of money into creating a technology platform after struggling with an early version of Drupal; by the time they actually launched with proprietary software, open-source Drupal had raced ahead. As this stuff gets technically easier and cheaper, you can expect a lot more experimentation. Someone is going to get it right. Someone may be getting it right this week.
We still don't know the right scale for doing this sort of thing, and that scale may actually be shifting as more people sign up for cheap broadband and become comfortable with creating and not just consuming content. Backfence cofounder Mark Potts once speculated in a conversation that the right physical community size is under 50,000. We've had great debates about that where I work; one point of view says a local high school district can serve as a useful proxy for defining a natural community, but your mileage may vary.
A successful community model and a successful business model are not the same thing. The tricky part is going to involve finding the intersection. Something like Front Porch Forum might have a great community model but never be able to make a significant profit, or vice versa. Or the right business model might involve delivery of a print component, something many Web-centric developers might overlook or avoid.
Everybody underestimates how hard and how expensive it is to build a powerful brand at a geographic community level. If you went down the street in one of Backfence's markets and knocked on doors, how many people would have a strong, clear, positive notion of what Backfence was all about and why they should use it? This is one place where incumbent, offline media may have a great advantage, although in many cases it can't deliver the message to the targets of greatest opportunity (nonconsumers).
See also comments from:
Peter Krasilovsky
Scott Karp
Amy Gahran
Paul Farhi
Terry Heaton
Dan Gillmor
Steve Outing
... and many more
Comments
Front Porch Forum Follow Up
Thanks for the thought-provoking comments about Backfence. I wonder about the test you suggest in the last paragraph... "If you went down the street in one of Backfence's markets and knocked on doors, how many people would have a strong, clear, positive notion of what Backfence was all about and why they should use it?"
Front Porch Forum might fare well on that one. In our pilot area (Burlington, VT) better than 20% of city households have subscribed since our beta launch last fall, with more joining everyday. Our most active neighborhoods have 90% of the homes on board. Members go door-to-door to sign up their neighbors. They set up tables at community events to pass out flyers. They organize FPF block parties. It's amazing to watch people step up and take ownership of this service. Many times we don't get to watch, because we only learn about the effort after the fact when we see a spike in new members.
Seven Days just published a story that's a case study for how neighborhoods are using Front Porch Forum. And check out the steady stream of subscriber comments of what this service means to them... this is something special.
As to business model... I like our chances! We're working with several trial sponsors as we bootstrap our way along... slow and steady (how's that for anti-internet!).