Paglo CEO ‘Nuts’ Over FREE ‘Google For IT’: INTERVIEW
Paglo (semi) launches today, in good Web 2.0 startup tradition, i.e, “beta invitations will be sent out shortly, so reserve your spot today,” the company announces. Paglo’s Web 2.0 roots are also on display in its reverence for all things Google, and disdain for solid revenue and business models.
What is Paglo? In the words of CEO Brian de Haaff and CTO Chris Waters, “Think Google for IT.”
Think Google’s YouTube for business model, as well, de Haaff and Waters told me, on the eve of Paglo’s declaration that it will soon be sending out beta invitations for its “free, on-demand service that helps turn IT administrators into heros.” How so?
For the first time, they can discover all their data and get instant answers to their computer, network and security questions. We are fiercly focused on bringing pure and unadulterated search to IT users.
BUT, Paglo is proudly NOT focused on monetization.
de Haaff and Waters have put together an entertaining flash preso of Paglo, demoed via colorful IT cartoon characters. Two questions immediately came to my mind after viewing it: 1) What are the revenue and business models? 2) Is venture capital money supporting the startup?
When I asked de Haaff directly “What is your revenue model?” he told me “free.” In response to my question “What is your business model,” de Haaff indicated, “growth will come through providing businesses value for free,” that is the Paglo “philosophy.”
I asked de Haaf and Waters if Paglo’s financial backers are nevertheless interested in getting a return on their investment; Paglo is financed through self-funding and outside capital. Apparently yes, although de Haaf and Waters underscored monetization is NOT a priority, in good Google and YouTube fashion!
While Paglo may eventualy try and charge a premium subscription fee, if their “valuable” users don’t object, the Paglo modus operandi–business model–is to please the highest number of IT staffers possible without asking a penny from anyone to fund the service.
de Haaff and Waters asked me if I thought Paglo was “interesting.” Interesting, yes, I concurred, while expressing my concerns about the lack of revenue and business models.
In announcing his soon-to-be-available beta today at the Paglo blog, de Haaff seems to riff on my business model required “philosophy”:
The service is on-demand and free. Some say that we are nuts, but we think the you need to prove that something is valuable before you worry about making money from it. So, we are maniacally focused on making Paglo convenient and useful.
Unfortunately for Paglo’s financial backers, however, the IT vendors required to provision Paglo’s free service undoubtedly do not share in de Haaff and Waters Googley, benevolent view of the business world; i.e., Paglo must pay money for all of the infrastructure and services it deploys in its desire to make “heroes” out of everyone else. AND, don’t forget those pesky Paglo staffers’ salaries or the PR firm retainers!
de Haaf confidently hails he is “focusing on driving massive use instead of revenues” with no need to “worry about data-handling costs” because “storage and bandwidth are virtually free.”
The Paglo “business model” is NOT cost-free, though. de Haaf and Waters have put their own good money behind it–gained from the sale of their Network Chemistry’s wireless security business to Aruba Networks–and “smart” capital is funding the ”virtually free” operations of Paglo.
de Haaf and Waters are convinced they have the winning Paglo formula: “Value + FREE = an unbeatable combination.” The Paglo “strategy for success” is to emulate what they deem as “wildly successful consumer-oriented sites,” such as YouTube and Facebook.
In other words, the de Haaf and Waters desired Paglo “business model” may very well be to follow in the “wildly successful” valuation paths of YouTube’s Chad Hurley and Steve Chen and Facebook’s Mark Zuckerberg in a search for Microsoft and/or Google-sized buyouts.
Unfortunately for Paglo, however, Google has had scant success in achieving a “consumerization of the enterprise.” At the end of the Paglo day, “think Google for IT,” may continue to NOT be very lucrative!
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