Signal to noise ratio.
Google had over 10 billion dollars in revenue in the previous quarter because people have questions and they look for instant answers on the world wide web. Google has came up with a genius way to rank the best results and make money off advertisers who offer products similar to those results.
Recently an article was written how Google is a “Magic Money Making Machine” and how Facebook ads suck. Despite close to 1 billion users, Facebook is only making four billion dollars a year on advertising. Google makes close to that in one month. The article described Facebook ads as “It’s like you’re at a party, standing around, talking to your friends, and someone made the posters on the wall advertisements“
With only 4 billion in advertising revenue Facebook was initially valued at 100 billion. Google is valued at 188 billion. Quora is valued at 400 million.
What is Quora: A high quality question and answer website. Ask questions and receive quality responses from experts. Numerous people could respond and the community curates the responses by upvoting and downvoting answers. Quora offers a symbiotic relationship: you need credits to ask questions and you earn credits from answering questions.
Last night I watched season finale of Game of Thrones. At the end, all I could say is WOW. I wanted to know how HBO time and time again creates the best shows on TV (Entourage, Curb, Sopranos). Instead of doing a Google search I posed the question on Quora.
Today I got a response that completely answered my question and then some:
“They find a really talented person named David (David Chase, Larry David, David Milch, David Simon and David Benioff) and then they give them some money, tell them to make great TV shows and then get the hell out of their way.
Networks use focus groups, committees, layers of executives etc to dilute a show and try and give it mass appeal. The end results lack creative vision and have no original bite. But HBO (and Showtime) trust a talented person to deliver them a great show and they pretty much leave them to it. The results are usually fantastic.”
Future of Quora- More than Facebook or any other company Quora has the potential to become the Google 2.0 . A fully mobile near instant search company (nobody wants to wait 12 hours for responses even if high quality). A search company that display high quality responses to anything that the average person would normally go to Google for. In order to prevent gaming such as SEO the Quora community would be essential in order to curate, upvote and downvote, the best and worst responses.
Quora does not have to revinvent the wheel to monetize. All they have to do is follow Google’s playbook with relevant ads alongside the community response. Or people can pay a virtual currency to send questions directly to the best experts (similar to Zynga).
With time and executed correctly Quora has the potential to be the next big Silicon Valley company that changes the world. Instead of asking about HBO television shows somebody could ask “how to use social media to start the next revolution in Palo Alto”.