Two Tales

Of course, we heard about the acquisition of Hardwarezone by SPH. To those who are involved in the internet industry, it is believed that the price is too low for acquisition, consider the customer base and other strong internet indicators such as Alexa rank. Our mysterious resident contributor, Cobalt Paladin shares his perspective on this recent acquisition and another tale about another entrepreneur with their goals and aims for another internet startup.

Yesterday, when my entrepreneur friend, KL, called me to meet up, I jumped at the opportunity. After being imprisoned in front of the PC for 4 days, I really had it. I dislike being cooped up in the office for days just preparing documents and replying to emails. Instead of being a paper-pusher, using modern technology, I became a button-presser. Sorry for being cynical, sometimes I wonder how could I consider myself working by just typing at the PC for days (writing a novel, thesis etc not included). No offence to anyone, of course.

We met up and we talked about the sale of Hardwarezone (HWZ). As expected, both of us felt that HWZ was under priced at S$7.1 million. Let’s look at what HWZ company encompasses: 3 magazine titles (HWZ, GameAxis Unwired and PHOTOVIDEOi), 5 portals (HWZ, GameAxis, PHOTOi, Carma and Inside Golf). Of course, the crown jewel is Hardwarezone portal itself. It spans Singapore, Malaysia, Thailand, Australia, Indonesia, China and Philippines. It has an impressive stats of serving 35 million page views per month, google pagerank of 6, with an Alexa ranking of 1937 (position 1937 out of the gazillion websites in the world), the highest Alexa ranked Singapore portal/website!

By selling at S$7.1 million, it also likely will affect the selling price of any other portals in Singapore. In one swoop, HWZ brought down the valuation of other Singapore portals too. Not that I am affected but I just felt unjustified for other Internet entrepreneurs who have worked hard too.

We wondered about the reason for the sale and at the particular price. We have our own theories but mainly may be because they are tired of running on their own already. They may have preferred to have a big backing. I can understand the pressure and stress that they go through every day. Including myself, I’ve only 3 staff and I worry a lot already. Imagine, running a company with a staff strength of 66, the pressure must be tremendous. And also, the founders Jackie and Eugene have been doing this for the past 8 years. Maybe, in two years time, I would feel tired too?

Anyway, KL met up with me to seek my opinion regarding his new expansion plans. He has a new product and has been launched for 3 months now. My eyes bulged when he showed me the stats. It was impressive but scary! In 3 short months, he needed to setup 4 dedicated servers to support the new online service. Likely, it would grow very quickly too as he has tapped into the China online market! China online is a ferocious beast which many find it hard to tame. My friend is surfing on a huge wave and the wave is still growing!

He shared with me his business plan. Not only what he is doing will be able to tap into the China market, if it catches on, it’ll be global! I worry about the server growth rate. If it all goes according to plan, 4 servers will be hardly enough in 6 months time!

I’m gratified that he periodically seeks my views when he has new ideas and now a new product. I gave him a few opinions and he seemed impressed by what I’ve shared. I’m glad that I’m able to help. Because during my darkest hour, when I wanted to give up, what he told me, made me continue. I owe him at least to give him my most intelligent opinion.

I asked him, what is the purpose of this new venture. Well, the short term goal is to reach 3-digit ranking of Alexa. Hahaha! That’s what I like about KL. We don’t do things solely for the purpose to making financial gains. At times, we do things just to make a point, just to show that Singaporeans can do it too!

But seriously, he also understood that if his new service does reach 3-digit Alexa ranking, he’ll need investment from VCs to continue the growth. The bandwidth and server requirements will be expensive. When it happens, he’ll be seeking VCs from America as they will more likely appreciate and understand what they are doing.

I wish him all the best and I’ll be enjoying the ride… from the side. :)

I’ve my own venture to occupy me now.

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