Why doesn't Craigslist have mobile apps?
The mobile site is really good. Hell, even the regular site has incredible usability and is very lightweight. It might not look as pretty as GumTree, but it's very usable.
How Craigslist Makes Money
31–40 of 246 posts
Re: How Craigslist Makes Money
#32Craigslist has one of the worst UX. How come has it not been improved in years? Why doesn't Craigslist get any competition? It should be trivial to implement something that's 10 times better...
My theory is because Craigslist deeply rooted network effects in the low end of the market.
Competing in the low end means that its a volume based game because each unit of value (each craigslist posting) is low. A new company trying to gain momentum capturing a small user base does't work because in this smaller stage of the company you have no network effects.
If you try to steal those low end customers with a 10x product, you will spend a ton of money to capture users that aren't very valuable.
If you make something that adds 10x more value, with people who want 10x in value, then by design you work yourself out of Craigslist's turf like AirBnB (they started hacky low end but now are moving into higher end listings to drive growth).
in short, I believe there is a valley of death when you try "siege tactics" on Craigslist's network effects.
Re: How Craigslist Makes Money
#33Craigslist has one of the worst UX. How come has it not been improved in years? Why doesn't Craigslist get any competition? It should be trivial to implement something that's 10 times better...
> How come has it not been improved in years?
Because it works. It's simply, "good enough.
Re: How Craigslist Makes Money
#34Craigslist has one of the worst UX. How come has it not been improved in years? Why doesn't Craigslist get any competition? It should be trivial to implement something that's 10 times better...
When I hard reload the Craigslist home page for my state, it downloads right around 150 kb. That is a thing of beauty.
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Re: How Craigslist Makes Money
#35Craigslist is ubiquitous in its niche, but i never really engaged with it beyond having a laugh at the occasional Craigslist meme post that worked it's way into the internet at large.
At the same time, for years now I've been banging on to any of my industry friends about how global social networks are an internet anachronism and that local networks are the future.
It's only just dawned on me that my misplaced futurism was simply describing a very successful long term business. A billion dollars later, it turns out Craigslist isn't niche at all - my thinking was.
Re: How Craigslist Makes Money
#36Great service for selling used electronics, renting out an apartment, or sucking a strange man's penis.
I guess that explains your username.
Re: How Craigslist Makes Money
#37Earlier quoted context omitted.
For companies that aren't going to eat the world, only exist on the network effect, and are happy in their space, a P/E of 5 is reasonable. How much would you pay to buy craigslist?
At least 10x their yearly profit? What other investment provides a consistent 10% yearly return on the scale we're talking about? At P/E ratio of 5, you literally just wait 5 years and you've just made as much as your initial investment.
If you get five years before someone disrupts it. That's not a given.
Re: How Craigslist Makes Money
#38If Craigslist makes ~600M in profit , Why the hell is Forbes giving them a valuation of 3B? That's a Price to Earnings ratio of 5. That's not conservative, that's insane. Am I missing something?
If 600M is profit (not revenue), that's 400M short from 1B. That's not a bad valuation, also consider the user base is quite strong. Using both yield 3B is very conservative IMO. If you buy it for 3B, then you will get your investment worth in a couple years.
they said "most of 690M is profit" in the article. I used bayes theorem to go through all of the numbers out of 690M that I would have said "most" for, and arrived at a guess of 600M. Even if it were the lower bound of values for which the word "most" technically applies that's still earnings of 345M. An 11% a year on an investment of 3 billion. That's still insane. CL revenue is not terribly speculative.
Re: How Craigslist Makes Money
#39If Craigslist makes ~600M in profit , Why the hell is Forbes giving them a valuation of 3B? That's a Price to Earnings ratio of 5. That's not conservative, that's insane. Am I missing something?
If 600M is profit (not revenue), that's 400M short from 1B. That's not a bad valuation, also consider the user base is quite strong. Using both yield 3B is very conservative IMO. If you buy it for 3B, then you will get your investment worth in a couple years.
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Re: How Craigslist Makes Money
#40I remember looking up this exact question a few days ago. I really prefer to sell things like used electronics on Craigslist over eBay.
I really like their business model too. They made enough to keep going, but not enough that they aspire to take over everything. It's a really simple concept, and there are very few business ideas that can pull it off.