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1月31日
January 31st, 2007 by haroldbbbg1619
Harold is one of my favorite AGLOCO bloggers
Here is part of his most recent blog on the Simmons Report about AGLOCO - personally, I recommend you read the whole post.
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Total Revenue (per member) – The simple math is: the ‘run rate’ of AGLOCO revenue at the end of 2008 is Search revenue per user (per my analysis in Part #2) $48.00 - plus Advertising revenue per user (per my analysis in Part #3) $13.44 - plus Commission revenue per user (per my analysis in Part #4) $50.00 - plus Transaction revenue per user (per my analysis in Part #5) $65.50.
This equals $176.94 for Total Revenue (per member). (To understand ‘run rate’ – that is the monthly revenue rate at Dec 2008/ Jan. 2009 annualized. Since revenue is growing, the 2008 revenue would be smaller than $176.94 and 2009 would be larger.)
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Net Revenue – The simple math is: total revenue ($176.94) – less – expenses (30% of $176.94 is $53.08) – equals net revenue of $123.86 — which is a monthly net revenue of about $10.00.
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Cash distributions to AGLOCO members - On a monthly basis that would yield about $8 per month per member in cash distributions.
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Value of an AGLOCO referral - yielding $39.00 as the value of each AGLOCO referral.
This $39.00 is somewhat higher than the Simmons Report of $30.00. But, several factors should be pointed out.
• Several times in the different parts of this analysis it was pointed out that the two year time given by the Simmons Report maybe too optimistic for the per member review projected. I would be much happier predicting the $39.00 valuation at the end or 2009 or sometime in 2010.
• Not all members will yield the same about of ownership value. A member recruited now will have 24/36 months of Viewbar surfing time to give the referrer a substantial number of accumulated hours for ownership. A member recruited in 2008 will not have given the referrer many hours and thus at that point in time would have a much lower value.
I just did this as a comment on th eAGLOCO Official post.
Brian,
Thanks for another update. I am just the opposite of Mark. (Don't get me wrong, I want AGLOCO to succeed and make all of lots of money.) But I feel like a founder of AGLOCO - this is a new experience for me.
I tell my friends about AGLOCO. They look it up and we chat about it. I send them to my blog - they sign up. It's fun. AND I know that I am building a huge network inside AGLOCO. I agree with John Chow that now is the time to get as many referrals as you can. http://www.johnchow.com/3000-agloco-sign-ups
Once the Viewbar is released there will be tons of completion for referrals. While on one hand this will make it easier to recruit everybody, it will make it much harder to build a wide network. And if I get as wide a network as possible now, then when the post Viewbar frenzy occurs, all of my referrals will be able to make referrals much easier.
Look at Top Guns like John Chow 3,600 referrals or RZ McCall with over 12,000, (check here for more http://agloco-top-gun.spaces.live.com ), can you imagine how fast these networks will grow once people realize that AGLOCO really works. They will grow 10X in months (see McCall’s latest post to see his thoughts on the shape of his network http://mccallsnotes.spaces.live.com/blog/cns!9F2891B66EBAA762!509.entry
Why would I want a couple of dollars a month for the next two months when the more time I have now the more time I have to build my network, before the fund. That is what being a founder is all about. You build before you get paid – but when you get paid, it is very big.
This is a true founder’s position – AND - I do not have to put up any money to participate.
So please AGLOCO, like AGLOCO Test says http://www.aglocotest.com , let me build out my network first, then start the frenzy.
Julie – bbbk0695 1月30日 Lastest edition --- just fyi
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AGLOCO Top Gun - January 30, 2007
Welcome to AGLOCO Top Gun
AGLOCO Top Gun Top Ten
January 30, 2007
#5 Geoff Schenk (NR) no website found 1,683 Members $ 50,490
#9 Well Begun Marketing (NR) no website found 1,200 Members $ 36,000
#10 Anil Joshi (NR) no website found 1,137 Members $ 34,110
Numbers in ( ) are increases from previous list - (NR) means no report
Next Ten
#12 Hector Garcia (+3) no website found 882 Members $ 26,460
#18 Frank Longo (+1) no website found 560 Members $ 16,900
#20 Paula Bernstein (+2) no website found 475 Members $ 14,250
AGLOCO Top Gun - Sharp Shooters
I had requests for the top Direct Recruiters in AGLOCO
#2 Geoff Shenk (NR) no website found 432 Directs
One time bonus
#11 Asheesh Bothra (+11)no website found 126 Directs
I know that at this point I am missing lots of AGLOCO Top Guns out there. If you think you qualify please send a screen shot of your account summary to aglocotopgun@hotmail.com or if you have it posted on your website - post a link to it in comments - Also note I use the Simmons Report http://simmonsreport.spaces.live.com/ for the US$ calculation.
If you found this information useful and are not yet an AGLOCO Member - Please join - here is my referral link directly to the AGLOCO signup pages www/agloco.com/r/bbbn6049 1月26日
Harold does another great job on the AGLOCO Simmons Report
http://haroldbbbg1619.wordpress.com/
This is the fifth in my series about the Simmons Report: AGLOCO
As I stated in the earlier parts, I decided to do a couple of blogs about the Simmons Report (taking a section at a time). I suggest you read the whole report on the Simmons site ( http://simmonsreport.spaces.live.com ) to get a w feel of the whole report.
For Part #5, I am again going to the Detailed Analysis and look at the Second section of that: Revenue Sources and focus on just the Distribution Revenue.
Revenue is the heart of the AGLOCO economic system. The Report breaks revenue into four sections: Search, Advertising, Commissions and Distribution.
Distribution Revenue – The simple math is: The number of different ‘activities’ (‘groups’ joined, products downloaded, services signed up for etc.) that the average AGLOCO member does in a year - times – the payment to AGLOCO for having some of it’s Members ‘do’ the activity.
Only two things to figure out – seems easy, but it is not.
The area of Distribution in the Simmons Report seems to its ‘catch all’ area. Simmons Report mentions everything from eBay fees to Flash upgrades to credit card/loan signups to large group buying (computers, cars). So we need to break this down. Here is my list:
• Software upgrades
• New software distribution
• Community signups
• Service signups
• Buying group
• Information/data
Software upgrades – The fact is most of us do not upgrade our ‘free’ software. Why? Many reasons – but we don’t. So companies like Adobe, Microsoft, Google etc. have incentive programs to pay some people money to get other people (lots of other people) to download and upgrade ($1 for Flash or Firefox are just two examples). With the viewbar looking in, AGLOCO can ‘advise’ its users when it is really appropriate to upgrade – Who do you trust? – the company that makes and pushes the software or the company who pays you (your economic network company). - Over time AGLOCO users will grow to rely on AGLOCO for all their upgrade decisions. How much is in here a year? Probably not more than $30 to $50 max. Cut that back by 50% for lack of interest by users and another 50% for deal overlaps etc. that gives about $7.50. To be really conservative, drop it back by another 60% for the timing – Simmons is using what the revenue rate will be at the end of 2008. That yields $3.00 a year.
New software distribution – When AGLOCO is in the channel making the transaction occur, it will be able to earn part of the transaction. Whether it is ant-virus software, or online back up software or one of the many forms of software that are in the market and will continue to be in the market, this is a huge potential revenue source (very similar to commissions, but since AGLOCO is doing the full distribution it can get 20%+ of the value. This is a multi billion dollar market, so estimating AGLOCO revenue is very difficult. I used a 25% average commission rate and two deals a year ‘run rate’ by the end 2008. With an average gross cost of $25 each, that yields $12.50 a year.
Community signups – These range for $2 to $22. New communities appear constantly (and even the free ones will ‘pay’ AGLOCO). For example a competitor to Skype is now at $6 to switch (if the new qualified user activates and uses the service for three consecutive months.) In the new mobile software world, there will hundreds of new opportunities for an Economic Network to deliver users for the right % of the future revenue (and it goes to the AGLOCO users so they are happy to ‘join’). I used an average of one new community per AGLOCO user per year at a rate of $5.00. My personal belief is that it will be 10 times that rate.
Service signups – This is where I put credit cards and home loans (and real estate brokers and tax preparers and dentists and health insurance and auto insurance etc.) Another huge market that difficult to assess. New credit cards pay $50 to $100, home loans more than $1,000 etc. The number of activities a year the average AGLOCO user will do (and do it with the AGLOCO negotiated discount rate provider) is a number that will start very small and grow over the first five years in to a large revenue source. At the end of 2008, I would say the average user would be doing one service signup every 24 months (1/2 signup a year.) The value of these I would put at $50 each. That yields revenue of $25 for this analysis.
Buying Group – This again can potentially be everything else – cars to computers were items cited in the Simmons Report. Again, when AGLOCO is in the distribution channel in a meaningful way the AGLOCO % of the transaction rises. AGLOCO should eventually represent $2,000 to $5,000 a year in user off-line transactions. The sales channel % would again be high, 10% to 20%. This will become a $200 to $500 a year per user source of revenue for AGLOCO . But by the end of year two – 2008 – it will be a small fraction of this potential. Just a 10% average fee on $200 of group buying, yields $20 which is what I am going to use.
Future sources – I think the AGLOCO users will think of many new sources of revenue for the network. They will have the incentive and the opportunity to do so. Within ten years, I would think that user generated ideas will be more than 50% of AGLOCO’s gross revenue.
The simple math for Distribution revenue becomes; $3.00 + $12.50 + $5.00 + $25.00 + $20.00 which equals $$65.50. This is only two-thirds the amount in the Simmons Report, but in order to be very conservative I think it is an appropriate calculation. 1月23日 Just a fabulous post by McCall
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Why AGLOCO Will Win - and yes I went over 11,000 referrals today
I went over 11,000 AGLOCO referrals earlier today – the pace seems up a bit – over 125 a day. (Probably just a couple of very active newbies).
Why AGLOCO Will Win?
It’s the Members -- you and me and the thousands of active Members out there already… everywhere.
It is always the people who make the organization – whether it is AGLOCO, YouTube, eBay, Craig’s List or even Yahoo. You and me - We make it popular. We contribute our time and our energy. We make it happen. And We will rally behind people and concepts We think are good. This is why AGLOCO will win. Because, We, the people, are already starting to rally.
You can see it. You can hear it. AND you can even sometimes feel it. The AGLOCO network is growing stronger every day… in every direction.
Sure, the AGLOCO membership grows by thousands every day. But, that is just one dimension. More important is the growth of the community around the membership.
By community, I mean what members are doing, what members are saying and what they are building. Let’s look.
- John Chow (one of my favorite daily blogs to read) is taking the time to write extensively his views on why he is supporting AGLOCO http://www.johnchow.com/category/agloco/ His latest post gives a very detailed account of why AGLOCO can be a big winner on the Internet and on how his readers can position themselves to share in that.
- Some of the many community service blogs:
- There are the more serious AGLOCO sites which discuss the economic, political and social aspects of this brand new community:
- Of course there are thousands of recruiting sites and blog entries on regular spaces like MySpace. Simon, the creator of AGLOCO Rocks, was sited in the recent AGLOCO Update email for having a fun recruiting site. But what I find more interesting than just his site is that people in the community help each other, learn from each other and will build the network together much as they did at eBay. http://allaboutagloco.blogspot.com/2007/01/agloco-update-2.htm is a site built by one of Simon/AGLOCO Rocks recruits and obviously he was inspired by Simon.
- Even the traditional media is picking up the story - Red Herring’s current print issue has an article in it on AGLOCO – nice picture at Stanford. Traditional tech bloggers like VentureBeat http://venturebeat.com/2006/12/20/agloco-signs-up-tens-of-thousands-and-hasnt-even-released-viewbar etc. continue to check the progress. They are sensing what you sensing. The early growth of a new form of entity on the Internet. What they may not have sensed yet, is just how strong and powerful an entity it can be when the full force of its members is brought forward.
AGLOCO’s community right now is a founders’ community, a pre-launch community. It is already showing the foundation needed to build a great Internet community. Maybe… just maybe… it is the first of the great Internet communities. Because, unlike all of the proceeding communities, this one will be owned by its members and therefore run for the benefit of the community, not some ‘well meaning shareholders’.
Have a great day,
RZ
BTW – I really like watching John Chow grow his blog. – He has set a goal of being a top 100 in the world Technorati rated blogger. He wrote that he went under1,000 a few days ago and I noticed he was under 900 now. Nice John – I hope it is helped by lots of AGLOCO links to your blog.
BTW 2 – in response to many questions I get about this blog – yes you may copy and paste it for tasteful and appropriate promotion of AGLOCO – a strong growing network will benefit all members. 1月20日 Really a thoughtful post from a guy with a lot of experieince..
He recommends going out NOW - and so do I - Have any friends??? Recruit them now - they will thank you --- at least the ones who do more recruiting NOW.
Today I passed the 3,000 members mark in my AGLOCO network. As I write this post, I am sitting at 3,010 referrals. Considering I haven’t talked about AGLOCO in nearly a month and my referrals still increase by over 1,000, that’s not too bad.
and
Another thing I realized is many people are waiting for the Viewbar to become available before they start signing people up. I think this is a mistake. Personally, I rather have AGLOCO delay the Viewbar even longer because right now, I have very little competition. Once the Viewbar comes out, I’ll be up against everyone and their dog. I’m laying the foundation to build a huge front line so when the Viewbar is released, I can just sit back and enjoy the show. If you’re serious about building AGLOCO, then NOW is the time to sign up those referrals. There is so much out there i do not know where to begin.
I will get some good posts and blog them here.....
1月16日 Here is his announcement blog - he deserves it - I have learned alot about recruiting for AGLOCO from his posts.
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Hit goal #1 - 10,000 AGLOCO referrals
I made my first major goal of 10,000 referrals in the AGLOCO network. My goal was to reach 10,000 by the end of February – it happened 6 weeks ahead of schedule.
Thank you to all my direct recruits who went out on limb with me and have backed AGLOCO. – I have 73 direct referrals and 9,934 extended referrals. This means my direct referrals have an average of 130 referrals each (direct and extended) . I have been aggressive in emailing and calling my friends to get them to sign up early for AGLOCO and I think many of them have done the same thing. This has been a big key for me. Recruit your friends and get them to do the same .It is that chain reaction which has given me so many referrals.
This is a very a nice moment for me (even my wife toasted with wine at dinner). More than a couple of my friends said AGLOCO was a waste of time (and it still could be), but at least I have helped AGLOCO reach some of its size.
There have been some great developments the last couple of weeks:
The AGLOCO Official blog has become very active www.blog.agloco.com.
The Simmons Report on AGLOCO http://simmonsreport.spaces.live.com is getting aired in many blogs. I see that Harold is doing a detailed study of the Simmons Report http://haroldbbbg1619.wordpress.com .
This Simmons Report has inspired some speculation http://usjulie.spaces.live.com as to what it means financially to individual AGLOCO builders.
It has even sponsored a Top Gun List http://agloco-top-gun.spaces.live.com
I applaud all these efforts to build a vibrant AGLOCO community. This is what will ultimately make AGLOCO successful.
It was a similar core of network builders that made eBay happen, MySpace happen, YouTube happen – and even Google happen to some extent. With AGLOCO, the network builders become the network owners and reap the rewards of their early support and efforts.
I think these are all positive developments in order to set a good foundation for when the viewbar software is released. (Personally, I would like a couple more months to have all my ‘early’ recruiting in order before the viewbar onslaught starts.)
My next stated goal has been 20,000 by the end of 2007 – so back out recruiting in the morning…. Harold has done another fine job on the second revenue section of the Simmons Report http://simmonsreport.spaces.live.com/ .It is a fairly long post so i have cut the "big" sections for her - I recommend first reading the whole Simmons Report - then all of Harold's analysis
Or just read my short blog and believe it......
January 16th, 2007 by haroldbbbg1619 http://haroldbbbg1619.wordpress.com/
Advertisng Revenue – The simple math is: # of ads showed to a member a month - times - click –through rate (CTR) – times – Cost per click (CPC) – times revenue share given to AGLOCO.
To figure out the number of ads per member per month you need to know how many ads per hour and how many hours per month of viewbar screen time. The AGLOCO viewbar has not been released and I could not find any information directly from AGLOCO stating ads per hour. AllAdvantage’s toolbar did 180 ads an hour (20 second rotation). So if AGLOCO does even a 30 second rotation it will be 120 ads an hour. AGLOCO is compensating directly for 5 hours a month, but with affiliate rebate sharing and search ability – my guess is the narrow looking AGLOCO Viewbar will be up most of the time (at least 15 to 20 hours a month). Five hours yields 600 ads and 15 to 20 hours yields 1800 to 2400 ads in a month. – I am going to use 1,500 ads a month for this analysis.
The CTR is another widely varying percentage, from a high in some cases of 3%+ to lows near 0.1% (a 30 times difference in response rates). AGLOCO’s ads will have the benefit of targeting both contextually (like Google ads based on the content of the page, but also AGLOCO ads can be based on previous pages, previous searches and previous ads clicked on). And they can be based on member profiles – where a member lives, age, likes and dislikes etc. This should lead to an above average CTR. On the other hand, it may take some time to build all of these features into the AGLOCO ad system. The Simmons Report is about AGLOC 24 months after the release of the viewbar, plenty of time to build in a lot of improvements. To be conservative, I am going to use an average CTR of 0.5% (one out of every 200 ads is clicked – one ad every hour and forty minutes.)
The CPC rate is also interesting. AGLOCO can once again use individual algorithms to maximize revenue. There are $10.00 CPCs and $0.02 CPCs. A CPC rate of $0.25 is what I used for this write-up.
The revenue share with the ad provider is the last metric. AGLOCO can go direct, but in the first 24 months that seems unlikely. Negotiating between, Yahoo, MSN, ASK and Google will be what is required. I believe AGLOCO can achieve at least a 60% revenue share.
The simple math becomes; 1,500 ads times 0.5% CTR times $0.25 CPC times 60% share. This equals $1.12 monthly or $13.44 a year. This is in the lower part of the $10 to $25 range that the Simmons Report uses. But still well within the range. http://haroldbbbg1619.wordpress.com/ 1月11日
I recently posted a comment on the Simmons Reort blog. Below I have reproduced my comment as my blog. I think what I just read uncovers a whole new way to think of the work we all have been doing to help AGLOCO succeed.
I set a personal goal of getting to 3,000 referrals by the end of 2007 -- I did it just becauseI do see AGLOCO as the user revolution. And I do think it is the fair way to develope the internet in the future. Now I see if I reach my goal I stand to make $90,000 extra money. This is a very wonderful surprise.
Below is my comment
I find this Simmons Report fascinating. The time and details about AGLOCO’s early revenue sources and their per user potential is very helpful to understanding the whole idea of how an economic network will work.
The addition of the personal value of a referral is more than fascinating- it really hits home what the potential financial gain we might all share if we work hard and AGLOCO succeeds.
BUT – Peter Wilson’s comments below are the most piercing evidence of just where this is all heading.
The creators of AGLOCO have build a system all users share in the value crated AND where those users who help build the system.net will gain a much bigger share. (AGLOCO’s website vision statement says this almost word for word).
The Simmons Report points out that the average user will have about $150 in AGLOCO value (after about two years) – and will be getting monthly checks between $5 and $15 a month too.
But not until Peter Wilson did the math did I really have any idea who powerful and rewarding the system could be for an AGLOCO network builder - like you and me or like…
RZ McCall already with 9,000 referrals would be getting $270,000.
$270,000 is a whole lot of money (earned by McCall in less than 6 weeks.
His stated goal by the end of 2007 is 20,000 referrals – which means he would get $600,000.
John Chow is at 3,000 people - $90,000
David Lawrence – the talk radio guy is already at 12,000 referrals or $360,000.
It seems almost too good to be true – but YouTube paid off at $1,6 billion and I am sure even John Chow is one of the top 20AGLOCO recruiters. (And if each one of them got $2 million it still would only be $40 million out of $1,6 billion – yes very doable.
Here is Peter's posted comments and a link to the Simmons Report which is a must read.
Peter Wilson said....
I work in the Internet advertising business. I followed AllAdvantage up... and back down. It seems to me that AGLOCO solved the biggest problem... which was paying users more money than they were worth.
Seems like AGLOCO is replacing short term cash to users with the riskier, but potentially much higher equity to users.
Simmons' numbers seem quite reasonable - even if I personally thing he should be talking three years not two.
I think it was a stroke of near genius to launch the member drive before the service - this way they have something to sell to the Yahoo's and Google's of the world the minute the service really starts.
The big winners -- I think they are the guys recruiting right now. They could be the real Founders of AGLOCO when it comes to cashing in.
The Simmons Report suggests that each referral of an AGLOCO member is worth $30. Using $30 you get some fast earnings by the early guys.
McCall - http://mccallsnotes.spaces.live.com/ - has over 9,000 - That is $270,000 in less than two months and he personally only got 70 people, the network he started got the rest.
John Chow is near 3,000 - $90,000 and he said he made $25,000 from AllAdvantage in 1999. http://www.johnchow.com/category/agloco/
And the biggest winner may be radio talk show host David Lawrence http://www.makemoneywithdavid.com who eports being over 12,000 - $360,000. David states that he made $100,000 with AllAdvantage.
These are the types of people who could grow networks to 20,000, - 50,000 and make $2- $3 million from AGLOCO. That is getting closer to Founder type money.
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Here is the link to the Simmons Report http://simmonsreport.spaces.live.com/blog/cns!645014F0B3DD8C0F!106.entry#comment
1月10日
This guy has been analyzing the Simmons Report I wrote about a couple of days ago - this is a good place to read up on it if you have any questions about the Simmons report.
http://haroldbbbg1619.wordpress.com/2007/01/10/analysis-of-simmons-report-agloco-part-2/
January 10th, 2007 by haroldbbbg1619
This is the second in my series about the Simmons Report: AGLOCO
I decided to do a couple of blogs about the Simmons Report in my blog (taking a section at a time). I suggest you read the whole report on the Simmons site (http://simmonsreport.spaces.live.com/) to get the whole feel of the report. AGLOCO
For Part #2, I am going to the Detailed Analysis and look at the Second section of that: Revenue Sources and focus on just the Search Revenue
Revenue is the heart of the AGLOCO economic system. The Report breaks revenue into four sections: Search, Advertising, Commissions and Distribution.
Search Revenue – The simple math is:
X searches a month times X $ per search (which is a derivative of click through rate and per click value and revenue split with search vender – Google, Yahoo, MSN ASK etc.) times 12(months in a year to get annual rate.)
Simmons Report says this will grow to $30 to $50 per year per user by the end of the second year.
My research has shown that the average Internet user is searching at 37 times a month (and growing). Plus, AGLOCO users, by their nature, will be more active than average, so I am using 40 searches a month for my analysis.
Google reports that the average CPC (cost per click) for an ad is just under $0.60. And that about 23% of the time an ad is clicked on. The result is $0.138 ($0.60 times 23%) per search (this number is much lower for Yahoo).
It has been “reported” in a couple of places that Google makes a substantial payment to AOL per search - $0.10 is the number in the Simmons Report. Google also reports that it spends 80% of its gross revenue to acquire traffic (TAC – traffic acquisition costs). 80% of $0.138 is $0.109 – more than $0.10 reported on AOL. TAC includes some costs other than publisher payments and it is also reported that on average Google shares less than 50% - size of network matters).
So eventually AGLOCO should be able to get to $0.10 when its network has enough users in it.
The math: 40 times $0.10 times 12 is $48. That is $48 in search revenue per AGLOCO user per year.
So having a range of $30 to $50 a year is a reasonable range to use for the Simmons Report.
I will do ad revenue in my next blog. For those of you who need high goals. Here is MCCall. He hit 9,000 in less than two months. Wow, is all I can add.
I will keep putting his blogs here when they contain good advice as this one does.
Julie
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Just went over 9,000 AGLOCO Referrals
Things have picked up a bit in my referrals in 2007 from the holiday period at the end of 2006.
I am excited to get over 9,000 (my stated goals were 10,000 by the end of February and 20,000 by the end of 2007.
A couple of quick points -- I put a picture of my account summary on this blog (should have done this earlier).
First, as you can see I have been active with friends in adding some direct referrals in 2007 - five this year. I really recommend this to all – including you people with great blogs – to personally recruit people who you think will do great AGLOCO recruiting. These are the people that really produce results.
Second, as I have pointed out before. My 70 direct referrals have produced almost 9,000 extended referrals. That is more than 100 extended referrals per each direct. I know if you get referrals from a website or advertising you can not influence their referral ability (I read that AGLOCO will be adding an opt-in communication system to help a bit with that). But, by adding some people you do know to your direct referral list, you can help them to make more referrals – answer questions etc.
Really important – to get referrals you have to ‘stick your neck out’ and you have to ask people to join – and be prepared for more than half of them to tell you NO (and that you are crazy or stupid to work on this.) – Get over it. Most new ideas are rejected by most people. You are not asking anyone to part with any of their ‘hard earned’ money, so don’t be afraid to stick your neck out.
Here is picture of my account summary: - Click on link to see it
http://mccallsnotes.spaces.live.com/blog/cns!9F2891B66EBAA762!361.entry 1月8日 Here is what I am now sending out.
Hey Cindy,
This note is mainly to offer you a chance to help build AGLOCO – it is a Member-owned Internet community.
Here is why I would like you to help. First – it is free. Second - it is quick and easy to join. Third – AGLOCO’s purpose is to get its members their share of the money generated on the Internet (i.e. you make money). And lastly – if you help build the AGLOCO network you can make much more.
Here is a link to sign up (it automatically records me as referring you with my ID BBBK0695) www.agloco.com/r/bbbk0695
AGLOCO works with a toolbar type software called a Viewbar. Privacy is very strict so no spyware, popups or spam.
As to how much money you can make, there is a study which says the average user should get $5 to $15 a month. (But less at the beginning.) Click here to read the report. http://simmonsreport.spaces.live.com
How much can you make helping to build the network? The Simmons Report predicts $30 per referral. I have 200, but a friend of mine RZ McCall has over 8,000. He has a great blog site http://mccallsnotes.spaces.live.com .
AGLOCO is in their beta phase which is the best time to help them build out the network. So please join now and help build the network. Have questions? Their website has all the details so go there www.agloco.com/r/bbbk0695 or ask me.
Go Girl,
Julie January 1月5日 Below is a great study on how much an AGLOCO recrutier stands to make if AGLOCO is successful.
Basically, it is $30 per referral in ownership plus cash dividends in two years of $1 per month per referral. I am almost up to 500 total so that would mean $15,000 of equity and $500 a month. Even if Simmons is 5 times too high it would still mean I would get $3,000 - and all I have done is refer a few freinds and asked them to do the same.
Very cool - I encourage you to read the report. Then go out and recruit more for AGLOCO.
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AGLOCO
December 6, 2006 SimmonsReport@hotmail.com
Simmons Report: AGLOCO
Analysis:
This analysis is centered around the amount of personal value an AGLOCO user could get, with a special focus on a user who is actively referring new users to AGLOCO. Material used included the AGLOCO website (membership agreement, privacy policy, FAQs and general information pages). management interviews, critical blog postings concerning AGLOCO, internet advertising and commerce data, valuations of other Internet communities and the business model economics of Google, Yahoo, MySpace, You Tube, etc.
Conclusions:
The valuation conclusions are based on AGLOCO reaching two million users in a two year time span:
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A user who has no referrals should receive ownership in AGLOCO worth on average about $150. (plus monthly cash distributions)
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The average value of an AGLOCO user’s referral network should be $30 each in ownership shares plus the referrer’s share of monthly cash distribution.
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The average AGLOCO direct referral should be worth in excess of $3,000 each (see example below for details)
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The analysis also shows a range of monthly cash distributions of between $5 and $15 a month per user.
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The AGLOCO business model looks theoretically sound – (assuming they get to a decent size quickly - at least 500,000 users within nine months to a year)
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The cost of recruiting new users to AGLOCO can vary. For many users it is simply sending an email to friends or contacts – or talking to them directly. For others it is blog postings or website notices and for some users paid ads on search engines. The privacy and anti-spam policies of AGLOCO and the track record on these issues of Ray Everett-Church (AGLOCO’s Chief Privacy Officer) makes the risk of getting spam, pop ups and other trash as a user a non issue.
In general, given the low level of work needed to recruit new users to AGLOCO and the zero cost in terms of money, the cost/benefit ratio of recruiting new users to AGLOCO seems to be highly favorable. Because there is no limit as to the number of referrals a user can recruit, the upper end on this opportunity could be high (which means it can be worth putting in the effort to promote actively). This analysis was done two weeks after AGLOCO launched and there have been user postings noting referral networks of 4,000 and 5,000 already. At $30 value each this would be $120,000 to $150,000 so far, which means AGLOCO could make some serious recruiting users a high return on their efforts.
Referral Example:
- A user recruits ten people (10 direct referrals) –
- If on average, each direct referral recruits 3 new users (some will recruit many and some none, but the average is 3 for each level of your network) -- Value of 10 referrals $300
- The user would have 30 indirect users one person removed. – Value of 30 referrals $900
- The user would have 90 indirect users two people removed -- Value of 90 referrals $2,700
- The user would have 270 indirect users three people removed -- Value of 270 referrals $8,100
- The user would have 810 indirect users four people removed -- Value of 810 referrals $24,300
- Total referrals the user would have in the network would be 1,210.
- At an average value of $30 for each referral the total value would be $36,300
It should be noted that the AGLOCO referral system achieves two tasks:
- AGLOCO saves all the costs of marketing its services to potential new users. This is sometimes a major cost many Internet companies face. Other network companies like MySpace, Skype and YouTube also achieve this goal of users telling users, but in those cases users do not benefit in the value created by the growth of the user base.
- Users who help build the AGLOCO network are financially rewarded for doing so. Because most the value of network oriented companies is based on the size of the network, it isAGLOCO’s stated goal that the people building the network share in the value they help create.
Detailed Analysis:
Business model:
Three major aspects of the business were analyzed; the people who drive it, the revenues and the expenses.
- People
- Management ability - – for a start up AGLOCO seems to be pretty good as it has combined experience with raw talent:
- The raw talent – is in the form of current Stanford MBAs. AGLOCO is a revenue driven business model – passion and aggressiveness are good attributes to have for part of the team. The average age of a Stanford MBA graduate is 28 years old – these are not just passionate and aggressive, they come with a few years of experience behind them as well.
- The experience – AGLOCO has some – it may need more. Jorgensen was CEO of AllAdvantage, Ray Everett-Church was the Chief Privacy Officer there and Sam Flax was the Chief Architect for technology at AllAdvantage. AllAdvantage grew to over 10 million users and over $30 million in first year revenues. A good fit for on point experience.
- Management reliability - The reality of the internet is such that every new entity should be investigated from this perspective. Below, is why AGLOCO should not raise any Internet scam worries:
- There are over 50 people listed on the about page of AGLOCO.
- The ‘development team’ has eight Stanford MBA students – not the type of people who would risk their pedigrees and reputations.
- The ‘development’ team includes two veterans Ray Everett-Church and Jim Jorgensen – both of who are well known enough to have Wikipedia bios.
- The ‘contributors’ include a couple of easy to spot people like; Gil Penchina, CEO of Wikia, Zaw Thet, CEO of 4info and Valerie Williamson a VP the Open Source group OSTG plus a sprinkling of major firm law partners and venture capitalists – not scam types.
- Press interviews – some of the founders have been interviewed by major bloggers (VentureBeat, John Chow, GigaOM, and Red Herring). AGLOCO’s management is out front and visible.
- Revenue sources– this is the core of the business model. Some revenue sources are very dependant on the size of the user base. Here are the major ones:
- Search revenue – AGLOCO can become a significant source of search volume. Google gets 40% of its ad traffic from third parties (the biggest one being AOL whom Google pays an average of $0.10 per search). The average Internet user searches over 35 times a month. AGLOCO should be able to capture virtually all search revenue and its users are more likely to be active Internet types (given that the active users are the early adopters who will be the first to find AGLOCO’s proposition appealing ) – When AGLOCO is of sufficient market size, its search revenue should grow to between $30 and $50+ per user per year
- Advertising – the AGLOCO toolbar software is stated to contain a thirty second targeted text ad:
- The targeting is further defined as being related to the current site a user is on or based on past user behavior or demographic information. AGLOCO also has very granular location information with city and postal code for users. AGLOCO should be able to take advantage of Google, MSN or Yahoo’s ad engines immediately (AdSense, adCenter and ‘Panama’) and during the next two years add a local ad overlay.
- AGLOCO’s available monthly ad inventory should be somewhere between 600 and 1,800 ads a month per user (1 ad per 30 seconds, 120 ads per hour and 600 ads per month given 5 hours or 1800 ads given the more likely scenario of 15 hours surfing per month). With 100% of these ads being available for ‘keyword’ targeting as it now exists. This is substantially more inventory than leaders Yahoo or AOL have and this will definitely increase the attractiveness of the AGLOCO user community for advertisers.
It is difficult to estimate what ad revenue per user will be two years from now. It should start low and grow substantially over time. A quick starting place for analysis might be a $10 to $25 run rate in this period and much higher later. Targeted keyword CPC rates vary dramatically with Google and Yahoo both averaging over $0.50 per click in search (non-search ads are substantially lower, but do not have AGLOCO multiple targeting.)
- Commissions - Sales commissions (and affiliate fees) should be a substantial source of revenue for AGLOCO. Almost every online merchant pays them. Link Share and Commission Junction each have thousands of companies in affiliate programs. Sales commission varies from quite low 2% on some airline tickets to nearly 50% on some financial transactions, and is generally in the 10% to 15% range.. Spending per active Internet adult users (one on line in excess of five hours a month) is estimated at more than $2,000 a year – twice as much as the $1,000 overall online spending average.) . For valuation at the end of year two, an estimate between $50 to $150 per user in commissions was used
- Distribution – The distribution of products and services may become the largest source of AGLOCO revenue. This revenue source is different than the sales commissions since AGLOCO states it would be a direct distribution source (or a direct signup source). There are four basic areas of distribution:
- AGLOCO can distribute to its members products and services ranging from new credit cards to home loans and to computers or software. Credit card and loan revenue can vary from $50 to $500. Online software distribution should be a normal AGLOCO activity (for example backup software should earn at least AGLOCO $1 a month.)
- Upgrades on paid-for or free software – This includes payments from companies like Adobe which will pay for each time a user upgrades free program like Flash or upgrades of paid for software like Norton anti-virus.
- Referral fees of online communities – This includes payments for new active users. Examples include: eBay ($22), Skype (a % of anything spent), eFax ($10 -$50) –there are at least one hundred of these
- Offline large buying group – AGLOCO can act as a large buying group. (Example; referral fees on car sales are anywhere from $200 to over $1000. Using a $400 average and a one-in-ten to one-in-twenty annual user participation rate (5% to 10%), then cars alone will be a $20 to $40 per year source of revenue for the entire user base. Similar but smaller sources exist in other products.
- An annualized distribution revenue amount of $100 a year per user by the end of AGLOCO’s second year should be a reasonable estimate.
Total Revenue – With the above detailed analysis, the total revenue would be estimated to be between $200 and $300 per user – (annual revenue run rate at the end of year two). Below is a chart showing potential revenue growth per user by category over a two year period.
Expenses – operating costs seem to be dominated by:
- Servers and bandwidth – since most of the communications with users are coming from search company servers and ad network servers it would seem should be a relatively small amount.
- Sales and business development – passionate MBAs etc –while expensive people, this should still be a low cost as a percentage of total revenue
- Customer services – lots of users, lots of questions – AGLOCO has started by using teams in India, China and the Philippines. Most communication is email so language should not be a significant problem
- Technology - should be much simpler than a Yahoo or Google as AGLOCO is not building much (a toolbar is a known and simple technology platform.)
- General and administrative costs need to include processing user payments (PayPal and others make this cheaper) and the management company fee of 10%
A reasonable estimate two years out (assuming 2 to 3 million AGLOCO users) would be a 20% to 30% cost structure - as a % of gross revenue
Valuation:
To make this a bit stable and understandable, the time for valuation chosen was the end of year two for AGLOCO (approximately December 2008) and with AGLOCO having two million or more active users at that time. Also the projected revenue was reduce from the $200 to $300 per user range to $100 (again to be conservative.)
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Given market comparisons,; a growing community of two million users with revenue above $100 per user and heading toward $200, $300 or $400 per user and a profit margin of 70% prior to cash distributions to users should have a sizeable value, anywhere from $200 to $1,000 per user (depends on the rate of growth of users, rate of growth of per user revenues. With very little per user revenue Facebook valuation was near the $200 amount this summer. MySpace had very little revenue and was losing money when sold and YouTube was similar.
- With a 15% to 20% net profit margin (after cash distributions to users), annual profits of $15 to $40 per user would justify a value of at least $300 per user.
AGLOCO is in the advertising and sale/distribution business – somewhat similar gross profits of Yahoo and Google. Yahoo and Google both have valuations exceeding 35 times earnings. A 35 times profit per user would value AGLOCO at $350 to$1,400 per user. Yahoo has a value of 6 times revenue and Google has a value of 16 times revenue. Even at the lower estimate of $100 of annualized revenue per user at the end of the second year, the corresponding value of AGLOCO would be $600 per user.
- With a $300 per user valuation and 2 million users, AGLOCO would have a total valuation of $600 million. A good range to be in for a fairly new public company.
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Per the AGLOCO website statements, about half of the AGLOCO ownership is given directly to active users and about half is given to the referrers who build up the network. With a $300 per user valuation the average each regular user would have been given $150 worth of ownership in AGLOCO (of course people who started earlier would have more than average and people who started later less.)).
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That also means that the referrers would (on average) receive $150 of shares for each AGLOCO user – again with the early referrals providing more. There are five levels of referrals in the AGLOCO user referral system, so the $150 is split equally between five levels of referrers, $30 each.
- This result is simple stated as: For each referral in an AGLOCO user’s total referral network, a person should receive $30 in AGLOCO ownership value (plus a share in the AGLOCO monthly cash distributions to all users.)
- Since a user can really best affect their own personal referrals, figuring out the ‘potential’ value of each of those is important to understand.
- Obviously if a user refers a new user and that second person does no recruiting then the total value of that new direct referral is only $30.
- Conversely, if a user refers a very active AGLOCO recruiter who adds 1,000 new users then that new direct referral was worth $30,000.
- To make some kind of estimate of value it is necessary to ‘guess’ an average referral rate. Looking at blogs about AGLOCO from users a conservative view would seem to be to choose an average of three new referrals every new user.
- Using three referrals at each level results in each direct referral resulting in 120 new users. Using the $30 valuation for each referral the total value for the 120 is $3,600; plus $30 for the direct user for a total value of $3,630.
- While not a focus of this analysis, a quick calculation of the monthly distributions might be estimated. (This part was added at the request of some early reviewers of this report:
- Using the $200 per user gross revenue and the 60% payout percentage then the annual run rate would be $120 (about $10 per month. This would be in addition to the ownership received). A $100 revenue rate would yield about $5 a month and $300 would yield about $15.
- This valuation analysis has a couple of caveats in it.
- Obviously, eventually all the users who want to join an entity like AGLOCO will be exhausted so referring will not be very significant and new direct referrals will not result in 100 total new user. At that point, direct referrals would not be so valuable (but with more than 100,000,000 adult US Internet users alone, getting to two million in the US should not hit any limits in the next two years).
- Different countries users probably have different revenue potentials and thus different valuations (The AGLOCO site states that AGLOCO has the ability to change distribution rates by individual country if needed.)
- Additional sources include
1月3日
AGLOCO = Infomediary
Hope you all had a great holiday I had a nice two week holiday trip - relatives near Nice. I did two Google searches today - first was AGLOCO - 820,000 pages - that is a lot of pages. Next I did AGLOCO and infomediary - 290 pages - pretty weak as a percentage of 820,000 - obviously people are more interested in recruiting new members than they are in what makes the whole thing work. (By the way - this blog was the #1 result in that search which shows how few sites really have much to say on the subject - there were 7 ads however.) I then did two more searches - infomediary and Google - 18,000 pages (this blog was #4 on that results page - which shows again a weak Google infomediary connection. Next - infomediary and Microsoft - 23,000 pages - several talking about the MS Passport as Microsoft's infomediary play. (This blog was not there on that search.) The conclusion - AGLOCO is a very attractive member machine - but most people are joining without the knowledge of just how powerful AGLOCO can become. So they are in for a good surprise. To all the people who have been supportive of me this year thanks - It has been very nice -- and to my new AGLOCO friends thanks too.
Julie This is McCll's plan to be a winning recruiter - read it then do it....
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Passed over 7,000 AGLOCO referrals
Did my 7,000th on Christmas Day - nice gift.
Based on requests of friends – here is my AGLOCO recruiting advice
Before I start, I want to explain a couple of things I believe that help me organize my effort in recruiting (some of which I have covered in previous blogs):
· I believe that 80% of the people who join AGLOCO will not recruit new members and the AGLOCO program (and thus my recruiting) needs to address why these people will be very happy they are members of AGLOCO
· And of the 20% that do recruit, most will be casual recruiters (send out some emails to friends and maybe mention it a couple of times to people they see.) and a few will take the extra time to get really involved in AGLOCO recruiting. Some of my advice is to both of these groups and some just to the really dedicated.
Point #1 – Know why "Every Internet user should join ALGOCO" - (here are the reasons I use)
- All Internet users help create value on the Internet and should get their fair share of it – and AGLOCO has a great plan to get it for its members.
- If Google can afford to pay AOL 10 cents a search
- and if YouTube (with users doing 90% of the 'work') – can be sold of $1.6 billion,
- then there is plenty of 'excess' value to share with the users.
What share will an AGLOCO member with no referrals get? –
- They will get their share of AGLOCO's profits . In my personal view this will eventually be $100 to $200 a year – but at the beginning much less.
- In addition to the cash payments members will get their share of the ownership of the company – This could be much more than the annual cash check due to the multiplier effect of earnings.
All Members get security and utility – There is a short list of items on the AGLOCO site, I think AGLOCO members will drive the utility of the Viewbar to become very useful for all members.
It is the right thing to do – AGLOCO is nothing short of an Internet Economic Revolution – and YOU should be supporting it. That is pretty much how I say that.. (- like Wikipedia is Internet revolution in freedom of Internet information)
Membership is always free and all data is totally private (no spyware). AGLOCO never gives out any member data to anyone at any time (Read Privacy Policy) And they have one of the top anti-spam and privacy people in the world as their Chief Privacy Officer, Ray Everett-Church, (he wrote the "Internet Privacy for Dummies" book and the "Anti-spam for Dummies" book.
Point #2 – Know why "All AGLOCO members should recruit new members."
AGLOCO can better serve its individual members the bigger the total membership gets. – This is because AGLOCO can get:
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- Better deals with business partners the larger the network is (size matters when making marketing deals).
- Better Viewbar software (the more users the more other companies will want to connect their software with the AGLOCO Viewbar).
Recruiting members can increase their 'share' of AGLOCO by recruiting new members.
- AGLOCO does reward network builders who recruit new members (recruit five new members and 'double" your share – recruit 25 and increase your share 5 times)
Point #3 – Know how to "Motivate new members to recruit for AGLOCO."
- Give them a plan
- Most people use email – so 'ask them when they are going to send them.'
- Most potential builders are worth a personal call or visit – ask your new recruits to list the people they now who would be good AGLOCO builders
Give them the tools
- Sample emails
- Answers to questions they get asked (I told them to email them with any questions they get.
Point #4 – Just keep at it.
- Keep recruiting new members every chance we can.
- Keep in touch with your recruits to help the keep recruiting as well.
Good luck……….. RZ Here is McCall on what Google might have to pay AGLOCO
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More on Bill Gates and AGLOCO
This is up to his usual standards - While I agree that AGLOCO will get the billions when they have the large member base I am not sure that Google will actully make less money - they may develope ways to make even more money by partnering with AGLOCO in many other ways besides search. Just a thought.
I can see why Bill Gates likes AGLOCO's business model - it is at least very threatening to Google.
Here is harold's post
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I have been doing research on how a successful AGLOCO might affect the Internet.
I think it will be in various different ways… major ways. But one simple way of looking at AGLOCO’s impact is how it will move money around on the Internet search alone. I think Google could be one company that is greatly affected by the invention of the Internet Economic Network (which is what AGLOCO is).
To make this simple – Let’s say that AGLOCO is highly successful and gets 150 million members (and that other economic networks also start and together they get another 150 million members (and that further that these 300 million members represent 50% of the active volume on the Internet.)
How will this affect Google profits?
Google’s financial statements release significant data on how Google makes a profit.
First — Google gets 60% of its revenue from selling ads on its own sites and 40% from sites of others (like AOL).
Second — In regard to the AOL etc. 40% part, Google states that it has an 80% cost of revenue on that part of its business (this means that $100 of the revenue that is generated by this part of the business costs Google $80 to get – like the fact that on average Google pays AOL 10 cents a search. – that is about 90% of Google’s average gross revenue (obviously Google pays other suppliers less than 80% or otherwise the average cost would be higher 80%).
Third — The Google direct site revenue (the 60% part), is highly profitable – with an 90% gross profit margin.
Simple math – if Google does $10 billion in total revenue, then $6 billion is direct and $4 billion is indirect (from other sites). The $6 billion has a $5.4 billion gross profit (90%) and the $4 billion has a $0.8 billion gross profit (20%). Total $6.2 billion in gross profit. Google has about 25% in operating costs ($2.5 billion) leaving $3.7 billion in net profits.
IF AGLOCO (and other economic networks) have half of the total Internet users then Google will have only half as many direct customers. – New split would be 50% AGLOCO etc. 30% direct and 20% AOL etc.
Simple math #2 - if Google does $10 billion in total revenue then $5 billion is AGLOCO etc, $3 billion is direct and $2 billion is indirect (from other sites). The AGLOCO $5 billion has a $1 billion gross profit for Google (20%). the direct $3 billion has a $2.7 billion gross profit (90%) and the AOL etc $2 billion has a $0.4 billion gross profit (20%). Total $4.1 billion in gross profit. (Google still would have about 25% in operating costs ($2.5 billion) leaving $1.6 billion in net profits.)
A net profit of $1.6 billion is less than half of $3.7 billion. So Google’s net profit would be less than half of what it is now if AGLOCO succeeds and becomes huge. And where did that $2.1 billion go that Google lost – to AGLOCO and other economic networks.
And this would be AGLOCO‘s income from just search (and not including money from Yahoo, MSN etc.) – A very nice start…..
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