Thursday, April 26, 2007

If you can't build it, BUY it.

Stockpickr, a social network geared around the portfolios of various investment professionals, was bought yesterday by for undisclosed terms. We've been talking about Stockpickr for a while now and whether or not the collective intelligence of the group could predict the fortunes of the market. We've noticed that Marketwatch launched something similar with so-so results. However, the difference is the aggregated knowledge that Stockpickr has, boasting the portfolios of Warren Buffet and George Soros.

I think that Stockpickr was a great acquisition by which can utilize the social networking aspect to bolster its editorial content. The Wisdom of Crowds approach holds again, as savvy investors dart to see which stocks were picked by which investment gurus. The real reason however that I wrote about this acquisition was because of all of the press surrounding social networks. MySpace and Yahoo both have equal page views, however MySpace has a CPM that is a third of Yahoo. I wrote about metrics that MySpace commissioned to determine what the value of a friend add is. Facebook, the cover story of this month's Fast Company, was reportedly offered a billion dollars. YouTube of course $1.65 billion. A lot of money is being thrown at these social networks, but at the end, this money needs to be recouped. Of course, you can never charge someone to have an account, but if you can't do that, then how can you monetize this? Do you charge for premium content like Perhaps, after all this is how equity research makes their living (sort of). While it was a great buy (terms pending, of course) it remains to be seen if Stockpickr really is a stock picker!

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