Michael Arrington of TechCrunch (one of the best blogs for info on emerging startups today) points to an intriguing new advertising based site called Moola.com. The site creates a new business model by asking users to view ads prior to playing a faceoff style "AdverTournament" with other users. Each time you win a round, you double your money, with the maximum prize of $10m coming after winning 30 rounds. Or, you can cash out at any time and take the money. At the moment, the site is still in limited beta … but it does do what smart web based businesses have been doing since the early 90s – reinventing the way to make money online. Whether it was Priceline turning the travel industry on its side and allowing customers to set their own price, or eBay introducing a new way to sell products to perfect strangers in a global marketplace, one of the steadiest forms of innovation that works has been creating a new business model to support an innovative idea.
In Moola’s case, the team behind the site is betting that the promise of winning real cash will be enough to have people willingly watch ads online – and draw advertisers. Paying people (directly or indirectly) to watch ads is not a new idea, but coupled with the irresistable lure of the $10M grand prize, and the ability to cash out and make multiple sums of money, this is an idea to watch. What I like most about Moola, though, is the open and transparent way that Jason White (CEO) is engaging in dialogue about the company. Read his latest post in response to the question from a commenter to the Moola blog about how easy it would be for Moola to fix the game so people always lose before they make any big bucks. This is product evangelism at its best, laying out a clear logical argument to help build trust in a new model that is almost too good to believe. Every example I can think of where a new business model is created comes with a trust gap. Today smart companies like Moola and others are using blogs to engage customers in dialogue and sell their ideas. Get-rich-quick scheme or not, for those who manage to hear about the idea and read the dialogue, it’s hard not to want your own chance to join the AdverTournament.