While social networking in all its forms has bred a lot of new websites, and media hype to go with it, the beginnings of a shakeout seem to be in order.
On Wednesday, Seattle-based Jobster announced it was laying off 60 people — 40% of its staff. Jobster is a job board/career networking site (think Friendster for jobs) that has yet to make a penny in profit despite pulling in $48 million in venture capital money. With LinkedIn fast becoming the career networking site of choice, Jobster, the beneficiary of a lot of fawning press (imagine that in the web world!) seems to be losing steam.
So I think you’ll start seeing more Web 2.0 startups flame out the way so many early web ventures did in 2000 and 2001. It’s what happens to shooting stars, I guess.
Meanwhile, our friends at Talent Zoo are stepping up plans to expand–proving that you can grow a web-based business without $48 million in VC money.
I’m curious about how you’re concluding that Jobster is a dot bomb. Please explain how a revenue generating company that has made an adjustment to reposition itself for an evolving market is a “bomb.” Large amounts of venture capital investment don’t correlate to immediate profits – quite the contrary.
A company raises large amounts of capital when it deems it necessary to build out a product that has the potential of large revenue generation that can only be achieved after years of expensive product development, sales, marketing, etc. Jobster has only been around for a relatively short time, and can’t be expected to defeat the big guys immediately. It takes time and sometimes readjustments to do it right.
Hi Brian,
If you read the post carefully, you’ll notice that I did not say that I concluded that Jobster is a dot bomb. You’ve made that inference yourself.