For database publishers, a key challenge has always been how to scale the business while maintaining quality. Typical business publishers can effectively track ten or twenty thousand companies. Outsourcing has enabled some publishers to perhaps double that, tracking fifty thousand companies, but research and data entry remains a critical obstacle to scaling data collection beyond those numbers.
A few startups have taken various approaches to shifting the editorial function to their users (a la Wikipedia). Today, I add one such company, Jigsaw, to the 50 Content Companies that Matter.
Jigsaw, founded by Jim Fowler, is basically a marketplace for business cards. Jigsaw’s gambit is that they will “pay you” 2-for-1 for any new contacts you can add to the database. You simply key in or upload names from your rolodex and you can access the Jigsaw database free of charge. For every 25 names you add each month, you can access 50 of theirs. Or, for those who don’t want to bother with the uploading, you can simply subscribe to Jigsaw, paying $25 per month for 25 contacts.
As with any network-based application, achieving critical mass is a key point for viability. Jigsaw is approaching that today, with 1.7 million contacts, growing another 10,00 per day. Jigsaw has more than 32,000 members, a mix of “pay” and “play” (swap) customers.
Jigsaw has also applied some additional features, taking their cue from eBay and others. To ensure quality, users may “challenge” any data they believe to be inaccurate; correctly challenging bad data rewards the user 5 points, good for one additional contact, the same as they would get for adding a new contact. They have also added the ability for users to sell their points to other users via a Jigsaw marketplace.
A question that often comes up regarding Jigsaw is “who would share their best contacts with strangers”? The answer, of course, is that no sales or business development professional would share their “best” contacts. But, they’d be happy to share those which are no longer live prospects or customers for them. In many ways, that’s the secret to Jigsaw – “one person’s trash is another person’s treasure”. In glancing at my own contact database, I have about 1,000 people in it. Of those, probably three-quarters are contacts who I am not actively working with at present. However, most of the data is still accurate and they can be great prospects to many others.
Jigsaw has taken a unique approach to building and maintaining a massive database. Their reliance upon users to add and edit the data enables them to scale their database without requiring an editorial staff. Assuming that 25% of their 32,000 active users are paying the $25 monthly fee, Jigsaw is probably at a run rate of about $2.5M per year. However, it’s likely that they can begin to sell corporate licenses to their data, providing eight-figure revenue potential.
Jigsaw is in a strong market niche (sales prospecting data) with a unique and interesting editorial model and looks to have achieved the critical mass to make their database viable. Based upon that, they are clearly one of the 50 Content Companies that Matter.
