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Saif Ajani, left, with the company’s other co-founders, Mike Rhemtulla and Minaz Abdulla, at their Toronto headquarters. (Fernando Morales/The Globe and Mail)
Saif Ajani, left, with the company’s other co-founders, Mike Rhemtulla and Minaz Abdulla, at their Toronto headquarters. (Fernando Morales/The Globe and Mail)

Social media

Entrepreneurs wring cash from Twitter Add to ...

When Twitter - vanguard of the online world's growing fascination with micro-blogging - recently undertook another round of venture capital funding, the startup made plenty of headlines for earning a total valuation of $1-billion (U.S.).

Not bad for a company that has yet to fully explain how it plans to make money.

For all its popularity, Twitter has yet to turn a profit. But that hasn't stopped a host of other entrepreneurs from trying to leverage its massive user base into a money-making business model.

Add to that list a Toronto-based startup run by three friends from Waterloo, Ont., looking to bring advertising to the micro-blogging site - and to help Twitter users make some money in the process.

"It adds value for everyone," says Saif Ajani, founder of Assetize Inc. "For a publisher or content creator, you're now monetizing your Twitter account just like you would your blog or RSS feed or e-mail subscription.

"When you think about how big this market is, it's a great opportunity: hundreds of millions are spent on Facebook and MySpace, almost nothing is spent on Twitter advertising."

The Assetize business model is similar to many Internet advertising networks. Essentially, Twitter users sign up with the company the same way webmasters would partner with an advertising giant such as Google to have ads inserted alongside their content.

Assetize checks the user's followers and a selection of their tweets to see what kind of information is of interest to that particular group, and chooses an advertising partner accordingly.

After signing up, the user allows Assetize to insert a sponsored message once every few tweets. The message contains a link to the chosen advertiser's product, and the user is paid according to how many people click on that link - even if other users re-tweet the sponsored message, the original user gets paid for all subsequent clicks.

The model is still in its infancy, and not everyone on Twitter will end up making big bucks off their accounts. At a rate of about 10 cents a click, Assetize's payment model probably won't prove very lucrative for people with only a few hundred followers. However Mr. Ajani says some of Assetize's partners have as many as 60,000 followers, and at least some partners have made hundreds of dollars in a single month.

But whether Assetize's attempt to monetize the white-hot social-media site proves successful on a large scale is yet to be seen. Indeed, the young company's first go at making money from Twitter fell apart after Twitter itself objected to the business plan.

When Assetize launched last May, the company's business model looked a lot more like eBay than Google.

The initial concept, Mr. Ajani says, was to essentially run an auction house for Twitter accounts. A user could put their account up for sale to the highest bidder, and the potential draw would be twofold: the first user to register an account under a popular name such as Dave, for example, could offer that name up to all the Daves in the world willing to pay for it. But a user could also hike the asking price based on how many followers they have - a group that would come with the account once a sale is made.

But Assetize's founders never got much of a chance to see if that business model would work - shortly after the service launched, the micro-blogging site itself asked it be shut down.

"Twitter wasn't happy about it," Mr. Ajani says.

Now Assetize is trying again. The advertising service is pulling in about 20 new users a day, Mr. Ajani says.

But perhaps the best news so far is the absence of any angry letters from the micro-blogging site.

"The fact that Twitter hasn't opposed it is a great sign," Mr. Ajani says.

 

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