Ok, well this is the first official valuation for the site. First up is SynapseLife. I was first made aware of this sale the sameway most people were…by reading TechCrunch. So I checked out SynapseLife’s Ebay Page. The have the auction starting at $50,000 with a reserve…which is obviously more than the $50K they are starting with. So…the question here is…Is SnapseLife worth the $50,000+ they are hoping to get. Lets take a look:
Ok, so what is SynapseLife? “SynapseLife is a full Web2.0/AJAX suite of 9 web/mobile applications including: Lists, Ledger, Calendar, Feed Reader, Email Reader, Contact Manager, Ledger tool, Bookmarks and Tagging.” You can read the TechCrunch reviews on the site Here and Here. Based on what I was reading in the comments, reviews are not great, but are sort of mixed on the product…
“I am in the beta, and I can honestly say I am not impressed. It’s a good idea, but it’s far too slow to load the different apps that I just get frustrated and gave up. Also, it failed to import in my Outlook contacts…which basically makes it even more useless to me.”
“Being a beta issue I expected to find bugs throughout the application, but was pleasantly surprised with how well it performs all functions. Since I have a fair level of knowledge with similar applications, I found it very easy to navigate through and each application/module worked as it should, while often surprising me by providing with more functionality in a more intuitive way than I expected. Their professional roots are clearly reflected in a superb public product.”
The product is free to use and they do not currently have any advertising revenue. So the first question a potential buyer is going to have to ask themselves… “How can I make money off this thing??” Since this is an AJAX based application, its very difficult to try to figure out how much money Adsense could bring in based on pageviews and click-throughs. The SynapseLife team claims that they’ve had quite a few requests by individuals wanting to purchase licenses for the SynapseLife software. Now, before buying this I would thoroughly investigate these leads they apparently have and the potential value. The problem is that “a few licenses” is not a lot at all…I think “a few” usually means approximately 3. So unless these are $10,000 clients, you’re going to have to wait a while until you make some money. What about making AdSense money from the registered users…you have 4,500+ of them…well lets take a look. I asked the owners for some more information…They are currently receiving between 5 and 12 new users a day, 40 return users login per day, which means around 1,200 logins per month. So lets try to figure out how many unique users they’re getting per month. I’m assuming that out of the 4500 registered users and based on the approximately 40 return logins per day…(and these numbers are all assumptions mind you), 20 people are daily users, which means that about 20 random people use it on a given day…and I’ll even assume that they use it once a month just to get the maximum number of unique users, but this equates to only approximately 640 people who use this in a given month (unless my math is completely wrong)…meaning the other 3,860 other registered users are one and done. Now you also have the new users signing up…so that equals another possible 250 or so monthly visitors…but out of that probably only 25 or so will actually use the service more than once. And if you start charging for this service…at least 70% of your active users are going to drop the service…probably only some of the daily users will stick with it. So I’m questioning how effective an Adsense model would be because they don’t seem to get a lot of unique users.
Lets see how the traffic details compare with three competitors…Zoho, Zimbra, Goowy (Yes I know Alexa is bad…which is why I’m making sure I’m just using it to compare here). And I’m really not sure if ZOHO is a direct competitor because they offer so much more robust and diverse applications…but I put it in there for good measure.
You can see the spikes in traffic…that seems to correlate with TechCrunch cameos. Basically the other sites are killing it (Compete.com didn’t have any info on SynapseLife).
The team will give you one weeks worth of consulting services in order to help with the transition of the service. One thing I would get fixed is formating…the service worked fine in my Firefox, but when I was using IE I would get some weird formatting problems. It works much better in Firefox, but it needs to work in IE too.
The mobile aspect of this application might be the reason to buy it in the first place. Being able to use this service from any mobile device is a big plus and I think as time goes on the value of that will only grow.
I think that the only way this service is going to make any money is by subscription and individuals are not going to pay for it. I do see potential for smaller companies with individuals that are always traveling around…ie sales people…who can take advantage of the mobile aspect of it, to pay for a subscription to this. The applications need to be upgraded a bit though…there needs to be a solid reason to choose this over a competitor…and right now I’m not sure exactly if there is one (do the competitors offer mobile? because that could be the one). Also I would want to make sure that the API was up and working before taking over the helms.
So…to wrap this up…I do think there is some potential here, but I really am not sure if they’re going to get the $50,000 they were asking for…actually I think probably not. What they should have done is put the starting bid much lower and kept the reserve where ever it is. But there are still a couple of days left and perhaps the bids will start to roll in towards the end. I’m just saying that unless I had a VERY good plan for this application and what I wanted done with it…I wouldn’t make a bid.