I’m taking a break from housing and personal finance to cover a passion of mine, technology. Many in the media have been shouting about the Facebook IPO over the last two days. I’m taking a different route by explaining how you can create a social network of your own.
Facebook IPO madness is sweeping the country. Mark Zuckerberg rang the Nasdaq opening bell this morning. Investors are scrambling to get shares of what is now the most talked-about company in the United States. And somewhere along the way, Facebook raised more than $16 billion dollars. That makes it the third-largest initial public offering in U.S. history, behind GM and Visa. At the time of publication, investors were paying $38 per share for Facebook, a company that is now valued at more than $100 billion.
All of this serves to make Zuckerberg the 29th richest person on the planet, according to Bloomberg.
Why is the Facebook IPO generating such interest among investors? In a word, reach. Consider the fact that 12.6 percent of the world’s population is doing something on Facebook every month. It’s unprecedented.
For a small-timer like myself, these numbers are staggering. I have to count the zeros of $104 billion on both hands. So I’d like to present a number that is much less staggering — $389. That’s how much it would cost you to build a social-networking website of your own. No, I did not forget to include ‘million’ or ‘billion’ after that number. I’m talking about three hundred and eighty-nine dollars. Period. That’s the approximate out-of-pocket expense for building a social network of your own.
Of course, you won’t have Mark Zuckerberg looking over his shoulder anytime soon. But let’s have some fun with it anyway. While everyone else is in a tizzy over the Facebook IPO, let’s talk about how you might launch and grow your own social-media website.
How to Build Your Own Social Network
So, you want to start your own social network. What does it take to get started? Do you need an army of investors? A legion of Red Bull-swilling computer programmers? Maybe later. It’s actually a lot easier and less expensive than you might think.
Of course, to build a website with Facebook’s level of activity, you would need to invest in some serious web-server technology. And that will cost you. But if you’re building a small-scale social network around your hobby or profession, you can outsource the web hosting for $9 – $15 per month.
Web hosting is the first thing you’ll need to start your own social network. This allows your site to be ‘served’ to people all over the world, via servers that are connected to the Internet. The average cost of web hosting today is around $9 per month with a 12-month purchase.
As your social network grows, you’ll eventually need to upgrade your hosting. You may even need to move the site onto a dedicated server (one that does not share server space with other websites), to keep up with your traffic demands. It’s a good ‘problem’ to have. But for starters, a basic hosting plan will do. We’ll call it an even $10 per month.
Let’s talk software and programming. This is where the rubber meets the road, so to speak. You may be surprised to know there are several open-source (free) software programs that can help you start a social network of your own. BuddyPress and Elgg are two of the most popular programs among hardcore technophiles.
BuddyPress is made by Automattic, the same company that created the wildly popular WordPress blogging program. BuddyPress has an active community of users and developers who exchange ideas and provide troubleshooting support. The program offers many ‘plugins’ that can extend the capability of your social website. For instance, you could install a plugin that allows your members to create photo albums and upload photos.
Elgg also has an active community of supporters and troubleshooters. Its users include the University of Florida and the Australian government. In 2008, InfoWorld named Elgg the best open-source social networking platform.
Both of these programs can be used to start a social network with some of the same features as Facebook (friends, groups, activity streams, etc.). They can be expanded / extended with added features or plugins. Best of all, they are both free to use. So our price tag still sits at $10 per month for hosting.
In truth, you could start your own social-networking website for nothing more than the price of web hosting. We already talked about the open-source technology that’s available. But there is another preliminary expense you might incur — at least, if you’re taking this project seriously. You’ll need a logo. You want people to take your social network seriously, right? If so, a quality logo is a must. And unless you’re a graphic designer, this will be another expense for you.
The good news here is that you can get a professional-grade logo for less than $300. You could work with an individual designer, or you could crowdsource the design project through a service like crowdSPRING. According to crowdSPRING’s website, logo projects start at $269. For that price, you’ll be presented with a dizzying array of logo options from up to 100 designers (hence the term crowdsourcing).
So now you have a social network up and running, along with a spiffy new logo. That’s all there is to it, right? People will start joining the site in droves, right? Wrong. Now the real work begins. Now you must promote your new site to the ends of the earth (or at least wherever your target audience hangs out). Having worked as marketing manager in a previous life, I can offer some tips.
First, you need to get people talking about your new social network. This is the best form of marketing, because it’s free and endless. The best way to get people talking is by filling a void with an interesting product or service. If you start a social network in a niche where one already exists — and the existing site is fairly popular — you’ll face an uphill climb. On the other hand, if you launch a social-networking site in a popular niche that is currently under-served by social media, you could generate some serious buzz.
The Next Big Thing, or Just a Bit of Walking-Around Money?
Be realistic with your goals. If you’re expecting to attract thousands of members in the first month, you’ll probably be disappointed. For starters, focus on creating a great experience for your members. Make the website incredibly easy to use. Remove distractions. Help people do what they came to do, connect and share with like-minded people.
Once you’ve accomplished these fundamental goals, you can shift your focus to growth. If you decide to integrate a revenue model later on (i.e., advertising), just remember that the user experience comes first. If you make your website hard to use for all of the advertisements, your members will leave as quickly as they joined. Treat your members well, and your fledgling social network may turn into a popular website someday.
And if you wind up ringing the Nasdaq opening bell someday, just remember where you got your inspiration.