The Deal
Thursday, October 23, 
1:07 am

[Posted on February 20, 2008 - 2:10 PM]

The local-services and small-business Web site category has been in dire need of a rethink for some time. When I Google a dry cleaner in my neighborhood, I get several hits from outdated and uninformative Citysearch-type sites, a Yelp review page that's only marginally useful and some sites that are covered with advertising but offer precious little information of value.

So it's no wonder that several fairly new companies are trying to rise above this mess, especially with an emphasis on user-generated content. The latest is GenieTown, launched Wednesday with $2 million in backing from angel investors including CEO Hassan Chafi and fellow Stanford professor Kunle Olukotun. The site will allow service providers to post information about themselves and work out arrangements with customers, building a reputation for new customers to browse all the while.

In addition to Yelp, more often associated with user-generated reviews of restaurants and bars rather than plumbers and carpet cleaners, several other sites have sprung up in this area. Angie's List relies on membership fees from users. Smalltown ($3 million from Formative Ventures in October 2006) has focused on the suburban market thus far.

But a few failures in the sector make it clear how difficult it is to pursue the long tail of advertising dollars from small and independent merchants. Judy's Book ($10.5 million from Ignition Ventures, Mobius Venture Capital and others, prior to 2005) said in October it would scale back operations and seek a buyer, and Sequoia-backed Insider Pages was sold to Citysearch cheaply after laying off staff. It takes a large sales force to pursue many local businesses, yielding relatively few dollars from each, and none of these sites has succeeded in scaling nationally yet. Someone's got to solve this problem; maybe GenieTown has the magic it'll need. - Paul Bonanos

Read TechCrunch's take on GenieTown


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