Interview with Vikas Srivastava, CEO of eDirection

eDirection.com offers community services, ecommerce, social networking and other functionalities all in one easy to use website. There are many classified websites, social networking sites, and community websites, but you won’t find all of these services integrated into one service. Normally people have to go from one website to another to search for resources. Our goal is to place all of these capabilities within one website.

We are a very small firm. Mostly, everything is run by me and my friend/co-founder, Alvin McBride. We are working with a few developers in India and overall operations are run by five of us. We are currently self-financed so it is a very small team.

One key aspect was to ensure that the navigation was consistent throughout all the channels. We really had to keep it simple while also offering easy and direct access to the many different services. eDirection features jobs, housing, stores, ecommerce, etc.

The main goal is to grow the user base by cross marketing the many different tools and resources that are available. People who come to sell something today, may be looking for a job tomorrow and housing the next. We have built a great tool that I believe people will use on a daily basis.

Our plan is to give them a run for their money. We almost have all the functionality of eBay, which has been around for 10 years, Monster has been around for 9 years. They obviously have strong business models. We think that we can develop a stronger model by integrating these different services. Plus our emphasis is on local cities as opposed to other websites, though we also provide nationwide services.

Most of the websites that are available for classifieds have purchased out-of-the-box search solutions, and don’t even offer a greater array of services around classifieds. By integrating our services, we have made the individual services that much stronger. They contribute and build upon each other.

My partner and I bring over 15 years of technology experience to eDirection. I was one of first members of the Nifty?s auction website in Japan. Alvin, my co-founder comes from LA Times and Shopping.com. We are bringing these very different experiences together to make this company a success.

We are primarily targeting classifieds at this time. Our service is similar to Craigslist.org, but with great capabilities and services. We are targeting the mass market. We are doing that by providing localized offerings for classifieds, for stores, etc. There are a number of websites that offer limited local services. We decided that we would feature all of the cities within the United States. Our proprietary system offers services to 50,000 cities within the United States. Not a single small city is missed.

People can simply search via their zip code to find classifieds that are within their area, whether it be homes that are for sale, to people looking to network for local businesses. Most other sites offer national services, and a few are beginning to target the local markets. We are across all the channels; housing, jobs, friends, everything.

The initial idea originated with our family and friends. They kept sharing with us their displeasure with having to use all of these disparate websites for all these different services. Not only are these sites difficult to use, but they are also extremely expensive. For example some websites charge something like $400 per job posting.

We don’t need to charge anywhere near as much, simply because we don’t have the same overhead that they do. We will charge people to post jobs as well as to open stores, but at a fraction of what other sites charge.

That is definitely our goal. We currently have 1.1 million listings, all built around the latest Microsoft .NET technology. Technology is the other factor where companies drain their financial resources. By using Microsoft .NET we know that we can scale quickly and efficiently.

We have partnered with more than 1,300 car dealers within the United States. This has enabled us to bring over 700,000 new & used car listings to our site. Apart from the individual listings, we want to partner with other companies across all channels. They can provide us with a scale of classifieds that individual postings aren’t able to at this time.

We are definitely trying to take on the large players. It is a risk, but we are dedicated to this effort and we believe that we have built a technology and service that will resonate with consumers.

We have pulled together our own seed money. At this point our only costs have to do with servers. Alvin and I are software architects and developers ourselves, so we keep our costs low by executing most of the development work. We have also cut down the costs significantly by working with our friends.

From day one our goal has been to charge for premium services. Unlike other sites that plan to charge after five years or so, we have launched with premium services from the day we launched. All of our basic services are free, but we do charge for featuring a specific classified.

About 25%. We see this as a good start, but we aren’t expecting this to deliver profitability for at least another year or so.

We do not plan to take them on directly. eDirection was built so that when someone comes to the site for any one of our different services they will find our other services and begin to use them as well. Remember, we only launched in May 2005. We expect this to take time to grow, but then again, it could also be like MySpace.com which experienced fantastic growth.

If the service is valuable, then people will migrate to the most effective service provider. A key aspect of our approach is to maximize the network effect. After people visit the site, we want them to share it with their friends, co-workers and family members.

The search engines drive most of our traffic. Having over 1 million classified definitely helps with the search engines. With the right marketing, this could go to the nth level. The combination of word of mouth and marketing can be very successful.

We are talking to a few Venture Capitalists within Silicon Valley, but they want more users before they will move forward. We are also looking for partners that will help us expand across all channels.

It is a lot of hard work. You have to put your personal life aside and focus solely on the business. You can’t get tired. If you are tired, it isn’t going to work. You have to focus your efforts and not get distracted with different business models or technologies. Make a decision and give it your best shot.

Any project can succeed or fail depending upon the people involved. We had that experience initially, which wasted two months of time. This was crucial to our launch. Hiring good people will make the difference. You bring them on board and your company will succeed.