Two left feet: Why ChaCha will fail
The second-surest sign of a doomed startup is how badly it gauges human behavior. (The first is how much BusinessWeek wrote about it.) The freshly launched ChaCha.com is about to prove this, five bucks at a time.
While the company presents itself as a human-based search alternative, it's really a poor man's help desk. ChaCha claims it hooks up searchers with expert topical guides. But in practice, they're hiring whoever's got time to kill. The SF Chronicle reports:
Jones said the company will have about 3,000 guides when the program is released and is prepared to add many thousands more as business warrants. They will be typically paid from $5 to $10 an hour and the company will recruit among college students, retirees and stay-at-home parents. The guides will be trained and will compete against each other for rankings, determined by customer satisfaction. Guides who get higher scores will earn more — up to $20 an hour for top earners.
Oh boy! Up to $20 an hour! Rates like that will attract guides from the tops of their respective fields!
Startup scorecard
Competition: Google Answers; Yahoo Answers; normal search; Wikipedia
Pros: Free to use
Cons: Pays too much to profit, too little to hire strong guides; who wants to spend 30 minutes with a human instead of 30 seconds on Google?
Bubble alert level: Orange
Life expectancy: Eight months or until the guides unionize
Parting shot: "Bostic said it will take a while to attract traffic like Google, which handled 2.75 billion searches in July." Ya think?
