Deal Radar 2008: Wetpaint

Wetpaint is a social publishing platform. Headquartered in Seattle, Washington, the company was formed to make it easier for people to share their experiences and information online. Founded in 2005 and previously named Wikisphere, Wetpaint combines the best of blogs, wikis, forums, and social networks.

Wetpaint makes it easy for users who want to write about their opinions and create content to make a free website. Users who don’t want to create a website can join and contribute to another site. The site offers features that are extremely user friendly. For example, its EasyEdit Toolbar makes it simple to add content including photos, videos, and polls or participate on other people’s social websites.

In March 2008, Wetpaint added social networking features for users to create collaborative and social websites. Some of the features that Wetpaint has introduced include Friends Network, Custom Member Profiles, What’s New Dashboard, Compliments and Friend Feeds. The Wetpaint sites already boast rich content, and these features will facilitate a greater degree of interaction and discussion that generates even more varied, creative content and attracts a wider audience. Michael Arrington recently wrote in TechCrunch that Wetpaint is all set to take on Ning.

In May 2008, the company unveiled its platform, Wetpaint Injected, which can be embedded into any website to accelerate user-generated content on the site. Wetpaint Injected introduces an easy-to-use toolkit that enable users to author and edit content directly on the site. Since search engines will be able to index and credit the content to the host site, the site will attract new audiences and generate incremental revenue.

The platform is free for publishers for up to 100,000 impressions per month. However, websites that use more than 100,000 impressions are charged on a CPM or revenue-share basis. Further, sites can choose additional services along with the platform like enterprise support, editorial and moderation services, and custom development. Wetpaint charges $150 per hour for custom development, $2,000 per month for enterprise support, and $3,000 per month for the other services. The company also supports contextual advertising.

Wetpaint has raised a total of $39.8 million: a $5.25 million Series A from Frazier Technology Ventures, and Trinity Ventures; a $9.5 million Series B from Accel Partners, Frazier, and Trinity; and a $25 million Series C from DAG Ventures, Accel, Trinity, and Frazier. So far more than 1 million websites have been created on the Wetpaint platform. According to Quantcast, the network attracts 1.1 million US monthly uniques.

According to Forrester Research, Enterprise 2.0 tools will become a $4.6 billion market by 2013. Wetpaint has already begun positioning for this trend and launched the platform just as social networking for businesses is catching on. The real business model for Wetpaint may well emerge from the enterprise play.

This segment is a part in the series : Deal Radar 2008