More Bootstrapping: VirtualTourist.com Co-Founder J.R. Johnson (Part 4)

SM: What type of traffic levels are you currently seeing?

JJ: We are seeing 5-6 million unique visitors a month.

SM: In 2000 the market bottomed out, and you somehow managed to build your site back to a very reasonable business.

JJ: We were fortunate that the content was growing the entire time. People were still visiting the site, we just did not have the monetization aspects that we do now. We had to wait it out until the ad market came back.

SM: What happened after 2003, when you got your base business going?

JJ: We started hiring more people as needed. It is now a complete cash flow business. The more money we make, the more people we are able to hire. We started doing some ad sales in-house so we hired a couple of guys to run that. We had inventory that could be sold, so those employees paid for themselves. We started looking around at different opportunities in the space. One thing our advertisers wanted was more conversions, and our users were still looking for a better way to book and compare rates. We came up with the concept for OneTime.com. It is a booking comparison site that we launched in April 2004 as a separate company.

We have always been focused on content. We wanted the best content, and only the best content, on VirtualTourist. We did not want booking clutter competing in the space. There are a lot of subtleties that go into user-generated content. The content contributed on Orbtiz, Expedia or Travelocity is very different from the content that we get on our site. OneTime has also grown as a successful business. We actually sold both of the companies to Expedia.

SM: In 2004 you launched this comparison shopping site. What was significant about 2003 that made you do that?

JJ: I don’t know if there was anything really monumental, we were just trying to focus on growing the business. We were very focused on finding ways to monetize all of this content we had, and figure out how to put ads on the pages without destroying the user experience.

SM: How did the ad monetization change as you went from pure AdSense to your own ad sales force?

JJ: It was nothing overnight; it was pretty slow. We always had enough inventory and had never completely sold it out until the end of 2007. Before that we had plenty of inventory, so we were able to plug in whatever we sold, and we ran it that way.

SM: Who were the advertisers you were able to tap into?

JJ: American Express was our biggest advertiser, and they were with us for three to four years non-stop. The travel guides were also pretty big. The airlines, hotels, and online travel agents were other big advertisers. That was really our focus.

SM: What shape did the business take in 2006 and 2007?

JJ: On the ad side of the business, we went after convention visitor bureaus. They spent a lot of money in TV, newspapers and magazines but were really slow to get online. We really tapped into them, and it was a perfect fit. We had a bunch of people on the site who were trying to travel, and a bunch of the CVBs who were trying entice travelers to come to their city or country. That was a big boost in our advertising sales model.

In 2006, it became fun. This was where we always wanted to be. We were starting to make some money and do some of the things we always wanted to do. We were able to offer users the ability to save reviews into their own guidebooks and print out their own custom travel guides. We were able to do things we were never able to do before. Going from a negative cash flow to a positive cash flow really helps morale.

This segment is part 4 in the series : More Bootstrapping: VirtualTourist.com Co-Founder J.R. Johnson
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