I guess we’ve been at it for 10 years now. Initially it was just two students doing their thing; we hadn’t formalised anything into a company yet.  That happened in 2003, when we first set up a company called Incrowd.  Initially the idea was to specialise in youth marketing. We felt that marketers didn’t understand youth culture very well, especially regarding what was happening with mobile. We had a number of ideas that we turned into projects.  One of those early projects was asl.com. ASL is a term that was big in SMS chatting—it stands for age-sex-location—and was often the first question youngsters asked each other. Toon had the idea to create a solution for the easy exchange of ASL information. It was basically a simple tool for sending people a link with your ASL data with some extra information and a photo. But it spread virally very quickly and became a real community.   That’s how it began. Initially it was a tool, but it became a community with a predominately youth profile.  And it still is today.

 

But asl.com was at first one of several projects we had on the burner.  We also did some consulting; and we had a publishing venture. But we quickly learnt that we needed to focus; you can’t do it all. By 2005 we had moved full time onto the social networking project—we called it Redbox society then—and by 2006 we made our first international moves.  We did it stepwise, creating a new site with a new brand in each country. But by 2007 we were experiencing tremendous growth and therefore we decided to integrate it all in a single site, under a single brand. At that point we looked for VC money to fund the continued expansion. That worked out well for us; we collected 5 million euro. So it’s from 2007 that we really got going, that we hit the right note. Before, it was a real struggle, with plenty of ups and downs. We didn’t have a salary, we struggled to find people, and we even had our electricity cut off once.

  

Although we had always been financially self-sufficient, in 2008 we started focusing more on the commercialisation of the project, creating brand pages and such.  Last year—2009—was a difficult year. We thought long and hard about our positioning and strategy; about our differentiation from Facebook and the many local players we compete against. The key conclusion coming out of that process was that we needed to focus on our core users: youngsters. Also, we decided to focus on the community element and less on the relationships. Netlog is more a community than a classic social network.  Our users interact around specific themes and communities, where the point is to meet new people.  It’s the opposite of the types of sites where people reconnect with old classmates and such. Today we’re really happy: we’re growing strongly in the youth segment and our strategy seems to be panning out well. And we’re diversifying again. For example, a key focus today is gaming.  We’re not just creating a platform for 3rd party developers—although we’ve done that too—but we are also developing games ourselves, games that can be played in the Netlog environment but also on other platforms.  We’re relying on the OpenSocial framework to accomplish that—open standards are key here. In a way we’re returning to some of our original ideas and projects, but this time from a position of strength.  

I guess so, in several ways. The business model is clearly rooted in Europe—we’ve had to be self-sufficient from the start and it shows I think. Compared to Facebook we probably are somewhat more commercial. Also our promotional products differ. As I said, we’re a lot more focused on the youth segment; and we’re also more localised. And the promotional products we offer are integrated more in the actual site. We focus less on banners and sponsored links but tend to work with home page make-overs, integration with a particular feature of the site, etc.  We have a dedicated team who market these services and they work with clients to create pretty tailor made offerings.

There are many.  The main challenge, I think, is that the internet’s user base is expanding dramatically.  You’re already seeing bandwidth issues emerge in several countries.  

 

Augmented reality and mixed reality will have a big impact in the coming 5 to 10 years. I suspect that the online experience will become more tactile – a richer experience – going beyond the keyboard, mouse and screen.  If you think about it, in the past 10 years the actual experience of the internet hasn’t changed much. Sure, it’s gotten bigger and there’s a lot more money flowing about, but the essence of what we do online is the same. I suspect that the future will still be about content and communication, but the experience will change. That said, bandwidth is the key obstacle today.

 

Mobile is really important too. Consider the fact that more than 10% of our pages today are delivered to mobiles. That’s a lot, I think. Smart phones are expensive, especially for young people. In mobile we really need to look at location-based services. People have been talking about this for years but it looks like it’s going to happen now. The potential is huge, especially if you’re able to track the location of a user and link that to social elements; e.g. are any friends nearby? Which party are you going to? Etc.

In the past we were a bit paranoid about everything ‘open’.  We were concerned about privacy issues and security; just imagine if competitors starting hacking our site. But we have since become convinced that open standards are the way to go; and we’ve taken steps in this regard. For example, you can link your Twitter account to Netlog; you can login via an OpenID account; and we’re working with OpenSocial (ed. note: OpenSocial is an open standard for exchanging social data). It is a good initiative and it does work, but we think that you do need to keep a commercial perspective. That’s the main problem, I think, with the whole OpenSocial story:  there seems to be a contradiction in the model. On the one hand it’s a model that is based on openness and accessibility but because it is difficult to commercialise it ends up attracting little investment and hence users. That’s why the really big networks are all commercial entities.  

Most of the social networks have signed up to a code of practice designed specifically to deal with this problem. The EU is monitoring this and we all get audited too.  It’s clearly a challenge, but the dangers aren’t unique to the virtual world. The key difference between the online and the real world is the degree of anonymity but many of the risks are the same. There are dangers out there, both online and on the street. It is very important that people are aware of the risks. And that’s still a key problem I think; there is still a lot of ignorance. We tell all our users that people are able to view their profile, and that many of these people are anonymous, passive users. It’s like the real world, people are watching you; you need to take care.

I suspect that the key obstacle we have here is that there is too much government interference. The system is so complex, so bureaucratic. Sure you have many programs and subsidies to stimulate innovation but I wonder if all that really helps. On the whole this system probably hinders innovation. Freedom is the biggest driver of innovation and entrepreneurship. I have to acknowledge that the environment isn’t ideal here. Staff costs are tremendously high, and the cost of dealing with all the regulations is huge. If I could start again I probably wouldn’t do it in Belgium. Not because we don’t have the people, the talent or the education; no we have all that.  What we lack is entrepreneurial freedom, room to breathe. We’re creating a nanny state here.