There are many sites on the Internet which specialize in posting links to the best stuff on other sites. Boing Boing does it. Lifehacker does it. Neatorama does it. But none of them comes close to Laughing Squid, in terms of a diverse online business model.
On the surface, Laughing Squid looks like just another blog reposting other peoples content. But if you take a look under the surface, you will see another venture – web hosting.
The company was initially started as a video production company, making documentaries. They also, for a time, offered publicity and web design services. From 1996 to 2013, they produced an arts and culture events email list called The Squid List. So they are not afraid to get their feet wet in many ponds and try out new things to see what works and what doesn’t.
In this article, we are going to explore the different layers of Laughing Squid and examine their diverse business portfolio.
A Brief Background
Laughing Squid was started in November 1995 by Scott Beale, and now the team includes his wife, Lori Dorn, and two contributing writers. They are based out of New York City, after originally starting in San Francisco, where in 1996, they started producing the Squid List, an events email list and calendar (which was shuttered in 2013). Their Twitter page has ballooned to 600,000 followers, and they have 550,000 fans on Facebook (these numbers are obviously subject to change though, and are accurate as of February 2016).
The company initially started with web hosting in 1998 (making them one of the oldest web hosting companies still in operation), and the blog came much later, starting in 2003. They have been remarkably intuitive with future web trends, getting involved early with companies which at the time were hardly known, but would later turn out to be stars. Sites such as Zendesk, Freshbooks, and Stripe. They seem to be very adept at spotting the “next big thing”.
The distinctive squid logo, with its many tentacles, was gifted to Beale by designer Matt Dong, and it is now a sticker on many a laptop. Stickers which Laughing Squid sell on their own store. More on that later.
The Laughing Squid Blog
Nearly 1.5 million people visit the Laughing Squid blog every month, and its popularity earned it a Webby Award in 2011. The site posts about interesting things in the areas of art, culture, and technology which they have found on other websites. This could be anything from an amusing YouTube video to geek/nerd related themes. Or anything which is just downright weird and “out there”.
The blog is one of those places that people with a few minutes to spare might check out, to watch the latest amusing video. Today, the blog side of Laughing Squid is a separate entity in its own right with a hardcore fan base visiting, commenting, and subscribing, every day.
The Web Hosting
The web hosting is pretty much what keeps Laughing Squid afloat, apart from the usual advertising model that most sites utilize. The revenue from this side of the company helps to finance the blog. In a previous interview, Scott was quoted as saying “the hosting basically helps take the pressure off the blog and having to chase pageviews”. So by having your site hosted with them, you are in a way expressing your support for the Laughing Squid blog.
Laughing Squid say on their site that they cater to “individuals, artists, and bloggers”, so it sounds as if businesses are turned away. They specialize in WordPress hosting as they have had a long relationship with Automattic, the company behind WordPress. They are actively maintaining this relationship, relaunching the blog on the WordPress platform in 2005.
They sponsored the very first Wordcamp conference, and they held the distinction of being one of the very few web hosting companies who are recommended by WordPress on their site. The page is in the process of being redesigned at the time of writing, so Laughing Squid is no longer on the page.
Laughing Squid Web Hosting is run on Rackspace’s Cloud Sites servers, and this business relationship started in 1999, making Laughing Squid one of Rackspace’s oldest customers. This means that Laughing Squid is merely a hosting reseller, not a company with their own servers. But to their credit, while other companies may hide the fact that they are merely resellers, Laughing Squid has always been very transparent and honest about it.
The web hosting is absolutely remarkable in that they can offer very powerful and very generous hosting plans at a very low price, often undercutting some rival companies. The most expensive plan works out at $96 a year ($8 a month). There are no contracts, no obligations. Merely a month-to-month arrangement which can be cancelled at any time without the need for a reason.
The Laughing Squid Store
The online store is also another source of revenue for the company. They sell gear, gadgets, apps, and software, which helps a great deal in keeping the blog going and helping the company turn a profit. They also have a separate store on Noonaco, selling T-shirts, mugs, and posters.
The online store is where all the action is though. The store is powered by StackCommerce, which provides the platform for many big online stores. It is basically the same store for everyone, but every site rebrands it to their own styles and colours to make it look like their own.
StackCommerce’s model is that their inventory changes frequently, and when something goes up on the site, it is usually heavily discounted from its usual price (or so it is claimed). A non-flexible deadline is placed on each item, after which the item has expired and is replaced by another item.
A quick skim of Laughing Squid’s store reveals such eclectic items as a camera drone, courses to become a web developer, headphones and pay-what-you-want bundles.
Since Laughing Squid only receives a percentage from each sale, it’s probably fair to say that the revenue from the store is not a huge amount for them. They probably still have to rely on the web hosting and the blog advertising to keep the lights on. But as their subscriber count increases, so too should their share of the pie from StackCommerce.
Laughing Squid is a great example of a company which is not afraid to diversify and try different business models until they find the one that fits. They have been around since the beginning of the Internet, proving that if you are not afraid to change with the times and become constantly flexible, then you can weather any dotcom crash, any change in trends, and still come out on top as one of the most popular sites on the Internet.
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