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The attack of the dot-clones
March 16, 2012 3:21 PM   Subscribe

How Three Germans Are Cloning the Web
"Launched out of a loft in New York City’s Garment District last June, Fab had sales of $20 million in its first six months and is on track to earn $100 million in 2012....Six months after Fab launched, it was knocked off. An e-commerce design site called Bamarang opened for business in Germany, the U.K., France, Australia, and Brazil...
Bamarang is the creation of Oliver, Marc, and Alexander Samwer, a trio of German brothers who have a wildly successful business model: Find a promising Internet business, in the U.S., and clone it internationally. Since starting their first dot-clone in 1999, a German version of EBay, they’ve duplicated Airbnb, eHarmony, Pinterest, and other high-profile businesses. In total, they’ve launched more than 100 companies."
[SLYBloombergBusinessweek]
posted by FirstMateKate (51 comments total) 20 users marked this as a favorite

 
The Samwer brothers are very savvy and quick. It's easy to brush them off as "cloners" but as someone who works in the Internet industry but not in the US, I know all too well how hard it is to, a) identify popular trends quickly, b) implement them effectively in your local market, c) find buyers who will pay for your efforts.

If the Samwer bros. efforts mean that good Internet business models get replicated quickly, then I'm all for them. We need clones of the Samwer Bros. in many markets.
posted by gen at 3:25 PM on March 16, 2012 [1 favorite]


Interesting article, but I could do without the "ja?" tacked on to every !@#$ing quote from them. Yes, we all have verbal tics, and people speaking a second language tend to be overly-reliant on a limited repertoire of "filler" expressions. Foreign guy is foreign, I get it.
posted by LMGM at 3:41 PM on March 16, 2012 [3 favorites]


Users get tired of waiting years or even months to try out a new site so it's not extremely difficult to pick up on emerging businesses - you can always follow the VCs - and execute them in your own region.

Getting cloned so fast and so well sucks for startup founders but that's the reality fo the game. I don't see how founders will be able to compete with many of their copycats without working more network based where they have partners in different regions from the very first start.
posted by Foci for Analysis at 3:42 PM on March 16, 2012


Users get tired of waiting years or even months to try out a new site so it's not extremely difficult to pick up on emerging businesses - you can always follow the VCs - and execute them in your own region.

Yep. I think the Samwers sound like awful people, but any "not available outside the US" is just unacceptable in this day. If you launch a company and wait forever to internationalize it, somebody's going to take your market. Tough luck, but you can't treat users elsewhere as second class, thinking that they're going to wait for you.
posted by Jehan at 3:53 PM on March 16, 2012 [22 favorites]


Users get tired of waiting years or even months to try out a new site so it's not extremely difficult to pick up on emerging businesses - you can always follow the VCs - and execute them in your own region.

Exactly. Never heard of these guys before, but they deserve a medal. American sites are famously US-centric; if there's physical product delivery involved, new companies might deliver to Canada if you're extremely lucky. Delivery to Australia? Forget it, it's going to cost way more than it's worth because the companies appear unaware an international market exists and is worth tapping. For media-based companies (I'm looking at you Pandora, Spotify, Last.fm, hell even Apple when it first started the iTunes store), they usually can't be bothered chasing down licencing agreements outside the US. They often promise to do so for years - I've been waiting years for them to make their iPhone app available in Australia. I see Spotify is making the same bold promise "Be the first to know when Spotify launches in Australia! Enter your email here!". Yeah right, arseholes.

As far as I'm concerned, the international versions can win, and the US versions can die like the dinosaurs they are.
posted by Jimbob at 3:54 PM on March 16, 2012 [15 favorites]


Tough luck, but you can't treat users elsewhere as second class, thinking that they're going to wait for you.

Some people should have this forcibly tattooed on their forehead.
posted by Jimbob at 3:56 PM on March 16, 2012 [7 favorites]


Good for them! The world is better off when successful business models spread faster.

The main danger I see in the brazen cloning of business models is that US companies will try to defend against it, and the number of applications for ridiculous software and process patents will soar. They are enough of a drag on our economy as it is.
posted by Triplanetary at 3:56 PM on March 16, 2012 [2 favorites]


Willkommen bei Zombo.com. Dies ist Zombo.com. Sie können alles auf Zombo.com tun, überhaupt nichts.
posted by Blue Meanie at 3:58 PM on March 16, 2012 [49 favorites]


Beste aus dem Web.
posted by ceribus peribus at 4:01 PM on March 16, 2012 [1 favorite]


Some people should have this forcibly tattooed on their forehead.

To serve as a reminder for yourself?
posted by phaedon at 4:01 PM on March 16, 2012 [5 favorites]


Admit it : you're pissed off you didn't think of it first.
posted by Afroblanco at 4:02 PM on March 16, 2012 [7 favorites]


If anybody in the US is interested about how long some sites take to internationalize, Netflix launched in the UK 10 weeks ago.
posted by Jehan at 4:03 PM on March 16, 2012 [3 favorites]


Okay, but like, the way they rip off the typography and design is kinda horrible...
posted by sixohsix at 4:03 PM on March 16, 2012 [2 favorites]


Netflix launched in the UK 10 weeks ago

And they currently ship VHS tapes through the post.
posted by ODiV at 4:05 PM on March 16, 2012 [5 favorites]


Meanwhile, in regards to Netflix in Australia: "A statement from Netflix said that after their 2012 launch in UK and Ireland, they are likely to “pause on opening new international markets until we return to global profitability”.
posted by Jimbob at 4:05 PM on March 16, 2012


If anybody in the US is interested about how long some sites take to internationalize, Netflix launched in the UK 10 weeks ago.

And so Lovefilm (which I use) grabbed the market
posted by vacapinta at 4:12 PM on March 16, 2012 [1 favorite]


I think they sound too result-driven and harsh on their staff, but this quote rings true:
“There are pioneering entrepreneurs and execution entrepreneurs, and maybe we belong more to the execution entrepreneurs,” says Oliver [Samwer]
Big ideas are great, but someone needs to implement them. And global implementation is degrees beyond what local implementation means.

Kudos to their implementation abilities, too bad they sound like terrors as employers.
posted by filthy light thief at 4:13 PM on March 16, 2012


Actually I should probably be a bit fairer - I know negotiating a licence agreement to distribute music is different in every country, and probably poses a fair barrier.

SO my question is - with all these copyright trade agreements going on to try to establish the same system everywhere (no matter who evil those agreements might be) - would this enable companies to offer their products to a global audience much more quickly?
posted by Jimbob at 4:15 PM on March 16, 2012


And so Lovefilm (which I use) grabbed the market
I use Lovefilm, and while I have never used Netflix, all I've seen of it (the original US operation) suggests that Lovefilm's business model (discs in the mail in returnable envelopes, queued on a web site) is a direct clone of Netflix'. Which is a good thing, as otherwise, us in not-America would have had to go to Blockbuster for our video rental needs for a few years longer.
posted by acb at 4:29 PM on March 16, 2012


I thought they meant the entire web, which sounded astonishing, not to say strange and bizarre.

Just ripping off - sorry, implementing - other people's successful ideas is a decidedly less impressive.

Though I would be curious to learn if any of these sites were actually better than the originals.
posted by IndigoJones at 4:31 PM on March 16, 2012


Meanwhile, in regards to Netflix in Australia: "A statement from Netflix said that after their 2012 launch in UK and Ireland, they are likely to “pause on opening new international markets until we return to global profitability”.

If/when I decide to return to Australia, I don't look forward to going back to 20th-century commerce models, with iTunes having a monopoly on music downloads (not counting Telstra's DRMed Windows Media shop; is that still going?) and the nearest proper online book/music retailer being amazon.com in the US. If Amazon were to open an Australian subsidiary, that'd solve a lot of problems.
posted by acb at 4:33 PM on March 16, 2012 [1 favorite]


Just ripping off - sorry, implementing - other people's successful ideas is a decidedly less impressive.

Implicit in any condemnation of this is implying that business models are someone's intellectual property, for them to sit on like a dog in the manger until they're good and ready to bring them to a grateful public.

Capitalism (as opposed to rentierism and the sort of neo-feudal oligopoly that the world, alas, is moving towards) doesn't work that way. If you're a producer and choose not to fill a demand, you have no right to expect that demand to stick around.
posted by acb at 4:37 PM on March 16, 2012 [12 favorites]


acb: For books, Australia's all about the book depository - a UK site, but free shipping and great service. Amazon totally dropped the ball there.
posted by pompomtom at 4:37 PM on March 16, 2012 [1 favorite]


If anybody in the US is interested about how long some sites take to internationalize, Netflix launched in the UK 10 weeks ago.

Webflix (which became LoveFilm) has been around since 2002 though, and offered pretty comparable service on DVD rentals (I have no idea how their streaming holds up).
posted by Artw at 4:38 PM on March 16, 2012


Ah, I see vacapinta has covered that.
posted by Artw at 4:39 PM on March 16, 2012


When starting companies in the US, every VC told me to "Forget the rest of the world. Focus on the U.S. and you can worry about internationalization later." This is proving to be bad advice.

On the other hand, having lived in Berlin, I can attest that their success has made it near impossible to get funding for an original idea startup there.

The rumor is that they copied Groupon in extreme detail, down to their choice of programming languages, corporate structure, and even job titles. Everything to make it the obvious acquisition target when Groupon woke up to the existence of other countries.
posted by wanderingstan at 4:46 PM on March 16, 2012 [9 favorites]


When starting companies in the US, every VC told me to "Forget the rest of the world. Focus on the U.S. and you can worry about internationalization later." This is proving to be bad advice.

Maybe. If any kind of licensing is involved, as it is for many of these, then TBH going international from the start is likely to be a very tough goal to meet.
posted by Artw at 4:52 PM on March 16, 2012 [1 favorite]


For books, Australia's all about the book depository - a UK site, but free shipping and great service. Amazon totally dropped the ball there.

I'm a regular user of it to get UK stuff in the US, despite being all about the Amazon for most things.
posted by Artw at 4:53 PM on March 16, 2012 [1 favorite]


To be fair, the major barrier to Netflix expanding into other countries is local rights holders sitting on licenses in the hopes of forcing their shitty pricing models and interfaces on the public. I'm not looking at you, Rogers. I'm thinking at you.
posted by TheWhiteSkull at 4:55 PM on March 16, 2012 [1 favorite]


The article never discusses exactly how they Samwers copy other businesses but there's this idea - based on actual research - in business management that if you want to repeat a successful business or practice (which copying really is), you need to replicate it down to the very last detail before you can even start thinking about modifying or improving the business. I think this explains why the Samwers, for example, decided to copy Fab.com so closely: they need to follow the template (Fab.com) before doing any changes.
posted by Foci for Analysis at 4:56 PM on March 16, 2012 [1 favorite]


For instance, check out this paper:
Getting it right the second time
Szulanski G, Winter S.
Harv Bus Rev. 2002 Jan;80(1):62-9, 125.
posted by Foci for Analysis at 5:00 PM on March 16, 2012


Webflix (which became LoveFilm) has been around since 2002 though, and offered pretty comparable service on DVD rentals (I have no idea how their streaming holds up).

Exactly the point. Netflix can boohoo about losing a market of 60 million people if they want, but fuck em, they were a decade late. A decade! That's a eon in internet terms. Somebody else cloned their model and ran with it, sorting out whatever rights issues there might have been. And seriously, this is fair-sized and rich English–speaking country we're talking about, not Boondockistan.
posted by Jehan at 5:24 PM on March 16, 2012


"For books, Australia's all about the book depository - a UK site, but free shipping and great service. Amazon totally dropped the ball there."

Until they picked up the ball again by buying it.
posted by Pinback at 5:29 PM on March 16, 2012 [3 favorites]


Interesting. Let's hope they remain hands-off.
posted by pompomtom at 6:17 PM on March 16, 2012


Pinback beat me to it: Amazon bought the Book Depository. Amazon also bought Lovefilm. Amazon seems to have learned a trick.
posted by Hogshead at 6:17 PM on March 16, 2012 [1 favorite]


American sites are famously US-centric; if there's physical product delivery involved, new companies might deliver to Canada if you're extremely lucky. Delivery to Australia? Forget it, it's going to cost way more than it's worth because the companies appear unaware an international market exists and is worth tapping.

Or it's simply not worth the cost to the companies to serve Australia. There is a cost to that, you know. Both dealing with business requirements of other countries (privacy requirements? shipping requirements? etc), and the risk of spreading yourself too thin.

As for Spotify not being "bothered chasing down licencing agreements outside the US", it was available in Europe for years before the US.
posted by inigo2 at 7:25 PM on March 16, 2012 [2 favorites]


Pinback beat me to it: Amazon bought the Book Depository. Amazon also bought Lovefilm. Amazon seems to have learned a trick.

That's not a new trick, that's big business 101. Once you make it in a big market (like the US) you have the buying power to enter other markets in whatever fashion you choose. If you're cheaper than the other guy, you just have to make yourself available. If you're not, you buy them out, change the prices to something less attractive, and profiteer from the vacuum left by the absence of a good competitor. Then you use your monetary clout and market power to restrict any attempts by others to re-introduce a company that is cheaper.
posted by kisch mokusch at 7:59 PM on March 16, 2012


I noticed this the other day. Same guys, or just China being China?

It was promoted on Facebook by QQ, which already has a habit of knocking off any useful app for incorporation into the QQ app.
posted by ctmf at 9:49 PM on March 16, 2012


I've noticed that almost anything I might want to buy these days, I can find* for sale (or a copy, quality indeterminate) shipped direct from China, at a total price less than the UPS/FedX/Priority Mail cost for shipping me the same thing via some US reseller.

I believe this may be why the USA has to get rid of its postal system -- because if it's kept in place, it will be a conduit for stuff from China that will outcompete the US resellers of the same stuff.

Wipe out the ability to offer "free shipping" from China arriving by US Mail, and the China direct sellers won't have as much of an edge
_____
* Google Image Search is particularly good at finding these things
posted by hank at 10:23 PM on March 16, 2012 [1 favorite]


Gee, which is worse? Giving money to Bezos, or China? The horror is, I'm really unsure.
posted by Goofyy at 1:34 AM on March 17, 2012 [1 favorite]


As a consumer you're participating in the unmitigated horror that is capitalism no matter what you do, so you can just as well go for the best deals for yourself.

Mind, it will mean a couple of weeks in the strawberry mines once proper global socialism is here, but that's the price you pay for cheaper dvds now.
posted by MartinWisse at 3:06 AM on March 17, 2012


I believe this may be why the USA has to get rid of its postal system -- because if it's kept in place, it will be a conduit for stuff from China that will outcompete the US resellers of the same stuff.

Wait -- we need to get rid of USPS because people in China are paying to use it to ship stuff to Americans?
posted by inigo2 at 4:53 AM on March 17, 2012


All of those sites are similar to other sites anyway. eHarmony is just a dating site, those have been around forever. Pinterest is just a message board with photos. I'm pretty sure there have been sites like couchsurfing.com

Even Google, there were search engines before google. Facekbook was a ripoff of my-space and and friendster (and there were social networks before that. Sixdegrees, classmates)

A lot of people still think that it's all about the "idea". If you have the best idea, you win. But everyone has the same ideas. It's all about doing something well.
posted by delmoi at 5:38 AM on March 17, 2012


I noticed this the other day. Same guys, or just China being China?
Most of the china stuff is done locally. What's interesting is that seems even much more crassly commercial then pinterest itself is right now.
I've noticed that almost anything I might want to buy these days, I can find* for sale (or a copy, quality indeterminate) shipped direct from China, at a total price less than the UPS/FedX/Priority Mail cost for shipping me the same thing via some US reseller.

I believe this may be why the USA has to get rid of its postal system -- because if it's kept in place, it will be a conduit for stuff from China that will outcompete the US resellers of the same stuff.

That seems like a lot of work. There's also shipping times to consider. It doesn't seem like there would be much of a difference shipping something from a warehouse in the U.S. vs. shipping from a warehouse in China, and you'd get it a lot faster if you got it from the U.S. Maybe for expensive electronics or something, it might make sense.
posted by delmoi at 5:46 AM on March 17, 2012


I have nothing against these guys or their business model and I appreciate there's a lot of value in being first to market, so if someone takes my idea in another country and runs with it, then good for them.

But I don't think many of the commenters in this thread really appreciate how much work goes into internationalization of a website or peice of software. It's not just handing over the text to a translation service and then getting it back and you're done. You have to make sure the whole thing is written so that all the text gets pulled from those translations (the correct one, even) on demand. Then every time you change anything, you need to check to make sure it works correctly in 17 languages instead of 1, which makes testing a lot more expensive. You have to make sure you're not violating any laws in any of the countries you'll be doing business in. You have to figure out whether you have to charge VAT tax and if so, how much, and once it's collected, how do you pay it to the correct government?

You find out that your search algorithm relies on being able to match on the boundaries of words (I.e., so that "cat" doesn't match "category") and then when you throw Chinese at it you have no idea how this is supposed to work until you can get someone who speaks Mandarin to sit down with a programmer and figure out what should happen.

I currently have bugs files against my software for things like "the logo appears on the wrong side of the text in right-to-left languages" and "html5 'ruby' tags don't display Japanese pronunciation hints correctly".

There's a lot of work involved in doing internationalization properly and it's all very difficult to verify that you've done correctly because you don't know what it's actually supposed to look like.
posted by tylerkaraszewski at 9:41 AM on March 17, 2012 [3 favorites]


There's also shipping times to consider. It doesn't seem like there would be much of a difference shipping something from a warehouse in the U.S. vs. shipping from a warehouse in China, and you'd get it a lot faster if you got it from the U.S. Maybe for expensive electronics or something, it might make sense.
The most recent item I purchased from a Chinese merchant took almost 27 days to arrive (they didn't even get around to shipping it until I complained that I hadn't heard anything regarding my order in over a week). I'm not so sure free shipping from China is worth it if I have to wait over half a month for it to get here.

I ordered a package from Japan that had a shipping cost of around $11, and it arrived in about a week. I wouldn't mind paying that to a Chinese merchant if it meant I'd get my package in a timely manner. Christ, I pay around that much just to have items on the other side of the country sent to me, and it still can take up to two weeks to get to me.
posted by Redfield at 9:59 AM on March 17, 2012


(I'm looking at you Pandora, Spotify, Last.fm, hell even Apple when it first started the iTunes store)
...
the US versions can die like the dinosaurs they are.


Damn those America-centric Swedes and Brits/Germans/Austrians!
posted by kmz at 3:51 PM on March 17, 2012 [2 favorites]


Well, Zynga basically just cloned pretty much every Korean avatar game idea and business model from 10+ years ago, so I'd say we're all just about even.
posted by meehawl at 4:31 PM on March 17, 2012 [1 favorite]


There's a lot of work involved in doing internationalization properly and it's all very difficult to verify that you've done correctly because you don't know what it's actually supposed to look like.

I can understand that in some markets its not worthwhile to do quickly, moreso if the payoff is low. But if we take the specific example of US to UK, you have virtually the same language, a relatively large and wealthy market, rather similar cultural tastes, many of the same products, and a host of other similarities. I know rights issues can get in the way, and there's a learning curve for a new company, but we should be talking on the order of months at most, not years and years. Heck, I'm sure you can find plenty of English people in California who will consult on the whys and wherefores.

I seem to recall that some years ago Abercrombie & Fitch had no shops in the UK, and their online stores wouldn't ship here. Resellers on ebay did a booming trade in their clothes at the time, and A&F likely missed out on some sweet profits. Shipping tshirts and jeans ain't difficult, they just didn't want to.
posted by Jehan at 6:06 PM on March 17, 2012


American sites are famously US-centric; if there's physical product delivery involved, new companies might deliver to Canada if you're extremely lucky. Delivery to Australia? Forget it

It's not restricted to just new companies.

I notice it most trying to buy (non book) items via Amazon. Out of dozens of different companies selling a product, I'd be lucky if even one or two offer true international shipping.

For a country so proud of its supposed entrepreneurialism, it's incredible that the concept of packaging something up for postage but to a *gasp* international address is such an apparently challenging concept.

I imagine them wringing their hands in meetings, "But how can we manage all those furrin states? Like this New South Wales - how on earth can we fit it into our list of 50 states?"

"Could they just enter South Dakota, and we manually add a 'New' with a Sharpie in the warehouse? New South Dakota is 2/3 correct, right....? The postal workers will be able to work it out, and if not we can blame them when the order goes missing..."

"But what if the customer chooses New Hampshire as the closest match? I suppose we could manually edit that to New South Hampshire, but then we'll be using two different names for the same place. IT'S ALL JUST TOO DIFFICULT!"
posted by UbuRoivas at 4:47 PM on March 18, 2012


But I don't think many of the commenters in this thread really appreciate how much work goes into internationalization of a website or peice of software.

And people like the Samwers are doing that localization work, at least for their target market. This makes their sites even less of a clone— they're making an investment that (e.g.) Fab.com has decided not to, and as a result, they reap the rewards.
posted by hattifattener at 8:21 PM on March 18, 2012


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