Can Mahalo Learn from Brijit's Closure?

Yesterday we learned that Brijit has closed its doors (at least temporarily). When I interviewed Founder & CEO Jeremy Brosowsky back in December, one of the topics we discussed was my concern about their business model. Trying to pay a staff (in this case writers) with CPC advertising is very difficult. I'd like to note that my conversation with Jeremy was one of my favorites to-date; Jeremy is a very bright guy.

As I thought about Brijit some more last night, Mahalo came to mind. Mahalo utilizes a similar structure to Brijit in that they have a team of writers and link scrapers who scour the Internet for the latest hot topic to create Mahalo pages for. Brijit created article abstracts which is similar to the content Mahalo creates around a topic. Mahalo adds a variety of links on the topic while Brijit only linked to the original source article. Mahalo has also created many "how-to" articles which are much more in-depth and pay more (some are up to $150 per how-to).

One of the differences between Brijit and Mahalo is that Mahalo has very strong search engine rankings. CEO Jason Calacanis has become a master SEO and this will help Mahalo over the long-term. Brijit didn't have good search engine rankings and I think this was a major factor in their lack of ability to generate revenue. Calacanis does an excellent job in "sending" pagerank to Mahalo through his very authoritative calacanis.com blog. Calacanis also has 20,000+ Twitter followers and each time he posts a link to Mahalo, some percentage (my guess is 2-4%) will click through. Both of these traffic drivers require no marketing expenditure which can help to drive the ROI up. Mahalo relies on two types of traffic: search engines and Calacanis' shills - both on his blog and on Twitter.

Brijit paid a flat rate $5/abstract while Mahalo pays both full-time salaries to its in-house employees and a sliding scale to it's freelancers. While most of the pages on Mahalo will take years to return the money invested to create the pages, a few gems should be able to take care of the load. My guess is that their 100+ Grand Theft Auto 4 walkthrough pages will be some of those gems. Mahalo is banking on the gems.

Last month we learned that Mahalo workers need to write more words to capture more search engine rankings and we also learned that Mahalo is testing affiliate relationships as a way to increase revenue.

Mahalo has already started to push link research to the "free" community. I imagine we will see more pushed to the free side to maximize the ROI over time.

If Mahalo staffers aren't looking at why Brijit didn't work, they should. It could provide some valuable insight in how to avoid similar issues from affecting Mahalo.