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Taking the HardRoad for a web-based entertainment company
by Chris Crowley, President, HardRoad.com

The recent demise of riffage.com (and others before) reminds me of that great line in Richard II where the depression-prone Richard sighs, "Let’s sit on the ground and tell sad stories of the death of kings."

News flash --- not ALL music web sites are out of business. And not all of the survivors are tied up in court, or bizarre partnerships that appear wildly antithetical to their single interests. How does anyone survive in this market?

The challenges are many, the possible solutions only dimly glimpsed.

HardRoad.com is a web-based entertainment company. We feature six 20-something reporters who roam the US, filing daily dispatches about their travels, reviewing hot local bands and posting MP3s from the bands. We post fresh music, road trip and rich-media content, six days each week.

Sound like a "content play?" It is, with off line revenue streams. We rely on syndication, concerts, record sales and member list sales as our core revenue streams. Still, it ain’t easy out there. We face problems many others face, as well. We offer our partial answers in hopes of helping and hearing from others what they are doing to survive and thrive in these tough times.

Our three biggest challenges are:
1. raise some investment money to expand;
2. build traffic without a marketing budget; and
3. generate revenue to make the funders believe and the business survive.

We’ve given up on venture money. Venture capitalists want to forget they ever heard of MP3, while the term has become the most used search criteria on the web, replacing "sex." Go figure.

We’ve reduced our burn rate to a glowing ember and are financing ourselves with genuine angels - people for whom investments of $25-100,000 are major risks, but who love what we’re doing and believe it will work. This isn’t an option for many businesses that must spend more to grow, but we’ve made this a core value so we can soldier on. If your burn rate is more like the typical $100k/month, good luck!

To market a site these days without lavish budgets is a real challenge. Is any "dot" going to advertise on the Super Bowl this year, or will the teams be reduced to playing football? How do music and other content sites build traffic without the luxury of flashy ads and marketing budgets?

HardRoad has pursued simple trade deals with sites that have traffic in abundance but want something we have to offer - great content and ways to reach consumers off line. With some deals, it’s been the way we all think it’s supposed to be in the Internet model. Sometimes done with email only, sometimes on the strength of relationships. With the biggest players, jealously guarding their revenue-generating real estate, it feels like we’re dealing with the pre-break up phone company. But we’re getting there (we think).

Meantime, we have not spent a dime on marketing and have done what little PR we’ve undertaken in house. It’s not how we want to grow, but it’s what we can do in this climate. The content for traffic deals are boosting our numbers nicely, though we’re not building the brand the way we’d like.

Finally, how do we generate revenue without the money to build out the aspects of our business that will make us profitable?

We’re trying things on a scaled-down, prototype basis, with help from strategic partners, to show we can make money, then ramp up.

HardRoad will release its first album in February in one market where we enjoy a strong relationship with a top radio station and a local music store. By getting the station to put the record in its rotation and our brick and mortar partner to promote it in stores, we plan to make some money.

We’ll do the same thing with concerts. We’d planned 140 per year around the country, but are rolling out four in the first quarter while we work on nailing down sponsors and additional partners to help defray costs. See item one above - it’s all about operating with no cash reserves.

Our focus is on doing more with less and showing we can make money with our model. That appears to be the lesson for the whole dot-economy.

Back to Shakespeare, for the close. Of course, Richard II finally does die and - voila! Henry IV arrives on the scene. A happening dude, with Falstaff and a merry band of followers who know how to have a good time. And, how to please an audience.

The pendulum will swing back someday, and we and others who’ve figured out ways to be lean and creative and actually make money will be there when it does. In the meantime, we welcome your visits to our site, comments on the above and suggestions for folks who could help us as we tramp down the HardRoad.