TechCrunch reports that Judy’s Book CEO Andy Sack has said that the company will be shutting down. I’m surprised by this and have asked Sack directly for confirmation (confirmed below). I’m surprised in part because the site was in the midst of something of a relaunch around its new coupons-deals business model.
Sack has been very forthright about what he did right and wrong with the original Judy’s Book model and displayed unusual wisdom in deciding to change the model after he saw what the company was doing wasn’t working.
How should the apparently demise of Judy’s Book be seen, especially in the wake of the sale of InsiderPages to Citysearch/IAC? In the fragmented market of local, getting traffic and advertisers is very challenging. But the greatest challenge is around monetization. Sack wrote about that on his personal blog when the site shifted its model.
As with the sale of InsiderPages, one could write a story about the impatience of boards and investors, or about the presence of larger competitors who have established sales channels or who can bring scale to local that startups cannot.
TechCrunch says that “Yelp is the last of the local review sites standing.” That’s not exactly true. Citysearch is one of the original local review sites and it’s still around. And there are many other sites that offer community or local reviews. Yelp is just the most prominent of the class of startups that began a couple of years ago, and which included InsiderPages and Judy’s Book. But more recently sites like Marchex’s OpenList, Outside.in and, more recently CityVoter, among others, have emerged to take on local.
The demand for trustworthy local information online isn’t going away. But it may be that for startups (as opposed to companies that can subsidize it) there’s not enough runway and too little room for error in a market that its very difficult to crack.
But, once again, local is where the money changes hands — it’s the “last mile of search.”
Update: Sack posts about the closure on his blog here:
Today was a tough day. For the second time in my life I had to tell a great team of people that the idea they’d worked so hard on was going away. After 3+ years, our management team and board of directors has decided to scale back our operations at Judy’s Book and seek a strategic acquiror.
As a CEO, I know this is the right thing to do for our investors. But as an entrepreneur it’s disappointing to stop chasing an idea just when it’s beginning to take root in the popular consciousness.
Update 2: Kudzu and SmallTown (and Angie’s List) should have been mentioned as local sites that are going strong (as the comments suggest). It’s also quite possible that Judy’s Book will live on if acquired. I think the site had really yet to explore the potential success of its new coupons-deals model. And as I’ve said before I think there is still a largely untapped opportunity to aggregate coupons in a consumer destination (I’m not talking about Coupons.com).