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Web 2.0 Warriors: Leading the New Generation of Internet-Based Companies

It was Summer 2002 and Ryan Sit (B.S./ M.S., ’04) was visiting his mom in San Jose before beginning his UCSD master’s work. As he attempted to teach his mom—a computer novice—how to email photos taken with her new digital camera, Sit realized there must be a way to automate the cumbersome process.That idea became the focus of his master’s thesis and the start of DropShots, a service that allows family and friends to share their photos and video online. Sit’s beta site was the first to use Flash for converting home video files to play on Web browsers. DropShots now hosts more than 4 million media files, and Sit says the site has become the number one family photo and videos sharing service in the world.

DropShots founder and CTO Ryan Sit (front) with (l-r) CEO Darren Hardy and COO Brian Pond (M.S., ‘01). DropShots is a subscription service that allows
users to effortlessly share photos and video online
with an invited circle of family and friends.
DropShots founder and CTO Ryan Sit (front) with (l-r) CEO Darren Hardy and COO Brian Pond (M.S., ‘01). DropShots is a subscription service that allows
users to effortlessly share photos and video online
with an invited circle of family and friends.

DropShots is one of a new generation of lean and smart Web 2.0 companies that are flourishing as broadband access becomes commonplace and everyone from kindergardners to grandmothers embrace the Internet.

“We were determined to spend only what we made, which gave us a huge incentive to create something valuable that people would pay to use,” says Sit.

His objective was to create an online destination where family members could share life’s joys and stay in touch, so he focused on making Dropshots easy for even non-technical users. In addition to the onestep drag and drop system that automates compressing, transcoding, uploading, organizing and publishing media files, Sit’s team created an interface that allows the photographer and viewers to share experiences by posting comments about the images.

Sit’s plan paid off. By the time he graduated from UCSD, his test group of 10 users had organically grown to 5,000. Having launched its subscription-based service in November 2005, DropShots became profitable this March.

Taner Haliciouglu at Facebook, where he is expanding the college social networking site with new features targeted to the corporate community.
Taner Haliciouglu at Facebook, where he is expanding the college social networking site with new features targeted to the corporate community.

Taner Halicioglu (B.S., ’96), employee #4 at Facebook, the popular social networking site for college students, says being first to market is key for Web 2.0 companies.

“Hardware and processing power is cheap, and free software is readily available, which is why Facebook was able to get off the ground so quickly,” says Halicioglu. “With the barrier to entry so low, it’s important to get in early and build a critical mass of users who will remain loyal, so long as you provide substantive features.”

Halicioglu should know. As the senior operations engineer for the seventh mosttrafficked website in the U.S., his job is to ensure that the Facebook network and all its features runs smoothly. He says Facebook has become a way of life for many college students (including 22,000 subscribers at UCSD), and roughly 50% of their users return to the website everyday to chat with their friends and connect with new people.

Riya co-founder Munjal Shah. Riya’s face recognition software allows users to search their own private photos, without manually tagging each shot.
Riya co-founder Munjal Shah. Riya’s face recognition software allows users to search their own private photos, without manually tagging each shot.

Veteran Web-entrepreneur Munjal Shah (B.S.,’95) says the recent trend in Internet usage is whyWeb 2.0 companies can pursue highly targeted markets: “In 1999, there were only 50 million Internet users.Today, there are a billion people on the Internet, so you need only capture a small percentage of the market to be successful.”

Shah was the co-founder of Andale, an online market research service for E-bay merchants. His latest venture is Riya, the first photo search site to use face recognition and text recognition technology. “Once you train the system, you can find a picture, say of your daughter and wife together, even though you’ve never manually tagged the photo,” says Shah.

Although Shah raised $19 million for his venture, he hasn’t spent a dime on advertising or PR. Instead, his team kept a running blog as they developed the product, telling the story of their trials and tribulations. With the exposure from major bloggers such as TechCrunch, Riya’s story was covered by nearly every major newspaper in the country.The unique face recognition concept was so well received, that more than one million photos were uploaded to the site on March 26, 2006, the day Riya’s beta site was publicly launched.

Shah credits Jacobs School computer science professors Mohan Paturi, David Kriegman and Serge Belongie for providing initial encouragement that inspired him to pursue Riya. Face recognition experts Kriegman and Belongie continue to provide technical advice as the company develops. And like Sit and Halicioglu, he says he relies on the fundamental education he received at the Jacobs School.

“The Internet is in a rapid innovation phase and not all Web 2.0 start-ups will survive,” says Shah. “I am a big believer that the long-term competitive edge starts with deep technology that others cannot easily replicate.The intensely rigorous curriculum at UCSD gave me exposure to difficult concepts like artificial intelligence, and is the reason I was prepared to take on a highly technical challenge like Riya.”