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How Wez Made Millionz Wit Dis Foto

Two entrepreneurs turn a quirky culture of creating misspelled captions for cat photos into one of the most popular Web sites. Lessons about commerce in the 21st century

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 There was a time when publications such as The Wall Street Journal or Business Week called for an interview and Kari Unebasami would only agree to be quoted under her online screen name, tofuburger. Unebasami and her partner, Eric Nakagawa, were the creators of a Web site where people could post silly pictures of cats and caption them. Site visitors then voted on which ones they liked best. The site started as a lark and Unebasami wasn’t sure she wanted to be known as one of the founders of that quirky cat Web site. So she asked for anonymity.

But the two 20-something, local entrepreneurs had managed to develop that quirky cat Web site, in a matter of months, into one of the most popular Web sites online. So The Wall Street Journal, among other national publications, was calling. Unebasami and Nakagawa had harnessed an online cultural phenomenon and created an online community that was astonishing people. Their Web site was quickly emerging as an emblem of new commerce opportunities built around user-created content online.

If you are not yet a believer, mull this over. The site was launched with zero capital in January 2007 and the duo reportedly sold it for seven figures in October of that year. Neither Unebasami nor Nakagawa would confirm the number, nor would the Seattle-based entrepreneur, Ben Huh, who bought it. But none other than Time magazine (Yes, they called, too) put the sale at $2 million.

 Not bad for two friends who had initially hoped their new hobby would make enough money to buy Nintendo Wii systems. “We had a goal of $600,” Nakagawa says. “You make a goal and then you work to achieve it. Then you move [the goal]. That’s progress.”

Indeed.

Their story is about progress, about how business is changing in the 21st century and the barriers to operation that once disadvantaged Hawaii are no longer a factor for online ventures such as theirs. Their story is also about how customer expectations are fundamentally changing, whether you are a traditional brick-and-mortar retail store, a Hawaii Business Top 250 company or just a quirky cat site. And their story has lessons about what the power of person-to-person marketing can do for almost any business.
Yes, these funny cat photos can teach us something.

1 Silly Foto

It all started with an e-mail between friends. On an average day in January 2007, Unebasami sent Nakagawa a photo of a smiling, gray cat with the caption, “I Can Has Cheezburger?” Something about it cracked him up. He bought the ICanHasCheezburger domain name for $9.99 (annually) and posted the photo, first by itself and then with ads. Unebasami suggested they make it a blog, so they added other silly photos with captions. Almost immediately, people found the site, which logged five hits the first day, then 17, then jumped to 100. Soon it went from a couple of hundred to 10,000, Nakagawa says.

To be fair, the tech savvy Unebasami and Nakagawa did not create the phenomenon of posting cat photos with captions. From a generation that came of age as avid Internet users, they simply created a Web site that did it better than anyone else, a better mouse trap, if you will.

To better understand the phenomenon, it should be made clear that, while the site features pictures of cats with humorous captions, there is an added layer of humor. The captions are often deliberately misspelled and use poor grammar — what has become known on the Web as “LOLspeak,” where “LOL” means “laughing out loud.” For example, a photo of a black cat on the site appearing to play a purple tuba has a caption that reads “DIS mak dem wakup an’ feed meh!” The idea is to approximate how a cat might spell. The cat photos with captions have come to be known as LOLcats. In addition, the captions at times mimic the dialogue of online gamers who often taunt each other in interactive, multiplayer games.

“It’s hard to explain,” Nakagawa admits, noting that many people — including some family members — don’t really “get” the site. Some, he says, even call the idea stupid.

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