Oingo sale : Play games or make millions? The choice is yours

Directnic

Defender video game.

Playing games can be a form of distraction from day to day duties and obligations.

And it’s all cool.

A game of “Defender,” however, cost its player millions of dollars, after he turned down a business offer, in 2000.

Entrepreneur and author, James Altucher, explains how that happened:

I was running a $125 million dollar VC fund but I played the arcade game “Defender” all the time in my office with the door closed.

When I need to escape my life I have one outlet that I always use. Games. I bought a Defender arcade game. It was my favorite game from when I was a kid. I had it moved into my office.

One time there was a knock on the door. Dan, one of the associates at the firm, had a pitch that he liked. Since he was my regular opponent in Defender, I let him in so we could play.

“The company is called ‘Oingo’,” he said. “The CFO and I went to college together. He’s a smart guy.”

“What do they do?” I was trying to focus on the aliens that were landing and turning into mutants. They were harder to kill when they became mutants.

“I’m not sure. They help search engines. They have a way of having advertisers bid on advertising spots on the search engine when people search words that the advertisers want to appear next to.”

“Search engines make money from banner ads,” I said.

“This is different,” he said. “Advertisers for ‘beer’ for instance, would get placement if they bid or buy the word ‘beer’ from the search engine.”

“Do they have customers?”

“No, that’s the thing. They are about to go out of business. No customers. I think we can get at least 50% at a super cheap valuation. Almost nothing. They are desperate.”

“Forget it,” I said, “The search engine business is dead.”

Dan left. He went into the meeting that was gathering in the conference room. I skipped it and just played Defender.

Oingo changed their name to ‘Applied Semantics’ then a small search engine called ‘Google’ bought Applied Semantics for 1% of equity in Google.

Google changed the name ‘Applied Semantics’ to AdWords and AdSense and now that is 99% of their revenues.

1% of Google is about $600,000,000 now. Maybe we could’ve gotten half of that or a little less for about $2 million.

For the full story click here.

Many thanks to Richard Lau for the link.


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