Too much information. In conversation, it means roughly “Stop! I didn’t want to know that.” But it’s also a cry heard more and more often from search-engine users who type in a generic query like digital cameras and get back an Everest of results (21 million at Google, 21.5 million at MSN Search, and 38.1 million at Yahoo, to be precise). For shoppers in pursuit of product reviews or retail listings, general-purpose search engines just aren’t the right tools.
But shopping portals like Shopzilla, PriceGrabber, Shopping.com, and Froogle have their own shortcomings, argues Silicon Valley entrepreneur Michael Yang. They generally assume that shoppers have already decided what they want to buy and are simply comparing prices. “But shopping is really a two-stage process,” says Yang, who is 43. “Once you decide what is the best product, then you start comparing prices. And the comparison-shopping sites are only focused on getting you the best price.”
Yang should know. Along with fellow Korean-born engineer Yeogirl Yun, he launched price comparison site mySimon in 1998. MySimon was one of the earliest and most successful online shopping aids, attracting millions of users and $30 million in venture capital in its first 18 months. In early 2000, CNET acquired mySimon for $700 million, providing a princely return to its investors and allowing its founders to walk away with fortunes in the “double-digit millions,” in Yang’s words. It was one of the rare examples of dot-com dreams come true.
But Yang and Yun weren’t sated by the experience. After spending a few years on other projects, the two are back together and taking a second run at the online-shopping market. This time they’re building a new type of search engine that focuses exclusively on product-related information. And that might be just the beginning: the engine itself, they say, uses fundamentally new search algorithms that could be adapted to any specialized, or “vertical,” category. A beta version of Yang and Yun’s site, called Become.com, debuted in February.
But can a pair of dot-com millionaires strike gold twice? (Or thrice, in Yun’s case: after mySimon, he developed a search engine called Wisenut, built a solid base of users, and sold it to Looksmart.) These days, the odds are unfavorable for any startup. Add to that the extreme caution now endemic among Silicon Valley venture capitalists, the surfeit of existing shopping sites, and the fact that Yun and Yang are taking on Google, Yahoo, and Microsoft all at once, and their plan begins to sound brash.
Yang immigrated to the United States with his parents at age 14, earned degrees in electrical engineering and computer science at the University of California, Berkeley, and Columbia, did stints as a chip designer at Xerox and a marketer at Samsung, and got a night-school MBA from Berkeley. Yun graduated from Seoul National University in 1993 with a degree in computer engineering, won a national scholarship in computer science, earned a master’s in the subject at Stanford, and went on to found an Internet software startup called One-Oh. By that time, Yang was running video-card maker Jazz Multimedia, and he and Yun first met when Jazz acquired One-Oh. When Jazz itself folded in 1998, the pair decided to start an Internet business together.
They settled on comparison shopping, a habit Yang says he acquired as a high-schooler earning a low wage at Seven-Eleven. “There were a couple of startups that were already doing that, but they weren’t doing it very well,” Yang says. (One of them, Jango, was absorbed in 1997 by the doomed search portal Excite, and the other, Junglee, was acquired by Amazon.com in 1998.) Their creation, mySimon, was built around a “virtual learning agent” designed by Yun to extract prices, product details, and other relevant data from merchants’ online catalogues, each of which was structured differently. “These days we don’t need that agent technology, because most merchants package their information in a standardized XML [extensible markup language] structure,” Yun says. “But back then no one wanted to give out that information” – so Yun’s team became expert at extracting it.
Between April 1998 and December 1999, 10 million users flocked to mySimon, and its staff grew from two to 60. Yang says he and Yun would have stayed on as the company’s leaders, but by early 2000 its investors were itching to cash out. CNET’s offer of $700 million – made just months before the dot-com crash – was impossible to refuse. (MySimon continues to operate today as part of the CNET publishing empire.)
While Yun went on to start Wisenut, Yang started a family. He says the years after mySimon gave him time to think more about what makes a search engine successful – and to watch Google rise to greatness. “I really got excited about challenging Google by developing a new search engine company that could give them a run for their money,” Yang says. In early 2003, he started reading papers about PageRank, Google’s algorithm for sorting search results, and started looking for partners who could build something better. “One day it just dawned on me – I should recruit Yeogirl.”
Yun, who having sold Wisenut was in law school in Korea at the time, was initially cautious about taking on the search giant. “Google is a strong company,” Yun says he told Yang. “I advised Michael to think about something else.” But when Yang gave a half-hour pitch over lunch that grew into a six-hour brainstorming session, Yun was hooked. It helped, of course, that Yang was promising to put $2 million of his own savings into the venture.