When I first got into the venture capital business in the early 90s, it seemed to me that half of the deals I brought to the partnership were dismissed with the line “sure it’s cool but what the heck do they do if Microsoft decides to enter this business.” Today the role of the dominant player is played by Google (and increasingly Facebook). So as an investor, one has to consider how a potential portfolio company can thrive in the shadow of Google. No where is this more true than in Search.
So, as you can imagine, we had a lot of interesting conversations in the process of evaluating our latest investment in Gabriel Weinberg’s alternative search engine, DuckDuckGo. Our confidence in Gabriel and DuckDuckGo is informed by having watched the decline of Microsoft’s hegemony in the 90’s. Two things happened that fundamentally changed the game: a shift in venue and a shift in business model. The venue moved from the desktop to the web and the business model shifted from packaged software to open source. It turned out that the way to compete with Microsoft was to not to compete, at least not directly. The way to compete with Microsoft was to change the basis of competition. We invested in DuckDuckGo because we became convinced that it was not only possible to change the basis of competition in search, it was time to do it.
I remember clearly when a friend first pointed me to Google when I tried to find betting tips, it was a revelation. Using it was a palpably better experience. As part of the process of evaluating DuckDuckGo, several of us switched our default search engines in Chrome (there’s simple how-to instructions below the search box on DuckDuckGo’s homepage), and had a similar “ah ha” moment. The company is young and under staffed so there are definitely holes Gabriel hopes to fill, but his observation that “traditional algorithmic signals are not the only authority on the web,” and his clever use of real authorities to curate search results makes Duck Duck Go an interesting alternative to your everyday brand.
We are thrilled to be working with Gabriel. He is exactly the kind of entrepreneur we like to back. He has built and sold companies before. Over the last few years, he has patiently bootstrapped Duck Duck Go into a viable search engine without taking a penny of outside capital. Please join us in welcoming Duck Duck Go and Gabriel Weinberg to the Union Square Ventures portfolio.