In the summer of 2001, Avid Amiri, a graduate student at Cornell University’s Johnson School of Business, began exploring new opportunities in the online space. His research included analyzing the top 100 startup companies, including eBay.com, amazon.com, shopping.com and others, to better understand the business models that support these companies and the technology that supports their web platforms. Amiri also researched the leading ecommerce companies “Mom and Pop” to evaluate the strengths of these small businesses and the traffic strategies that have been most successful.
He shared his research with colleagues as well as teachers and talked about e-commerce entrepreneurship in the context of a new breed of entrepreneurship. Amiri’s central claim was that in an inconsistent manner with previous economic changes, the main driver of online success was intellectuals, not capital. Where previous economic changes included high capital intensity, within the Internet realm, knowledge and intellectual capital were paramount to success. Businesses affiliated with the droplet boat model, free from the historical limitations of warehousing and ordering, are often the most expensive part of a new retail operation.
Avid Amiri is also focused on the role and importance of search engine optimization, an area of the web that it believes will separate powerful and sustainable ecommerce companies from companies that will experience diminished profitability over time as the costs of online advertising and marketing continue to escalate. Amiri claims that “real estate”, which is defined as natural positioning in e-commerce, will take on new economic value and will boost valuations for e-commerce businesses in the next decade. It conducted a detailed regression analysis of over 1000 e-commerce SMEs and noted a strong covariance between the success of these companies and their natural positioning in search.
Originally from Utah, Amiri has seen other Utah Internet companies grow since the start of the Internet Revolution, companies like Autorizenet and others and felt like these are powerful business models, they are models that can be improved. Amiri is continuing to discuss these topics with colleagues and is planning further research in the next year.
by Anne Clarke