Liz Gannes

Recent Posts by Liz Gannes

ChaCha, Still Grinding Away at This Online Q&A Thing, Raises Another $14M

Giving people answers instead of links is the new hotness in search. To its credit, Q&A site ChaCha has been trying to do just that for six years now, and it’s getting one last push of venture capital.

ChaCha answers questions amid a heckuva lot of ads.

ChaCha answers questions amid a heckuva lot of ads.

Well, you gotta hope it’s the last push! The Carmel, Indiana-based company has now raised its Series G round: $14 million from VantagePoint Capital Partners and Rho Ventures. That brings it to $82 million raised in total.

ChaCha CEO Scott Jones says he’s finally, finally — after many twists and turns and pivots — on the verge of cracking this Q&A nut.

His solution is a combination of, 1) weaning the company off of paid answerers in favor of passionate users — the current ratio is 50:50, but it’s changing; 2) switching from search to social distribution, and from “wizard behind the curtain” answers to real names; and, 3) bringing on brands to pay for the privilege of answering questions.

Not all of that is implemented yet; it’s a hypothesis in progress. But Jones has been in a constant state of evolution. In February 2011, Google’s Panda update chopped ChaCha’s traffic and revenue in half overnight.

So: After clashing with Google by gaming its search results, ChaCha wants to take the even harder path of competing with Google head on, by trying to better answer the sort of quick questions Google now surfaces on results pages through its “Knowledge Graph.”

But Jones said ChaCha can go further than Google because it has spent years focusing on how to answer “out and about” questions about surroundings, make judgment calls and recommendations, and process phrasings that evade natural linguistic processing.

And, in the meantime, ChaCha has built up an audience of 45 million uniques per month and two billion questions answered.

Along the way, some random experiments have actually worked. For instance, ChaCha now runs a sort of sponsored tweet scheme called Social Reactors that’s sharing revenue of as much as $100,000 per month with certain individuals who tweet about suggested topics.

Jones admitted that perhaps that particular initiative was somewhat off-topic, but he noted that kind of distribution power will likely be very useful when ChaCha makes a big mobile app push later this year.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik