In his first interview since the remains of fallen social media Digg star were sold to Betaworks, Digg’s founder Kevin Rose said he sold some company shares during its venture-capital financing rounds but “did not make a lot of money.”
That was just one disappointment of several for Mr. Rose, who founded Digg in 2004 and was involved with the company off and on as an executive and director until its very end.
Digg was one of first social media sites, providing a way for consumers to put together their own collections of news and other Internet content by posting links on the site’s homepage, rather than relying on the choices made by newspaper editors. At one point in 2008, it was valued at more than $160 million by its investors, according to Dow Jones VentureSource.
Mr. Rose chalked up Digg’s failure to a combination of its own missteps along with an acknowledgement that the news-sharing site was outmaneuvered by Facebook Inc. and Twitter Inc. Among the missteps: Digg botched its re-launch in the summer of 2010, and, more importantly, he said the company was slow to respond to the criticism.
“We were desperately trying to figure out how to get traffic back,” he said. “A bunch of the community had already revolted by the time we fixed it.”
He also said Digg made a mistake by cloning the features of other websites like Twitter and Facebook. “We did a lot of things that went against the DNA of our product.”
Mr. Rose said that Twitter and Facebook started to eat away at Digg’s traffic as both sites evolved into places where people discovered the most up-to-the-minute news and information, the main reason people visited Digg.
“Twitter became a major place to find out what was breaking on the Internet,” he said. “Facebook became a place to share links. Social media really grew up.”