heard that there was an under-monetized segment of the online economy and put up a site,” says Wilhelm. “This was put up by people who love it, and maintained by people who want to keep it going so they can document their projects. That authenticity is our greatest strength.”
But it’s the rare crowdsourced site that actually turns a profit. Wikipedia, for example, is supported by a non-profit foundation. Wilhelm says Instructables has devised a successful business model by offering something of value to each of its three overlapping constituencies: authors, readers, and advertisers. “We have to serve each of them in different ways,” he says.
Instructables helps authors by providing them with a pulpit for sharing. “When you build or create something, you want to put it on the coffee table so that people can come and look at it,” Wilhem says. “You want to tell them ‘Here was the part that was really hard, and these were the choices I made.’ But at some point your friends and family get sick of hearing about it. We take the project off the coffee table and give people a very large, engaged audience.”
Readers, obviously, come to the site for entertainment, instruction, and inspiration. Quite a few of them sign up for a “Pro” membership at $1.95 per month or $39.95 for two years. The benefits include fewer ads, access to PDF versions of articles, and single-page versions on the Web (so they don’t have to click “next step” 10 times). Wilhelm says about a quarter of the company’s revenue comes from these premium subscriptions.
Advertisers, finally, get to put their brands in front of an audience that, by definition, is in the mood to make something—which often means they’ll have to do a bit of shopping first. The site is rife with ads for brands like Scotch tape, comparison shopping sites, and Liberty Mutual homeowners insurance (just in case your next projects sets your house on fire?).
But some of the most creative advertising campaigns on the site, says Wilhelm, emerge when “we try to think of projects that can serve all three [customer groups] at the same time.” Instructables frequently offers “challenges” sponsored by a single advertiser, where authors compete by uploading articles on a common theme. For two years running, Craftsman has sponsored a Craftsman Tools Contest with $20,000 in Craftsman products at stake for the winners; the 2011 grand prize went to a guy who turned his Geo Metro into a plug-in hybrid. Currently, Krylon is sponsoring a contest offering an iPad 2 to the author with the coolest project involving spraypaint.
Wilhelm calls the challenges a classic win-win. “The advertisers get to associate their brand with something running on our site, the authors get a chance to show off what they’ve done, and the audience gets an influx of high-quality content.”
Wilhelm’s plan for earning a venture-scale return for his investors is to build up Instructables’ content archive, audience, and advertiser relationships to the point that the business is an attractive acquisition target for a large media or software company. “At the size we’re at, the actual revenue and earnings are not really that interesting to people who might buy us,” he says. “The most interesting thing is the authenticity of the site. That’s the key reason somebody will want to buy the company. They will want to understand how we’ve built that, and how to build it up in other communities. What we have done is not necessarily specific to how-to; there are aspects of it that I think would work for finance, or health, or whatever.”
But that authenticity probably wouldn’t come through unless Wilhelm himself were an engineer and inveterate tinkerer. His office at Instructables is dominated by a pair of makeshift treadmill desks, one for him and one for his wife Christy Canida, the company’s community and marketing director. In fact, the company’s entire second-floor space, located above a bar and a burger shop on 2nd Street in San Francisco’s SoMa neighborhood, is cluttered with circuit boards, craft kits, half-finished robots, and other contraptions. Wilhelm says the last Friday of every month is “Build Day” at the company, when “everyone is encouraged to build a personal project and document it on the site.”
Given that hands-on ethic—which is flowering these days into a larger “maker” movement centered on companies like TechShop and MakerBot, unofficial hackerspaces, and publications like Instructables and Make Magazine—I made a point of asking Wilhelm whether he felt driven by an urge to improve the general level of technological literacy among Web readers. Surprisingly, he demurred.
“Sure, if Instructables had been around when I was in sixth grade building lasers, it would have been fantastic,” Wilhelm says. “But if I were to say that I’ve had this big plan, wanting there to be another generation of kids building lasers, that would be disingenuous. I don’t have big thoughts beyond ‘I want to do something positive.'” Except, maybe, to make sure there’s still some time for kitesurfing.
