Docoloco - Local Recommendation Engine

Today we are showcasing another venture from Melbourne, Australia, Docoloco

Co-Founded by Melbourne boys, Chris Mander and Johnny Cussen, Docoloco - is a community powered online recommendation engine that helps locals find, share and follow the best local businesses. In laymen terms, people can use Docoloco to

• find recommended local businesses and services,
• recommend the places they love (or love to hate)
• and ask friends and other locals to share their recommendations.

Chris Mander, describes:

Today local businesses use Docoloco to:

• list their business, features and products online free of charge,
• appear in the top web results on Google,
• use their loyal customer base to generate new business
• and attract new customers.

Tomorrow businesses will use Docoloco to:

• find out a whole lot more about who their customers and competitors really are
• and deliver highly targeted ads to a local audience.

Let us explore bit more about Docoloco and Chris's journey as an entrepreneur and what his thoughts are on the changing landscape of innovation in Australia. This is what he has to say:

• Please tell us how it started
We both felt that online advertising is too complex and time consuming for small businesses and that small business websites are expensive and usually stagnant which means they gather very little distribution.
As consumers, we're sad that in 2008 consumer reviews are almost entirely absent from the Australian online landscape. That has to change.
So we decided to grease up our elbows and throw our hat in the ring.

• How long it took before it was up and running?
The concept was hatched early on in 2006 with a fury of sketches, diagrams and wireframes. Software development commenced during August 2006 and a 'friends & family' beta version of the site was launched in May 2007.

• What stage of your start-up is, stealth mode, beta mode or fully functional?
The recommendation engine is fully functional and the business marketing tools are still stealthy.

• What is the main objective/mission behind your venture?
To give Australians a better place to go for local business recommendations than the tired old Yellow Pages concept.

• What is unique about your venture?
Docoloco is a collective intelligence platform with an infinitely expandable taxonomy. The structure of the collected intelligence is very effective at matching local search queries in general search engines.

• What market segment verticals you are targeting for?
We are targeting the small business advertising and competitive intelligence markets.

• What type of customers you are targeting ?
Small businesses.

• How many users are using your services?
We currently have more than 500 contributors and ~20,000 unique visitors per month.

• What sort of marketing you are using to spread the word?
To date we have been focused on product development. We have done no real external communications to date.

• How are you measuring the success of your venture?
The two key metrics we're watching at the moment are recommendations per contributor and search referrals per recommendation. Over time the focus will shift to business account numbers and our ad product sell through for those accounts.

• Are their any special mechanisms/tools are in place to monitor the progress?
We spend a lot of time crunching our standard web usage data with a particular focus on how effective our SEO is. We also monitor key performance metrics through our custom reporting interface.

We are constantly measuring traffic, SEO performance and user behavior to decide on which features to keep, ditch or re-visit.

• What is the monetizing/revenue model? Is their any new model, which is being tried?
We will be offering small business marketing and analytics products.

• Which are the main competitors or major players in this market segment?
Yellowpages.com.au and truelocal are the current leaders in the space.

• What has been the most easy to use, out of box and helpful technology?
OmniGraffle, OmniOutliner and good old fashioned butchers paper. We're product guys - wire-framing, concept mapping and task lists are critical. Ruby and specifically Ruby on Rails fits well with our Agile workflow.

• Are you using lot of open source tool sets for this? What is your operating environment (operating system) and what type of database you are using?
100% open source. The application is developed using Ruby-on-Rails, running on Mongrel clusters, Apache and Ubuntu, our data lives in a MySQL database and search is powered by Ferret which is a ruby port of Lucene. We use a stack of other smaller open source pieces but I think you get the picture.

• How often do you catch up with others trying similar things and where do you catch up. Do you have dedicated communities in your city?
We are constantly in touch with friends and colleagues in the industry and try to attend organised meetups when we can.

We've worked in online and search for a long time so an awful lot of the people we know here and overseas work in the space.

• How much money is needed upfront to start a venture?
The wonderful thing about building web products in an open source economy using commodity hardware is that the bulk of operating costs goes into man-power. Docoloco has been developed entirely by Johnny and I so has required very little cash investment.

We think time is perhaps a bigger factor than money - sometimes one can be independent of the other but it takes a lot of juggling.

• What are the main barriers in general for people start their venture in Australia?
We think the whole ecosystem is underdeveloped in Australia. It's harder to raise capital, there are fewer like minded souls to hang with, and even when we look for bread and butter consulting work our entrepreneurial activities are largely undervalued. Our experience in the US and to a lesser extent the UK is of a different environment. A move to the US is a constant question for us but we think the opportunity in Australia is real and ready so we're determined to push as far as we can here.

• What are your thoughts on the future trends of your service and market segment you are in?
We expect the Australian small business online advertising market to approach $1 billion by 2011 and that small business online advertising spend will follow consumers who are shifting from category based searches on yellowpages to keyword based search on general search engines.

We think that it's unlikely the large search engines will develop a significant and ongoing relationship with consumers in the local recommendations space and that there will be one or two key local players in each market.

• Do you have any advice for people who want to start their venture?
Read this book
Follow Venture Hacks on Twitter
Love what you're doing.

Thanks Chris for sharing your thoughts. We look forward to hearing from you in future on the progress of Docoloco. All the best for future.

For coverage on other Australian startups, innovation, tech trends check this out and our coverage on interviews can be found here and here