November, 1997. I was completing my PhD course at KAIST, I started making the site PeopleSquare, which was precursor of the current Cyworld , with my friend Jung, a web developer, whom I met whilst doing my military service. Since we didn’t have much money, I learnt Adobe Photoshop and designed the site myself. It was so ugly however, that I had to work part time to pay for a real web designer. Luckily, I participated in a research project for NCA (http://www.nca.or.kr/eindex.htm) related to Virtual organizations - Virtual Company Strategy Utilizing ERP and PDM on CALS environment – the knowledge I gained here would later help me define a concept now known as PRP.
Initially we benchmarked Match.com as we considered starting a dating service, but soon realized that the concept wouldn’t fit well with Korean, or Asian, culture. To give an example, in the US divorced women register that they are divorced and have children from the previous marriage. Wind back to 1998 in Korea, and this kind of openness is impossible to imagine, members would be almost obligated to lie. Putting people online anonymously grants them the opportunity to embellish their looks and social status, and given the platform of a dating service this, obviously, became the only possible outcome. i.e. “don’t ask who I am, just enjoy”. So I thought the idea of transforming real society into the online digital world would be a better approach, since society exists on the foundation of social network infrastructure.
When we enter this world, we have parents as the first nodes in our social network. What are the second nodes? Our siblings. As we grow, we continue to add nodes; relatives, alumni, friends, previous and present colleagues, friends of relatives and colleagues etc. So I firmly believed that the offline, or real society is conceptually just a completely inclusive a social network. My main field of study was ‘Trust-based Information Sharing’ for my PhD thesis. The concept is included in many of the Harvard Business Reviews on ERP, PDM and SCM. Trust-based Information Sharing is the core infrastructure for many IT process-based solutions and services. When we couple this concept with Social Networks, we can regard the SN as a kind of trust-based information sharing channel.
At the time, Sixdegrees.com was growing quickly and I got wind of their efforts in exploring the six degrees of separation based on Millgrams’ model. Of course I immediately benchmarked their service, but already had the philosophy of trust based information sharing and PRP (Personal Resource Planning) in mind. PRP is really just a personal abstraction of the ERP model. I regarded people as a big information silo (people they know, profile sharing, calendar sharing, car purchasing experience, photos, movies, restaurants, hospital and law service experiences etc). For example, a mini-case of trust based information sharing is a hospital review from one’s own personal experience or perspective, it’s not like a paid review, and it’s intrinsically connected with our social network, which changes the dynamic dramatically. I thought this concept had a great potential for things like dating and careers etc.
Society also consists of many groups like alumni, work colleagues, family etc, so we made a ‘Secret Club’ service which provided special functionality for project groups and alumni networks – the focus was social transformation from offline to online. Later in 2000, a site called iloveshcool.com, similar to Facebook.com in the US, went through rapid growth. The site was focused purely on the alumni functionality in Cyworld. Recently I think products like Grouper.com and Microsoft’s Sharepoint are based on the PRP concept, even if they differ in execution. After we received Angel investment late in 1999 we took part in the New BizConcept competition at the Walker Hill Hotel in Seoul. We won the Millennium Rookie for the concept of PRP and Cyworld. One of the judges was interested in using the PRP concept in the Harvard business review. However, a few months later I resigned as CEO.
Cyworld was acquired 2 years later by SK Telecommunications for around US$7 million. The sale price was very cheap given the growth rate and huge revenue increase post M&A. After some heavy investment into server infrastructure and marketing, and with the digital/phone camera trend sweeping Korea, Cyworld’s was quadrupling each year. I think the Korean investment industry is not particularly diverse and have come to the conclusion that targeting markets outside of Korea, like China, USA or Europe, can work better for online networking businesses.
A few months later I was contacted by Adecco, an executive search agency, saying the CEO of Yahoo Korea wants me. At that time my resume was not very strong comparing with other CTO’s and the deal didn’t work out – I wasn’t good enough for Jerry ;) After that, the Neowiz.com CEO who was previously and alumni at KAIST introduced me to Michael from Matchmaker.com. I then started an Asian style dating services called Saycupid.com, which Michael, Neowiz and Yahoo invested into.
Saycupid.com started quite a paradigm shift as at that time when we were single, we generally looked were looking for a partner, and used these kind of sites to find one. Most offline marriage services requested a lot of official documentation related to your career, academic background, but interestingly not marital status. Offline marriage services carried a kind of stigma and had a pretty low image, so I wanted to change the meaning of ‘Singles’ to have a more positive connotation.
We made the slogan of Saycupid.com, “Enjoy your single life and single community”. We helped arrange a lot of offline member activities like inline skating, snowboarding, hip-hop and latin dancing - primarily we wanted to let single people enjoy their hobbies with other singles. The point was that you might be fortunate enough to find someone you love, great, but if not at least you are enjoying your single life in a quite productive way.
We didn’t request a lot of documents or authentication papers, but rather made the process simple and convenient for users. We started networking digitally with a lot of university offices and government departments – they assisted with our authentication process and customer identity verification (career, school, marital status etc). This concept is quite well defined using Social Process Reengineering (SPR, as opposed to BPR for businesses). In the not to distant future I think all of these kind of process will be virtualized as more governments and schools adapt a plugin-based digital economy style service.
http://www.cyworld.com/
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