Building something like Ello costs money. They have a team of at least seven people, and have worked on it for months. That doesn't come cheap.
The About section makes it seem like Ello was built independently, a group of artists making something for themselves, presumably funded by volunteer effort and maybe a seed investment from Ello president and CEO Paul Budnitz, who also founded Kidrobot and Budnitz Bicycles.
But a little digging shows a much more predictable source: they took a $435,000 round of seed funding in January from FreshTracks Capital, a Vermont-based VC firm that announced the deal in March.
Long story short, because Ello has gotten hooked on that sweet, sweet VC smack-money, they'll inevitably be compelled by their investors to you know, make some money, probably by ads, and therefore end up having to drag their “no data mining, no ads” manifesto into the trash.
But hold up:
But Cross (editor: Cairn Cross, partner at FreshTracks Capitol) laughed at the thought of his firm forcing ads on Ello. “We practice venture capital in a way that very few people practice it. We’re really small-town venture. We’re patient, we have long exit horizons, we’ve had some successes, we’ve been around for awhile,” Cross said. “This is not Kleiner Perkins.” FreshTracks Capital has funded 30 companies in the past 14 years, focusing on Vermont-based organizations.
So no ads. Right. So how is Ello planning on making bank?
Instead, they’ll chase a kind of freemium model. The same Ello will be available to anyone, but they’ll have a few cosmetic features available for on-site purchase for a few bucks here and there.
“For example, some users may want to manage multiple accounts from a single login — like a designer who has a work Ello account and a personal one,” Mr. Budnitz (editor: Paul Budnitz, Ello founder) told Betabeat. “We also have users from Europe and Japan who have asked for an inverted screen — white text on black. Apparently there is a big movement over there who thinks it is better for your eyes.”
If you're having trouble making sense of that, it roughly translates to “pray to God Google ends up acquiring us”.
P.S. Anybody have an Ello invite?