The highlight of the Affiliate Summit in Las Vegas was with no doubt Jason Calacanis keynote. Jason Calacanis is the founder and CEO of Mahalo.com. As he described himself on his blog, in the affiliate world he considers to be the bad guy. To be honest, and will excuse me my affiliate friends, I am not so sure about this statement.

Jason in his own way, succeeded to busy the minds of almost anyone in the summit. The all story began when he included in his presentation the photo of Zac Johnson, a respectable super affiliate, holding a six figure check and was published on Zac blog:

“You guys really think small. Holding up a six figure check is frankly pathetic. It’s desperate. The industry that I am in, like the internet industry, like the web 2.0 industry elitist, you know. Kevin Rose, whatever. They would laugh at that. It’s sad. It’s embarrassing.” Jason Calacanis @ affiliate summit Las Vegas 2008

To say that kind of words in front of more than 2,500 affiliates you must have guts. I must say that at first I thought that Jason is about to make a fool of himself. It’s my first time I see Jason Calacanis in person, but I knew about him long time ago. I was sure that he is going to do better than that in his speech. I wasn’t wrong. He’s got my attention and probably the rest of the audience who waited to see how his speech is going to end.

Jason Calacanis mentioned several points that I believe needs to be tied up in order to take the benefit out of his words. I believe to Jason when he described the affiliate’s marketers as the smartest guys on the web. At the end of the day, if you know how to sell than you have the greens papers that help you to put a food on your table.

The problem starts with those affiliates who use this market to make easy money while spamming the net. We all despise SPAM. We don’t like it in our mailbox, in our chat room or anyplace else. It’s pretty understandable that a professional eye will look at a “thin” website as a SPAM. Maybe the ordinary user will look at it as spam also. But….. we have to remember that for each good side there is a bad side and vice versa.

The affiliate market did well to the e-commerce market. Affiliate is not something that was invented in the last years. It was there most of the time but under different names. The affiliate markets attract to the e-commerce industry great brains that brought both knowledge and money to this market. Even young people who had great ideas made it all the way. Those young affiliates probably couldn’t attract the attention of the e-commerce industry differently. At the button line the affiliate market boost the sales especially for those merchant that were not aware about the potential of the e-commerce system.

At around year 2000, if you had a good idea for a startup you had to find the funding at venture capital companies or applying to angels. The affiliate market, with its great ability to create a huge amount of money in a short time was also a way for guys with great ideas to raise money. These days you can start your startup company with $100K. Back in the 2000 less than ~$1M would be considered as a bad deal for the VC. VCs are looking for a short run exit. They don’t care much about the product or its vision. They mostly look for the bet ROI on their investor’s money. Isn’t sound like as a PPC affiliate campaign?

No matter how you will look at it, it’s all about the money. VCs are looking after it and also affiliates. At the Silicon Valley it’s very rare to find VCs that are looking for ideology based investments. The same with affiliate’s spammers that probably don’t gives any contribution to the market. However, both VCs money and the affiliate sales are the fuel to keep their market alive. With no VCs money probably most of the great products that we are using these days were not exist. Some of them needed lots of money to maintain their R&D departments. As the same, without the affiliate marketers small/mid merchants probably wouldn’t be on the internet. Most likely that the biggest websites would took their place. Instead of finding niche website could be that Amazon or Yahoo would have variety of offers much more they do have today. Amazon knows how to sell online, but the local electric shop does not. With the affiliate marketers as their sales force they can now compete with the big guys and still keep their cash flow in a reasonable way to their business.

At its core, Mahalo.com is also an affiliate network. Mahalo organize the data in a single page based on a keyword phrase. On each page you see ads based on the page content. Mahalo is trying to be the giant that the affiliate marketers are preventing from it to grow. Who will win….time will tell. I am sure that the affiliate marketers should keep track after Mahalo.com. It’s a good source to lean about the e-commerce trends.

I think Jason Calacanis was right when he asked the smart affiliates to think big. I can understand his expectation for brilliant minds to do more with it. I think the affiliates did extremely well to the e-commerce market. Most likely the affiliate’s marketers will have to come with more and greater ideas how to gain profit for the merchants due to the nonstop evolving e-commerce market. I don’t think that Jason Calacanis meant to say that the affiliate marketers are doing wrong. I believe he tried to irritate the minds to be taken to a higher stage. Look likes he did well. After all affiliates are keep discussing about his speech.

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