Silicon Valley Star Starts Up New Kind of Social Network

Funds Rolling In

Banister launched Zivity with co-founders Cyan Banister, his wife, and Jeffrey Wescott last year at the TechCrunch 40. The site began initially with $1 million in private funding. The company announced this week that it secured $7 million additional venture capital from BlueRun Ventures and Founder's Fund, which has bankrolled PayPal and Pogo.com, among others.

Three of Banister's other tech ventures have been purchased by corporate behemoths Microsoft, AOL and most recently, Cisco.

So, Zivity has the cash to keep it running for now, but will consumers take the bait?

Tech analysts' opinions vary widely about what Web surfers will and won't pay for.

Rob Enderle, principal analyst at the Enderle Group, says paying for content is the future of the Web.

"A lot of people were convinced people weren't going to pay for [cable]. … There's no doubt that the same kind of model will work on the Web," Enderle said.

"We hear advertising gets in the way of things, but we're still at the very beginning of that. … People pay for 'World of Warcraft.' People pay for that kind of entertainment. … We know where it is working, is pornography."

In terms of more traditional, non-nude forms of social networking, Paul Saffo, a technology forecaster in Silicon Valley, agrees.

"There is a constant in the history of media. All ultimately successful media forms go through a pornography phase," Saffo said.

According to Saffo, social networking, as we know it, will eventually splinter into smaller private groups like Zivity.

"The one size fits all social networks is atomizing out into private networks," he said. "It used to be hip to be on Facebook, and now it's hip to be on the private social networking club."

Can It Compete With Free Porn?

But even if people are willing to pay for privacy from advertisers, will they pay to see photos of naked women when they can see more graphic videos of sex online?

Paid subscriptions are nothing new, especially when it comes to porn.

"The pornography market is huge. It's one of the major drivers of the Internet," Enderle said.

Xtube, one of the most visited sites on the Net, has a pay-to-view and revenue-sharing model similar to Zivity's. The audience pays 50 cents to $2.50 to view short homemade porn flicks. Posters get 50 percent of the revenue.

Last year, Penthouse paid $500 million for Various, Inc., a group of personals sites, one of which, AdultFriendFinder.com, operated like a paid membership social network.

But TechCrunch co-founder Michael Arrington says it's unfair to compare Zivity to porn.

"This isn't competing with porn. ... [Men] develop this sort of crush on [the models]. There's no easier way to show them that than with your vote," Arrington said. "Think about strip clubs. You tip. There's an analogy."

Instead, Arrington compares Zivity to the mind-blowingly popular site SuicideGirls.com. Originally conceived as an "alternative" to traditional porn, the site's group of tattooed, pierced women became a pop culture phenomenon in 2003, launching nationwide burlesque tours.

"If you create a friendly atmosphere, you can extract money more easily," Arrington said. "If they can develop relationships on the site, they can develop a successful model."

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