Founding Cookpad: staging the revenue on a user-posted recipe service (1998)

Gather for free, recover by staying on food: the user-posted model

The heart of Cookpad’s founding was to open recipes for free — widening the base of people posting and searching — and then to layer monetisation on top in stages: advertising in 2002, paid membership in 2004. Having, at the very start of the business, chosen a $4 (¥500)-a-month charge only to withdraw it after barely two months, Sano switched the order — build value and scale first, recover later — and that reordering set the course of everything that followed. A business carrying losses in the year to April 2005 had, by the year to April 2008, grown into one generating more than $5.8M (¥600m) in sales and around $2.9M (¥300m) in ordinary profit — precisely because a base widened for free supported several revenue streams, advertising and paid membership, at once.

What stands out is that this revenue base was built while staying specialised in a single field — cooking. Against the temptation to broaden the sources of revenue, Sano instead preached “stop doing Good,” narrowing the aim and concentrating resources on the single point of making cooking a pleasure. To what looked like an either/or — paid or free, expand or specialise — the founding-period judgement offered an answer: layer paid membership on top of a base widened for free, and let several revenue streams coexist while staying specialised in cooking. The discipline of continually asking what the value is as seen by the user became the template for the paid-membership model that would carry on after listing, and set the skeleton of a business that supports the everyday domain of cooking with information technology.