Craiglist’s cash flow

In the early years of the internet, conventional wisdom dictated that the best way to make money on the web was to charge people to use the site. With the rise of Facebook, Google, and countless other free websites, the focus has shifted on providing free content to users in order to gain a following. Once enough people begin to visit the site regularly, money can be made by giving companies space to advertise on the site.

I recently made a purchase on Craigslist and began to wonder how the site made money at all. Craigslist allows people to post and view classified ads for free and there are no advertisements on the site. The site has remained very simple over the years and has somehow made itself an internet giant with seemingly no way to make money off of the business model. I decided to dig a little deeper and found that while the large majority of their classified ad postings are free, the job category section does in fact charge money. Somehow this small section of the site is able to generate enough money to fund the rest of the operation and make Craigslist a profitable venture. It is amazing that this seemingly insignificant amount of posts can generate so much income. It makes one wonder how rich Craigslist would be if they charged for other categories in addition to the jobs section or if it allowed outside advertises space to solicit its users.