Search Popularity Contest Almost a DirectHit

When those 10- or 20-year high school reunions come around, it’s always interesting to look at how well the “In Crowd” has done. While most of the ruling clique have not ended up dining out of a dumpster, the test of time proves that being popular is not necessarily a guarantee of success.

Such also seems to be the case with a new popularity-based search engine, Direct Hit which seems to offer significant new capabilities for surfers trying to filter feedthrough the Web’s e-flotsam and i-jetsam.

According to DirectHit, its Popularity Engine tracks the sites that users select from search results lists and determines the amount of time they spend at each site. Sites at which users spend little time, say 15 seconds, would get penalized while those that captured the surfer’s attention for 10 or 20 minutes would be rewarded. Sites that are routinely selected by others users for a given query are ranked higher on the list and the least popular ones are ignored — sort of like geeks at the popular clique’s cafeteria table.

Danny Sullivan, editor of Search Engine Watch told VC watch that DirectHit has noticeably improved results in many cases, especially for popular queries.

“But where their technology is really so compelling is that DirectHit doesn’t go to a search engine and say: ‘Hey, we’re better. Rip out the guts of your service and use us instead.’ In contrast, they go in and say, ‘Try us out alongside whatever you already do.’ That’s a painless way to get in the door.”

And in the door they have gotten including some pretty big ones: MSN, Lycos, HotBot, LookSmart, ZDNet and others. DirectHit shares advertising revenues with its partner portals.

Jonathan Goldstein, a partner with Boston VC firm TA Associates believes popularity will work in DirectHit’s favor.

“We took comfort that the actions of Direct Hit’s OEM partners indicates that there is something compellingly better about Direct Hit’s technology. Direct Hit has partner relationships with over 50% of searches done on the Internet. Perhaps the most compelling application of Direct Hit’s technology will be for shopping. This is an application where dynamic updating of results is important and the underlying desirability of a given search result can change rapidly as companies put products on sale, etc.”

TA Associates was part of $26.3 million in third-round financing that closed earlier this month and included Commonwealth Capital, Draper Fisher Jurvetson, Hikari, Viventures Partners, Mosaic Venture Partners, NeoCarta and Cornerstone Capital Group. DirectHit previously raised $3.4 million in its first two rounds from Draper Fisher and Mosaic.

Like all new technologies, DirectHit’s search results need some tweaking. A search for “online wine buying” turned up a number of marginal wine sites, but nothing (at least on the first results page) for top sites such as Virtual Vineyards. Similarly, a search for “wine stocks” turned up nothing despite the fact that a number of online sites cover publicly traded winery stocks. Finally, the technology is certainly not immune to the same sorts of irrelevant hits as other search engines. “Buy wine” turned up ” Tampa Bay, Computer Sales, Service, Repair, in Gulfport, St. Petersburg, Florida” as the second listing.

So, like all those popular in-crowd folks back in high school, the promise is certainly here, but only time will tell if they will live up to their early promise.

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