My friend Isabel Wang wrote a fascinating post regarding web sites and scalability (or lack thereof) within the SMB market.  Specifically, Isabel references a thoughtful post from Andy Schroepfer regarding the recently announced merger between Web Site Pros and Web.com.  Andy is shareholder in Web.com and offers some truly interesting technical, if not partially biased, analysis on the merger.  His premise is that both companies have solid fundamentals and both are undervalued and ponders broader market dynamics that could come to fruition to boost the value of the combined company.

Equity research aside, Isabel highlights the simple fact that both companies are "still battling for a slice of the massive SME market opportunity, which both firms have always talked about but barely shown the results."

One thing is for sure -- targeting the massive market known as SMBs requires massive scale.  How does one achieve massive scale?  I wish i knew the answer.  But, in truth, i only have opinions.

In my opinion, it is possible to achieve huge scale in one of two ways:

• in a direct distribution model over the course of many years by those who execute extremely well and who have access to significant amounts of equity capital.

• in a channel distribution model over the course of fewer years by those who execute extremely well and who have partnership-level access to existing customer bases consisting of millions of SMBs.

Regardless of your distribution model, the more important element of success is to deliver "simple to use" products and services that enable small businesses to become active participants in the conversational web.  Success requires simple tools that SMBs can use to dynamically define themselves as often as they wish -- monthly, weekly, daily, hourly.  Massively scaleable success requires a full-blown ecosystem that encourages SMBs to actually participate.