White-label is a term used to refer to a product that is re-branded multiple times and licensed out. The old-industry motto was “I want to own everything”. Nowadays, people have learned to share and for the better. When it comes down to coding a social network you hit quite a few obstacles:

1) Finding developers that are experienced and have worked on large-scale sites before.

2) Writing the 1M lines of code before your competitor beats you to market.

3) Coming up with a budget to meet the six-figure price tag associated with development.

White-label platforms solve these problems. A white-label social platform is one that has already been developed, bug-tested, and proven stable. It may have taken the platform 15 months to code, but for you it is already done right when you need it! Since it will only take 1-3months to skin your site over the platform, the development costs are a fraction of the usual rate. Also, in most cases, these costs are also extremely discounted to members of the platform in trade for equity play or rev-share opportunities. One does have to pay a monthly licensing fee to use the platform, but with it comes a myriad of support and services that makes it so much easier to sleep at night. I know I don’t like to deal with servers crashing, code breaking, and new patches constantly being released. The white-label platform takes care of your technology and lets you deal with what you are best at—The business strategy side of things.

Now let’s talk from a buying power perspective. As is anything, bandwidth is sold in bulk at cheaper rates. In fact, if you buy in big enough bulk, you are looking at 30-60% discounts. A platform supports multiple sites, so they have that buying power. The same comes from the advertising side. Media buyers won’t place ads on a site with 50 users. Traditionally, they won’t even talk to you until you have at least 500k page views per month. You could always use Google Adsense and make pennies, but in order to get high CPMs, you need a real agency backing you! Usually, start-ups rely on angel money to pay hosting until that point, and then start making money several months in. When a platform goes to the media buyers, they can leverage the combined total of page views across the entire network. This gets the ears of the buyers.

The old adage “Two heads are better than one” can be applied greatly to the white-label model. In this scenario, every company on the network is continuously coming up with new creative ideas for features. À la carte feature purchasing is made available, so every time the platform develops a unique feature for one of its sites, you are notified and can make a decision to also have that feature. These are features that you may have never thought of having, made available instantly to you, that could better monetize your site. The other advantage is collaboration. If you can synergize with another site on the platform, the contact is immediately made available. You could be sharing users by leveraging ads for your site on other platform partner sites, and vice versa.

As you can see, there are several advantages to white-label models. I’m a big advocate of them because I’m a sharing type of guy. I strongly suggest getting in contact with one immediately if you plan to build your own social network. In today’s over-saturated social networking space, niche sites can still become very viable—just need to be built quickly. Nobody has a year to stay stealth anymore. I have done extensive comparative analysis of the current providers and I’d be more than willing to recommend a few. Hit me up, and happy developer hunting!