ChaCha, the other Q & A site, raises $14 million. How it can have a shot against the big boys

By Richard Nieva , written on January 28, 2013

From The News Desk

Last week, the Q & A website Quora was in the news for suddenly becoming a little less Q & A. Today, another question and answer site, the elder ChaCha, founded in 2006, is taking steps toward doing the opposite: beefing up its Q & A service. The Carmel, Indiana-based company announced a funding round of $14 million led by VantagePoint Capital Partners and Rho Ventures.

When Quora announced that it was introducing a blogging platform to accompany its normal format, ChaCha founder Scott Jones says he viewed it as a nonevent. No strategic opening to strike at users that might be disillusioned with the change. No digs at Quora for working outside the Q & A format. Jones says he paid the announcement no mind, and his claim sounds sincere. It doesn’t feel like the blustering of a CEO trying to downplay his reaction to a competitor that has clearly won in the buzz department.

The two sites aren’t competitors despite the similar formats. While Quora deals in longer, almost encyclopedia-like content (as evidenced by the new blog platform) ChaCha aims to answer questions in real time, like a search engine. Scott, an Internet veteran who was the founding CEO of the music metadata company Gracenote, says ChaCha is everything Siri was supposed to be.

For example, ask a question like, “Who is the 49ers starting quarterback?” and ChaCha tries to get the answer back to you within a few minutes, instead of the longer period it takes for Quora to crowdsource a response. And unlike another search engine, it doesn't give you a link to a website that may the answer. The site does this in two ways: First, because ChaCha has been around for a few years, it claims to have answered 2 billion questions and have 129 million answers in its database. Jones says the service can reuse and repurpose most of the answers, though it takes a second to recognize different phrasings of a question. For about 10 percent of questions, there is no way to automate an answer, and ChaCha turns to its human guides to find them. The guides are usually college students contracted to search for the answers.

But recently the company has been moving away from more anonymous, institutionalized answers, to giving expert answers. Part of the new funding will go to building out its expert network, which might consist of a college professor or PhD, a CEO, or just someone enthusiastic about the topic. (The bulk of the new funding is earmarked for building new apps to be released in the next few months, though the company is hush hush for now. The company has also recently started experimenting with different models to leverage social media.)

Certainly, the key will be just how much the company can refine its network of experts. There can be a great chasm between a PhD and your garden variety enthusiast, and a user whose question is fielded by the latter will feel less confident. But if ChaCha can nail the expert answer, and keep its real-time speed that distinguishes it from Quora, it could be a useful tool. I know many journalists wouldn’t mind having an easy way to connect with experts in a hurry.

While ChaCha has been at it for years, it has become en vogue to try and topple Google by reinventing search. Apple’s tried to stake its claim with Siri. Facebook entered the fray earlier this month with graph search. But it’s yet to be seen how anyone can really put a wrinkle in search that would cause someone to use something other than Google. (Just ask Microsoft, which has been pushing Bing for years.) Facebook has conceded it isn’t trying to do that.

But ChaCha is. “It’s tough for a little guy to do that, but we’re also one of the top fifty websites and top 5 mobile sites,” Jones says. “We’re not nobody.”

True, but it’s farfetched to think that Google will flinch either. Perhaps the first question a user should put to ChaCha's network of experts is this:

What will it take for ChaCha to become a contender?

[Image courtesy: quinn.anya]