I first heard about ZiXXo while reading about the none-too-impressive Supernova 12 (you can read my opinions on that list here) and really didn’t give them a second thought at first.  I figured clipping coupons was limited to the Sunday paper and getting $0.10 off three gallons of milk, so the Internet seemed like a bit of a stretch.  After an interesting email exchange, I decided to actually go take a look at their offering.  In a nutshell, it’s an online engine for enabling the creation and deployment for coupons which can be redeemed either online or offline.  Their system also allows for affiliate programs, effectively allowing anyone who runs a Web site to generate revenue through redeemed coupons.  The ZiXXo system is basically easy to use, I even created a coupon in less than 10 minutes (sorry, no real-world value):

Here’s where I have a bit of a change of the typical skeptic tone.  I don’t have much of a problem with ZiXXO giving it a shot.  They’ve raised a handful of money (less than half a million dollars), have a small team, and a specific focus.  Frankly, I think they don’t belong in the Web 2.0 category at all (much like Ether and Travelpost, two other interesting new services that just don’t seem to fit into the typical 2.0 world), as their service, for the most part, is focused on everyday businesses and customers.  In fact, I think the company needs to get as far away from this description as possible:

Silicon Valley based Zixxo has launched a great service that I asked for last year (#4 on this list) - local coupons via RSS. This is a very big market.

Yes, coupons represent a very big market.  Coupons by RSS?  Who knows.  The company needs to stay small, and get into a massive marketing push.  Again, like Ether and others, it is all about getting a critical mass of users outside of the blogosphere aware of their service.  Right now they suffer greatly from a very small amount of coupon availability (my zip code has about 80 total, none of which were really appealing to me at all).  If they can avoid the Web 2.0 hype and focus on their business (in a single word: build that coupon database!) , I could see a potential ebay acquisition.  I actually like this kind of a play, the ‘all-or-nothing’ startup. 

Mike Hogan, their CEO (and seemingly a very friendly and enthusiastic guy) didn’t disagree:

“ZiXXo is a tipping point business. Once we get over the hump it will be huge. We’re working on this ourselves, signing-up affiliates to do it with us and working on some very big partnerships that could send us flying over that hump with a single press release”

Now I don’t know if the single press release will do it (SaveSmart tried a similar thing back in the late 90s, and I’m sure there are others), as tipping is unbelievably hard to do, but I’m giving out extra points to all the non-2.0 startups who are getting unfortunately batched into the same pool (had a good 4th of July so I’m feeling nice).  But like that show on TV, the points don’t matter.  Getting millions and millions of stores and customers using their system is what matters.