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Posts Tagged ‘Dick’

Gillmor Gang 7.09.11 (TCTV)

July 9th, 2011 07:00 admin View Comments

The Gillmor Gang — Michael Arrington, Dan Farber, Robert Scoble, and Steve Gillmor — enjoyed @scobleizer’s FaceTime tour of Florida’s abandoned Kennedy Space Center in the aftermath of the last shuttle launch. The countdown clock sat frozen amid a sea of media trailers and the huge Twitter Live Assembly building. No, wait; that was where FriendFeed stood until Google + was launched last week.

Google + should buy Twitter, suggested @arrington from his retirement center in the Pacific NorthWest. Having immediately shut down its live stream to Google the day after Plus went public, it seems unlikely Jack and Dick (and Ev and Alice for that matter) are any closer to selling. As the ghost of Walter Cronkite peered down from the “permanent” CBS News bunker, CBSNewsOnline editor in chief @dbfarber schooled @arrington on the news of the day. We all got a little older. And that’s the way it was.

Source: Gillmor Gang 7.09.11 (TCTV)

Harmony Project Pushes Lawyers Off FOSS’s Back

July 8th, 2011 07:32 admin View Comments

Open Source

Julie188 writes “Harmony is an effort that was begun and shepherded by Amanda Brock, the general counsel at Canonical. The intent was to create a small collection of consistently-worded contribution agreements (both licenses and assignments) for free and open source projects to use to reduce the friction such agreements can cause when they’re encountered for the first time by corporate counsel unfamiliar with FOSS licensing. Version 1.0 of the documents have launched. As court cases involving software copyrights and patents continue to sprout forth, we don’t have the liberty of ignoring the changes brought on by the law. Neither do we get to follow Dick the Butcher’s suggestion in Henry the Sixth, and kill all the lawyers.”

Source: Harmony Project Pushes Lawyers Off FOSS’s Back

How A Tweetdeck, UberMedia Deal Could Cut Down Twitter’s Bird

April 22nd, 2011 04:10 admin View Comments

In the world of Internet startups people can become obsessed with the function of a product or app, often ignoring how a company can change the dynamics of a market just through it’s sheer existence. More often than not, it is not just a case of just having a better technolgy than the other guy. Equally it can be about a creating an incursion into a competitors’ space which forces them to manoeuvre, destroying value for them, and creating value for yourself. No greater example exists of this today as the dramatic moves being made around the rumoured sale of Tweetdeck. I have been talking to sources well acquainted with the issue and what they have to say suggests a fascinating drama – which we are about to see played out.

The scenario: Back in February we reported that UberMedia, had acquired Tweetdeck for $30m, although no party released any official statement at the time. If true then this would have given Bill Gross’ company, after buying EchoFon, another popular Twitter client, roughly 20% of the userbase of Twitter. Tweetdeck reportedly has 11% of active Twitter users. But as any journalist or social media expert will tell you, these are power users, producing many of the most influential content. Indeed Cornell University and Yahoo! Research found that a tiny minority of users – around .05% of the site’s population or 20,000 elite users – are generating around half of all the Tweets. These are divided into celebrities, media, organisations (such as Google) and blogs.

My sources tell me that UberMedia had a 30 day exclusive on that deal. But negotiations took too long and it expired, allowing Twitter to emerge with a $50 million offer for Tweetdeck. The battle was on for Tweetdeck’s high end users.

But there is much, much more to this than meets the eye, and there are earth-shattering implications if Twitter makes the wrong play.

The question is this: What is it worth to Twitter to keep Tweetdeck out of Bill Gross’ hands? For in Tweetdeck lies the balance of power in the Twitter eco-system.

Let’s run through the scenario through.

Choices:

Uber buys Tweetdeck, thus gaining around 20% of the userbase of Twitter.

With one fell swoop Uber has market power relative to Twitter, plus most of the high value users.

As a result, Uber has the power to say to Twitter “We have 20-30 percent of Tweets. So, are you feeling lucky? Are ya?”

Uber can then say “Unless you let us sell our own advertising, not yours, against those Tweets, we will have to migrate our user base onto a different platform.”

* Boom *

This is the .44 magnum Bill Gross is holding to Twitter’s head.

Uber is already selling its own adverts on some of their applications.

That is a huge threat. You can imagine that Twitter’s management will wondering how to deal with this threat.

But exactly why is this so likely as a scenario? Let’s work through the numbers.

Twitter’s original business plan said: We will get to sell 100% of the ads on the network. But remember, advertising follows an 80/20 rule. In any advertising network around 80% of the revenue is made from 20% of the audience.

So if Uber becomes the owner of Tweetdeck, the most valuable 20% of the audience would not be owned by Twitter.

Thus, sitting in the Twitter’s boardroom, Dick, Ev, Biz and Jack will be saying something along the lines of: “Either Tweetdeck agrees to our deal and we own it, or they do a deal with Uber in some way, take a LOT of our users, and we have to cut a deal with Uber.”

Remember, keep in the back of your mind that research about those 20,000 elite users who tend to use higher end client apps – the apps BillGross has been busily acquiring. (All the monitoring is done on other platforms – these are less valuable).

You see, Twitter’s assumption was that no owner of a client app would stand up to them. Most of the client owners were young guys, just product guys, not commercial people. It’s one thing to deal with those guys, another to say to a company back ed by Jim Breyer of Accel, “no more client apps”.

What Twitter needs to avoid is a situation where Uber says “Guess what? On our client apps WE run the ads, not you.”

So the question is: Do you fight Uber with the risk that those high value users are ported to a totally new platform or do you cave in to Uber and say, “OK, you have us by the balls, we’ll let you sell your own ads.”

Let’s try out the latter scenario.

After losing the most valuable part of the ecosystem, Twitter’s ad revenues will have dropped by 80% to 20% of what they were GOING to be when Twitter owned the entire Twitter network.

In this scenario, Uber cuts a deal with Twitter. Uber says to Twitter, “we’ll do our own own thing, our own content, but you can run the infrastructure.”

Uber might also says to Twitter “Look, we’re nice guys – you can take the Tweets created on our platform and sell your own ads against them.”

Then again Uber might even say: “We’ll send the Tweets from our platform, but we’ll take a revenue share on the ads”!

Either way, in this scenario, Twitter’s share of revenues on their OWN PLATFORM has dropped from 100% to between roughly 20-40%.

Since the value of the business is in the cashflow, the challenge for Twitter is if they don’t buy Tweetdeck they will have created a monster that can bargain against them and take a samurai sword to their business model.

We’re not talking about losing 5-10% of the business here – we’re talking about a crushingly large amount of Twitter’s business disappearing. It’s not 11% of the Tweets that matter with Tweetdeck, it’s closer to 50% of the ad revenues in a combined Uber business.

If Uber buys Tweetdeck, Twitter can eviscerate their business by shutting Uber off (and a large swathe of their top users). Or they come to a deal, based on Uber’s terms.

Under this scenario Twitter actually becomes more like a utility.

Remember, it’s currently valued at $10bn because it’s forecast to get 100% of the ad revenues on its network. For arguments sake, let’s call it $1bn in annual revenues. But now, wiith Uber controlling Tweetdeck and other clients: not so much. Under this outcome, Twitters revenues only reach half their potential – more like $500m.

So is Twitter now worth $10bn or $5bn? Looks like 5, kids.

But wait – back in our other parallel universe, Twitter has won the day and acquired Tweetdeck.

No, Uber doesn’t have a strong hand. But that is the ONLY real reason for Twitter to buy Tweetdeck.

In a world where Twitter buys Tweetdeck, then Twitter might still lose a bit of its revenues to Uber but not as much.

Unfortunately this is a beggars choice. Buying Tweetedeck does not increase Twitter’s value by much, but it DOES protect it from dropping revenues by 50% (because of the threat represented by Tweetdeck falling into Uber’s hands).

So what is Tweetdeck worth to Twitter?

Well for starters, it’s a LOT more than $50m.

It could be as much as $250-500m – because that’s the price Twitter might have to pay to protect 50% of it’s entire business.

That deal would have to be done in cash and FUCK LOAD of Twitter stock.

Remember, sitting in Tweetdeck’s boardroom are people who realise that the moment they sell to Uber, Twitter is fucked.

That is possibly the biggest bargaining chip in the entire startup world as of today.

IainDodsworth and his investors will not sit there and say to Twitter, fine, we’ll take 5% of a $5-8bn company, I want 15% of your damn company. Because if you don’t agree, then we’re am going to destroy your business by selling to Uber.

Meanwhile, back in the negotiations with Uber, Tweetdeck will be looking at Uber’s offer.

This is where things get mighty interesting.

While the offer might be $25-30m from Uber (about 25% of Uber’s equity) at a $100m valuation, Uber might eventually be worth $1bn final exit value if it can sell the lion share of Twitter’s most valuable Tweets. So Tweetdeck’s stake in this would go to $250m, should they choose to go with Uber. Hold that $250m figure in your mind.

Now, in the case of Twitter’s offer, this $50m deal being talked about right now is at Twitter’s $10bn valuation.

But assuming Twitter is around for the next 10 years (as have all of the other big Internet giants like Yahoo and Google), what of the next 10 yars?

Imagine Twitter goes from $10 to $20bn valuation. Tweetdeck’s stake goes from $50 to $100m over that period.

So, as a founder and investor in Tweetdeck, are you better off talking the $25m deal from Uber to realise a $250m exit, or should you go with the $50m offer from Twitter to realise only $100m?

Exactly.

In fact, even if Twitter offered $200m for Tweetdeck, that would go to $400m when Twitter double in value over a 10 year period.

But what if it doesn’t? What if it this picture of Uber still stealing a lot of ad revenue means (even without Tweetdeck) and Twitter goes from its $10bn to 8bn valuation?

Now you’re not sitting on a $100m you’re sitting on about $160m and the $250m offer you were getting from Uber actually looks a lot sweeter.

The end game is clear: Twitter must, at almost all costs, acquire Tweetdeck. Or they will be royally screwed.

Lucky there’s another royal wedding on to take their mind off things.

Source: How A Tweetdeck, UberMedia Deal Could Cut Down Twitter’s Bird

Hey Kids, What Time Is It?

April 17th, 2011 04:19 admin View Comments

Suddenly there’s a lot of noise about Twitter hitting an execution wall. The musical chairs at the top with Dick coming, Ev backing away, Jack returning, and Ev really leaving are responsible for much of the discussion. Underlying the shifts is the current meme that Twitter now has to justify its valuation with some clear business model. The only problem with all this: so what if Twitter has no clear revenue to justify the $3 or 4 billion the company is supposedly now worth.

Part of the problem is the comparison to Facebook, which is said to be enjoying over a billion in revenue as compared to 2 digit millions for the Twitter cloud. One is leveraging a carefully curated cloud of friends and family; the other is a realtime news service on the front lines of the media transformation. As such, Twitter is more analogous to Netflix than it is to Facebook.

If Twitter counted users as subscribers, they are 10 times the 20 million of the streaming service. But of those engaged enough to be analogous to paying subscribers, the numbers are likely more equal. All that’s left is to identify what those frequent flyers do and how that might represent addressable engagement. Engagement, by the way, means show me the money. And Twitter doesn’t have to explain how to make money in order to justify the value of the service.

What it does have to do is clarify what it does and why that IP is uniquely and defensibly held by its executives and investors. It makes sense (at a surface level) to identify presumed success by examining the talents and track record of its executives. Keep in mind that Ev Williams sold his previous company to Google and is known to have been unhappy with what followed. As with a list of acquired CEOs including most recently Dodgeball’s Dennis Crowley and Jaiku’s Jyri Engestrom, Google’s track record has been spotty. No more so than what happened with Yahoo and another string of acquisitions, but not the success Twitter is threatening.

Twitter’s IP is that it controls the worldwide realtime news information bus. Although the news business and other entertainment networks have been challenged by the move to the Web, and now the tablet, the social media that emerges will have huge economies of scale and formidable barriers to others’ entry. Take a look at what Apple has done with its iPad lead, and how it appears ready to add cloud services. Who are the competitors in the social news space?

Facebook? No real iPad app, though the iPhone one plays in the push notification alert business. The realtime nature is blunted by the lack of speed required to gain traction (your friends are still going to be there 5 minutes later) and the way Likes are implemented as a vote rather than a cascading viral retweet. No @mentions either, which not only provide a head’s up to the mentioned but a social map to the group (implicit or explicit.)

Google? So focused on killing Facebook by cloning that there’s not even 20% time left over for Twitter. Microsoft? Oracle? Who? None of them care about news, or heterogeneous direct messages that span silos. But we care. Twitter DMs are simple, push notification compliant, and built on a namespace we’ve decorated with streams that define our interests, opinions, values, and relationships. Who else has this? Nobody.

Meanwhile, the garbage about Twitter continues, to what end. Are competitors trying to eat away at the inevitability of a user-managed system of record? What competitors? Chatter? The only similarity there is how far ahead Chatter is in the enterprise, with its combination of viral incentive for creating and routing the status updates of the enterprise software and device grid, and a revenue cloud that ensures continued growth. I don’t mind ringing our own bell, because to not do so is misleading.

Mostly, the noise is a reflection of the lazy media. Faced with the choice of reporting what is a secret even to the direct participants or making it up out of whole cloth, reporters hide behind a lack of conjecture while pundits try to thread a needle of conservative guesses that are more likely to be vaguely true than not. The latter produces tons of predictions about decisions not being debated; the former reflects the conflicting recollections of eyewitnesses to the most forgettable of events.

Here’s my guess: the combination of Dick Costolo and Jack Dorsey together with the benign pressure not to sell of Evan Williams adds up to massive success when the iPad platform reaches its first stage of maturity. By maturity I mean an application ecosystem that thrives on the routing of addressable metadata-wrapped objects based on @mention-weighted push notifications. We are at an early stage where users are learning how to process poorly-hinted incoming pointers into the information stream, and in the process providing signatures of behavior that will inform the filtering substructure when they are broadcast in parallel to the objects they decorate.

The good news is that these iterations are software-based not hardware-constrained. The relative stability of iPad 2 over, or next to, iPad 1, suggests the new computing platform is close to lift off. The signature of laptop-based information triage is multiple open windows or tabs, email and social alerts, and digest hints of the value of serial video streams. It’s an effective interface, one that we can’t yet replace with the tablet/notification paradigm. Or can we?

The iPad presents a new set of primitives that taken together orchestrate an uber queue of social imperative. Namely, a dynamic list that emulates at a tunable process layer the kind of mental triage we perform routinely: is this actionable, is there an advantage to being timely, what value will this provide to someone monitoring my feed, the group’s feed, related feeds, and so on. More: is this valuable regardless of the spread of the content, can it make access to the content more valuable as a result, does this value provide incentive not just for subscription but for creation of the original content and tuning of the contributors?

On this week’s Gillmor Gang, Foursquare boss Dennis Crowley bats away similar noise about The Death of Check Ins. He concludes the show with a pitch to the shrinking pool of developers, saying that contrary to fading, the company is focused on capitalizing on the opportunity in front of it. I never check in to Foursquare, preferring to lurk at the push notification level where the rhythm of check ins blends with @mentions and news alerts. But what Crowley and friends are building out is a fascinating version of that uber queue within Foursquare. In one view, you can surf nearby specials as vendors compete for attention with discounts. In another, you can explore different categories of venues in a given area. Two slices, two dices — new incentives for metadata creation that grow exponentially as they take off in popularity.

As Mark Twain, or Yogi Berra, famously said, reports of Twitter’s or Foursquare’s death are exaggerated. There’s way too much left from picking over RSS’s carcass. No, seriously, I really mean that. There’s way too much value lurking in Jack Dorsey’s original pivot from a bike messenger dispatch service to be mined, and who better than Dorsey to lead the charge as the iPad drives the push notification queue into the new media vortex. It’s two minutes past the Big Bang, and not enough time to grab the low hanging fruit. As Professor Irwin Corey, or Wavy Gravy, said Adam said to Eve: Stand back, I don’t know how big this is going to get.

Source: Hey Kids, What Time Is It?

Season 7

April 4th, 2011 04:20 admin View Comments

One of the deep pleasures of writing on the weekend is taking a break from the drumbeat of incremental news and marketing disguised as insight. We forgive the marketers for at least having some product or service to promote, but give less leeway to the drip drip drip of factoids served up as revelation. There are no scoops on the weekends; they’re being saved for the early Monday tip off of the new week.

As Hollywood has undergone the fragmentation of the television audience and the resulting collapse of the sweeps cycle, there is a similar flight from the kind of fare that traditionally pays the bills. The holiday season from Thanksgiving on still commands the big releases, but once the networks broke away from the sweeps months there’s been little difference between opening on big holidays and littler ones. All you need is a few two-day weekends, and the market is ready for something to stretch out with.

You can see the same dynamic in the tech world. At South By (SW) we got a whole lot of nothing breaking through: no Groupon, no Foursquare, no Google social gasp. Instead, the slots just after were filled by the new usual suspects like Color, the Google +1, the New York Times pay wall, the Time Warner iPad gambit. Some were tuned to their less than spectacular innovation, others to a desire to slip into the market ahead but not too exposed. That may have worked for the Times, not so far for Time Warner.

It’s not as though there’s nothing going on here, just the wholesale overhaul of show business. But the drama is only apparent if you stretch out and relax into the rhythm of weekend politics and its seemingly sedate warfare. Take the palace coup at Twitter for example. Just when we are finally told that Jack was fired (the kick in the stomach heard ’round the social world) out goes Ev and heeeere’s Jack again. Astute readers and attendees of the realtime Crunchups may remember that Jack has always been partial to Twitter’s holy grail, Track. Are we at the doorway to a Golden Age? See Dick run and Emily Play.

Let’s try another one: Mad Men. The deal is finally almost done for the realignment of the television business. Creator Matthew Weiner gets $30 million for the final three years of the series, with no cuts of talent and only a partial concession to AMC’s insistence on cutting 2 minutes of the show for more ads. This “concession” is to keep the first and last shows at 47 minutes and then go to 45 for the rest of the 13 shows in the middle. But wait: those shows will be 45 on broadcast and 47 or even 48 on digital with an eight day window.

In other words, the broadcast show becomes a giant commercial for the iPad market and iTunes version, setting up AirPlay viewings on the big home theater screen that will become the dominant mechanism for high value audience metrics. Twitter and Facebook posts will market the extra two minutes relentlessly to the addicted fan base, as more and more people time shift the show to the “real” version. By the end of the three years the iPad version may well be in sync with broadcast, since Weiner has only made a deal with the studio for Season 7 so far.

By then Jack and Dick may have integrated Square into DickBar 2.0 and offered Weiner thirty million for just the last season. A combined Twitter/Apple (read Disney/ABC) deal with social metrics replacing broadcast ratings? Such a new network powerhouse, with the already implicit Netflix association, can fund a whole new set of iPad blockbusters promoed in Season 7.

In the meantime, we could use a live streaming news network on the iPad. So far YouTube hasn’t jumped, but if Netflix can do it how far behind is, oh, the Season 7 network from doing it? Apple TV uses its hard drive for caching only, so it’s already up and running for such a stream. ABC already makes their broadcast shows available next day on the iPad, while NBC/Comcast is queued up behind TimeWarner waiting to get permission from everyone else to TV Anywhere it in subscriber homes over WiFi.

This looks very much like Apple and AT&T squeezing the other carriers until Verizon blinked. Now that we can run FaceTime over the iPad via iPhone 4 tethering, how long will it be before either carrier drops the no 3G blocking of FaceTime? Just think how Apple servers are going to look at that data in a big Twitter switch, mixed with shared news channels, live events, and Season 7 Glee Direct. Can you say MobileMe One. If Facebook is worth 65 billion, what is Season 7?

Source: Season 7

Vitrue Raises $17 Million For To Help Brands Manage Social Media

February 16th, 2011 02:57 admin View Comments

Vitrue, a social media marketing company, has raised $17 million in Series C financing led by Scale Venture Partners and Advent Venture Partners with existing investors General Catalyst Partners, Comcast Interactive, and Dace Ventures participating in the round. This brings Vitrue’s total funding to $30 million. In conjunction with the announcement, former Facebook Vice President of Global Sales Mike Murphy has joined Vitrue as Special Advisor to the CEO.

As we’ve written in the past, Vitrue’s SaaS platform allows brands and marketing agencies to
communicate with fans and consumers across Facebook and Twitter accounts, location based services, and via mobile applications. The company’s SRM (social relationship management) platform is being used by a number of high profile brands including Harley Davidson, Mentos, Dick’s Sporting Goods, Crocs, Eddie Bauer, Maybelline, Purina, McDonald’s, YouTube, Ford, AT&T, Disney and Best Buy.

And Vitrue is growing in terms of revenue and is cash-flow positive. From Q2 2010 to Q3 2010, Vitrue’s revenue grew nearly 100 percent as the company tripled accounts using their SRM platform and expanded its API.

Currently, the service manages over 2,500 Facebook Pages and Twitter accounts for various clients, which adds up to 450 million fans/followers in 47 countries. That’s up from 680 Twitter and Facebook accounts managed in October of 2010.

With the new financing, Vitrue will be opening offices in seven U.S. markets including New York, San Francisco, Dallas, Chicago, Detroit, Cincinnati and Los Angeles. The company is also expanding globally, creating presences in London, Toronto and Singapore. And to support all these new outposts, Vitrue will be hiiring between 100 and 150 new employees in 2011.

Source: Vitrue Raises $17 Million For To Help Brands Manage Social Media

Spanish Design Student Creates Sleek New Spotify Gadget

February 13th, 2011 02:50 admin View Comments

Leave it to those ambitious, young grad students to show us the objects of our desire that we didn’t even realize we desired. Thanks to Jordi Parra, an Interaction Design student at the Umeå Institute of Design in Sweden, we now have a futuristic new music player that lets you listen to Spotify from the comfort of your living room. (Only if your living room is in Europe, however, as Spotify is not yet available in the U.S.)

At first glance, the player — which Parra made as part of his final design project in collaboration with Spotify — looks like a digital lovechild of Jonathan Ive and the brilliant Swedes at Ikea. Perhaps the coolest feature of the product’s design is its inclusion of 192 LED nodes, which display volume levels, battery life, and Internet connectivity on the device’s face. Not too shabby for a degree project!

How does this bad boy work? The player uses radio frequency identification (or RFID) technology: place one of the colored RFID tags, which contain your playlists, onto the magnetized volume knob, and voila! As soon as the tag sticks to the knob, the antenna/Arduino in the player reads the tag and plays your hot jams. You stop those hot jams by simply removing the tag. Kinda cool, right?

In the case of Parra’s reader, the information is actually transmitted via magnetic induction using the player’s magnetic volume knob and an Arduino processing board to sense the tag and extract its contents. (Pictures of Parra’s Arduino and the player’s insides here if you have no idea what the hell I’m talking about.)

How you go about encoding your playlists on the RFID tags is a little equivocal, but it sounds like this is done by connecting the player to a computer via USB. This should automatically call up Spotify and begin configuration. The RFID tags are read-write, so once the tag is connected to the player (while the player is connected to your computer), you can change your songs or link to a new playlist.

The player is sold with a unique serial number that will essentially register your device with Parra, though “register” may be a strong word in this case. The serial number allows Parra (and perhaps his future company) to track the player and its corresponding tags. Obviously, as you may have guessed, RFID technology has the potential for myriad security and privacy issues. (Think of the ad technology in Minority report that is essentially Philip K. Dick’s conjecture on RFID technology.) So, this will require some sensitivity on Parra’s part should the player end up being sold at market by Spotify.

Though the inner workings of the device works may sound a bit complex at first glance, the UI is sleek and simple. Use the two small buttons in the lower left corner of the speaker (as seen in the above image) to skip to the previous and next tracks in your queue. The adjacent magnetized knob holds your tags and controls volume. The slick packaging that would ship with the player will include 8 RFID tags (which incidentally look suspiciously like pogs), a USB cable, and a stand for the tags.

It seems that, thanks to collective consciousness (or the relative novelty of applying RFID tech to music players), a few other designers and firms have been developing their own RFID devices. You can check out IDEO’s retro (whoa! Cassettes! Turntables!) player here. Or this guy’s squeezebox here.

You can also check out Jordi Parra’s blog for a stroll through the product’s development.

Source: Spanish Design Student Creates Sleek New Spotify Gadget

Close or View

February 13th, 2011 02:08 admin View Comments

There’s something about the time we’re in right now that reminds me of the brief period before FriendFeed went realtime. Bret Taylor and Paul Buchheit were experimenting with realtime updates, a conversational format where comments paged in as they occurred. Seemed like a minor feature request at the time, before Google Wave and certainly no comparable Twitter functionality. And as much as some of us clamored for it as a Track replacement, most users could care less.

In fact, most of the discussion about realtime was about how to keep up with, or pause, the stream. FriendFeed took a radical approach, adding new comments and their parent thread at the top of the interface. Last in, first out. In so doing, the tyranny of the chatty commandeered the Twitter posts that also appeared in pseudo realtime. Partly a chat session, partly a news feed, the swarming characteristics of the social crowd were exhilarating, sometimes nasty, and destined for attack by economic blockade.

Twitter provided most of the utility, and then most of the failwhaling. Whether technical or just business, the firehose was rendered unreliable by a series of outages and turf gamesmanship. Luckily for Twitter, Facebook was either too busy or too focused to compete directly for a realtime experience, and aggregator strategies such as FriendFeed couldn’t reduce Twitter dominance by merging multiple streams. FriendFeed didn’t want a direct confrontation with Twitter, and Facebook wanted the co-founders. End phase 1 realtime.

In the aftermath of FriendFeed realtime, Twitter has finally pulled even with most of the capabilities if not the UI of phase 1. The center of the platform is the iPad client, or will be once Dick Costolo has his druthers. The iPhone is similar in features, but pales next to the larger device’s ability to go right from update to post. The website still has its moments, particularly when Google Track alerts send you to the web client rather than the iOS app. To more or less the same effect, you can navigate to citations from direct messages, @mentions, and @replies from all three.

My favorite UI is the iPad app and its sliding columns. Click on an item to retweet, reply or email (I don’t use favorite), and then walk the neighboring tree of someone’s posts or @mentions by clicking on their picture and the appropriate stream below. It can get a little ungainly as column after column slides in and replaces the preceding one, but you can swipe them to the right to backtrack. But the rewards for this slightly goofy UI are that you can catch up on folks you don’t see frequently in the stream, or bounce from person to person in a kind of cloud-hopping scenario.

You might think Facebook updates were a big loss in the Twitter scenario, but I find the one-way nature of the Facebook stream (in from Twitter but not back) blurs the possible value I’m missing. Occasionally I’ll venture over to see what I’m missing and find that bucolic Facebook conversation among friends and acquaintances. Not a waste of time, but nothing I can’t catch up with in a few minutes once every few days. Recently the Twitter to Facebook push seems to have slowed to a crawl, or perhaps it’s being more selective than the Likes, posts, and comments I push from FriendFeed. If someone comments on one of those reposts, I get email notification.

Now that Chatter @mentions and Likes are online, I’m getting email alerts. I’m subscribed to the New York Times, Wall Street Journal, and Washington Post breaking news emails as well. I get email from Plancast, Twitter follows, News.Me daily updates, and so on. Here’s where it starts to get interesting. The Times pushes notifications to iPad and iPhone. CNN pushes breaking news to the iPad. Facebook pushes pictures, Foursquare check ins, and a new firehose from Twitter: @mentions and direct messages.

The only way I can quantify this is as phase 2 realtime. Right now it’s a hodgepodge of interfaces: Safari Web, iPad or iPhone but all push notification. It’s that little feature that tips us over into the next world, just as realtime pushed FriendFeed to a complete revamping of its experience and eventually existence. When a push appears, you have two choices on the iPad — Close or View. It’s a modal window, meaning you have to click on one or the other to either swap windows or get back to what you were doing before the interruption.

If multitasking were uniformly enabled, that would largely be a no-brainer. If I could jump to the incoming alert and return seamlessly to where I was in the prior application, I’d choose View 90% of the time assuming I cared about the alert. But different apps handle things differently. The New York Times app is pretty good; it saves the index page I’m on and for the most part the actual story. The Wall Street Journal app is abysmal; no matter where you are in any of the seven days of archived issues it holds, it reloads the current issue’s home screen when you return.

Twitter is in some ways the best of both worlds, offering a separate browser instance within the app from which to escape the tyranny of the iPad’s Safari instance. It will save the page you were last on in Safari, but forces clicking on the index icon to navigate between the 9 pages in its landing screen. Twitter lets you view a citation within the column interface, or click to widen to full screen, or push the page directly into Safari. Not the true multitasking panacea of Android, but not the battery crisis either.

Email has its own semi-universe in this pseudo-tasking environment. Exchange (or Active Sync) vibrates but doesn’t push work email to the alert window; appointments make a chime sound and let you click to bring up conference call numbers and codes. Gmail vibrates after synching recent messages, triggered once Exchange has notified. That’s largely a good thing, since Gmail is where all my email notifications go and would kill the battery not to mention what’s left of my sanity. But because of the poor state handling of iPad apps, I have to choose between losing my place or waiting to find out what’s new.

As a result, push notifications are the new prime time, water-front property, Boardwalk and Park Place of phase 2 realtime. The domino effect of this alert mechanism will transform the iPad and therefore the downlevel iPhone and Web clients in turn. Soon we will be able to write filters directly to that middle layer buffer where state is stored, with business rules that let some things through to compliant apps and push data from weaker clients to second class citizenship. This in turn will provide powerful incentives to clean up wayward apps, as iPad economics propel such power features for an additional price or more targeted information about user interests.

At the time of phase 1, much was made of FriendFeed’s failure to achieve a broad-based popularity. Certainly the service plateaued and then collapsed once the buyout occurred. But the lessons learned were quickly absorbed into Twitter, and to a lesser extent Facebook and Google Buzz. Most significantly, Likes and @mentions have now largely recreated the underlying realtime Track structures that are now being harvested in Chatter. From phase 1 to acquisition took a very short time, a matter of months.

No doubt Apple is paying attention to phase 2 in a similar way. With signs increasingly pointing to new hardware in the next month or two, the iOS advances could be as or more significant than size, camera, etc. Integrating video chat with state-saving features and the social stream could spell doom for an Office already under pressure from being shut out of the iPad and maybe the Mac as it goes iOS. And killing the laptop market will put a rather significant dent in Windows sales too. With friends like HP running WebOS apps, Steve Ballmer can be forgiven for wondering who needs enemies.

Source: Close or View

Should You Really Be A Startup Entrepreneur?

January 30th, 2011 01:49 admin View Comments

Editor’s Note: This is a guest post by Mark Suster, a 2x entrepreneur who has gone to the Dark Side of VC. He started his first company in 1999 and was headquartered in London, leaving in 2005 and selling to a publicly traded French services company. He founded his second company in Palo Alto in 2005 and sold this company to Salesforce.com, becoming VP of Product Management. He joined GRP Partners in 2007 as a General Partner focusing on early-stage technology companies. Read more about Suster atBothsidesofthetable and on Twitter at @msuster.

One of the most common questions that entrepreneurs who meet me for the first time like to ask is, “Do you miss being an entrepreneur?  Aren’t you ever tempted to go back and do it again?â€

The obvious answer is yes.  When it’s in your blood, it’s in your blood.  I guess it’s kind of like crack (not that I know from experience).  It’s addicting.  I know this sounds superficial.  If you’ve taken the roller coaster ride that is a startup - you know what I’m talking about.

But I’m very happy now.  I’m enjoying being a VC.  I thought I’d talk a bit about the differences I’ve experienced between being an entrepreneur & a VC – you know, from “both sides of the table.”

On Being an Entrepreneur

I was asked by somebody recently in a private message on Quora about whether the individual should leave his comfortable job to become an entrepreneur.  You would think the obvious thing I would tell somebody is, “yes, of course it’s a great idea.”  You’d be surprised.  I often advise against it.  I really have to know somebody’s personal story and circumstances to know whether it is suitable for that person.

In this particular case I wasn’t convinced it was a good idea from the limited information I had.  The following is a short excerpt of what I said,

“… being an entrepreneur is very unsexy. Long hours. Time away from family. Low salary. High risk. High stress. It only looks sexy when you read TechCrunch. There is no shame in being an exec at a company or whatever.”

And I mean this.  I’m sure everybody has their own definition of the attributes of an entrepreneur.  Some of the ones I would identify are:

  • Not very status oriented
  • Doesn’t follow rules very well and questions authority
  • Can handle high degrees of ambiguity or uncertainty
  • Can handle rejection, being told “no” often and yet still have the confidence in your idea
  • Very decisive.  A bias toward making decisions – even when only right 70% of the time – moving forward & correcting what doesn’t work
  • A high level of confidence in your own ideas and ability to execute
  • Not highly susceptible to stress
  • Have a high risk tolerance
  • Not scared or ashamed of failure
  • Can handle long hours, travel, lack of sleep and the trade-offs of having less time for hobbies & other stuff

The truth is that in my experience very, very few people really enjoy the “pure” startup environment: months with no salary, months with no live product and lots of trial, error & rejection.  Even many successful entrepreneurs tell me that they’d prefer to do a buy-out the next time rather than go back to square one in a startup. NOT easy.

There are a larger number of people who enjoy coming on when an idea has become validated and thus “de-risked” but I still think this is a small number of people.  And also there are a large number of people who would like to do startups in theory, but have high cost bases (family, real estate, school loans, whatever) that makes it very difficult to take the kinds of risks required.

And what gets lost in reading about the glamor of Facebook, Twitter, Zynga, GroupOn and the like is that most startups fail.  And for ones that do get sold often most of the employees don’t really make huge upside gains.  You don’t read about these garden variety outcomes online – only the high profile exits or busts.  Mostly you read about fundings, product releases, big valuations, and M&A.  So readers of tech journals gain a bias of the chances of success.

I’m not trying to be negative.  But I start most conversations with “wantrepreneurs” by saying,

“make sure it’s in your personality type, make sure you have the risk appetite, make sure you can afford to take the risks given your life situations and make sure you know that there is a high possibility your startup won’t be hugely financially rewarding.  If you still want to go for it knowing all this and all that you’ll endure – awesome!  It’s the best experience I’ve had in life.  But not for the faint hearted.”

You’re in for the Ride

There’s nothing quite like shipping V1.0 of your product.  You’ve come full cycle from vision, to hiring some people, raising some cash, arguing about direction, setting a release date, missing a release date, feeling like you’ve effed everything up, regrouping, rethinking, getting back on track and then setting your baby loose into the wild.  And then.  Whew.  Sit back and watch usage.  Get your press coverage.  Either you arc up emotionally or you arc down.  There’s not a lot of flat line.

Snap.  Great story on TechCrunch!  Inbound calls from partners, people who want to join, atta boys from friends.  You knew it all along.  Your vision was right.  VCs are calling wanting meetings.  La vita e bella.  Uh, oh.  Fawk.  Facebook DID NOT just announce that!  Scoble is saying your best days are behind you?  No, I think we can still be huge.  We’re just going to have to change our focus a bit.  Weekends.  Evenings.  Regroup.  Team losing a bit of confidence in you.  VCs pushing out your meetings a few weeks.  WTF?  Just a month ago they were all email you!

Well, you still have 6 months runway.  What if we pivot slightly?  Not a total change – just a different way of making money.  What if we dropped the code that would compete with Facebook and instead go after this other area instead?  Relaunch.  Oh, man.  Our user numbers are up.  Awesome!  Loving this new direction.  It’s all good.

But … only 2 month’s cash left.  Let’s just not pay ourselves for a couple of months.  The junior devs need it.  They’re month-to-month.  I think we can be like the Maccabes and stretch this cash.  Do we tell our team? Can they handle knowing we only have 3, maybe 4 month’s cash? Or if we say that will they all be putting out the word to their friends to look for their next gig?

Great new product release. Another good article.  VC meetings going well.  Holy sh*t!!! We just landed the biz dev partner we’ve been working on for 9 months.  They love us!  Awesome!  $2 million in VC.  Life couldn’t be better.  All your buddies want to join.  No.  Google DID NOT just acquire our main bizdev partner.  What?  Google doesn’t know if they’re going to honor our contract?  We now have to re-convince everybody? But we had a term sheet !!!

You can’t believe it.  8 beers that night.  Maybe even tequila.  And the next morning – water off a duck’s back.  We’ll find a way.  Startups weren’t mean to be easy.  Back to work.

Anyone who has worked in a startup will know that this narrative is not exaggerated.  If anything it’s the tame version.  Every one of these events (with names changed) has happened to companies I’ve worked at or closely with.  Most of them in the past 12 months. I’ve personally experienced much worse. Imagine how Flurry felt when Steve Jobs called them out by name.  They seems to have bounced back nicely.

I remember being a few months before my wedding wondering whether I would walk down the aisle unemployed.  It was 2002 – the “dog days” of the Internet and we were running out of cash. I remember an employee asking me whether I’d fill out their paperwork to get a home loan when we only had 3 months of cash in the bank.  What do you tell somebody in that situation?  I remember having a merger called off at the last minute and having a planning meeting at a pub to figure out how to run a bankruptcy process (luckily, we never had to do it).

And I had all the VCs play head games with me.  One investor played chicken with me by threatening not to approve my next-round financing unless I gavehim more equity.  He wasn’t willing to put in more money but he had “blocking rights.”  I had 10 days of cash.  He was going on vacation for 2 weeks and told me, “Too bad, I’ll deal with this when I get back.”  I literally told him to Fawk Off and sue me. That is a true story for which I have witnesses. I hung up.  He called back and said, “OK, do the deal.”

Really?  I had to go there? I learned this lesson long ago – many investors wait until you’re staring at a cliff before committing whether to re-invest in you. It is risk minimization + maximum leverage. I swore never to do that as a VC. Many VCs don’t realize just how destructive this is to team spirit and confidence. Penny wise, pound foolish.

But there is nothing that would ever replace the rush of being on the top of the startup emotional curve.  Winning my first million-dollar contract.  Getting on the front cover of the most prominent VC magazine in Europe (was called Tornado Insider).  Acquiring a competitor with complimentary assets whom we long wanted to beat. Walking into an office at the London Underground and seeing every workstation open and using our product.

I was watching Meet the Press this morning and they put a big screen behind the guests with TweetDeck open and showing the constant stream of information about Egypt.  That must have been a proud moment in the Betaworks offices.

And on the bottom of the emotional startup curve there is nothing crappier than having to lay off 60 employees in one day.  Been there. It tests your soul to have to ask close friends to leave the business. Losing a deal that you had worked on for months after being told you won and then have snatched away from you will ruin some nights of sleep. There are moments like being on stage when your demo crashes, reading about your competitors raising a ton of cash or having one of your top team members resign that test your will.

My SVP of Sales & Marketing quit 30 minutes before an important board meeting.  Dick.

And that’s what it’s like – all superlatives.  Your highs are super high.  Crack.  Your lows are unexplainably low and lonely.  It’s the startup roller coaster world.  And I miss it.

What do VC’s Experience?

There’s still a cynical entrepreneur in me regarding VC.  In my experience many in the industry still think about “my CEO’s” or “my companies” as though they are pawns on a chessboard. I’ve heard many a VC comment, “Yeah, I told the company to do A,B,C and they didn’t listen.  The management team wasn’t strong enough.  That’s why we didn’t succeed.”  That’s the rationalization for the failure.

And all too often I hear upon success, “Yeah, I was actively involved on that one.  Our advice is what helped them target the right market, hire the right team, build the right products.”  And there are some delusional people who really believe it.  I remember this attitude really well from working in consulting where people took too much credit for “creating new strategies” and deny any responsibilities for failed initiatives.

The reality is that the majority of successes & failures are created by & experienced by the entrepreneurs.  The VC sense of accomplishment or failure is blunted by being slightly removed and by the portfolio effect.  I think it looks something like the graph below.

But there are many great VCs also who see the entrepreneur as their customer as they should do and are realistic about how much of an impact we advisors and financiers really have.

We enjoy our jobs.  We love working with entrepreneurs.  We’d have to be big babies to complain about what we do.  We’re paid well to spend time with smart people who want to change the world.  We control our hours, our travel and our investment areas.  We get to ride your ride, too.  But as above, the highs just aren’t quite as high and we don’t have to sweat the lows as much.

Why Many VCs Secretly Envy Entrepreneurs

When I first considered leaving Salesforce.com to become a VC I obviously called all of my VC friends and asked their opinions. It’s a very tough decision to walk away from a senior role at what I consider one of the most successful tech companies of Internet era. Almost universally they said, “Are you crazy? If you’re going to leave, go do another startup? Don’t go into VC.â€

Huh? Here they were in what I thought was one of the most sought after jobs and they almost all told me not to do it.  I was baffled.  It was 2007.  It was well past the Internet boom, well into Web 2.0, before the really profitable years of social networking and when many in the industry were despondent.  Really.

What I garnered was that many VCs secretly wanted to be entrepreneurs.  They were envious.  Let me explain.  Let’s say you became a partner in a VC fund in 1995 and started investing heavily in 1997-99.  You felt invincible.  As John Doerr, the revered partner at Kleiner Perkins said it was, “The largest legal creation of wealth in history.â€

You were minted.  Golden.  Making bank.  King makers.  Internet pioneers.  I remember the New York Times wrote an interesting article about it.  They talked about how the dream job for Harvard MBAs used to be investment banking where you wore your Rolex watch, drank $200 bottles of wine at fancy New York restaurants and vacationed in the Hamptons.

Suddenly the VCs & Internet pioneers were buying Patek Phillipe watches, ordering $1,000 bottles of wine, getting all of the best restaurant reservations and flying private jets.  At the time all investment bankers secretly wanted to be VCs and many did just that.

But the “gilded age†ended quickly.  The days of quick flips, quick IPOs and astronomic returns had come to a close.  If you became a principal or a new partner in 2000/01 you had a good salary but as it turns out you were very unlikely to see a large upside “carry†return for quite some time. Nobody really talks about this.

So here’s the deal.  There are many VCs who have been made partner since 2000 and haven’t previously had an exit of their own.  They’ve probably watched smart teams, younger than them, walk in with a paper napkin, get funding, build a modest company and sell it for $20-30 million in 3-4 years pocketing $8 million for each founder.  It looks so easy.  It looks so alluring.  That’s where the envy comes from.

But they don’t have a great idea. And they have the status of being a VC. And a comfortable salary. And the chance at diversified returns. So it’s hard to put your neck on the line and try. But those returns won’t come for 7-10 years for many of them.  Some, not ever.

That’s why when I met Mark Peter Davis and heard he was giving up his VC career to run a startup I was seriously impressed. It takes cojones - hats off to him.

So while you’re struggling to get access to VCs and those that meet you seem unwilling to commit – at least take comfort in knowing that many of them secretly long to sit in your chair, as much as you might find that hard to believe.  I promise you.  They envy your courage, freedom and upside possibilities.  Not all VCs want to be entrepreneurs, of course.  But I’ve heard it from many, many a VC that they feel the calling to try.  Most won’t.

Me?  I’m committed to where I am.  I have 3 partners with whom I work really well and whom I respect.  We have a broader team that have become our close colleagues & friends.  I’m enjoying the diversity of working with 6-7 portfolio teams on a regular basis on strategic issues.  I’m enjoying watching them grow from nothing to meaningful businesses.  Would I take another hit off the startup pipe? No time soon. But I’d never say “never.”  It’s such a rush.

Just please make sure to enjoy the ride (up and down) while you’re there. When you finally get off it’s a long line and you have to be really committed to want to get back on.

Roller Coaster image via Rich Evenhouse on Flickr

Source: Should You Really Be A Startup Entrepreneur?

The AirPlay Network

January 23rd, 2011 01:47 admin View Comments

Week One of the Age of iPad was barely weekended when Keith Olbermann was removed from his position at NBC/Comcast. I missed his final show, mostly because I stopped watching it and all the cable news channels once the election was over. But then I remembered we are now in the Age of iPad, and guess what I found when I turned on Apple TV. There it was right in the podcasts section, ready to stream.

Parsing the language I heard the same thing we heard earlier when Steve Ballmer fired Bob Muglia, when Eric Schmidt was kicked “upstairs,†when I was asked to leave along with my wife and a friend from the Crunchies because the room was too full. In the last case, I refused to move, waiting until the venue manager moved on to people more her size. I wonder what would have happened if Muglia just said, no, Steve. I’m not going anywhere.

We’ll get back to Eric and the boys in a minute, but in the Age of iPad, all is not as it seems. Take Olbermann for instance: firing him seems like exactly what NBC doesn’t want. It dredges up the recent Leno fiasco in a visceral way, suggesting that even if Conan’s new show might as well be emanating from Siberia, at least he suffered no bad will for telling NBC where they should get off. By contrast, I wouldn’t touch NBC at 11:30 with someone else’s hard disk.

I don’t put much stock in Comcast being behind the Olbermann firing, because showing him the door doesn’t just hurt MSNBC, it hurts CNN and Fox as well. First of all, the only cable news coverage of the number one story of last night was on CNN and Fox. Tonight’s NBC Nightly News studiously ignored it, and somehow I doubt the Today Show will touch it either. Without any credible reporting from one of the 4 major networks, the other three have little to pivot off of, no comparable story about how cable news is being squeezed out by the Age of the iPad. That’s what happens when you become the story.

The unreported story is that a new network has emerged with new rules of engagement. Once the hall monitors had retreated from the Crunchies auditorium, I pinged my former overlords at TechCrunch and soon we were escorted backstage to an empty sofa. The sound was difficult, and I didn’t much feel like standing in the wings. But then I realized that combining the audio in the room and the sound of the crowd with Twitter produced an excellent new medium. I could hear Dick Costolo and Mike Arrington toss a few softballs around, and knowing Dick’s background as a standup comedian, wait a few seconds after the laugh for the punchline to appear on my iPhone.

Bear in mind that this is not the Golden Globes or the Grammies but an industry tech event being streamed live worldwide in realtime over Twitter and Ustream. Given the people I follow and the @Mention Cloud, we now have a microcast network that levels the playing field between all such events. Already the networks are bending to the new iPad reality, broadcasting the Ricky Gervais pummeling of Hollywood live at 5 on the West Coast, because Twitter has already eviscerated the results on the East Coast if they are embargoed. Gervais’ jokes cut to the bone all the more because his victims knew this was going out in realtime. He said what?

Actors or anchors, it doesn’t matter. When someone bypasses the big network to get straight to the audience in realtime, something big has changed. Olbermann had a 4 year contract worth a reported $30 million, or something north of $7 million a year. Let’s say he goes direct to iPad once a day, and takes Rachel Maddow with him. Push notify the audience of a rundown of each show along with headlines as they occur. Oh my, suddenly Comcast is happy to charge for the increased download bandwidth to support the model. And they don’t have to split the rate increase with the network, especially nice since they own one now.

Of course, Disney is ABC is Apple, so they might have some interest in bypassing the cable network business and going directly to revenue. That will bring Fox in, who are already playing ball with Apple TV on a test basis, and new power houses like whatever network produces Mad Men. Mad Men, by the way, is now the flagship of our go-to realtime network. We’re just starting Season Three, which I paid 22 bucks for and downloaded to my iPad for Airplay in whatever room the kids haven’t commandeered for Xbox Kinect. It’s realtime, just 1962.

Chatting with Dick Costolo after the Crunchies, I told him what he already knows, namely that the Twitter iPad app rocks. Then he said a very smart thing, that he thinks they should use the iPad implementation as the base platform and conform the other apps — web, iPhone, Android — to it. I couldn’t agree more. The iPhone may have started the revolution, but now it is a peripheral to the iPad. As is Apple TV, which is way more than a hobby.

Gone are the traditional networks. They are not dead, but rather absorbed into a new state of mind, one where we view our time as more valuable to us if we can sculpture it. I resisted Mad Men for years because I was already years behind. But AirPlay gave me the ability to try the first one, then “save†money on the first season, then let the mediocrity of the network offerings slowly but surely be routed around by streaming the now-addicted time machine of 1960. The year Kennedy was elected, the first television president, the dawn of realtime crisis, political and social upheaval, you know what I mean.

For those of you too young to remember, this was the time of not just Walter Cronkite but Huntley and Brinkley, not just the Beatles but the Stones, not just Miles but Hendrix. When Olbermann quits, he’s firing Glenn Beck. And when Steve Jobs steps aside he’s firing Schmidt too. Google’s job is to provide competition for Apple, to slipstream alongside the economic juggernaut Jobs has unleashed. Muglia’s ousting appears to be payback for Ozzie quitting, and in so doing Ray fired Ballmer, not the other way around.

The Age of the iPad has launched a wave of desperate moves, of actors and anchors testing the waters of the emerging economic model, of CEOs acting like COOs when what is needed is real leadership and insight. Costolo is one of the new breed, tempered in the crucible of the comedy circuit and the RSS politics of Feedburner and Google acquisition indigestion. Nothing about the Google realignment suggests any material change in the equation, and Microsoft’s retrenching around Sinofsky may prove the same kind of miscalculation NBC made in betting on Leno 2.0.

At the end of Season Two, Don Draper beats back a move to demote him or worse by pointing out that he has no contract with which to contain him, no non-compete to keep him away from the competition. Suddenly they serve at his pleasure. According to reports, Olbermann can’t go on television for some period of time, but can do anything he wants on radio and the Internet. The AirPlay Network awaits.

Source: The AirPlay Network

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