Entries from March 2008
It’s no secret around Silicon Valley that legions of Google execs are seeing their options vest and moving on to the next thing.
Wired chronicles recent departures here.
From the outside looking in, it’s hard to tell who actually played key roles in creating Google’s success and who was along for the ride. And from what I can tell there also is considerable disagreement on this question amongst Googlers themselves.
It’ll be interesting to watch which Google refugees hit it big outside of the mother ship.
Categories: venture capital
Yesterday was one of those fun days in the blogosphere where alot of attention was drawn to seemingly contradictory news.
While paidContent reported news of Forbes and Viacom launching ad networks for the finance and male lifestyle verticals, ESPN’s announcement that it was pulling the plug on 3d party ad networks also got alot of play. MediaWeek’s Mike Shields gave a nice summary of the debate raised by the ESPN moved:
“ESPN’s decision crystallizes a philosophical debate in the online ad sales industry that has intensified since the Interactive Advertising Bureau’s annual meeting last month when during a keynote address, Martha Stewart Living Omnimedia media president Wenda Harris Millard gave her now famous warning against selling Web inventory like “pork bellies.” Two sides have formed—those who want to protect traditional, direct selling of premium content brands and the math-loving crowd that favors automation and data. The math lovers make the traditional sellers nervous.”
Since I’ve got portfolio companies on various sides of this debate I will refrain from opining, except to say that there should be ways to address the objectives and concerns on both sides of the table.
Can’t we all get along??
Categories: venture capital
One of my favorite things about my job is getting to meet, work and hang out with really interesting people — not the least of which are my partners at Polaris. Top of the list is Bob Metcalfe, who in addition to mundane things like inventing Ethernet and founding 3Com, is an incredibly witty and entertaining fellow. No meeting with Bob in it is a dull one.
Bob just shared with me one of his “golden oldies:” an article he penned in 1992 for the MIT Technology Review titled “Zen and the Art of Selling.” In it, Metcalfe takes issue with the aversion many technologists and academics seem to have with market-facing activities, like selling, while arguing that selling is what ultimately accounts for a firm’s success, or lack of it:
“I am sad to find that the MIT culture,
at all levels, is still permeated with
the notion that professional salespeople
are properly placed in the food chain just
below green slime.
That attitude relegates too many MIT
students to bleak Saturday nights alone,
because they think it unseemly to do
the bit of selling conducive to lining up
a date….
And too many MIT entrepreneurs launch
companies that give no thought to selling
and so promptly crash and burn.
I can tell you firsthand that selling is
one of the highest arts in entrepreneurship.
Most companies, even successful
high-tech companies in Silicon Valley,
spend 10 times more on selling than on
engineering….
In short, nothing happens until something
gets sold.
I can’t help but notice traces of Metcalfe’s observations playing themselves out today in the world of Web 2.0 startups, virtually all of whom envision an “ad supported” business model but many of whom embrace a technology-centered culture which often turns up its nose at the culture and personality of ad sales itself.
Now, this is not all bad, in my view, as it is often this single-minded focus on great software that leads to wildly rapid adoption of “successful” web-based services. But it is worth remembering, every once in a while, that none of these are truly successful businesses until they actually generate sales.
In any event, Metcalfe’s piece is characteristically sharp, witty, and a damn good read. Here is a link to the whole piece: zenofselling.pdf
Categories: venture capital
Matthew Gertner does a guest blog post at TechCrunch discussing single-site browsers and the bridging of Web and Desktop apps. It is a good read and a great trend, I think.
Categories: venture capital
I’ve been on the widget bandwagon for over a year. I posted that the most interesting company at the 2006 Web 2.0 was Clearspring; and, along with the rest of the world, predicted that 2007 would be the year of the widget.
What I didn’t fully appreciate though, was that perhaps the most important application of widgets would be widget ads. I do now though. Everywhere I go I hear about advertisers building widgets. Google’s Gadget Ads, and Doubleclick’s announcement of a widget ad network, are but two examples. Another is the cool new widget-building service offered by Sprout, which has seen impressive early adoption by advertisers.
Yes, it is still in its infancy, but this is one to keep your eyes on.
Categories: venture capital
Sharon Kirkey, The Ottawa Citizen
Published: Monday, March 17, 2008
Compulsive e-mailing and text messaging could soon become classified as an official brain illness.
An editorial in this month’s issue of the American Journal of Psychiatry says Internet addiction — including “excessive gaming, sexual pre-occupations and e-mail/text messaging” — is a common compulsive-impulsive disorder that should be added to psychiatry’s official guidebook of mental disorders.
Like other addicts, users experience cravings, urges, withdrawal and tolerance, requiring more and better equipment and software, or more and more hours online, according to Dr. Jerald Block, a psychiatrist at the Oregon Health and Science University in Portland. Dr. Block says people can lose all track of time or neglect “basic drives,” like eating or sleeping. Relapse rates are high, he writes, and some people may need psychoactive medications or hospitalization.
Categories: venture capital
An article in today’s New York Times raises the question whether the Internet will be able to handle the growing surge in online video.
My partner Bob Metcalfe, who once famously predicted the Internet’s collapse and then — literally! — ate his words, has tempered his view, telling the Times “But the Internet is vulnerable today. It’s not that it will collapse, but that opportunities will be lost.”
And one of the smartest people I know has made the case (in the context of a board meeting, so I am not stating this person’s name) that the US communications infrastructure simply can’t handle the demand that the video web will put on it.
All this suggests the venture community should be pouring dollars into web infrastructure again. But given the economics of communications equipment companies (they take alot of capital in advance of market adoption) and the disastrous comm equipment bust a few years back, somehow I doubt this is going to happen.
Categories: venture capital
Yesterday I wondered whether YouTube was going to permit publishers using its API to monetize the video themselves, or whether YouTube would control that inventory. TechCrunch wondered the same thing.
YouTube exec Hunter Walk offered a sorta answer in a comment to my post. But product manager Jim Paterson offered TechCrunch the direct answer: No.
Here is what he said:
We are not introducing any fundamentally new way to monetize. Any video that is uploaded through our API is treated exactly as on YouTube.com. In general if a video is uploaded to YouTube, in some cases we serve ads into that on YouTube.com. When people embed those we reserve rights to serve ads in the future.
It is not a white-label service. We do offer a hosting service, but it is not a direct alternative to the companies that you mention. There are some big differences. It is a YouTube-branded experience. It is free. The price you pay for using it is you must participate in the YouTube community.
I guess it is only fair to offer the tool for free in exchange for keeping the ad inventory. But I wonder whether it wouldn’t make sense to offer the publisher a share of the ad revenue, at least for the video that is viewed on the publisher’s site…
Categories: venture capital
There is a popular TechMeme meme this morning on YouTube’s announcing its API which will allow 3d party apps and sites to use YouTube as an embedded video upload tool.
Smart move.
But will YouTube reserve the right to serve ads into those videos, even when they are viewed on the 3d party site? And, if the answer is “yes,” will the 3d party site get a healthy share of the ad revenue, ala AdSense?
Answers to these questions would, I should think, be pretty important for the developer community.
Categories: venture capital
