Archive for November, 2009
Finally getting around to trying the new iPhone app. Pretty slick.
WordPress just rolled out the ability to offer readers an email subscription option. I just added it to this blog. It’s over there on the right. Sign up!
As I have written many times before, answering the vexing question of when founders should remain or be replaced as CEO is probably both the most important and most difficult part of the job for both founders and the VCs who back them.
While the personalities and egos of both founders and VCs often complicate things, even without that, the reality is that determining the “right” answer is really damn hard. Sure, there are lots of instances where a founder is the perfect person to launch a startup but by his/her own admission clearly lacks some of the competencies necessary to grow it into a successful business. Even still, the notion of bringing in a CEO can be troublesome. Will a new CEO be entrepreneurial enough to fit into what is still a very early stage company? When an entrepreneur ask whether it isn’t risky bringing in a new CEO, the only answer is “yes,” it absolutely is a risk that, despite extensive interviews and referencing, even the best boards make mistakes in hiring startup CEOs. So when is it right to go ahead and take that risk, and when does it make more sense instead to surround a founding team with talent other than a new CEO?
This very question is playing itself out in no fewer than 3 of my portfolio companies right now, with 3 different answers emerging. I am going to share 2 of these outcomes here.
In one scenario, a very young first time founder/CEO appreciates that the company has a ton to gain by the addition of some senior talent on his team, and that what today feels like a really good trajectory could be a really great trajectory with some seasoned help. But he also worries that hiring the wrong guy would be disastrous if that guy is the CEO. Things are going well — why take that risk? Instead, the founder and the board are leaning toward hiring a strong #2, a President or COO or something like that. Facebook and Twitter did, why can’t we?
In the other scenario, a more experienced founder is doing a brilliant job establishing the company/product vision and establishing both himself and the company as a real thought leader in the space. Not surprisingly, focus and disciplined execution is not this founder’s strong suit, and the company soemtimes suffers from continually having a new strategy and positioning. The founder and I have been going back and forth on this for months. Here is where we’ve landed: for the next 6 – 12 months, the most important objective for the company is validating its solution and vision in the marketplace. Although full of “buzz,” the market is still early and super dynamic. Continued innovation and evangelism will be key, and success will look more like a handful of critical partnerships and acceptance of the company as the market leader, than it will a scaled business. So, we’ve concluded, the best management configuration is to keep the founder as CEO with strong sales and business development execs around him, and a couple board member/advisor types with great operational chops who can help the founder keep his feet on the ground and the company on track to where they need to go.
Stay tuned, we’ll see how things work out.
Every year on November 19 I call my mom to wish her a Happy Anniversary. And she always is so surprised I remember, since my Dad passed away in 2001.
Ask people who know me well, I am NOT the kind of guy who remembers things like birthdays, anniversaries, etc. But for some reason November 19 is etched into my consciousness, much more so than, for example, the date of my Dad’s birthday or death. Part of it, I think, is that my parents had such an incredible love affair that their anniversary was always a source of great happiness and celebration for all of us. And the older I’ve gotten the more I’ve appreciated this.
One of the best gifts parents can give their kids is the model of a wonderful marriage that remains a love affair even after all the struggles and tensions that any marriage endures over the decades.
So here’s to ya, Mom and Dad!
A year ago the venture community scoffed at application startups who were dependent on Facebook. Today, Facebook is not just where you want your app to run, it is also your most important tool (through Connect) for driving traffic to your site.
To my mind, this makes Facebook the new Google.
The power of Google over the web was manifested by the emergence of SEO and SEM as cottage industries in and of themselves. In the early days, SEO was a dirty little secret that sites like About.com and IGN used to build audiences far bigger audiences than could less insightful competitors. But then the rest of the world caught on and SEO/SEM became a standard part of web marketing.
Today, understanding how to leverage Facebook is eclipsing the importance of SEO/SEM as the future of web marketing. Some of our portfolio entrepreneurs are all over this, and those who aren’t are getting an earful from us on this topic.
Gregg Spiridellis, founder and CEO of our portfolio company JibJab, recently posted on Inside Facebook on the dramatic impact Facebook Connect has had on JibJab’s user growth. JibJab was one of the masters of using email to drive viral marketing. But using Connect dwarfed the power of email. As Gregg wrote:
It took us 8 years to reach 1.5 million registered users in the era of email. It took us only 5 months to acquire the same number of users on Facebook.
We used to get 2 to 3 email recipients for every piece of content shared by a user. Today, we are seeing anywhere from 12 to 20 clicks back to JibJab.com for each post into the stream. Because of this, we have completely subordinated email to Facebook stream publishing in our product experience on JibJab.com.
Another portfolio company of ours, LOLapps, has not only learned the power of the Facebook platform but in fact is building a business out of helping app developers publish on Facebook. Originally focused on enabling Facebook end users become app developers, LOLapps recently has launched a platform for game developers to build and publish games on Facebook. While still in its early days, early signs are promising as the first two games launched on the platform were both among the top 10 fastest growing games on Facebook last week.
And yet a third Polaris portfolio company, Sprout, is building a business helping brands build and publish social advertising campaigns on Facebook (and other social networks).
That giant sucking sound you here? It’s Facebook, pulling users, entrepreneurs, brands and web businesses into its grasp.
