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Investing and Participating in Social Services

October 29, 2010

vcmike

Chris Dixon had a characteristically smart blog post recently where he states that he can’t take Investors or commentators seriously on the topic of social services when they themselves don’t use social services.
Chris owes it to his cofounder Katerina Fake that he became an avid blogger and tweeter. And I owe my own entry into social services to WordPress creator Matt Mullenweg, who in 2005 insisted that I blog as a condition to investing in the company he was starting,
Automattic.
I wholeheartedly agree with Dixon that to be a good social investor requires that you participate in them. But a caveat: while using social services is critical to understanding the medium, relying on one’s personal taste in social services to shape an investment strategy is a recipe for disaster. It makes a helluva lot more sense instead to look to user metrics and behavior, even if limited, than to rely on a data point of one.

5 Comments

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  1. October 29, 2010

    Just as doctors make the worst patients and lawyers who represent themselves have a fool for a client – investors who use their own survey of 1 often miss the point – particularly investors who live and work on the coasts – with very little view of the heartland. I remember doing my first radio deal and hearing people talking about this powerhouse of a country music station. I couldn’t even begin to wrap my mind around the fact that country radio is the most popular format in the U.S. Growing up in Long Island, going to school in NYC, New Jersey and working back in NYC could never prepare me for that fact. The only cowboy we have in NYC is the naked cowboy – and he sings in Times Square for tourists.

  2. December 16, 2010

    Waw these information are just brilliant! This is what i was searching for. Found at last. Bookmarked now. thank you for this )

  3. January 8, 2011

    Mike I agree 100% with Chris. We are all writing the book on social. You have to be a practitioner to understand the components, practices and opportunities. Furthermore this is a dynamic space that is evolving rapidy. You have to be emersed and then you cant go off the grid… gotta play everyday! Love how you have embraced this stuff since you invested in Automatic. Wish other investors were as interested and dedicated.

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