Posts filed under 'Conferences'
I’ll be at Blog World Expo in Las Vegas on Thursday and Friday checking out this first time event aimed at the world of blogs. We have a Yahoo! booth that will staffed by members of Right Media’s Direct Media Exchange team as well as a few representatives from some other Yahoo! business units like MyBlogLog, Yahoo Search Marketing, and others.
Drop by the booth and say hello, and yes, I am also wondering how awkward the opening reception Pajama Party at the Hard Rock will be with a bunch of bloggers in their pajamas.
November 6th, 2007
I’ve got a proposal in the panel picker for SXSW 2008 called “Maximizing Ad Revenue for Online Publishers“. The title explains it pretty well, but if it’s voted in as one of the panels at the conference I’ll put together a panel of industry experts to go over the core methods today that publishers can maximize their ad revenue.
I think it will be educational, great for beginners, but also provide some nuggets of wisdom that even experts will benefit from.
If you’re interested in this panel idea, please go vote for it by giving it a star rating. Note: You do need to sign up for a free account to register, they promise to not spam you.
August 21st, 2007
One of the most interesting sessions to me at Web 2.0 Expo was fellow analytics blogger Avinash Kaushik’s session called “Click the Big Red Button : Tips & Techniques for Optimizing Conversion and A/B Testing”. I was looking forward to it because even though I’ve been big into testing for years, I still feel like the majority of the web world is so far away from embracing testing to improve web results.
Avinash is also embarking on a new adventure as an independent consultant after leaving his analytics job at Intuit. He’s currently speaking, has a book coming out, and consulting for Google Analytics. The following is an overview of his presentation.
The top metric that most people are looking at is increasing their conversion rate. So how do we increase conversion rate?
1. Segment, segment, segment.
Avinash wisely pointed out that looking at a site’sA overall total conversion rate is not that easy to take action on. By using web analytics you can segment conversion rate into all kinds of groups. You can segment by referral source, segment by landing page, segment by search terms, etc. Working then to improve the conversion rate of these segments is easier to monitor and improve.
2. Conversion rate needs friends
Don’t look at conversion rate in isolation. Look at average order size, visitors, bounce rates, and other metrics in conjuction with your testing on conversion rate.
3. Don’t look at conversion rate in isolation
Similar to the above two points, you need to put context around conversion rate numbers. For example, by offering your product for half price you’ll most likely increase your conversion rate. That’s great right? Well, no, because you’re making less revenue.
4. Fall in love with abandonment
Abandonment is the only way people can leave your site and hurt your conversion rate, so naturally improving the abandonment rate on each page of your website will help your conversion rate.
5. Determine the true opportunity
It’s impossible to actually convert everyone. Part of your audience is going to be landing on your site by mistake, some of the users are just crud and will never be customers, but what real opportunity can you get? You need a good idea of your true audience to go after it.
So what is the golden answer to all this? Testing.
Avinash said people far too often use the HiPPO strategy on their web decisions. HiPPO stands for “Highest Paid Person’s Opinion”. The HiPPO for your website is just one opinion, no matter how smart they are. You need to test to let the real users decide what works best. 80% of the time the HiPPO (or you) are wrong about what’s going to work best on your site. And you must continue testing, what’s great today, is stale tomorrow.
What methodologies can you use to test?
Methodology #1: A/B Testing
Hopefully most of you are familiar with A/B testing, and Avinash outlined the pros and cons of this strategy, but said if you’re doing no testing today then you should start with A/B testing immediately. He gave a great example of how when he was at Intuit they tried out this amazing and sexy Flash shopping cart solution. Avinash thought it was great, it kept users from having to refresh pages, it was slick, it was easy to use, and he saw no way it could fail. In an A/B test with Intuit’s old normal shopping cart, it failed miserably. Why? Users apparently were used to the old normal way.
Essentially, A/B testing is simple, easy to do yourself, but it’s limited and you have to keep it simple to be accurate.
Methodology #2: Multivariate Testing
Multivariate testing is a testing format that allows you to test multiple parts of your page at once. It allows you to test alot, most tools provide great additional tracking, you can visual results pretty well, but it’s more complicated. Avinash gave an example of how multivariate testing improved the downloads of Picasa on Google’s Picasa download page by 30%.
The prime tools in multivariate which all have different strengths:
- Offermatica – The most marketing focused.
- Optimost – More technically focused.
- Sitespect – Don’t need to implement javascript code, they do it by packet sniffing between the server and user.
- Google Website Optimizer – The only free tool, but have to be using Adwords.
Methodology #3: Experience Testing
This is the art of testing sets of multiple pages independently. Such as funneling Windows users vs. Mac users. There are no current tools that do this, so you have to be sophisticated and do this yourself. However, this has the most power and can lead to the biggest results.
A great talk overall, and Avinash was fun and engaging while he spoke. I think he has a bright future as an analytics evangelist.
April 18th, 2007
Wednesday’s keynote at the Web 2.0 Expo was Yahoo’s Executive Vice President of their Network Division. Jeff first covered what the network division consists of:
- Email/communications
- Media business so we package and program content
- Search business
- We tie it together through the front door of Yahoo.
Then the following is a paraphrased version of the discussion between Jeff Weiner and John Battelle.
John: Yahoo! reported earnings yesterday and Wall St. yawned. The statements from Terry Semel that Panama is doing well in January raised expectations and then you didn’t blow away expectations. Compared to the Google earnings which they seem to knock out of the park, why does it feel like they are running circles around you?
Jeff: We ended up in the middle of the range provided by Terry and Sue, so we’re extremely happy with the results of Panama so far and they will get better each quarter. We’re executing and we’re on the right path.
John: What about Google? Why am I compelled to ask them about you? You have the biggest network on the web, but everyone focuses their attention on Google?
Jeff: They’ve had a great run over the past 3-4 years, and Yahoo has had some slip-ups. But we’re building for the long term to be around in 11-12 years. We’ve had some nice attention recently with Panama, Yahoo! Pipes, and our deal with the newspaper consortium.
John: Do you think there is a distinction in approach between the way Google and Yahoo view the rights of content holders?
Jeff: I don’t know if there is a distinction, but we do value the rights of intellectual property holders. We’re building the largest video network with NBC, Universal, Comcast, Myspace, etc. And our recent relationship that was announced with Viacom is another example of media companies wanting to work with us.
John: Isn’t there a big game of Stratego going on here? Are people working with you because they don’t want to work with Google?
Jeff: I don’t think it’s because of Google, I think we provide value that others don’t. We work with media companies well and package content better than anyone. There is a reason we’re #1 in News, #1 in Music, #2 in Sports, and back to #1 in Finance after being out of that spot the last couple of years.
John: Two acquisitions you guys have been rumored to be involved in recently, the Doubleclick acquisition by Google and the Facebook acquisition. What can you tell us?
Jeff: I can’t comment on specifics, but the Doubleclick deal is no surprise. There is a trend that the largest providers of advertising services want to be full-service shops. The Doubleclick acquisition, AOL buying Advertising.com a couple of years ago, etc. We were the leader in display, and we went out and bought Overture a few years ago to get performance. In regards to Facebook I think it’s a great site that is continuing to execute and needs to continue to execute.
John: Is there pressure to make a big acquisition?
Jeff: There is no pressure, but we’re open to acquisitions where they make sense. We’ve got to get together our social assets. We don’t have something like Myspace or Facebook yet.
John: You say yet, so are you building this? You had Yahoo360 and that didn’t take off.
Jeff: We have great raw assets. Yahoo Groups, Yahoo Answers reaches 90 million uniques, delicious, Flickr, Jumpcut, and Bix. We have lots of great assets and we need to put them all together.
John: Isn’t that your job? To put them together? No pressure, right? Anyway, I need to get to one last fun question. Microsoft.
Everyone laughs.
John: What’s your opinion on Microsoft, this formerly great company who has not seemed to find the internet magic. They decided to go their own way and build their own search instead of working with you guys like they were. What should they have done over the last couple of years?
Jeff: You can never count out Microsoft. They are still very powerful.
John: You can imagine they were not pleased in losing the Doubleclick deal. They had 3.1 billion, so something else must have happened.
Jeff: It’s a very intense competitive landscape. Much like a chess board as you mentioned earlier.
John: Are you and Microsoft going to merge?
Jeff: No plans that I know of. I would’ve liked to have seen that relationship with Microsoft stay together. We’re always open to partnerships as we’ve done recently with Viacom, ebay, the newspaper consortium, and others.
John: Thanks for your time Jeff.
April 18th, 2007
Yesterday at Web 2.0 Expo one of the main keynote sessions was the “Built to Last” Panel which consisted of John Battelle asking various questions to a few entrepreneurs who have built companies that have sold or were worth selling. The participants in the session:
John Battelle – FM Publishing (moderator)
Mena Trott – Six Apart
Jay Adelson – Digg
Joe Kraus – Jotspot/Google
The following is a paraphrasing of the conversation, so don’t quote me on it.
John: Joe and I play poker, he’s going to Las Vegas this weekend. Joe founded Excite and rode it through the boom and bust, and then founded Jotspot and sold that to Google recently. Mena and Six Apart came to a point to decide whether it was built to last, or built to sell. And Jay, Digg was on the cover of Businessweek, acquirers came calling, but it didn’t happen.
John: What does built to last mean to all of you?
Joe: Entrepreneurs have to decide between success and control. It can really focus where you go. Are you building a company for the long term, or just a product to sell to another company? Funding is another question. If you’re built to sell, you actually want to take less money. The more money you take the harder it is to sell at a good return.
Mena – All those things Joe said have entered our minds. Control was something I was willing to give up because I knew I couldn’t get the company to the point I wanted without help. We’ve always felt we had control over the years, although we’ve given up a lot of control to others with titles and such.
Jay – Digg was something that was born of a passion with a specific goal. A lot of the ideas you come along are components of business models. We clearly went at it with profitability in mind. Digg’s experience has always been that focus. Although even if you do get to profit, aren’t you a better target in the long run?
John: I should disclose that my company FM represents Digg, Six Apart, and we all partner with Google. We couldn’t find a panel that fit this subject where that wasn’t the case.
John: How much pressure is there to sell? When you want to focus on building a profitable business, are there are a lot of pressures from employees and others to sell?
Joe: With Jotspot I felt like I had convinced 28 people to leave their jobs and opportunities to follow me. So there was pressure to me to get these people a good return on their time and efforts. From the VC point of view, most of the VCs don’t want to sell. The entrepreneur has 100% of their equity in one company, but for a VC you’re just a part of their portfolio. They expect most companies to fail and make their money from the big successes. So selling early on the VCs don’t want to sell because they don’t want make 5x, they want to make 100x. The entrepreneur wants to sell to make sure their 100% equity gets positive, so there is tension there.
John: Mena, selling for 50M is rare air, selling for 100M is even rarer air, and selling for YouTube money is even more rare. Do you feel a pressure or distraction?
Mena: I guess a little distraction, but we’ve been around for 6-7 years, and it’s a different acquisition market all the time. We don’t think about being the next YouTube, we think about achieving our company goals. We have 140 people, it’s not something easy to sell. We care about all those people so it’s complicated. It doesn’t interfere to our day to day work.
John: There was a period of distraction last fall right Jay?
Jay: Sure, with Digg last fall the buzz really hit. The Businessweek cover created a lot of calls, big media companies wanted to sniff around. They say they want to overpay, but you don’t know. We came up with a policy that we were going to execute, but the crazy numbers started to pop up and you start to think that you can give them a day or two to discuss it with us. That ends up taking a lot of time. It becomes a real distraction, and you have to bring everyone back to reality about this is who you are, and unless you really think that the acquiring company is going to execute it better than you are, we have to keep executing.
John: Do you guys have a perfect company in mind to acquire you?
Joe: With Google it was the right one because it’s a nerd paradise and I’m a nerd who had 28 other nerds working with him. Entrepreneurs are optimists, and so there are a lot of optimists in Silicon Valley. But Google was just really the right one at the right time for us. I think when I was operating I didn’t think about who the perfect partner would be. I knew what return we needed to hit for our investors and partners so there are companies that can hit that range.
Mena: I can tell you I have a list of who I wouldn’t want to be acquired by. Not so much on who I’d like.
Jay: You have to forget about the YouTube thing, and just focus on reality and what you can do.
Mena: There is a lot of pressure from family. We get newspaper clippings from our family asking when the big deal is going to happen to us?
Jay: It also really matters who you’re working with and owned by. If Digg was owned by the wrong company, it would really put into question the fairness in our algorithm.
Mena: Yes, we have the ability to partner with anyone as an independent company which makes our product better.
John: Is the Web 2.0 golden era over? Do you have to build bigger companies now to succeed?
Mena: We have a bunch of people because we have four product units which really spreads you out. I don’t know if the golden era is over, but we can’t really go back.
John: How many open jobs do you have at Digg?
Jay: Probably about 10, which will get us to 35. I’ve often been wrong about what it takes to get stuff done. I can see so many different things we can do, focusing on other categories, going international with news, etc.
John: When you joined Google did the number of employees on your project change?
Joe: It didn’t change, our non-engineers went to sales and marketing, and our core engineering group stayed together.
John: What are you going to do there?
Joe: Avoids question….tGoogle has a lot going in the in the Web office space and that Jotspot fits into those goals.
April 17th, 2007
A popular and very funny session today was the session entitled “Venture Capital 2.0: Bright Future or Broken Forever?”. This session was moderated by Mike Arrington of Techcrunch who is a former VC himself and current angel investor. It appeared like it could be boring listen to a bunch of venture capitalists talk, but Arrington did a very nice job spicing it up with well-timed insults and jokes. Mike also took the time to hype his new conference the Techcrunch20, check out the link to find out more.
Jeff Clavier – SoftTechVC
Invests his own money normally for under $1 million investments. Actually considers himself to be a bit more like an angel investor than a normal VC> Involved in Dogster, Userplane (which was profitably sold to AOL), and a new gaming platform.
Michael Eisenberg – Benchmark Capital
The overall Benchmark Capital funds manage a few billion dollars, with offices all over the world. Michael is based in Israel. They’ve Invested in ebay, Second Life, Metacafe, bebo, and Yelp.
David Kornik – August Capital
He’s the father of VC blogging with his blog Ventureblog.com.
August runs a 350M fund. They’ve invested in Six Apart, VideoEgg, and Technorati.
Josh Kopelman – First Round Capital
$50 million fund, with primariliy first seed round investments in the $250k-$500k range.
They’ve invested in StumbleUpon, del.icio.us, VideoEgg, Gigya, and Aggregate Knowledge.
Chris Moore – Redpoint Ventures
400M fund, invests in consumer internet. Invested in Ask Jeeves, Excite, Netflix, and Tivo in 1.0 phase. 3-4 years ago refocused to Myspace, Gaia, Buzznet, Right Media, Efficient Frontier, and Leadpoint.
The following is a paraphrasing off the conversation.
Arrington: When you invest small amounts, do you require a board seat? What’s the average first round size?
Dave: In almost every case we end up sitting on the board. It’s more about if it’s an opportunity to build a big business. Just because we have a big fund doesn’t mean we have to invest a ton of money to get involved.
Josh: We average about 350k over the past few years, we participate in later rounds as well.
Jeff: 200k to 1.5M. We act a little like angels.
Arrington: This isn’t going where I wanted it to. I wanted to pit Josh and Jeff against the big guys, so I’ll just force the conclusion I wanted. I was hoping to get at my thought that it’s harder on the big guys now because earlier investors like Josh and Jeff are getting into the best deals first and getting big chunks of the company and then you guys have to really compete later on to get in on the investment.
Jeff: We have participated with the big guys on lots of our deals.
Arrington: Again, the facts aren’t helping me.
Michael: Why would Techcrunch allow the facts to get in the way of a good story?
Arrington: Whatever your next startup is, it sucks.
Jeff: Hold on let me Twitter this!
There were quite a few laughs at this point, and everyone is having a good time giving Arrington a hard time about Techcrunch.
Arrington: When Joe Kraus built Excite years ago he needed to raise a lot of money. Now he raised a very tiny angel investment and got Jotspot started, then took a little more money later on when he needed to scale. What if there is no later round where you bigger guys get in?
Dave: If you make a lot of money off of very small initial investments, it’s fine! We’re paid on successful outcomes.
Arrington: So, if your fund is 350 million, and you have 5 partners, you make a certain amount of money from your management fees. But if you don’t invest all of that big fund, you will have less money under management and make less in management fees.
Dave: It’s not so much about how much we’re managing, it’s more about investing the right amount in companies that end up doing well.
Josh: My first company took 5 million to get a product shipped, second company took 2.5 million, my third took 750k. Now I’m funding companies for a couple hundred K. Now that doesn’t get to scale, you’ll still need more money down the road.
Chris: Mike, your theory has a point. If you’re looking at that $50M sale to Yahoo or Google, you can get there with less money. If you’re looking at the really big ones like YouTube and Myspace, you need more money to get there. The bigger funds have to be more careful and select the ones that can get big.
Arrington: Brand name angels are Josh and Jeff, if they want to invest people take it. The big funds have tons of competition for deals, Geni had a crazy valuation. What do you do?
Dave: Haven’t you heard of Value Add?
Arrington: Do you agree you’re getting squeezed from both ends? You have Jeff and Josh at one end and more competition from deals, on the other end the IPO window is shut.
Arrington: Jeff, I know the return on your portfolio because we’re friends. And it’s amazing. Josh I can guess at yours and it’s also going to be good. It’s natural for you guys to say everything is fine. Chris, are you agreeing with me?
Chris: Yes, it’s hyper-competitive, it’s cyclical. We’re not going to do crazy deals, but you have to just hustle to find the right deals and make relationships with the right people who can make these ideas happen.
Jeff: We have no clue how these things are going to turn out. Of 20 companies, I have a 50-75% kill expectation. So 10-14 companies should fail. I’ve sold three and none have died, but we’ll see in 5-7 years.
Michael – It’s incredibly cyclical. Everyone gets bubbly when the exits happen. You can make the most money when the exits aren’t occurring.
Jeff: It’s also hard now to find the quality workers.
Michael: Google is talked about as the key acquirer, but they are also driving up the cost of engineering everywhere.
Arrington: True, but there are a lot of key people leaving Google that are fully vested and are either for hire or will be starting new companies. That’s exciting.
Audience: What competitive advantages are any of you building to differentiate? Incubators?
Dave: Incubators have failed before, and they continue to fail. We’re investing in a set of people coming together to build a business. The incubator model shares resources, so when the companies want to build out and scale they lose those resources right back again.
Arrington: So besides the fact you hate Incubators, is there anything to do?
Dave: We definitely share information across portfolio companies to try and help them solve common problems.
Josh: We have CEO meetings as well as an e-mail list to handle things like how do you find a good recruiter, what sort of options package do people get, and other common issues.
It then moved on to some random audience questions and ended up as a very laugh-filled session.
April 17th, 2007
I posted a liveblogging entry over on the Right Media Blog about the Traditional Media 2.0 session. The session was kind of all over the place with what was discussed, but check it out if you’re curious.
April 16th, 2007
My first session here at Web 2.0 Expo is “Starting Up 2.0: Strategies for Pitching, Financing & Growing Your Web 2.0 Startup” with Jeff Clavier of SoftTechVC and Rob Hayes of First Round Capital.
Rob started up by asking how many people in the room had started a company in the last 5 years, and about 80% of people raised their hands. He then asked how many people would be starting one soon, and I think teh other 20% raised their hands.
Rob and Jeff then went over their companies portfolios, and they were impressive lists of some of Web 2.0’s biggest success stories and companies that look to be future successes.
They then moved into the “Ten Points”:
- The Idea
- The Team
- The Company
- The First Money
- The Pitch
- The VC Process
- The Funding Process
- The End of the Beginning
- The Growth
- The Exit
The Idea
VALUE
Rob: What value are you creating? There are “can dos” and “should dos”. There’s a lot of stuff that can be done, but should it be?
Jeff: There are often changes from the early stages in the idea, but the value has to be there.
MARKET
Jeff: At the end of the day what market are you going to serve. Why will they care? Then we can figure out how narrow or broad that market should be. You can go for a lot of users where you try and get a few cents from each user, or go narrow and try and get a lot of value out of each user.
Rob: You need to think through if you’re creating a new market or serving an existing market. It’s harder to create a new market, but it can be more valuable if you can do it.
Jeff: In a time where it’s so easy to build features and enhancements, if you’re going to do something that’s already been done, you need to be 100% better, not just 10% or 20% better.
ADOPTION
Rob: You need to go after scale and speed. Different kinds of money will be interested in different growth rates.
FAILURE
Rob: Failure cheap and fail fast. The quicker you can get to the point to figure out if it’s going to fail or not is the best. You can move on to the next thing while burning less cash in the process. We often like to invest in experienced entrepreneurs. Investing in a first-time entrepreneur can be like paying tuition.
Jeff: You learn more from failure than success. You can still believe in your idea, but the money is going to need to know when they should get out.
The Team
Rob: You need to gain our confidence that we can believe in you and your team. At the end of the day we’re betting on you.
Jeff: We will be your friend, but we’ll also kick your ass. One big question I get a lot is how to bring in the right people for positions. How do I find a CTO? How do I find a great salesperson? We can help as a VC, but you also really need to get out there and network and find people.
Jeff: Question from the audience about how you start finding people while protecting your idea. Basically, you can try to get people to sign NDAs, but in the real world that doesn’t work. As an investor I never sign them. You can do background checking to see what their reputation is like, but if your idea needs that protection it’s basically too easy to copy.
Rob: There isn’t much secrecy anymore. I’ve been involved in companies that we tried to keep quiet but people would come up to me and say they heard I invested in such and such company, when I didn’t even think they should know about it yet. Secrets just don’t say that secret now.
Jeff: The idea of the unique idea is not really true. The “rule of 3” is good. If you see one company working on something, it means three really are. If you see three companies working on something, than nine really are.
The Company
STRUCTURE
Rob: A great gut check is when you have to go through the trouble and cost to incorporate your company. Paying a few thousand dollars and doing the paperwork is a good early gut check if your idea is good and if you’re serious about it.
Jeff: Make sure you setup properly, get it legally protected and setting up in the standard format is important. A venture capitalist wanst to invest in a C corporation incorporated in Delaware. Use a real lawyer instead of one of those $500 services. They just send you the paperwork and you’ll have to pay $50k to fix the problems later.
FOUNDER EQUITY SPLIT
Jeff: How do you split up founder equity? The debates about how to split up equity need to happen and should happen early. Is it evenly split? Does the tech guy get the majority because he built the idea? Does the business leader get the majority because they will lead and be the CEO in the future?
Rob: From our point of view, the risk and dynamics are best with a fewer number of founders. We like two founders better than eight.
Jeff: At the same time, single founder companies make me nervous. It’s a lot of stress and it can be lonely to make decisions. My favorite is two people, one tech person and one business person is a nice mix.
Jeff; Audience question if there’s been any trends in how equity is split. There are no particular trends, I just like it explained to me why it is what it is.
Rob: There’s definitely a 50/50 pattern in two-person companies.
Rob: Does location of the founders matter in an investment? It can, but it’s just a factor. It usually doesn’t make or break a decision, but it’s considered.
Jeff: I like to have the founders within an hour’s drive. It makes it much easier to meet that way.
MAIN VS SIDE JOB
Rob: I get a lot of people who want funding so they can quit their day job. Get in line. If you don’t have the passion to quit your job and go after it, it’s likely we’re going to have problems.
Jeff: We expect you to take the risk, get out of your comfort zone, and put your skin in the game. The other problem, if you invent things in your spare time and have signed and IP agreement with your employer, it may technically belong to your employer. You can either quit your job, or get a formal letter from an employer saying they have no claim on your idea.
FUNDING SOURCE
They displayed a graph of valuation levels and money required, and what types of funding sources match those levels.
THE FIRST MONEY
Rob: What is the right amount? We’re often giving them money to get to the point where they can raise their next round of financing. We try and figure out the run rate and when that success point is and how long it will take to get them there.
Jeff: The usual first round/angel funding is around $1M.
Rob: There are plenty of companies who may give you $2M or $4M to reach that next funding point, but it’s probably not going to be us.
Rob: So how do you find and choose investors? Check all their websites and blogs, and ask around.
Jeff: How do you choose between these people? Find the ones who will really work with you to build the company. They’ll give you access, help you network, and they fit with your goals.
DILUTION
Rob: Just to explain dilution really quickly. Let’s say there are three founders who each own a third of the company. We say the company is worth $3 million today, and we invest $1 million. So now we and the founders own 25% of a $4 million company.
Jeff: Additionally, we usually ask that the options pool for future employees is set up pre-money. This means that we may ask that 20% of the company is set aside for options. So there is dilution from the investment and the options pool.
FUNDING MODEL
Rob: In the seed round you check to see if the idea is feasible. Risk is high and valuation is low. When you hit the beta phase, the risk is lower and valuation is higher. When the model is definite and proven, the risk is low and valuation is getting really high. It happens really quickly now. Getting customer acceptance used to take a few years, and now it takes 3-9 months to figure out.
The Funding Process
1. Pitch
2. More pitches
3. Due diligence
4. More pitches
5. Partner’s meeting
6. Termsheet issued
7. Terms negotiation
8. More due diligence
9. Legal docs negotiation
10. The funding
11. Money in the bank
12. Get to work
Oren Michaels from Mashery
Oren: In my case, raising money was a little different for Mashery because I had already built some relationships with these investors. The people who will invest in you need to know you. They aren’t investing in your idea, they are investing in you. So they’ll ask, why you? Why should we invest in you?
Oren: After I left Feedster I talked to Josh Kopelmen who wanted to meet to see what I was doing next. We took a small amount of money in the beginning because we didn’t have a team or hadn’t done much. We gave up a chunk of the company to get money so early, but getting it going quickly was something we needed to do.
Oren: We didn’t worry too much about valuation or getting the perfect deal. We had to get going quickly so that was the most important thing.
April 15th, 2007
I’ll be at Web 2.0 Expo in San Francisco early this next week and will be spending time manning the Right Media/RMX Direct table at the Long Tail pavilion. So please stop by if you’re looking for a demo of RMX Direct or more information on what Right Media does.
Additionally I’ll be checking out sessions and blogging on anything interesting.
April 13th, 2007
News icon Dan Rather did the keynote this afternoon at SXSW 2007 here in Austin, Texas. It’s not often you get to here a longtime American news icon speak in public, especially about the topic of “new media’, so I decided to liveblog it.
2:09 pm
The keynote was supposed to start at 2:00, so Dan is obviously playing the diva role for his keynote. The Hilton ballroom is large but people are packed in like sardines and most likely hammering away sending messages to Twitter so they’ll show up on the plasma screens everywhere.
2:11 pm
Jane Hamsher comes out, she blogs at firedoglake.com and produced Natural Born Killers, and she gets to chat with Dan. Lucky gal, and she’s reading from a bio card to introduce him.
2:12 pm
Dan has really lived and worked through some of the most amazing events in world and American history. He’s also interviewed most major political and news figures over the past 30 years, including a famous and hard-hitting interview with Richard Nixon.
2:13 pm
Dan is announced as one of Jane’s personal heroes, and then he comes out to a standing ovation to the music of What’s the Frequency Kenneth, when he was part of the incident that is the basis for that REM song.
2:14 pm
Dan leads off with a joke about appreciating introductions involving Abe Lincoln once saying to appreciate praise from the audience because they’ll soon enough figure out you aren’t worth it.
2:15 pm
Dan jokes that the acoustics are so bad he can’t understand the first question, twice, about being dismissed by Richard Nixon when he wouldn’t be dismissed.
2:16 pm
Dan said to this crowd Richard Nixon must feel as far away as Caasar’s campaigns.
2:17 pm
He was proud to work as a correspondent to the White House. He didn’t see himself as challenging Nixon, he was just trying to be an honest broker of information and find out what was really going on, opposed to what they wanted the people to believe was going on.
What he was saying wasn’t the facts, it was continually being disproved as not fact. Leon Jaworski and the special prosecutors would often find out the opposite of what Nixon was saying. So he tried to phrase the questions like “Mr. President, your’e saying one thing, but the evidence is saying the other.”
Nixon would respond trying to knock Dan off balance by making a comment or asking a return question.
2:19 pm
He said the facts were that President Nixon was the leader of a widespread criminal conspiracy. And Dan has more respect for the office of the President than anyone, but he had to focus on the facts.
2:20 pm
Jane asks if the opportunity exists for someone to do today what he did back then. Dan replies that “Over time American journalism has lost its guts.”
Journalists have learned to go along and get along. They keep people on their good side to get access to people, or they’re more worried about keeping their job and have people feel good about them.
There is also the danger of being accused of being anti-patriotic or being against the troops when you question our leaders today. It is the tough questions that are patriotic!
2:22 pm
Dan says we have to question power. Ask the tough questions, follow up on tough questions, and it does sometimes still happen in American journalism, but it’s getting more rare.
Jane says that Beltway journalists like to keep their status and don’t want to rock the boat.
Dan replies and says he includes himself in this, but that “American journalism needs a spine transplant.”
2:24 pm
Dan says journalists get too cozy with their sources. They make either stated or silent agreements that “if you’ll take care of me I’ll take care of you”. This is very dangerous according to Dan. You can get so close that you become part of the problem.
Journalists use the sources, and sources use the reporter. But the second the source begins to believe that the reporter can be pulled in and be “on the team”, then it’s gone too far. When the reporter begins to feel the same way, it’s gone too far.
2:26 pm
During the Nixon Whitehouse, their became a time early on when the Whitehouse decided to strangle the journalists and cut off information. So the journalists went outside to talk to Congress and others and then called again and said they’d be on the evening news with unflattering information. Pretty soon, the Whitehouse started calling back.
It isn’t true that you have to go along with the power to get the information you seek. You don’t necessarily have to play their game.
2:28 pm
Jane asks that most people today feel that there is a lack of asking the follow up question.
Dan says “do we still believe that it’s important that journalists are Independent with a capital “I”? Do we still believe that it’s important to ask the right question and have the guts to do so? Do we still believe that the documents produced by the government are owned by the people? Do we still believe that the people in power are here to serve the people?”
Dan then points out that isn’t the phrase “investigative reporter” redundant? He’s never liked that phrase.
2:33 pm
When is the last time you’ve seen a true hour long investigative show by one of the big six networks? The corporations of news have gotten larger and larger and are global conglomerates. As they’ve gotten larger, the news has become less important.
There is a gap in leadership there, and a huge gap between the leaders and the reporters. And they have so many goals now that have nothing to do with journalism, there is no relationship to the news room. They would possibly do away with the news if they still didn’t need things from Washington.
2:35 pm
Dan adds that we shouldn’t get him wrong, that he doesn’t think the leaders of the networks are evil and he has many friends there. He just said their focus is on shareholder value and other things besides investigative news. And that when they need things from the government, it puts them in conflict with those same people when their journalists are asking tough questions.
2:37 pm
Four of five companies now own the principal means of mass communication outside the internet, and they are trying to get less more competition, while Dan is in favor of more competition in journalism.
2:39 pm
America’s ideal for journalists is for them to be the barking watchdog. And that role has been shrinking over the years.
Jane adds that’s one reason the blogosphere has grown in importance. There are more investigative journalists and a democratization of news.
2:40 pm
Dan replies that he anticipated this question and could talk about it all afternoon. He thinks the internet is a tremendous tool and so much potential. He thinks it’s in the “Beatles” phase of development. If Elvis was the early stage, we’re now in the Beatles phase of it really blowing up with unlimited potential.
Dan adds he has no idea where it’s going, but if you’re trying to think what the internet may become you can’t think years out. When the Wright Brothers invented flight, one reporter said “In 75 years we may be flying coast to coast non-stop.” 5 years later we were doing trans-oceanic flights. The internet is the same way.
2:44 pm
The blogosphere and the internet is so large that it’s easy to overgeneralize about it. He hopes people will continue to investigate and report the facts, but he does have a problem with the ease of anonymous blogging and reporting, and he doesn’t have the answer. But given time, the marketplace will balance it, but in the interim people and businesses will be hurt by anonymous people saying untrue things.
2:45 pm
Jane says what she’s trying to get at is how does new media fill that vacuum where nobody is asking our leaders the tough questions?
Dan says we need to stay on top of it. If we think that the right questions aren’t being asked, people need to point out that the right questions aren’t being asked. “So many raindrops will eventually make a dent in the rock”.
Accountability is a problem in the political system. When bad things happen, either nobody is accountable, or people at the lower levels are held accountable when they really shouldn’t be. It’s a problem that has happened in every government of every type.
2:48 pm
Dan says the President or a general will say something, and we may think it’s a pile of steaming stuff. When was the last time someone reported that someone in power said something and a reporter contradicted it with the facts and called it a lie? Everyone just does a sidweays dance now.
2:49 pm
Round of applause from the audience.
2:50 pm
Jane asks if Dan thinks journalism as a craft took a hit in the Scooter Libbey trial.
Dan says it goes back to journalists thinking they are close and part of the system. If that toxic gas gets loose, we need to take care of it for the country as a whole. For example, Dan said it wasn’t that long ago that in Washington it was clearly defined what “Off the record was”, and “On background was”, and what “On deep background was”. These weren’t legislated, they were just the rules of the game.
It was up to the source to say “on what level are we talking here”? It wasn’t the journalist having to determine it, and it was often negotiated between the source and the journalist.
Dan said those rules aren’t as clearly defined today, and Dan prefers it being how it was where everything is clearly defined.
2:56 pm
Dan continues that the ideal is that a journalist should not be “clubbable”, that they can’t be able to be associated are put in groups and get too close with people. Even if that makes their boss angry or hurts their cwn career in the short term.
2:58 pm
Round of applause.
2:59 pm
Jane says this is more obscure, but how many problems have been created because the Fairness Doctrine went by the wayside.
Dan says that’s a good question and he’s not sure he’s qualified to answer it. There are a lot of factors at play, and we have to keep asking questions and figure out what are journalists role in society. Some people already feel that journalists already are too aggressive and independent. Dan disagrees with that and believes the opposite, but there are people who believe that and they are good people.
Dan wants the truth, the whole truth, and nothing but the truth and then he and his neighbors will make up their mind.
3:01 pm
Time check by Jane, and now for a couple of questions from the audience. Of course, there is no microphone in this gigantic room so nobody can hear.
The first question is an independent filmmaker in Austin, who likes Brian Ross’ work on the news, and Dan agrees that Brian Ross does good work. There are exceptions out there who do good investigative work out there, and Dan thinks it’s important that the people they work for hear from the people who appreciate it.
3:05 pm
Oh, there is a microphone, and a bunch of people waiting in line to ask questions! Next question is if the press isn’t willing to ask the questions, how can people get access to ask the questions themselves.
Jane answers that there isn’t really much access, as George W. Bush has about one press conference in every 6 months. Dan adds that it’s very hard to tell Presidents that they need to have more press conferences, although they should. But basically as the heat turns on, Presidents and their administrations become afraid, so they have fewer of them. It’s the same fear that journalists have of not being in the “inside”.
3:08 pm
Dan is going to leave us with a few thoughts. A plug for high definition television as he now works with HDNet. And a question for Jane, “on the whole, and taking into account that bloggers on all sides of the politically divide, do you think think political blogging helps pull us together or push us apart as a society.”
Jane says that’s a good question and says it allows people to share their viewpoints. There is a debate that goes on that allows people to have a discourse with the various sides that doesn’t exist in other mediums, so it allows for clarification of opinion. She thinks that the powers that push and pull exist on a much greater level, so blogs probably aren’t influencing it that much.
3:10 pm
Dan then says that stuff that happens 3,000 miles away seems to not really exist because it’s so far away. Television can seem like it makes things smaller than they really are. Larger TV screens and better definition can help that, but that we can’t think of the United States as the center of the world and universe. We can be leaders, but we have to get rid of the illusions that things happening far away are illusions. The war happening is real. If you only see small pictures of it or read about it, it descends into a video game in your mind. Fight that illusion.
3:13 pm
Standing ovation!
March 12th, 2007
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