The Post Money Value

The Conference Hall Alternative

Jeff Jarvis has a post regarding one idea for a cheap venue for conferences. He linked to Robert Scoble’s point about costs. 

One suggestion to Jeff. When this old fart used to work at MSFT, we used theaters during the weekday. When school was in session they are empty bldgs. You got two advantages, you could have popcorn and drinks for everybody and, after the gig, you showed a movie.

The theaters have great sound systems, love cranking up the corn/drink machines, and will get you pretty much any movie you want. We used to hold a dev jump start (what is today called “camps”) in theaters and then play Star Trek or James Bond movies, anything that blew things up. 

All in, with comfy chairs, twenty bux.

 

 

 

where's my DOS prompt?

Back in the 1980s during a PC-Expo in New York, I was on a panel with Bill Gates. I was, at the time, working for AEtna Insurance.  The panel was about software and the enterprise. At one point, he made the comment about how pleased he was that software was getting easier and he was particularly proud of getting away from the DOS prompt, real help when the F1 key was pressed.

I was sitting to his right and, after he was finished, was offered a chance to comment. I said some nice things about Windows versus straight DOS and then made the observation that it might be possible software was getting more complex not easier especially if we were all commenting and high fiving the growth of help files. I asked Mr. Gates if he thought measuring the ease of use by how little help was needed was a good goal and should developers who say it’s easy, be tracked by the F1 presses and big help files.

I got two things.

1. The “you have to be the dumbest turd on the planet and I’d like to shine my shoes with your face but I can’t because AEtna buys boatloads of my stuff,” look.

2. A short answer about making software easier is always an important job with never ending, yadda yadda..

I also set my hiring into Microsoft back by two years, at least, but that’s another story.

Fast forward to today.

Many of you may have the new Windows Live Messenger Beta. I believe, since my daughters, friends, and others have it, this baby is rolling forward. Great. And has been reported in a million places, the file sharing feature, ala Foldershare is in the product. 

Well, as for making it easier? There is an Sharing Assistant tool you can down load if you have problems with the file sharing part of Messenger. This is probably the most scary ‘help’ tool, I’ve seen in a long time. warnings about loosing data, sending personal information to Microsoft, stopping this, enabling that, etc.  Yes, I understand it’s beta and yes I totally understand most users will never this this. Almost never until somebody tells them to down load this to troubleshoot a problem.  It is a 9 step spooky thing. Again, I know it’s beta and I know the dev team is trying to get data to fix problems. 

However:

This beta product and this ‘assistant’ are representative, I think, of some really interesting things with respect to software expectations within the eyes of users.

It used to be that people would go nuts over bugs, demand the end of 401 errors, despise the ctrl-alt-del combo and, in general demand some level of quality and predictability.

Today, I fear, you can slap beta on any web service or software, warn people that their hard drive could explode and simply sit back and wait for the smoke test. “Beta” appears to be sort of free pass to ship stuff and let the users help sort things out along the way.  I’m not saying this is good or bad, but something tells me we are going to reach a point where this is going to back fire in a really bad way.

At least with Delete *.* and ARE YOU SURE Y/N?, the moron ratio was reasonably under control.  This assistant stuff? Dunno, go read the full instructions and you decide as I could be wrong.

VC - Live: Pushcrm.com (part 1)

Michael Suter of pushcrm.com wrote and said, I built it, now what.  So, let’s do this one live. 

Step one. Let’s get some feedback from out there.  If you have 5 minutes, take a look at the site and simply send Michael some feedback on what you like, don’t like, etc.   It’s actually pretty interesting. I’ve got a portfolio company that just jumped on SugarCRM and I’ve got a couple of from scratch start ups that I will have take a look.

Michael is at michael@pushcrm.com and could use people to take a quick look and let’s get him some first pass comments.

I looked at the pricing, not bad and there are something neat things.  Michael, collect some feedback and let’s chat live for a 30 minute no harm no foul meeting.

 

Patents and the Start up

Xavier Casanova, one of Fireclick’s Founders, has an interesting post on the value of patents and they relate to start ups.

Some interesting tidbits:

“The patent process started in 1999 – during the bubble. We weren’t sure if our technology could really be patented, neither did we know if it was worth patenting. In all honesty we did it because “it had to be done” – spending the money at the time wasn’t too big of an issue for VC-backed startups.”

and

“The jury is still out on the question of patents for start ups. Patents offer protection for startups but are seldom used for revenue generating purposes because the cost of enforcement is typically prohibitive for smaller entities. Also, they can be a distraction factor because these things do take time from the company brains.”

But the best part is.. well, go read the whole entry especially the last part. Ooops.

 

Currency

One of the items passed on over to me was written by John Roberts of CNET fame.  John said in a post of his”

“Ideas are not the hard part”

I’m not sure I’d agree or disagree with how hard ideas are to come up with. He makes some good points about execution, training, etc.

But one thing stood out for me and that was the title of his blog:

“clock — watching time, the only true currency”

Well put, John, well put.

VCs - We are not alone

While we are having all these thoughts about changes in the VC world, Jeff Jarvis is ripping the world of conferences a new one. Amen, Jeff.  For my own part, I usually insist on at least a few passes for students in return for my time. Hopefully, they get something out of it and pass along some knowledge to other students.

Disruption, everybody’s new best friend.

VC 2.0 part 2

First rule: Don’t write blog entries so late at night as they end up being cryptic. Sorry ‘bout that, Mark.   

Here’s some additional information on this whole VC disruption thing from my perspective.

I’ve been doing the VC thing for about 5 years which makes me a complete novice/nobody. I’ve had one partial realization on an investment I’ve done, while the others that I’ve championed are still evolving. The jury is totally out moi as a “proven” VC.

No question, I’m a newbie, so listen to what I have to say with the newbie filter on. And remember, I could be wrong.

My partners have knocked some out of the park, with my partner John having been in the investment biz for 17+ years, doing great, leading the charge on our fund raising, etc. We’ve recently had our first close of Fund 4, so we are still in the game. We have great limited partners and I’m working with a super team everyday. I say all that because I don’t believe the VC business is going to die, go away, or anything like close.

I think the phrase disruption fits because we have a status quo and anytime the status quo is not faced with change it gets slow, sloppy, and just needs a jolt.

Also, I’m only talking about a very narrow portion of investment capital.  New Drugs, Life Science, Computer Chips, Big Iron, Hardware, etc, all have much different capital requirements then the software/software services space.  It is this last space where I’m focused.

There are a number of things happening which, in my opinion, require a re-think of the way things have been done. This is not a complete list.

The Rolodex.

How many times have you heard about the VC with a great rolodex? They can pick up the phone and get you an intro to anybody. And this, sometimes, will be labeled as the value add for which you give up a piece of your company. This is important for lots and lots of companies, don’t get me wrong. However, consider this.  Let’s say you have a new web service, for example, a blogging tool. You’ve spent your time writing it while keeping the day job.  In the old days, a rolodex might get you an intro to Frank Derfler. Don’t know Frank? He started PC Magazines’ LAN Labs almost 20 years ago. You didn’t have a software product unless you made the trek to Frank’s place to get blessed. An Editors Choice was the gold standard. Commander Derfler and crew were tough. And get ink in the press? Walt Mossberg was not returning your calls.

Fast forward to today.  Meet Larry Borsato. He has a blogging tool, in beta, called Bleezer. It’s a good tool, off to a good start. Mark Evans, my friend and National Post reporter, talked about it here. Mark has, according to what I can tell, about 1000x the readers I do (well deserved) and is well thought of in the tech circles. Cost to Larry for the plug? Zip.  An email, perhaps, to Mark.  I know about it because Mark wrote it up, then Larry, who has commented on my blog before, mentioned it to me. In fact, I’m testing it out and it’s pretty interesting.

And if he needs/wants to start a dialog with Microsoft? He doesn’t need my ex-Microsoft rolodex because the world has changed. Robert Scoble puts his phone number on his home page, answers every email and says, here, “At Microsoft you always have a personal connection (or you can build one)”. He is not alone. Pick a company and chances are you can find somebody out there in public that can get the ball rolling for you.

The blogging community is the new rolodex.

So, the value of the old Rolodex?  A blogger who is reasonably popular or a VC who can call any one of the Fortune 50 CEOs and get you an intro.  Which is more valuable to Larry? 

No Money Down – Start ups.

I have two very smart daughters who, fortunately, get all the brains from their double masters, PhD. candidate mother.  My oldest daughter has a great idea for a web services company. Rachel and her friend are diving in. They have jobs, are going to school, and working on this idea. My value add? Not money. They don’t need money to get this running, given the open source, ‘free’, etc out there. They are getting the first version up on pretty much nothing, own the whole company and come to me for advice but not money.  Even tho funding daughter is a slam dunk, she doesn’t need it. That, to me, is a bit of a VC wake up call.

Keep in mind they are at the exact same spot as Larry was above: idea, get going, a little blogging link love, rinse and repeat.

Rachel and Cort’s excellent adventure is being played out all over the world without the good old days which required a bunch of capital to get going. When you can get a domain name registered for a grande decafe no foam latte, trust me, the world is changing and the VC community has to change or we will miss out on a number of these ideas.

And by miss out, I simply mean missing out on some good opportunities to put capital to work which  provides a good return for our limited partners. That’s my day job and I’d like to be good at it. I want to find lots of Larry’s, Rachel’s, etc, make them rich and keep a piece for my limited partners. Don’t need my money? Uh oh, time to think about this.  That’s my point.

The New VC Competition – HR

The person I think about when it comes to Microsoft? Lisa Brummel. Lisa is in charge of HR at Microsoft. She, and her counterparts at AOL, Google, Yahoo, and lots of others are eating at the back end of the VC ecosystem.  Back in Bubble v1, we had corporate brain drain. Everybody with an idea headed for the garage, ate Kraft Mac and cheese, got funded and did the wild ride.  Today, Web 2.0 is not unfolding exactly like before. If you take a look at some of the recent buy outs of small, really small software companies and services, you will see a that most of the big guys figured out that it makes far more sense to buy early and think of the whole thing as a sign on bonus versus a true acquisition in the absolute sense of the word. Or, even more disturbing from my VC perspective, are those same companies showing up and offering the web service start up some cash (or stock) for the idea, a contract to help integrate it and then, see ya later. 

Back to our man Larry.  Assume for a second, Larry broke the code on what makes for the perfect blogging tool. It is in Java and Sun decides, heck, we should buy that product, give Larry a million bucks cash on the spot, a year’s consulting contract to integrate it into whatever and presto, we are done.  Larry will be dancing in the streets, Sun gets a ‘buy out on the cheap, and the VC community never had a shot at the return because Larry didn’t need the traditional VC thing (cash) and, today, we don’t have a good model to work with Larry. 

Some time ago, Robert Scoble made some jokes in his blog about trying to get a checkbook. While Microsoft may not up Robert’s credit limit, they are, in fact, out there with a number of checkbook as are the other players.  They are being smart and have clearly figured out that paying 5 million bucks beats 500 million every day.  Google is famous for the 20% rule whereby 20% of your time should be devoted to fun/research.  Eventually, we will see people leave Google to start new companies. I believe for now, tho, we have an issue with this portion of the start up ecosystem and VCs who want to play in this space will have to address it.

Paperwork – Costs vs.Time

It’s simply not possible to do a $100,000 (or a $300,000) investment with $30,000 in legal fees. Yes, I know that’s a brilliant conclusion from the VC newbie. There are a number of things that get in the way of small “seed” deals.   The first problem is structure. I’m not sure putting together a triple dip, full ratchet, dragging and tagging term sheet along with 90 days of due diligence is the message I want to give to start ups in today’s Web 2.0 world.  I’m exaggerating but not by much. 

Most anti-VC rants tend to focus on a number of things, ownership, meddling, pressure to flip, etc.  So, like any industry, product, or service, a perception is created that tends to lay on top of the whole VC industry.  This, of course, tends to have people with ideas heading for the hills or more accurately, heading for the credit cards vs. coming to see me.  And if, via my blog, boyish charm, and some luck, you do come see me, the 90 day due diligence, pref share cha cha, is not going to look particularly appealing vs. paying Master Card.

In order to invest in the Web 2.0 world, this model can’t work.  Proper due diligence, term sheets, ownership stake, board seats, etc, all do apply to varying degrees, for sure.  The new trick is finding the balance and changing the rules a bit so that is becomes more then money.  It’s not Las Vegas so laying bets down is not the right attitude, for sure, but getting a new way for smaller investments to be efficiently made is certainly required.

Beyond the Demo

Obviously, once you get beyond the demo, it does take skill and money to build something that will scale.  You need some level of marketing besides total and complete word of mouth. You’ll need a skill set of technical talent, marketing talent, and other important aspects of a successful venture. Typically, this is where the gobs of money comes into play. And it is here that I believe we might have an opportunity to change the game a bit.

I started writing this last night and since that time, others have been super busy.

Mark Evans wrote a post which pointed me to others. It’s a good read, as are most of Mark’s writings. Disclaimer, he’s a friend, like em, want to work with em, etc. etc.

Dave Winer wrote a post on his thoughts.  Dave’s general view of users are driving is not all that far fetched. Esther Dyson’s PC Forum  is into year 28. The theme of PC Forum 2006 is Erosion of Power: Users in Charge.  I think it is telling and I believe there is an opportunity in all of this to change the game a bit for the benefit of everybody.

Robert Scoble weighed in with comments. The only thing I would add is to change the words slightly. Robert asks what are ventures the entrepreneurs actually need.  I would phrase this slightly differently to say, what capital do the ventures need with defining capital as everything but money. That is the capital, in my view, which doesn’t really have an efficient way of being deployed. 

A wacky example: Seth Godin runs a seminar from time to time along with all the other things he does. If he was just one seminar a month, easy, cough up cash to send somebody to New York.  You can also hire him for a speaking gig, possibly.  But if I, as a VC, believe Seth’s knowledge would be a huge edge for start ups, what’s the plan? Today? Retainers, perhaps. Pieces of the company, perhaps. All kinds of different ways to ‘bottle’ Seth but none have really been figured out in a way that applies to the Web 2.0 world we are in today.

Robert’s co-author, Shel Israel is another interesting fellow. When you read his bio, you will find that a ton of amazing products and companies have chosen him as ground zero to get the product/service off the ground. Again, same interesting question.  The conventional way to use this type of talent is ‘for hire’, in other words hire the consultant, he does the voodoo, give em the check, done.  Maybe a VC firm calls upon him from time to time or maybe he (or Seth or others) are on retainer. Maybe.

Matthew Ingram, in his post, makes the point Venture Capital didn’t create the bubble and I agree with Matthew on doing a variation on public company thing, not sure if that would work any better/worse then what we have in Canada, aka Labor Sponsored VC funds. 

But here’s the question that I’ve been thinking about: If you don’t need my money, the blogging world is your rolodex, and you could possibly be snapped up before you require capital which allows me to do my VC thing, what do I offer? I believe there is a different model out there that might work for the Web 2.0 type companies.

That’s my point of disruption.  My working theory is that a “Capital firm” with Esther Dyson, Mark Evans, Shel Israel, Doc Searls, Robert Scoble, Dave Winer, or some combination, might have value that, along side my money, could bring ideas into the mainstream in a much different fashion with great returns for all.

I believe if you come into my office for a 30 minute no harm, no foul meeting and, as part of that 30 minute meeting some combination of the people above giving you some feedback is a priceless piece of capital.  If I can harness that capital in a form that makes sense for the fine folks above as well as me and the start up, well, we’ve got something I think. And the capital of smart technical folks who have build world class systems, etc, etc.

So, these are some of my thoughts.  I am reminded of the words of guitarist Robert Fripp (thx Robert):

“We should not expect good work to be acknowledged; and where it is, we should not expect it to be welcomed. Rather, the strength of a creative impulse is measured by the strength of opposition it meets.”

I’ll also end with what is, I believe, going to be a universal statement on all of this. It comes from Fred Wilson:

“I would suggest one rule and only one. Be the entrepreneur's partner. Help him or her. Be there for them. Support them. Counsel them. Share the risk with them. Have fun with them. Laugh and cry with them. And make boatloads of money with them. It's a time tested formula and it will work forever.”

Amen.

VC Change: Would you like Fries with that?

Perfect. Right on schedule. There is just something heart warming about things unfolding as they should.  Most really successful products get targeted by somebody else who says we have the X killer.

Most disruption, in any industry,  usually begins with the old school taking shots at the new school as they struggle to figure it all out.  The really smart ‘old school’ gets new school really quick, leaving old school behind.

A friend of mine (thanks, Ken) sent along a link to a New York Times article entitled: Venture Capital Blogs? They're About Anything But.

A quick scan, yeah, yeah, some reporter taking some shots at VCs blogging digs up some academic wonk who is clueless about what goes on out here in real world 101. Some ‘balance’ in the article about Fred Wilson’s blog and Brad Feld’s blog.  Time to hit the ol delete key.

Next email. (noodling begins)

Hmmm.. Wait a second.. Hmmm.. Undelete. Read slowly. Splattered all over this article is one each Paul Kedrosky.

Most of you probably know/read a blog called Infectious Greed by Paul Kedrosky. Sorry, Dr. Paul Kedrosky, sorry.

Here are some of the things Dr. K. has to say about VC blogs.

Venture Capital blogs are “filled with the blogging equivalent of white noise”

He said “most venture capitalist blogs were insincere..”

For VCs, he said, “There's zero incentive to tell the truth.”

There was this fun quote:

"The reason you see so many venture guys blogging is because they have time to do it. How many C.E.O.'s do you have blogging?"

Then there was the last line, after saying he got some criticism for a few things he wrote in his blog:

“He declined to give specific examples of his gaffes. "I don't know that I'd want any of it in print," he said.”

Yowsa, Dr. K, a little bee in that VC bonnet?

First, you should go read the entire article as I might have taken something out of context; go read make up your own mind, I could be wrong.  Second, take a quick look at Dr. K’s qualifications. He is not a lightweight so you might be better served to ignore me and listen to him.

I don’t have a Ph.D, an MBA, nor have I sole-authored 300 papers. Well done, sir, well done.

Nope.  I worked at Safeway as a bagger. I learned, at 14, that being nice to customers and telling the women what a cute baby she had, got a tip almost every time.  I manned the fry station at Burger King and learned girls used to love being slipped a large bag fries ‘by mistake’. That was until people got all health conscious.

So, use care in reading my views on this stuff, I’m new and unproven.

I sincerely mean that. I’m telling you the truth; sincerely.

Articles like this annoy me because broad, over reaching comments from ‘experts’ are damaging to my new profession. 

Consider this nonsense about telling the truth.  All one has to do in order to put this rubbish in it’s place is simply read Fred Wilson.  Fred tells the truth, for example, about his views on music and digital rights management. He has said, at least 3 times, I suppose that makes me a thief or words to that effect.  Raw truth and opinion. Surprise, surprise, a MUSIC management company shows up on his doorsteps to do the pitch because they clearly understand where he is coming from. Fred’s sincere, truthful, blunt, and respected. Doesn’t look like white noise to me. But I could be wrong. I can point you to other blogs where it appears truth, sincerity, and good signal to noise ratio exist. Brad Feld, is another example. Heck, for all my snarky comments about Guy Kawasaki, he too appears to be sincere, telling the truth, and trying to be useful versus noise. 

In short, the comment shows a real lack, well, let’s just say Dr. K needs to get out more or at least read more. My challenge to Dr. K is simple: Show me the money, errr, sorry, show me the insincere VC blog.

With respect to this comment about “how many CEO’s do you see blogging”, Doc, Doc, Doc.. Here’s a quick little test for you.  Wander Engadget, Download Squad, Tablet PC or a number of blogs out there that talk about new companies or “Web 2.0” companies. We can start with the biggies, like Technorati and that company CEO, David Sify. Blog? Check, blog.  Since I know you are busy (not like the rest of us VCs), I’ve done some work for you. Of the last 60 companies that I’ve been told about via blogs, email or word of mouth, 40 of em have blogs and most of those blogs are the CEO/Founders.  So, to answer the question of how many? Lots.

VC change. It’s coming, folks, it is totally coming. I predict that guys to watch are Fred, Brad and a host of other VC blogger types who get it. Those are the guys I’m watching, I’m trying to catch up with. I’m leaving the (dare I say “old school”) stuff to others.

Besides, I remember the important lessons, just in case I really am wrong:

Will that be paper or plastic? Is that for here or to go? And my personal favorite: Would you like fries with that?

Next up in the dead pool: Slingbox

Congratulations to each and every member of Sling media. You’ve worked hard, got a product out the door, have lots of fans and generally have done well as a start up.

But nothing says success like seeing the words “Sling Killer.”  Just think, in a relatively short period of time, you’d joined up with the likes of RIM (Blackberry Killer), Lotus/IBM (Notes Killer), etc.

Michael Arrington, who writes TechCrunch, is attending a Microsoft briefing and reports on fun stuff with the Media Center. A small quote that caught my attention:

“Anyone using Windows Media Center to record television (I do) will also be able to remotely control their media center to add/remove/edit recordings from any computer, via their passport account and a live.com gadget. We saw a demo of this today and its going to be pretty cool.

Note that this is not an annoucement for “remote viewing”, although there are heavy rumors that this is the next step, and it seems pretty obvious. That, of course, will be bad news for Slingbox.”

Michael didn’t actually use the phrase “Sling box Killer” but, for sure, it’s coming.  Oh, wait, there are 672 Google references already. Way to go Sling. You are off to a good start but will need some extra effort to match the 25,000 blackberry killer hits on Google.

I guess if I want to disrupt the VC business, I need to get the “Venture Capitalist Killer” hits up there.

 

A list you'll enjoy

Grab your favorite drink and settle in to review Biz 2.0’s 2005’s 101 Dumbest Moments in Business.

Awesome. Or pathetic depending on your perspective.

A VC Rant with an opportunity

Short story. “Joe” has been working for 5 years to bring a software product to market while keeping the day job waiting & bussing tables. He has a wife, two kids, a dog and they live in a small nothing apartment.

For years, Joe toils away while pounding the VC pavement looking for angel, seed, anything.  He is in the apartment because he’s already sold the house, already maxed the credit cards, hiding from bill collectors, etc, but he believes!  He also driving a Pinto with a billion miles on it; trillions if you do it in kilometers.

Finally, one day, he gets funded. 3 million brand new Yankee dollars into the company. He is flying.  The VC says, Joe, you gotta do this full time, quit waiting on tables and Joe says, amen. The VC says, Joe, take a salary with the founder title and Joe says Amen. 

After seeing the first actual paycheck for this business and seeing some personal income, Joe decides he owes his wife; big time.  Joe leases her a 2002 Mercedes (in Dec 2005). He keeps the Pinto. I didn’t know you could lease a car that old, but that’s another story.

One day, Joe drives the Mercedes into work because, surprise, the Pinto is in the shop.  Board meeting day.  Later that morning the VC comes into the meeting and, in front of the whole board, with two guests (employees) in the room, proceeds to lecture Joe on spending VC money for Mercedes. Joe says, excuse me, it is my wife’s leased car not mine. VC says, doesn’t matter, we didn’t pay you to go off and get cars for anybody. If we had known you were going to buy cars, we could have cut your salary, we think for the good of the company, you should never drive that car again.

I got all this because “Joe” called my cell today, told me the story, said he’d read my blog, and asked a simple question:

“How hard is it to return VC money, I can get my waiter gig back.”

This is probably an extreme case. I’m sure it is, but it started me thinking about my VC world.  My conclusion is this world has some issues that need to get fixed. Everything from being nice (no referrals) to defining the customer (you, the start up), we have lots of issues. Add this to the changes happening on the Web, the big guys using the HR department to handle buying small companies (hire em and ‘buy the company’ via big sign-on bonus), we’ve got trouble brewing.

It was this thinking that lead me to think about ways to make things better both for VCs and for our customers, the start-ups.  I’ve taken input from Robert Scoble, Chris Pirillo, Hugh Macleod, and Doc Searls, to name a few. I spent a day with Doc which you can read about here.  He has forgotten more about pretty much everything I know. When you add his knowledge to his lovely wife Joyce’s knowledge, you get 2 + 2 = 100.   In the end, we concluded a number of really fun/smart things that should be done.  Hopefully, I can convince Doc and a few others to take a shot, make some new rules, and try to apply the clue train and hughtrain to the art of getting good ideas into sustainable forms that create the because of effect.

Read Doc’s piece and stay tuned.

World Exclusive - Microsoft & Alaska Airlines Merger

While going completely unnoticed by all major and minor news outlets around the globe, I have uncovered the block buster merger of all time: The merger of Microsoft’s marketing team and the Alaska Airlines marketing team. 

We all know about these insult your customer ads:

Given the amazing success these ads have had, with the worldwide acceptance of insults = positive customer behavior, Microsoft’s team is now on a acquisition strategy to merge with other marketing departments.

Enter the first purchase: Alaska Airlines.

Tucked into the seat pocket is a laminated card talking about alaskaair.com. The theme? Animals calling humans stupid for not using the Alaska Air web site.

No, really.

“STILL NOT USING ALASKAAIR.COM? SO MUCH FOR THAT BIG BRAIN” (all caps, them, not me)

“WASTING MONEY AT THE BIG TRAVEL SITES? ANOTHER HUMAN FAILING” (all caps, them, not moi)

“You’d have to have the brain of a badger not to see that.”

“…lemming-like behavior...”

Now, many of you have flown Alaska Airlines and even more of you will want to tell me to take my meds, it’s all in good fun, etc, etc.  I get the fun, I really do.  I just don’t think insulting your customers is a good trend, humor or otherwise. Risky and it’s  going to get somebody into trouble.

Customers = Good. Insults = Bad.  Maybe I should ask Hugh to modify this cartoon to make this point clear.

 

More Digital Life

I just landed at LAX.  Plane rolls up to the gate and, surprise, surprise, busted jet bridge.  Hmm, 80 emails in the outbox, gotta get the map to Doc’s house.  Hoohkay. Plop back down in my seat, pop open the laptop, fire up the Verizon card and start cranking. Emails flying (well a brisk trot) out of my laptop and, of course, they get the jet bridge working, so I slap the laptop into the bag, scoot off the plane.

From the inside my bag, the laptop and the Verizon card just kept on going, sending my emails, no dropped signal, just working away.

While turning on your cell phone or your Treo or Blackberry as you land is nothing new, there is a larger message for you as you work on that start up. Think about where connectivity will be in as little as two more years.

It is changing the way you need to think about your customers and the connections those customers have to you from a bandwidth perspective. It’s truly remarkable and offers you opportunities not previously possible.

Off to the rental car counter to fill out: Paperwork.  I know you can get Frequent Renter things to cut down on the paperwork but this is just my way staying “low tech” from time to time.

Alaska Airlines

Sometimes you just have to wonder about trained professionals. I’m currently ready to head to LA on the early morning flight from Seattle.

I’m not on the flight going to some nice place in Mexico which is a good thing because those people are not getting their bags for the start of their vacation.  How do I know?

Here’s the conversation I (and about 20 other people) heard while waiting for the morning Joe at Starbucks.  From two Alaska Airlines pilot, also looking for a hit.

P1: “None of those people know their bags are not arriving with them.”

P2: [Laughs] Yeah, life’s a bitch. Not my problemo but, thanks for flying Alaska kids.

P1/P2: [Laughter]

Not cool.

The end of the VC list

Now that the blogging community has been graced with the arrival of Commander Kawasaki and his oratory from above, or below, sideways, or wherever; we must pause to consider the future of the list.  Guy’s VC blog has given the community a wide variety of lists.

Guy’s lists have told us you lie, I lie, and we pretty much don’t believe you, your spreadsheets, your market share, your plans, or your momma.  For bonus points, we got a wish list of what all us VC liar, don’t believe ya anyway types, want.

It was on that last wish list entry that I actually started a screaming, all caps, rebuttal, complete with professional commentary. (Don’t yell at me, it’s from Saturday Night Live.)

I think telling people to get a referral is rude, elitist and just continues to feed the not so hot VC reputation. The latest pronouncement of “show some traction” concerns me as well because the most successful VCs should be helping to grow the farm team by helping the new start ups instead the no referral, no traction blow off..  But, no rant today…

To be fair, Guy has some great posts and some great suggestions. He’s a master at evangelizing and I was fortunate he wasn’t at Apple when I was at Microsoft as the job would have been way way harder.

Having said that, the VC community, newbies like moi, and veterans like Guy need to call a truce/halt to the endless lists. Believe me, every VC out here has said, don’t read your powerpoint slides, tell me a story, keep it simple, show me the model, yadda, yadda, yadda.. No more lists.

[Interesting side note: When you type into Google “Don’t read your PowerPoint slides”, you get 1 result, so maybe we haven’t yelled it enough.]

So, I promise, no more lists of stuff you’ve already heard a 1000 times before. No more dribble. I promise to try and present real stuff you can use, that makes a difference, and will help you make some moves down the road to success.

Like this:

Nothing is more important to your success then people feeling that what you do is personal and matters to you. Alex Eckelberry runs a software company called Sunbelt Software. From the “we keep the bad guys out” to Alex’s blog, you can get a sense that the company is real and he is real. Consider his “Security on the Cheap” entry as a pretty good example of making it personal and helpful which, in the end, will hopefully cause you to buy some product. Alex is a super guy, running a super company.  I recommend you read his blog.

I have a list of these amazing people around here someplace…. Oops.

Nightmare on Book Review Alley

Writing a book is hard work. I know, I’ve done it a number of times. My recurring nightmare after the first two books was having one of my daughters coming up to me and say:

“Daddy, what’s a leftover”

“It’s something that is no longer new, much good anymore, and is priced to get rid of it, why?”

“Cuz there’s a big round bin over there with your books in it and the sign sez 3 for a dollar leftovers.”

Shel Israel, the co-author of Naked Conversations will not have this nightmare.  No, Shel is a new author. He will wander the book stores looking for his book, a pen at the ready the moment it even appears somebody is picking up the book.  He will wear out the F5 key, refreshing the Amazon sales ranking page.

And Shel will click on every link and read every book review out there. And when he does that, he will have, burned into his eyes, etched into his mind for all time, seared into the very consciousness that is Shel Israel; a sight no man, women (except Ponzi) or child should see.

This is a warning to all you budding authors. Be careful or you could end up with this review for your book.

Over Geeked

Maryam ( the real power behind Robert “I got me a book” Scoble) has written about loving geeks. It’s a good read and warms my heart that there is hope for my kind.  Sometimes, tho, we get a bit out of control and must seriously step back from the keyboard.

Here’s the transcript from a recent Blackberry Chat session I was having with a friend of mine. Sandy had just told me to down load google local for my blackberry and I had just done it and said thank you.

sandy: DaNada

sandy: They're bringing out Google Talk for the Blackberry as well, lets you IM with non-bb's.

Rick Segal: The interesting thing is that rogers and RIM got exactly zero money for that little download. Mobile free for all. That should be fun.

Rick Segal: The non-bb chat will be cool. Now we need a good RSS reader for this puppy. One that was optimized for the device.

sandy: Check out the moon, in the east. Very nice.

Rick Segal: Moon in the east?

sandy: Yeah. Look up...

[Yes, I actually went to ‘look up’ “moon in the east” and RSS in Google]

Rick Segal: Okay. I'm dense. Is this in google? For RSS?

sandy: In the sky, you geek. You know, outside? In the real world?

sandy: You need to get out more

Rick Segal: I'm pathetic.

sandy: Yup

And, of course for extra geek points, you blog it.  And so it goes here in rainy Seattle. I hope you are having a great weekend.

Instead of Summer Camp, try this

Leaving aside the Web 2.0 hype and the Mark Evans theory of “they funded what?” questions, you might want to consider attending a particularly good event that will give you a look into what’s happening as everybody starts building on everything else.

Mashup Camp which is being held on Feb 20th and 21st in Mountain View, California.  As I type this, there are only 25 slots left. If you go to this page and look at who has signed up (ignoring me), you will see a gold mine of talent, opportunities, tier one API providers, and a host of people wanting to dive in and code it. I’m bringing bags of money.

Microsoft is also having a thing called Mix06 in March, where even more possibilities will be laid out for the development world. 

In a recent post, Robert Scoble, made an interesting observation:

“You know, there’s a lot of heat and fire about the Microsoft and Google competition, but, seriously, who is the winner here? Microsoft made a few bucks by making the operating system for my cell phone. Google made a happier customer. Sounds like a win-win combination.”

and this:

“We need more partnerships in this industry, not more fighting. And where we fight needs to be done because you have a better idea, not cause you’re trying to tear someone else down”

Mashup Camp’s greatest possibility? That it will remove this problem as the province of the big guys to solve because you will be picking and choosing what pieces make the overall solution people will use. Only those that can offer up value that then allows for more value creation will actually survive.

I hope to see you at Mashup Camp.

 

Some VC Tips

This has been a pretty busy couple of weeks with lots of inbound deals, calls, emails, and meetings.  Out of all this popped out a few things you might want think about when working with the VC community. Or your banker, employer, friends, and mother.

BCC – Blind Carbon Copy

It actually stands for Basically Careless Crapola. From the mail bag (edited to protect the yadda yadda):

—————————

From: Him

To: Me

Yo. Later today you will get a note from Joe. He is worried about being in front of VCs. I told him about the 30 minute, just come and chat, and I think he will contact you. I appreciate you taking a look, he is a big fan of you, likes the firm, etc, I’ll owe you.

—————————

Yep, you are already there, right? “Joe” hits the reply all key and sends:

“Thanks. I met segal’s partner once before, bit of a wonk and really made the point to me these banking VC goofs don’t really have a clue what goes on outside that little cubicle world.  But, for you, I will be nice, suck up, and show him the demo. It’s dumbed down so that VCs can understand it.  On the bright side, they have a nice view of the harbor and the receptionist is outstanding.”

Lesson: Don’t use BCC. Forward it if you want somebody else to see what you sent. Also, if you receive a message where you are BCC’d, forward it to the original sender with any comments you want to make.

Track Changes – Microsoft’s way of letting you show me your underwear.

You’ve spent a bunch of time building, no crafting, that Word document. It’s a work of art. Every word, sculpted to make the masterpiece that is: Your business plan. Ta da..  Do yourself a favor. Before you send it out, accept all changes, save it, mail it to yourself, and make sure you can’t see the changes or earlier versions of stuff because geeks like me will always click “track changes” and always set the view to “original showing mark up.”

I love looking at the mission statement paragraph with the original text, then the red lines, then the comments from some editor saying “Michael, this is complete bullshit and stupid, sober up, write it again.”  Or, my personal favorite, in the financial discussions section, again the original text, red lined, with comments saying “Kris, VCs always cut projections by half so don’t tell the truth puff it up as I show, argue with the twits, and then agree on the number you know to be real anyway.”

Two plans this week, two different word documents, same oops, forgot to accept changes.

Lesson: Accept all changes and, if you are really worried, save it as a PDF.

[Side note: Nothing is more fun when the lawyers screw this up and flip documents with “I don’t think they will go for this but try anyway” comments still in the document.]

Auto Complete equals Auto Oops.

My name is not Rick Sekat or Ric Steves or Rick Stein. When you are sending an email to a zillion people, slow down and watch Outlook’s helpful auto-complete of email addresses.  Accidently putting me on copy for email to your agent and/or lawyer about your thoughts on valuation; helpful for me, bad for you.

Lotus Manuscript and Borland Sprint = I don’t think so.

I got a plan from a fine young lad in Barrie, Ontario. He was just looking for some quick advice. I couldn’t open the attachment and when I asked what word processor he had used: Borland’s Sprint.  10 points for loyalty, I guess  After I got the Anti-Microsoft rant, I suggested both Open Office and sending me a simple text file.

[Side Note: I wondered if Sprint was still alive and, yep, you can go here to see.]

So there you have it, 4 simple items you might want to consider thinking about. Always entertaining when you are on the other side of this stuff. 

Canada's Blogsphere Day

Mark Evans beat me to the TechCrunch story on two Canadian companies doing some interesting local ad stuff,  BlockRocker and rbloc.

Gizmodo has a story about cheaper broadband on airplanes. Talks about the FCC, auctions, etc, etc.

And the photo? Air Canada’s new planes.  Canada, we’re open for business.

Plaxo - Watching the Rock Throwing

Michael Arrington, of CrunchNotes (and TechCrunch) fame decides to step up and take one for the team. Which team? The zillions of people who can’t stand Plaxo messages being splattered all over their inbox.  He goes for the gold by also taking a shot at Charles O’Donnell of Union Square Ventures who compares Plaxo messages to Greenpeace.

Plaxio’s privacy person is all over both posts in the respective comment sections.  You can get a good sense of how Stacy Martin (the Privacy Czar) responds to both sides of a story and how both sides then respond to her commentary.

Both posts are interesting for different reasons but both give you a gold mine of data on customer service tips, dealing with the public, blogsphere opinions vs. people’s personal realities, etc.

Michael’s post and comments are here.

Charles, ‘bad as I wanna be’ O’Donnell’s post and comments are here.

Venture Capital - Inside Edition

Guy Tonka (or Honda or some vehicle) started a blog and got some responses from VC and non-VC community alike. One of the more interesting observations was from Jeff Jarvis where he says:

“It’s time for a VC to break free of the form: VC gossip, catty VC valuation badmouthing, anonymous confessions of the top 10 ways VCs blow off venture beggars, sex tips of the nearly wealthy….”

I couldn’t figure out what “catty VC valuation bad mouthing” actually was. Probably had the valuation word added in by mistake.  Catty? Bad mouthing? I can do that, I’ve got New Yorker blood in me..

Consider this:

With some additional details:

This was actually pointed out to me a ways back when I blogged about the entrepreneurs being the actual customers of the VC community. I still believe that, still believe that 30 minutes (no harm, no foul) out of my day for pretty much any possible investment is the right strategy.  The email that came with these clips said, in part:

“Yer Microsoft buddies took all that arrogance and started a firm to spend all those option profits they made off forcing Windoze on the public”

I always enjoy hearing from satisfied Microsoft customers. 

In my email response, I mentioned that given who these guys were, what was likely to happen when the firm opened the doors, and the desire not to have tons of people mad because they got ignored, they tried to come up with some filtering system to at least ensure they could give some decent responses to people, build a proper brand, etc, etc. 

Dribble…Yeah, it was all one VC ‘defending’ another or ‘being polite”, I admit it.

So, Jeff, this one’s for you.

I think Venture Capital firms that put these types of  “referral”  filters in place don’t add much to the already shaky reputation of our industry.  My general belief is that as you get more successful, you have an obligation to give a little back.  As a successful VC, the give back is time. Help the little guy, give the gal ten minutes.

Just like really good lawyers do pro-bono work for people that can’t afford it, the VC community needs to help grow the farm team. That means open doors and staying away from these things that reinforce what people already think. 

I know.  I’m not drowning in billions of dollars under management, sitting on 60 boards, and booked on the rubber chicken circuit 18 months out. I know I probably have more time then all the rich kids up the street. Doesn’t matter. The richer/more successful you are, the more you should be giving back.

Yeah, this only rates a 4 on the Jarvis Catty-Comment Meter, sorry, I’m in Canada, they’re very nice up here and I’m outta practice.

Memo to Doc: Don't worry, the 5 year old's got it covered

Doc Searls did a report on Intel’s Keynote and mentions the notion of where great material will be coming from which is you and me. David Berlind does a great job adding additional commentary on this whole media cartel, DRM story.

He makes the reasonable point that DRM is just way for the little guy, hardware or software, to be kept out of the game. Apple makes it a pain in the ass with formats and DRM and this “plays for sure” garbage is really a giant scam for control.

And, of course, “Do no Evil” is creating a DRM solution for TV content coming via Google and friends.

I went to Wal-Mart. 

Las Vegas, with all the money flying around everywhere, has 19 stores located in and around town.  CES is an amazing trade show to see all the latest and greatest everything. Geek heaven, Gadget city, etc, etc.  Wal-Mart, on the other hand, is where Sue and Sam six pack are spending those hard earned dollars made keeping the lights around here. It is where I do customer research,  lots of it.

Let’s see what’s happening besides everyday low prices.

“Mommy, Johnny got 135 songs off of Limewire for free, can I have that on my computer?” (kid was no older then 5) 90 seconds later Mom is giving in to buying some Britney Spears stuff but not CDs.

——

“Well, sir, you can download one of these music recording applications and then just take the files and put them onto anything you want. No, don’t worry, when done this way it will play on anything.”

——

“Yes ma’am, any music device will play music files called MP3 files and, yes, you can just share them if you download them from….”

——

Then, in the video aisle, $3.99 movies that, according the Jeremy, just fly off the shelf. “People love this stuff, it’s cheap, fun, etc.” And does Jeremy think anybody steals this stuff (aka RIP the DVD and post it)? Naah, sez this kid. Who the heck is going to waste time over 5 bux, you just buy it.

So to all those big shots running around Las Vegas in the VIP cars. All of you music, video, whatever execs, pressing flesh and telling everybody about new content this, distribution rights that, go talk Jeremy. It’s over. The 5 year old gets “free” and is doing free. The minimum wage employee at Wal-Mart is giving ad-hoc lessons on how to deal with media property that people actually understand.  Make it cheap, people buy it and don’t steal it, whoduh thunk that!.

Lots happening at Wal-Mart. CES is running full tilt as well.

Google and the Movies

With all the speculation on Google buying this or building that or offering it, let’s add something fun.

GooglePlex-24.

Google buys up a few movie houses and changes nothing except the following:

If you want to come to the movie for free, show up 20 minutes ahead of time and be seated. So, called it 30 minutes ahead of time, buy some corn, pop, candy, etc, and plop your butt into the chair for 20 minutes of, well duh, ads. But fun ads, promos for TV/Shows, TechTV stuff showing new products, all fun, interesting all Google style. Don’t want to show up or wander in after the full 20 minutes starts, just buy a ticket.

Hmmm, but you don’t need Google for this, couldn’t the existing theater owner(s) do this? Couldn’t they, for ten bux, have a Star Wars Marathon day? Couldn’t they have, giant super bowl screens up with guys going up and down the aisles with pop corn peanuts, candy, etc?

Don’t tear down this idea, I just made it up to make the larger point about thinking in a disruptive manner when you start thinking about doing that next cool/great thing.

The New Digital Life

Nicole Simon asks a pretty good question about the digital lifestyle. She is looking for what it means to people. I’m not sure I can give a great answer but here is a nice story about what is happening all around you.

While traveling from Orlando to Las Vegas, I was faced with a very ugly flight delay. It seems there was an in-flight medical emergency whereby the America West flight out of Phoenix had to drop into Jackson, Miss and, once there, get fuel and oxygen for the in-flight system.

The AW team on the ground did a reasonable job getting people lined up with whatever flight connection information they could, etc.  The one thing they couldn’t do was tell people what the flight delay was really going to be like and would they actually get the plane in here and go to Vegas. 

First, they put up the departure delay from 8:30 to 11:45p.  Rule is they never go earlier once they commit to a time. Then it was endless, sorry no information, annoucements.

I have my Motion Tablet PC and I am watching TV on my sling box on my Verizon, all you can drink/one price, edge card. Almost full screen, watching HBO. 

After some time, I’m thinking, this is stupid, I can go get some food outside the airport instead of sitting here.

Step one: http://www.flytecomm.com/cgi-bin/trackflight, type in my flight number and track it. Gee, still on ground in Jackson, heh,  they ain’t making it here by 11 anything.

Step two: Find a local Steak -n- Shake by the airport.

Step three: I walk up to the counter and say, look do you have a real time for this plane’s status? No, sir, sorry. Well, I do.  I show him my live flytecomm tracking page which now shows the flight airborne, 34,000 feet with a landing time of 12:09a in Orlando.  I say, I’m going to Steak and Shake, grab a burger, some fries, and a shake, can I bring you anything? ( I felt bad for all the crap this guy was taking..) Shocked look. Uh, sure, but I can’t promise the plane won’t leave without you. Trust me, I say, I’ll track it while in the Cab and if it comes in for a landing, we’ll high tail it back. Cheeseburger, no onions, small shake. No, problem, my treat, I say.

Step four: Head out, grab some chow. 8 hr battery, Verizon card, etc, never failed/dropped connection. I’m hitting refresh a couple of times,  and still watching HBO on demand, catching up on Rome. I come back to airport,  bring the guy his food, plane lands at, surprise, 12:09a, taxiing around for whatever, offloads people, cleans up plane, etc, etc.

Step five: Mr. Segal up to the counter, plz. Uh, oh, homeland security is gonna arrest me for the flytecomm stuff, damn.  Uh, nope. Guy slips me a first class seat, sorry for the delay, thanks for the food, and can I get that website address again?  

Into Vegas around 3a. Surprisingly, no taxi lines, no traffic, and no line up at hotel check in.