Posts from October 2005

Are you having trouble getting your legitimate permissioned email through spam filters?

If so, you are not alone.

Return Path, a Flatiron portfolio company, and the leader in helping marketers get legitimate mail delivered, reported yesterday that:

The blocking of permissioned-based email by users’ Internet service providers and Web-based e-mail providers remained just as big a problem this year as it was last year.

and

Mistaking legitimate e-mail for spam, ISPs,
and Web-based e-mail providers failed to deliver 21 percent of
permission-based e-mail to consumer inboxes during the first half of
this year, compared to 22 percent during all of last year.

I know that I’ve blogged a bunch about this problem already, but how would you like that email annoucing ticket sales to your favorite band’s local concert to get blocked?  How about your visa statement this month?  Or the impending shipment of something that has been backordred that you want asap?  Or the verification email from that cool new service you just joined?

This happens all the time and the spam cops don’t give a damn about it. They think their job is to block spam and if some legit email gets blocked, too bad.

Return Path helps legit email like this get through.  So if you are sending permissioned based email and having deliverability issues, give Return Path a shot at helping you. I am certain they’ll deliver for you.

Yesterday we flipped the switch and turned our website, UnionSquareVentures.com, into a blog.

Like most things, we should have done it a year ago when we first launched our firm’s website.

But better late than never.

Why did we do it?  Because, as Brad explains in his first post:

We realized that our [investment] thesis evolves incrementally as a result of our
dialogue with the market, and that the best way to manage that was to
accept that we would never get to an answer, so we should just publish
the conversation.

Go read the whole post. It’s short and to the point, like all good blog posts.

So what does this mean for A VC?  Not much, I suspect. I do not plan to stop blogging here.  And most of what I blog about here isn’t appropriate for our firm’s blog.  But some of it is.  When it is, I’ll either post it here and cross post it there.  Or, if it’s the announcement of a new investment or something specific to Union Square Ventures, then I’ll post it there and link to it from here.

But there is something you’ll get at UnionSquareVentures.com that you won’t get here. You’ll get a complete picture of our firm. You’ll get to read Brad‘s views on the market which until now were only available to me, Charlie, our portfolio companies, and a few friends (but often ended up on this blog with me taking the credit).  And you’ll get to read Charlie’s posts about our business.  And all of my posts that I put up there.

So if you are interested in the complete view of Union Square Ventures, subscribe to our blog via RSS or via email (enter your email address on the left sidebar of our blog) and then let us know what you think by commenting or linking back.  As Brad says, please join the conversation. We think it will be a good one.

Apple introduced the video iPod today.

I gotta get one.

60gigs for $399 seems like a pretty good deal.

It was never heavily advertised by Apple, but iTunes has been able to play video for a while now, at least since version 4.9.

And since iTunes also accepts RSS feeds, I’ve been watching funny videos in iTunes for a while.

I do that by putting the following feed into the "subscribe to podcast" field in iTunes:

http://del.icio.us/rss/tag/funny+system:filetype:mov

So now I can watch the funny videos I get with this feed on an iPod while killing time on the subway.

Cool.

I am going to do a mashup this week.  I am going to combine my Nuggets, MP3 of the Week, and VC Cliche of the Week posts. Let’s hope this works.

In high school and college, I was a big fan of Ian Hunter and Mott The Hoople.  Ian Hunter released a brilliant self titled solo record in 1975 which I still listen to every now and then.

It’s has a fantastic cover of Who Do You Love and a bunch of other really rockin tunes on it. If you like straight up ’70s style guitar driven rock n roll, I bet you’ll like this record.

The opening number is called Once Bitten, Twice Shy and it is a fantastic song.  Ian opens it with the classic "Allo". I’ll never tire of that opening.  The song is about the corruptive powers of rock and roll. It’s a pretty well known song and has been covered a lot. Here it is in case you’ve never heard the song or just want to hear it again.  Man, did those guys rock.

OK, so now that we’ve gotten through the Nuggets and MP3 of the Week parts, here comes the cliche of the week.

Life is a learning experience. The older you get, the wiser you get.  But there is a cost to all of this learning.

I attended the Return Path open house last night and we got to talking about how some of the greatest works of art, music, science, literature, etc were created by people in their 20s.  And how these same people never did anything close to that brilliant for the rest of their lives.

There is something about not knowing the impossible or improbable.  It allows you to take risks and achieve at a level that can produce amazing results.  Look at Microsoft, Dell, Yahoo!, Google, etc.  All created by kids who had a dream and made it happen.

Life takes its toll on that blind enthusiasm.  You get bitten or burned.  And you become more careful and cautious.  Once bitten, twice shy.

I know. I’ve been there.

My post on Web 2.0 last week was taken by most to be a "yellow light" as Jeff Jarvis put it.  And so it was.

It’s human nature to be more careful the next time.  But caution isn’t all good either.

Venture Capital is about taking risks.  Not stupid risks, smart risks.  Risk and return are always correlated in the end.

So, the trick is to learn from life’s lessons, get smarter, wiser, but not shy.  You have to take risks to make money.

Once bitten, twice shy.  Gotta work against that tendency.

If you are like me, you get a lot of spam touting penny stocks.

I just hit the delete key, but a guy named Joshua did something much cooler.

He built a page where he tracks all of the stock spam he gets.

Take a look.

Too bad you can’t short most of this crap.

And I do mean crap.

From the NY Times this morning:

HONG KONG, Oct. 11  –  Roche, the maker of the main drug that would be used against a possible bird flu epidemic,
is under growing pressure to allow production of generic versions of
the medicine, with a senior Taiwanese official saying that his country
could begin manufacturing it in a couple months if it received
permission.

But the company and some outside experts
say production of the drug, Tamiflu, is so complex and time-consuming
that even generic makers could not quickly expand global supplies.

Those
putting pressure on Roche, a Swiss company, include the head of the
United Nations and health officials in some nations. They are asking
whether the health of hundreds of millions of people in a possible
pandemic should depend on the efficiency and productivity of a single
corporation.

When I was at my first venture capital firm, Euclid Partners, we had investments in several vaccine companies. We loved vaccines because they were preventative. It seemed to be a much more efficient way to provide health care.

But we didn’t make a lot of money on our vaccine companies and as we studied the market, we came to realize that vaccines are not particularly good products to own in the grand scheme of the pharmaceutical business. I won’t go into the reasons why because its been a long time and I’ll probably botch it and there is always the possibility that things have changed for the better.

But this article reminded me that vaccines are a critically important part of the overall health care picture and we need more vaccines, for more diseases, available in more places.

But how to get there?

Our drug discovery and development process is so expensive that any company undergoing the effort needs to be compensated with high prices and monopolies for a long period in order to get a return on investment.

Generics are great, but they are only available once the patent period expires and, if the article in the NY Times is to be believed, there are some compounds that are so complex to manufacture that its hard to do it in generic form.

It makes me wonder if the pharma/healthcare industry can take a page from the software industry’s playbook and do something like open source.  Why can’t we get the academics who make the initial discovery to "open source" their work and require anyone who improves the work to do the same.  Then when the final product is available, it will be generic from day one?

Maybe this exists already.  As I said, I don’t know very much about the healthcare industry.

But if it does exist, it seems that vaccines are a great place to put this approach to work.

Back when iTunes introduced Podcasts, I submitted Positively 10th Street to its directory.

For some reason, they don’t want to list it because its not there, and when I resubmit it, it says "podcast already submitted".

Well Yahoo! apparently doesn’t have an issue with our show and if you’d rather use Yahoo! to get Positively 10th Street, you can do so right here.

Thanks Yahoo!

Readers of this blog know that I have been reading Hackoff.com, Tom Evslin’s "blook" which is a book delivered via a blog.

Hackoff.com is a muder mystery set in the heyday and aftermath of "web 1.0" as we now call it in our family.

The story is starting to develop now. 

In Chapter One, we found out that the founder and CEO was found dead in his office of a gunshot wound to the head and learned a bit about the people at Hackoff.com.

In Chapter Two, we went back in time to 1999 (which was big time memory lane for me) and saw the board prepare for the IPO.

In Chapter Three, which I just read, the Hackoff.com IPO roadshow gets a little crazy with some sleeping around going on.

Having never been on a roadshow myself, I honestly can’t say whether there is any truth in this chapter.

A few tips on reading Hackoff.com.

If you like to read blogs with an RSS reader, then add the feed to your reader. 

But I prefer to read each chapter by printing out the PDF.  I have linked to each of them above.

If you choose to subscribe via RSS, you might want to print out the first three chapters and read them to get caught up.

I hope you enjoy it as much as I am.

I just finished John Battelle’s The Search.

It’s a great book.  I highly recommend it to anyone who is interested in business, technology, marketing, and the internet.

One of the things I that I enjoyed most in the book was John’s comparison of Google and Yahoo!.  I won’t quote from the book here.  If you want to read that part, get the book.

The most interesting thing about the comparison was the roles of Jerry and David at Yahoo! and Sergey and Larry at Google.  Both were Stanford grad students.  Both started the companies in their dorms.  Both are still with their respective companies.  But at Yahoo!, Jerry and David are part of the management team, but don’t run the company.  At Google, Sergey and Larry are in charge, along with the third member of the troika, Eric Schmidt.  It’s a very different model.

And it got me thinking about the role of founders in general.

Founders contribute something to companies that is very special.  It’s the core DNA of most companies.  Many founders step aside at some point from the CEO role.  Many times that happens at the urging of the VCs.  Many times they do it on their own, recognizing that they don’t enjoy actually running a company.

But the tricky part is keeping the founders engaged and involved once they’d stepped down from the CEO role.  So in that regard, I am actually more interested in Jerry and David than Sergey and Larry.  From reading John’s book, Sergey seems like Bill Gates.  I suspect he’ll be at the helm for a long time at Google.

But how do you get someone of the caliber of Jerry Yang or David Filo to stick around and keep working on moving the company forward.  I don’t think its a coincidence that Yahoo! alone out of the web 1.0 portals has made the transition to web 2.0.

In fact, Terry Semel’s talk at web 2.0 was essentially a description of how a large portal can use web 2.0 techniques to remake themsleves.  How did Terry come up with that plan?  Not alone, I am sure.

My bet is that the founders had a lot to do with this. They are still of the web. They get what’s going on and they can translate it into a strategy that Terry, Dan, and the team can execute.

That is enormously valuable. But how did Yahoo! keep them around?

Marc Andreessen moved on from Netscape.

Joe Kraus moved on from Excite.

Fuzzy Mauldin (Lycos) and Louis Mounier (Alta Vista) are long gone too.

Many web 1.0 founders left their companies and moved on to start new companies.  That’s fine and frankly expected.  But not great for the companies they founded.

I’d like to find a formula (like the one Yahoo! has found) and bottle it.  Because I believe companies that can keep their founders engaged and motivated are so much better off than those that cannot.