Posts from February 2008


I told the Gotham Gal that I was going to get together with a friend from London next week. She asked me who. I told her his name. She said, “how can he be your friend if I’ve never heard of him?”

Good question. But the truth is that I have friends, hundreds of them, who I haven’t even met. They are people that I’ve met online. Not in chat rooms. Through blogging and other forms of social media.

When I get the opportunity to meet these online friends face to face I try to do it. I have rarely sized someone up incorrectly who I consider a friend online. It’s amazing how you can get to know someone without ever meeting face to face.

My kids think there is something stalkerish about this behavior. I guess that’s because we’ve taught them to be wary of strangers online. But they also see that it’s been a great source of new friendships for me. I hope that as they become adults, they will shed the caution we’ve taught them and embrace the web as a social medium too.

Two years ago, our family was in Phoenix. I blogged it (because Twitter didn’t exist back then). One of my online friends, Howard, left a comment that he had a couple extra tickets to the Suns game that night if Josh and I wanted to go with him and his wife.

I jumped at the opportunity. Josh was excited to see Steve Nash. Emily said, “Dad, Howard is stalking you.” Howard hasn’t completely lived that down yet, but our friendship has morphed from the online world, turned into a business relationship and much more.

That’s just one story. I could tell dozens like that.

I wrote a post not so long ago about the difference between social nets and social media. For me, social nets are a great way to stay connected to your friends but they don’t do much for me in the way of meeting new friends. Social media, on the other hand, has been the best way for me to meet new people since college.

It’s a lot like college. Back then, we’d sit around, play music, and talk about stuff, maybe play some cards. Social media allows that "talking about stuff" to happen asynchronously as we go about our busy lives in places all over the world. That’s how I met my friend in London. Who I am going to meet face to face next week. It’s an amazing and wonderful thing.

#VC & Technology

David's Got It Right

David Hyman’s been around online music for about as long as anyone I know. He’s the founder and CEO of Mog, the blogging service for music lovers. He has a post about the future of music up on his mog that I completely agree with. Here’s the meat of the post in case you don’t want to click thru and read the whole thing.

Here’s what the labels need to do: drop that penny per track per
stream rate to about 10% of what it is today (that’s right – 1/10 of a
penny per stream). When that happens, the labels are meeting the market
and giving away music becomes lucrative; everybody and their brother
starts doing it. The labels turn all of online music consumption into a
revenue stream – every site with all-you-can-eat, on-demand music.
Thousands of sites innovate and create new value around how to discover
and consume music. By my estimate, that’s a $250 million per year
market for online ad spending alone.

Next, ensure that every streaming track links to the opportunity to download the track in mp3 (with Amazon
or whomever) and the labels have created the ultimate promotional
machine for mp3 purchasing (for the next 10 years, people will still
need to download for their portables and their car). Then slap on a
tempting upsell: offer users an ad-free, higher-bitrate subscription
service for a reasonable fee (say $5 per month). Suddenly the labels
have a shot at staying alive.

I’ll go one step further and suggest that while they are at it, they agree on an open api standard that allows connected devices (like sonos and squeezebox) in our homes to connect to these services. That’s a big opportunity just waiting to happen.

#My Music#VC & Technology

Interesting Business Development Job Opportunity

I’ve been on the board of Alacra since 1999. It’s a company that sells data and services delivered over the Internet to wall street and other large corporations.

They’ve been building some interesting consumer/SMB facing services and recently launched a very different kind of ad network – the premium content ad network – which I blogged about last month.

Now they are looking for a business development person to help build the network. It’s a very interesting job for someone looking to invent a new kind of ad network in the world of stock blogging and financial media. Details are here.

#Listings#NYC#stocks#VC & Technology

My Head Is In The Cloud This Morning

Last week I posted the following to twitter:

      We’ve assembled 8 of the top developers we know and are talking about the future of the lamp stack

That was not entirely accurate. We put together an impromptu lunch last week and invited some of the top developers from our portfolio companies located in NYC to attend. We know a lot of great developers who didn’t attend the lunch. I wish they could have. Because it was fantastic.

We discussed the lamp stack (and derivatives) that almost every single one of them run their web app on. We discussed the scaling issues that they have all faced. And we discussed what we should be looking for in the future to make those scaling issues easier.

The first post (that I know of) that has resulted from that lunch is Alex Iskold’s cloud computing post on Read Write Web. For those of you who don’t know Alex, he is the founder and CEO of our portfolio company Adaptive Blue, he’s a great developer, and he also writes awesome blog posts at Read Write Web.

I dont’ want to summarize Alex’ post here because I think it’s an excellent discussion of scaling issues that the lamp stack creates and how cloud computing can overcome some of them for some companies.

Alex is a huge fan of relying on others to deal with the scaling issues so his company can focus on the application itself. Last year at our portfolio company offsite, when we were having a similar discussion, he said:

think about it, if you can’t trust Amazon to be up, who can you trust?

Of course, the day after our lunch last week, S3 went down for what seemed like the entire morning east coast time. Alex acknowledges that risk in his post and quotes my partner Albert Wenger who once told Alex:

We live in a stochastic world, but people fail to grasp it because all they experience is right now.

Alex argues that it’s time for startups to give up the scaling issues to the big guys and let them do what they do best. He says:

Every time we have an outage, like the one that happened on Friday,
people sit back and think: How can I possibly
rely on these guys? I bet I can just code this up myself and it will be
fine! For decades the software industry has been
suffering from the ‘I can do this better’ disease. We keep re-inventing
programming languages, we keep on re-writing the APIs,
and we keep thinking that we’re smarter than the guys who came before
us. 99.9% of the time we are wrong. The truth is that we cannot do it
better than Amazon. They spent a massive amount of money,
talent and most importantly time, trying to solve this problem. To
think that this can be replicated by a startup in a matter
of months, assembled, be cost effective, and work properly is just
absurd. Large-scale computing is an enormously complex problem, that
even the best and brightest engineers years to get right.

I think Alex is directionally correct. We are going to see more and more companies build and host their web apps on someone else’s infrastructure. It’s not going to happen overnight because I’ve never met a more control oriented group than software engineers. But it will happen and in the long run we’ll all be better off because of it.

#VC & Technology

Smart Playlists In iTunes

A month or so ago, I wrote a post called "Why I Don’t Like The iPod Touch" in which I described the shortcomings of the current iPod I am using.

I still find this thing annoying to use but one thing has made it vastly better – iTunes Smart Playlists. I’ve always had an iPod with more space on it than my iTunes library so I’ve never needed to filter my library.

Ewan left the first comment to that post about the iPod touch and said:

For the space limited Touch, couldn’t you create a smart playlist in
iTunes (ctrl-alt-n in windows), to say "Date added is in the last 4
weeks" as your options, and that way the iPod touch would always have
your newest added tunes on it, even if you don’t have time to manually
add them? That way running out of space will be less of an issue.

I finally got around to doing just that. And while I was at it, I created a whole bunch more smart playlists and I sync them too.

My iPod Touch is so much more fun now. Thanks Ewan and thanks Apple for smart playlists!

#My Music#VC & Technology

Some More Thoughts On Pro Bloggers

Chartreuse has asked me to retire the word journablogger and I agree that it’s an awful name. So I’ll just call the bloggers who are making money doing this full time ‘professionals’ and people like me ‘amateurs’. I think that’s not exactly right either but at least it puts a nail in the coffin of a bad word none of us want to see used again.

First, I am sorry for singling out Matt Marshall and Erick Schonfeld. I didn’t mean to take a shot at either of them and I realize that both of them are among the best at what they do. I was trying to highlight examples of quick posts that I felt didn’t really dig deeply into the issues. Further, Erick talked to me when he was doing his post and I felt he either didn’t get what I told him or he ignored it. Which of course is his perogative.

Mike Arrington thinks I owe them both a call before I call them out on their posts. That would have been a nice touch, but I think blogging about it is a better thing to do because it’s now started a conversation, both in the comments to my post, and on techmeme.

Now the specifics of both Matt and Erick’s posts are getting debated. And the points I made in my post are getting debated. We’ll all get a lot more out of these three stories in the end and that’s a good thing.

Blogging is a discussion and it doesn’t matter if you are a problogger or an amateur, you get to participate. That’s progress for sure.

#VC & Technology

Journabloggers Should Do Their Work Too

When I started blogging four and a half years ago, there was a clear delineation between bloggers and journalists. But that’s all changed and now we have this new category, the journablogger.

The journablogger has his or her own blog or works in a blog network like paid content, techcrunch, gigaom, alley insider, read write web, mashable, venturebeat, etc, etc. Just look at the top of techmeme’s leader board and you’ll see them right next to the traditional journalists like New York Times, Wall Street Journal, CNET, etc.

These journabloggers got their start as bloggers who operated outside of the traditional world of journalism where doing your homework and getting the story straight are requirements for the job. That was good. It allowed them to be quick, get the story out, and fill the blog with opinion.

But in the past week, I’ve seen two stories where it looked to me that the journablogger could have made the post a lot better with a bit more work.

The top story on techmeme right now is a Venturebeat post about a shopping search service called It contains quotes like:

But suddenly, over four months, the company has tapped a robust number
of users, and it now expects to earn $10 million in revenue this year.


We’€™re killing them, he says, of social search engines (these include ThisNext, for example).

My friend Gordon Gould started and runs ThisNext (I am not an investor), so I figured I’d see if that was true. Here’s a comscore chart of traffic for the past year


It’s clear that had a great December but one month does not make a breakout. These two services have been neck and neck for the past year and Alexa still has ThisNext well ahead of I think a little work on this story to dig into the claims of the CEO would have made it a better story.

Similary, this story by Erick at TechCrunch last week about Zynga and Social Gaming Network left me scratching my head. I talked to Erick about that story and he quoted me in it. Erick shared with me the line that the CEO of Social Gaming Network was giving him.  I suggested he go to adanomics and see the truth. Here’s the list of top facebook apps companies. Zynga is one of the top five app companies on Facebook and Social Gaming Network is number 33. If you include the acquisition of CLZ (number 30 – three ahead of Social Gaming Network), that Zynga announced last week, Zynga is almost an order of magnitude bigger than Social Gaming Network. But when you read Erick’s story, it’s like the two companies are neck and neck like Hillary and Obama. may end up killing ThisNext and Social Gaming Network could end up being a real competitor to Zynga, but right now I don’t think either of those are true statements and a little work by the journabloggers could have surfaced that truth and made both stories better.

#VC & Technology

Super Delegates Have No Place In A Democracy

I think that we should have called Florida a tie in 2000 and had them vote all over again. Settling a presidency in back rooms, even if the back room is the supreme court, is not good for our democracy. It reinforces the idea that we have a rigged system

And the same is true of the 795 ‘super delegates’ that are up for grabs and who will surely determine who is the democrat nominee for president

I read this quote in today’s New York Times:

‘The remaining undecided superdelegates … in many ways (are) the final contest of the nominating battle’

Apparently there are about 300 undecided super delegates. So this comes down to back room deals made with these 300 people?

In the book ‘The Bronx Is Burning’ there is a story about the runoff between Ed Koch and Mario Cuomo for the mayor of New York in 1977. There was a short period of time between the first primary and the runoff. During that period Ed Koch ran around promising whatever he had to give away to get the support of leading elected officials, unions, and other big democrat power bases. Cuomo refused because he felt it would impact his ability to govern. Koch won.

We can all see the same kind of thing going down in the democrat party and I don’t have to say who plays Koch and who plays Cuomo. That’s obvious

Howard Dean, Al Gore, Nancy Pelosi, and the DNC need to broker a deal now that forces the superdelegates to vote for the candidate who has the most regular delegates or who won their state or something similar. Otherwise this nomination process will be suspect and the party will be damaged in the fall contest and for years to come.


Song Circles

Sometimes the best things on the internet are not intentional. Over the past several months, I’ve developed a song circle with a small group of friends on tumblr. They include Rach, Bijan, JoeLaz, Daryn, and Lindsay. I know a few of these people and plan to meet a couple more shortly. But we never planned this song circle. And this is my song circle. Each of them has a different song circle.

I just started posting a song every day on tumblr. You can listen to my songs on this blog on the upper right (check autoplay to make it a playlist).

Then I noticed others were doing the same. I started to follow them in my dashboard. Then I found the filter button in the tumblr dashboard and started filtering for audio. That gives you this:


Now every day I try to listen to the song circles we create. It’s not that we share exactly the same tastes in music. But it’s close enough. It’s like going back to college and hanging out with friends and playing music for each other. It’s wonderful.

#My Music#VC & Technology

White Meat Dark Meat

One of the two guys who taught me the venture business was Bliss McCrum. He is the king of the cliche. One of my favorites of his was "they get the white meat and we get the dark meat". You see that all the time in the investment business. When there is something good mixed in with something bad, you always look to split them up.

I thought of Bliss and his cliche this morning when I saw this news from FGIC

Financial Guaranty Insurance Co., a major bond
insurer, has notified the New York State Insurance Department that it
will request to be split into two companies, according to a person
familiar with the matter.

One of the firms would likely retain much of the
business of insuring structured finance bonds such as those backed by
mortgages, which have come under severe pressure due to the housing
market slowdown, according to the person.

The other company would likely retain most of the municipal bond insurance business, which is stronger, the person said.

This certainly seems like a good idea and puts a firewall between the problems in the mortgage business and the muni bond business which has historically had very low default rates and has traditionally been a safe haven.

#stocks#VC & Technology