Posts from February 2009

I was moving around my twitter account this morning, looking at my timeline, my direct messages, my recent followers, and the people I follow. I started looking carefully at all the avatars and thinking about the people behind them. The image on the right is the profiles of the most recent seven twitter accounts I've chosen to follow.

It's really interesting to see what people choose to use to represent them online. The simplest thing is a headshot and I suspect that's what the majority of people use when they are asked to upload a profile picture. That's what Kara Swisher chose (she's the top profile, my most recent follow).

But even with the headshot, some people go for the funny picture, adding some character to their profile. Mike Doughty (second profile) has his head on the table and some sort of box between him and the camera. Stuart Ellman (fifth profile) is dressed as the court jester (probably a halloween pic). Both of those profiles tell us a bit more about those two.

Some choose to use a photo of something or someone else. Lauren (fourth profile) seems to have chosen a family photo of some kind. Howie (sixth profile) has a photo of his friend and Springsteen's guitarist Nils Lofgren. We don't get to see these people's faces, but they are telling us something about them nonetheless.

I've been online since the early 90s and I've gone back and forth on what kind of profile I like to use. But for the past couple years, I've settled on the image that I now try to use everywhere online. It's my online brand and I stumbled on to it accidentally. I thought it might be interesting to share with all of you how that came about and what I learned from it.

In the middle of 2006, Howard Lindzon approached me about getting involved in a web video show he was going to produce called Wallstrip. In the initial incarnation of Wallstrip, there was going to be a daily video talking about the stock of the day, and then there was going to be about a dozen bloggers who would do a short post on what they thought of the stock as an investment idea.

Howard asked me to be one of those dozen bloggers. I thought about it for a while and then agreed to do it. Then, unbekownst to me, he asked an artist friend of his in Phoenix named Jenny to go on the web, find photos of each of the dozen bloggers, and draw up a sketch that he could use as their Wallstrip avatar. This was mine.


From the minute I saw it, I liked it. It uses my favorite color (green) as the backdrop and the eye color (my eyes are sometimes blue and sometimes green and sometimes something else). It looks like me, but not too much.

So I began to use it a bit here and there around the web as I set up new profiles. But by no means was it the only profile picture I used. For corporate oriented services like LinkedIn, I'd use my Union Square Ventures headshot. For social nets like Facebook, I'd use a regular headshot. I used a photo of me taking a photo on Flickr for a long time.

But then I started to realize that the Wallstrip avatar was becoming my online identity. People would comment about it all the time. Around the time we sold Wallstrip, Howard asked Jenny to do a real painting of it which I now have in my office at Union Square Ventures. It's a real conversation starter.

So sometime last year, I just decided to go with it everywhere. It's at the top of this blog and everywhere else I have an online identity. And I think that decision is having some important effects.

As I said earlier in this post, it's become my online brand. It's simple, small, and very recognizable. By putting it everywhere that I am online, I've used frequency and reach to power home that the avatar is me. It's become my visual handle and it's also a signature and a sign of authenticity.

But there's also a risk in standardizing on an online identity. Someone could grab that image and use it to pretend to be me. That's a concern and probably one reason why many people choose to change their profile picture/avatar on a regular basis. It hasn't happened to me yet, but I am sure it will and then I don't know what I am going to do about it.

Online identity is a big issue and a big opportunity for entrepreneurs on the web. It seems like Facebook is quickly becoming a major provider of online identity authentication and that's a smart move for them and a good thing for the web as a whole. But there is still a ton of opportunity out there to provide services in and around what Facebook and others are doing. Because online identity is powerful and becoming more intertwined with offline identity every day. My avatar is a good representation of that.

I know I don't have to explain this to anyone because it's done all the time, and I've done it plenty myself. But this headline from Claire Cain Miller's post on the NY Times blog yesterday is a good example of accentuating the negative in the headline:

Here's the facts from a VentureBeat story on the same data:

So let's look at this data. Venture returns across all funds and stages are 6.6% for a three year period, 8.6% for a 5 yr period, 17.3% for a 10 yr period, and 17.1% for a 20 yr period. Venture as an asset class has outperformed the public markets by 7.7% over a three yr period, 5.5% over a 5 yr period, 15.2% over a 10 yr period, and 8.4% over a 20 yr period.

And the headline that comes out of that data is that "venture capital returns dip below zero"?

The thing that really bugs me is if not for FAS157, which I posted about a few weeks back, we wouldn't even see negative returns for VC in the past year. FAS157 is an accounting ruling which requires venture capital firms to mark their investments up in good markets and mark their investments down in bad markets. I am not sure if this was an intended consequence or not, but FAS157 is going to make venture returns more highly correlated with public market returns than they have been in the past.

I'm quite sure that the -1.6% one year return for the venture asset class is driven by the roughly -33% drop in the NASDAQ from september 2007 to september 2008. Many venture firms, including ours, use NASDAQ traded companies as the comps in our FAS157 valuations.

But talking about one year venture returns is like talking about the score in one inning of a baseball game. Venture capital is a long term asset class. I recieved a distribution last week from a fund that I helped raise in 1994, fifteen years ago. Returns develop over a long time horizon in venture capital and focusing on what happened in the past year is not useful.

I'll end this rant/post by saying that the venture business does have issues. It has not produced the kinds of returns this decade that it is known for and is expected to produce. Generating a 8.6% return over the past five years is nothing to brag about. But venture has outperformed the public markets over any time frame you want to talk about and I think it will continue to do so. And the venture business is going through its own restructuring, forced by dwindling returns and financial stress in the limited partner base. There will be fewer firms, less capital, and less competition and overfunding in the next ten years than there was in the past twenty years. So I think its a very good time to be investing in venture capital right now if you can put money with a good manager. But that doesn't make a good headline, particularly in these times.

Thummit, a relatively new company started by, among others our new FCC Chairman Julius Genachowski, ran a survey via twitter and web of the super bowl ads. Here are their results. Click on the link that says “The Worst” to see the ads that got the least votes.

If you are curious how they compiled these results, the methodology is outlined here.

Let me know in the comments what you thought was the best and the worst.

I liked Hulu, Bridgestone, and Doritos.

Jason Calcanis has a very interesting post up at Calacanis.com about life in public and the costs associated with it. He starts out with the story of Josh Harris which is told in the Sundance winning documentary We Live In Public. And then he goes on to discuss the very real tragedies that have occurred to people who have taken online life, social networking, and lifestreaming too far. He discusses some laws of human behavior he's observed:

Godwin’s Law:
At some point, a participant, or more typically his or her thinking, will be compared to the Nazis.

Harris' Law:
At some point, all humanity in an online community is lost, and the
goal becomes to inflict as much psychological suffering as possible on
another person.

IAS:
This disease affects people when their communication moves to digital,
and the emotional cues of face-to-face interaction–including tone,
facial expression and the so called “blush response”–are lost.

And then Jason goes on to explain one of the reasons he moved from blogging to an email list:

And then Jason drops this bomb:

I'll plead guilty to the addicted to comments part. The conversation that develops after I post is the greatest reward I get from writing it. But "harvesting our lives" at the "cost of our humanity" is not my experience.

Jason is right that too many people hid behind anonymity when they participate online and that leads to rude and agressive behavior. Most of the nasty comments we get on this blog are from people posting anonymously. With the advent of comment profile systems like disqus and now Facebook connect, I think we are slowly building real accountability into the commenting process. And that's a very good thing.

But I reject the idea that you give up your humanity when you choose to put your life online. I've been doing it for over five years and I've not experienced that very much. But I think you need to have some rules. Here are some I've developed.

1) Keep your family out of it until they want to be in it
2) Be nice.
3) Demand that others are nice back.
4) Encourage the community to police the comments. Early on Jackson was my "bouncer" and now Kid Mercury has assumed that role.
5) Take the nasty comments lightly and use humor to defuse them.
6) Do not delete comments unless they are hateful to others, porn, or spam.
7) Ignore the trolls even though it kills you
8) Be careful with photos. They greatest lesson I got was when I posted a photo of me on vacation looking smug. Bad move that I learned a lot from.
9) Give more than you take.
10) Enjoy yourself. Talking, discussing, and debating is fun. Keep it that way.

Jason ends his post talking about empathy and the need for more of it on the Internet. I'll second that request. But I think what we need more of on the Internet is mutual respect and authenticity. And unlike Jason, I don't see things getting worse. I think they are getting much better these days as more and more of our society moves online and brings with them the manners they have in their offline life.