It Is Hard To Hide From The Web

Back in the early days of comScore, the founders thought that the data they were collecting from their megapanel would be useful to Wall Street. They built a product and developed some sales channels, including one called Majestic Research which was co-founded by my friend Seth Goldstein. Seth and his partner Tony built Majestic into a significant business and sold it a year or two ago. comScore had less success selling to Wall Street. I think they were too early.

A week or so ago, a top Internet analyst from Wall Street was in our office. He mentioned that the AppData numbers on Zynga foretold a difficult second quarter and the Yipit report on Groupon predicted trouble in that name as well. Both turned out to be fairly accurate and investable.

I have always told the companies that we invest in that you can't hide from analysts. If you do business on the web or mobile, your data is out there in the public whether you like it or not. Don't try to hide the bad news, because it isn't hidden.

But this is true for way more than Internet businesses and Wall Street.

Let's take the selection of Paul Ryan as Romney's VP. I read this (originally from here) on the web a couple weeks ago and reblogged it on Tumblr.

Sarah Palin's Wikipedia page was updated at least 68 times the day before John McCain announced her selection, with another 54 changes made in the five previous days previous. Tim Pawlenty, another leading contender for McCain's favor, had 54 edits on Aug. 28, with just 12 in the five previous days. By contrast, the other likely picks β€” Romney, Kay Bailey Hutchison β€” saw far fewer changes. The same burst of last-minute editing appeared on Joe Biden's Wikipedia page, Terry Gudaitis of Cyveillance, told The Washington Post.

None of Wikipedia entries for the current candidates being bandied about by Romney-watchers β€” Rob Portman, Marco Rubio, Paul Ryan, Bobby Jindal, Chris Christie, Kelly Ayotte or Pawlenty β€” are currently showing anything like the spike in edits that Cyveillance spotted on Palin and Biden's pages in 2008. But most of those came in the 24 hours prior to the official announcement. That said, if Wikipedia changes offer any hint of what's coming, then today might be a good day to bet on Ryan.

A few days later my friend Rich asked me who I thought the VP pick was going to be. I confidently responded Ryan. He was surprised. I wasn't.

Everything is out there on the web. You just need to know where to look to find it. And if you think you are hiding something, you are wrong. So don't hide anything.


Comments (Archived):

  1. Carl Rahn Griffith

    To paraphrase that classic New Yorker cartoon…”On the internet, everyone knows if you’re a dog.”

    1. William Mougayar

      Woof Woof

      1. Carl Rahn Griffith


      2. ShanaC

        umm, meow?

    2. JimHirshfield

      Paraphrase? I think not. The cartoon has it the other way:http://www.condenaststore.c…”On the internet nobody knows you’re a dog”Which is more of a commentary on anonymity and pseudonymity, than anything else.

      1. William Mougayar

        Good correction…

  2. John Revay

    Yup – I was at a business plan contest last year and one of the finalist developed an app that charted movements in a public co stock price / over laid w/ web traffic.During Q&A – I asked if it was predictive – or just looking at the data on a retrospective basis. He answered – real time.Side note – we need a post discussing the Paul Ryan pick one of these days – should spark a very lively discussion here at AVC.

    1. fredwilson

      we did that the other day on an unrelated post

      1. John Revay

        I think – it would be funny if the Dems ran the Clint Eastwood Chrysler commercial from the super bowl during their convention – re: theme is it is half time….ESPN link – (starts at the 22 second)

  3. Tom Labus

    This makes internet companies public from day one and they should embrace that instead of avoiding it. Release financial statements like you were “public” from day one and get used to the pounding.

    1. awaldstein

      Hmm..I like the phrase and the ideal but I don’t buy this.We have phrases and ideals, we owe honest transparency to our customers and shareholders but the idea that I want to open my private financial details as a matter of course is simply not a workable way to run a company,There are huge advantages to being private. Disdaining those doesn’t make operational sense to me.

      1. Tom Labus

        Understood completely about being private but I would say the vast majority of internet cos are born with the intention of going public because of their investors,

    2. Chris Rechtsteiner

      I’m not sure it’s “get used to the pounding” as much as it is presenting and conducting themselves in a manner appropriate with massive visibility & unfettered commentary.

      1. Tom Labus

        That’s well said,Let’s go with yours.

    3. fredwilson

      great way to think about it.

      1. Tom Avon

        Fred, After all the lockup periods end, why can’t MZ simply take the company private at $3 or $4 per share? Sorry if that is too naive, but it seems like a great way to get rid of cranky shareholders and Wall St analysts. Other than VC $, is there any debt?

        1. fredwilson

          He could but I doubt the stock will get that low

  4. awaldstein

    If you personally and professionally act like you are onstage, you are safe.I don’t always succeed but that is what I try for.That is also why the core of my private life with true friends and family has become even more sacrosanct and critical to balance and meaning.

    1. William Mougayar

      There was an interesting related quote from last week’s post. “Every one has 3 lives: a public life, a private life and a secret life.”

      1. Carl Rahn Griffith

        I wish my life was interesting enough nowadays to warrant multiple personas, lol πŸ˜‰

      2. Kirsten Lambertsen

        So true.

    2. fredwilson

      great way to be

  5. Ronnie Rendel

    Yet another way how the Internet is moving society closer to the utopian ideal (Moshiach). This trend, of mobile/web app data making companies more transparent, is the end of the old “lying, secretive, and faul playing “I corporate Ametica. A new business ecology for a new society.

    1. ShanaC


  6. Ryan

    this is absolutely fascinating, is there a resource that shows which wiki pages are being updated most frequently? a trending articles, if you will.

    1. fredwilson

      if not, someone should/will build it

  7. William Mougayar

    In other words, “If you are going to be naked, you better be buff.” (@dtapscott quote)Speaking of transparency, I wonder what the 270 million Facebook employees shares being unlocked next week and the forthcoming 1.8 billion over the next 9 months will mean for Facebook’s stock price and the company as a whole.Even at today’s $20/share that’s $5.4billion that could be sold starting next week. If you assume 1,000 early employees are eligible, that’s an average of $5.4 million per employee. And when the 1.8 billion shares become unlocked, at $20, that $36 Billion which is 80% of Facebook’s current value, and that could yield $36 million per employee on average (for 1000 employees).That assumes of course there will be enough suckers to buy FB stock at $20 just to make their employees rich enough to leave Facebook. There’s something insane about these numbers.

    1. Tom Labus

      FB becomes very interesting a little lower from here.

      1. William Mougayar

        There’s a huge imbalance between shareholder value vs. internal wealth that’s being revealed now. It had been suspected before, but now it’s even more obvious.

        1. JLM

          .This falls under the “how many tacos can you really eat” theory and conundrum.Employees who are going to be able to realize FU $$$ at $20/share are going to do it and at $15/share and at $10/share.FU $$$ is more than the number of tacos you can comfortably eat in a lifetime. Or it is enough money to go do YOUR thing.FB will not get a glimpse of $38 for a long, long, long time.Huge head fake well executed..

        2. Tom Labus

          If they have a legit way of moving forward that will work itself out over time.I like that everyone has turned so negative on them.

          1. JLM

            .The pendulum always moves too far in both directions. There will be a buying opportunity when the downward momentum is eased. I think that is at $14/share..

          2. Carl Rahn Griffith

            I think this pendulum is in the style of The Sword of Damocles.

          3. Tom Labus

            It’s pretty close.Some horrible corporate gaffe or news will get them there.

    2. JLM

      .Goldman bolts. Puts its clients on the short side of the trade.Employees unload — they don’t care whether they are buying that Ferrari with $40 of $20 stock, do they? Liquidity is King.Huge influx of stock into a market price that is still struggling to find its equilibrium in the midst of disappointing info. How many real customers do they have? Not bad, just uncertain.FB stares down the barrel of $14 before Election Day.Might be a great stock long term at that price..

      1. Carl Rahn Griffith

        Hubris, defined.

      2. William Mougayar

        Yup. I think FB got a bit ahead of itself at the macro level. Let’s hope that plane can regain altitude after it finds a real support level.

        1. JLM

          .No question there will be a “touch”.Big question — will there be a “go”.Touch and go — maybe so..

          1. Wavelengths

            Ain’t happenin’ on autopilot. πŸ™‚

          2. JLM

            .Good one. George is not handling this one.Well played..

        2. Carl Rahn Griffith

          Not clear if FB1 is about to go into an incipient spin or just a stall.

      3. Abdallah Al-Hakim

        this is perfect conversation for Howard Lindzon to jump into πŸ™‚

      4. fredwilson

        nice call. i would tend to agree. when facebook trades at the same ebitda multiple as google and apple, then you can and probably should buy. i myself am out of the public markets as we discussed a few weeks ago

        1. Richard

          It is interesting that the most “open” and “liquid” markets for investing seem to be lower on the trust scale than those that are less open and less liquid. Interesting time indeed.

      5. William Mougayar

        These 270 million shares will boost by 60% the current number available to trade. When you have a 60% increase in liquidity overnight, something has to give.

      6. ShanaC

        I told my friend that. She’s shorting it at a much higher price. Unfortunately a lot of the wall street people still don’t totally get how the internet makes money…

        1. CJ

          Unfortunately the internet still doesn’t get how it makes money either. FB going public now was a bad deal based on traditional financials but as an ‘internet company’ they’re killing it. Weird how that works.

          1. ShanaC

            Not weird. Do any of us really understand technology? A lot of what we’re seeing is vaporware turned into only the semi-real – never fully answering the promise of what should be.

      7. JamesHRH

        Interestingly, the value for FB – massive PR coverage of the monster IPO – will not be undermined by pissed off investors, IMO.MZ has total control and – I believe – outright disdain for the financial markets. Not even 30 yet! That’s a long time to do what ever you want.

        1. JLM

          .I am not sure I fully comprehend your comment.I don’t think that MZ’s opinion really has much to do w the valuation of FB stock. I do think that his personal zeal and vision has a lot to do with the company’s fortunes. He is a doer.Investors, pissed off or otherwise, will set the outcry value as they see fit.That value will be impacted by performance or lack of performance.Should owners decide to sell with more pressure than those who would buy, then the price will surely go down. Simple financial physics, no?.

          1. JamesHRH

            The share structure is such that pissed off investors can make the price go down but nothing else. There are no signs the business is a sham and that the price is going to zero – see comments here on when to buy.So, he has total control of a multi-billion $ public entity.From the cat bird seat, the most important thing for him is to get more people on FB more often. BIg IPO PR ruckus assists there.Fallout from big IPO ruckus has zero impact, long term, on MZ.Its a net winner for him.

          2. JLM

            .If I were to agree completely does that really have anything to do w the stock price?I don’t think being pissed off has anything to do with the pricing. I think the wave of stock coming — supply perhaps overwhelming demand — will tend to exert downward pressure.I think once some mythical tipping point is hit — say $15/share — then it is going to keep moving downward until some huge resistance level is hit.MZ will still have control at $6 or $16 but the individual investor will have different outcomes..

          3. JamesHRH

            My point was a little bit of a tangent, but connected to @fredwilson:disqus ‘s transparency idea.If you look at the share structure, you quickly figure out that MZ cares not a whit about the common stock, in any way shape or form.I get that you have taken this as ‘when or if to buy FB’. I have taken it more towards ‘if you look in the right spot, you realize that buying FB stock is a complete and total bet on MZ’.

      8. hypermark

        Stock price corrections aside, I would not bet against Facebook long-term.I think that other than Apple and Amazon, they are the one company that has: 1) begun with the end premise that everything’s integrated; and 2) shown a capacity to play the long-game.Plus, Zuckerberg is like Bezos and Jobs in the sense that it’s hard to see personal hubris clouding his business judgement. I still think they are the real deal, and as an investor, just hope enough folks throw the baby ($FB) out with the bath water to make it a value play.

        1. JLM

          .I agree more with you than you agree with yourself.This is a numbers issue only — the “right” price for the stock.MZ is a phenom..

          1. hypermark

            As history shows, that type of leader + entrepreneur comes around <5 times a generation (Gates, Ellison, Jobs, Bezos). Bet on that.

          2. JLM

            .I agree completely and it is even more interesting such as whether you have the first or second incarnation of Steve Jobs.Two different guys?.

          3. hypermark

            That is a good point. The first incarnation of Jobs was prone to grandiosity and hubris, whereas the second incarnation was prone to grandiosity and rigorous execution.One doesn’t perceive grandiosity in Zuckerberg (for good and bad), but one does see hardcore execution. The biggest unknown with MZ is how he adapts to course-correction; namely, the shift from desktop centricity to mobile + post-pc.

          4. JLM

            .Jobs went away and learned a lot about Jobs. He came back better.Zuckerberg is still a work in progress.He has such a huge operation that he can almost dictate what works, etc. Instagram, anyone?.

          5. CJ

            Doesn’t matter. Same result. πŸ™‚

        2. fredwilson

          I suspect that may happen

    3. Carl Rahn Griffith

      It’s a parable for our times.A G(r)eek Tragedy.

      1. JLM

        .Haha, pretty damn………………………………………….funny!Well played..

      2. Tom Labus

        Yeow, Carl.

    4. Abdallah Al-Hakim

      what price point for FB will make you not a sucker for buying it??

      1. fredwilson

        when it trades at the same ebitda multiple as google and apple

        1. Cam MacRae

          something like that. i’m a buyer under $6.

        2. LE

          The problem with stock investing if it’s not your full time gig is similar to that of gambling in a casino.[1] You might make out very well on a few trades, or over a few years, but for the average person who has limited experience over time I don’t see it as good unless you have some special knowledge or advantage. To many variables and incomplete info. Of course if the market is rising everyone can be a “schvitzer”. And schvitzers only tell you of their wins, not their losses.This is ok (but not super funny) and it illustrates somewhat a schvitzer: didn’t even have the patience to watch the entire video..)I know of some people who have done ok with stocks of course by following some basic strategies that they have followed over time.[1] Like a casino you could very well buy facebook stock at an attractive price and sell and make yourself a bit of money. But that would simply encourage you to take another risk, place another bet on another stock which you may or may not make out from as well. Casinos know this and that most people who gamble on any regular basis will come back and the casinos edge will kick in over time.

          1. Wavelengths

            So why is it that the standard advice from the standard Main Street USA financial advisor to the average working stiff is: Work hard at your day job, save money, and invest in the stock market so you will have money for retirement.I’ve always had a queasy feeling about this for the very reasons you cite. BTW, my parents lost well over half their hard-earned retirement in October 2002, having followed that standard advice.

          2. LE

            “average working stiff”Well for one thing advice is always specific to a situation. This is one of my peeves with information on the internet or in general anything that you read or get advice on. If the advice is not tailored to you it can be wrong or dangerous. That’s why I don’t like to give advice w/o asking a lot of questions. To me it’s all a “it depends” devil in the details.There are certain types of investments that depending on your experience, and your work schedule and knowledge, might be excellent for you. Take real estate. If you are self employed or have a flexible schedule that might (given other particulars) be a good idea. Why? Because you have the ability to deal with things that people who are “working stiffs” don’t. You can meet a contractor if you want, or a potential tenant at any time. A working stiff can’t. This assumes that you want to put in the effort to learn how to do this. And that’s not going to be at any real estate seminar either. And you have to have some money to start as well.Investing in wall street is different today then it was back in the day of “widow and orphan money” and blue chip stocks which essentially payed dividends and held their value over time because of the way trading was done and the restrictions on information. So they were fairly stable once identified. People in business tend to hold on to past history when going forward even if things have changed.Of course the main reason Wall Street pushes what they do is because that’s how they make money. That’s not necessarily bad because as long as nobody questions the assumptions it keeps people in stocks and maintains the price.Certainly one of the most important things in investing is taking into account the downside. Most people who loose their shirts only focus on the upside.Lastly in order to make money on anything it is normally best to do something that isn’t easy or is far removed from being turnkey. You make money by transforming something where someone else wants to avoid the effort or the uncertainty of transforming.So if you buy a condo or a building that is ready to go with no defects sure you can hold onto it for 20 years and given a set of circumstances maybe make money. But much better to take something and then transform it. That cuts down on the potential bidders and people interested which cuts down on the price the seller can get. So you are really arbitraging things.Sorry about what happened to your parents by the way.

          3. Wavelengths

            We definitely agree. I like the concept of CREATING money by creating new value.

          4. kidmercury

            there is no escaping the casino, especially in our current times; the price of everything that can be bought is subject to fluctuation and sentiment. there are some simple formulas that have proven themselves to be worthwhile, but almost no one follows them. there’s one called “the magic formula” by joel greenblatt — literally that’s what he calls it. greenblatt has one of best returns of any hedge fund manager out there and publishes his methodology in his book (with lots of free videos online). his goal is to explain it in a manner that his teenage kids can understand and implement it.

          5. LE

            “greenblatt has one of best returns of any hedge fund manager out there”The statement that he has earned 40% annual returns since inception, has that ever been verified -or- how would one go about validating that figure?http://authors.simonandschu…Most hedge funds are highly secretive for a reason. Other than front running how does it benefit someone to publish their strategy and if widely used, or obvious, wouldn’t the effectiveness of the strategy be greatly diminished by market forces by other participants?

    5. fredwilson

      that is going to weigh on the stock for a while. it always works like that. i’ve seen it every time.

      1. William Mougayar

        But aren’t these ratios a bit too high or have you seen same before? Mainly:- +60% boost in available stock (the 270 million) overnight- that’s only 14% of the total to be made available, i.e. 7X coming later

    6. CJ

      I wouldn’t sell the stock at $20/share if I owned it. That said, I suck at picking stucks, I’m long a shit tonne of Zynga and it’s going the wrong way fast. πŸ™‚

  8. Rohan

    Consequence of this is that we need less personality and more character i.e. less talk and more walk.If your numbers ain’t good, spend time fixing it.. and not fabricating a lie.Gone are the days when the talk could make for an absence of the walk.If only this was the case for the financial system….

    1. Carl Rahn Griffith

      We’ve got lemons – so. let’s make a crazy IPO valuation.

      1. Rohan

        Why just valuation? Let’s IPO.Nothing to worry.. our banks will ‘do all they can’ to make sure our stock price stays at our valuation for day 1.Let’s sell shares then, make some money and switch to oranges.

        1. Carl Rahn Griffith

          Lol. It’s like comparing Apple’s to Bears πŸ˜‰

        2. ShanaC


    2. Carl Rahn Griffith

      Ironically, there was an old (from the 60s but set in WW2 of course) Dad’s Army sketch on BBC R4Extra earlier this morning discussing the financial woes of Pvt Jones – Cpt Mainwaring of course also being his and the local bank manager.Circular arguments and illogical logic lunacy and farce ensued. Beautifully written, as ever. Had never heard this episode before.A spot-on encapsulation of all that is wrong nowadays. It’s been brewing a long time. The Facebook farce only serves to remind us the Gecko’s are still out there and as detached as ever and they don’t give a damn – solely focused on greed, manipulation, and making a quick buck. They know the price of everything and the value of nothing.

      1. JLM

        .The FB head fake was and is of such monumental proportions as to be a fable for our times. Greeeeeeeeeeeeeeeeed unleashed beyond the ability to understand and yet, there may be real business in there somewhere.That is the comedic part of this tragedy.Of course, if Jon Corzine can disappear $1B and not be held criminally liable this will just continue and continue and continue.Oh, well, I guess dueling and public beheadings are NOT going to happen after all. Alas..

        1. Carl Rahn Griffith

          Well said, JLM.Some people have moved so very far away from mortar and bricks, trades and professions, family and society, the true value of money and the building of things, that there is no dignity, pride, perspective or accountability within them.A true Bonfire of the Vanities.

        2. Tom Labus

          Jon should be heading to Lewisburg for an extended stay.

        3. ShanaC

          Why is that? Corporate law versus criminal law?

          1. JLM

            .He has friends in high places?.

    3. Shawn Cohen

      To your point, I just read this in an article about transparency/authenticity in email marketing: If you have to trick your way in, you suck. Stop emailing. Rethink your whole marketing strategy.

    4. Trevor McLeod

      Great point on character.Today’s post made me think of @garyvee ‘s “thank you economy”. If we realize that (even on the web) we’re always doing business with individual people – then success points back to “the golden rule”.Too often the web is treated like a network of machines. It’s really a network of people. And people respond to great character.

      1. Rohan

        We aer indeed doing business with people. Behind every computer is a real person – we often forget that. :)@shawncohen:disqus I guess that only echo’s your point. πŸ™‚

    5. ShanaC

      It might become the case over time – part of the problem of the finacial system is that outside of standard GAAP, there isn’t a way to really real time monitor. In theory one could partner with the exchanges/broker dealers for information monitoring. That could get interesting when it comes to honesty in the system

      1. Rohan

        I don’t know. I’m skeptical. It’s not in the interest of people who are supposed to fix the system to fix the system.+ I’m not sure if they even have the capability. The people on Wall Street are faster.If you have some time and haven’t done so yet, I’d recommend The Big Short by Michael Lewis. πŸ™‚

    6. LaVonne Reimer

      If I could “bold” the vote upon your comment Rohan, I would. To your comment on spending time to fix, it would be great to see a comparative analysis, something like time, energy and cost of fixing vs fabricating. My experience has been that the latter really isn’t easier even in the short-run.

      1. Rohan

        Wrt cost of fixing vs fabricating, I don’t know if that is the case LaVonne – I think if fabrication is done well, it can mask a fix for a long time – long enough for the fabricator to maximize personal gain and move on.If you are in for the long run, I agree – fixing works better. But fabricators are hardly ever in for the long run. It’s cash ‘n’ carry.PS: Thanks for the ‘bolding’ πŸ™‚

    7. CJ

      Unfortunately I think these days are more talk than walk by far. Wall St. makes a living selling the present at the expense of the future. The country is led by leaders (on both sides) who prioritize what happens today while declining to fund it tomorrow. These are the days of talking the talk and hoping to trip, stagger and fall on the path of those walking the walk.

      1. Rohan

        It’s all over. Just look at the EuroZone..The cost of ‘talking’ politicians is costing the world a LOT.

  9. Brandon Gardner

    Great post! Very true. A good lesson for starting a company. Don’t try to hide what you are doing. Just embrace what you are doing and don’t be afraid of it.

  10. LIAD

    Wikipedia edits as a leading-indicator of world events. Magnificent.

    1. fredwilson

      yeah, isn’t that great?

  11. Mike Geer (MG)

    You can’t hide, but most people aren’t looking. For example, everyone says is an amazing success, I look at the data and see them pumping paid traffic which is most likely unsustainable. The “experts” keep hyping it though.

    1. Max Yoder

      What data are you looking at?

      1. Mike Geer (MG)

        My quick go to is always Alexa. I look at general traffic patterns over the last 3 to 6 months, and then look at bounce rate. It’s not terribly accurate, but it will show you a clear yes or no on whether they have or are using high rates of paid traffic. You can also look to appData to get that same high level on facebook connect use.To be clear, there is nothing wrong with paid traffic, but before you invest or follow someone’s lead, I always want to know if price of acquisition is at least equal or approaching equal to the ARPU (average revenue per user). If not, you are slowly and painfully throwing money away with the hope of an exit to rescue you.

        1. Max Yoder

          Thanks for the clarity, Mike.

    2. Carl Rahn Griffith

      The more vague the monetisation plan is, the more bullshit there is.

    3. fredwilson

      i have the same view as you but i have many friends involved in that one so i am not going to be public about my views

      1. Mike Geer (MG)

        Yeah, figured that might be a delicate one.

      2. LE

        “but i have many friends involved in that one so i am not going to be public about my views”[ ] I would pay for a premium version of your thoughts. [ ] No need you just gave me for free the premium version of your thoughts.

        1. fredwilson


      3. kidmercury

        by admitting you have the same views, you have essentially been public about your views. a wise man once said you can’t hide anything on the web — i’ll send you the link to his blog! πŸ™‚

        1. fredwilson

          True. But the comments is a better place to share them.

    4. ShanaC

      It could work if the cost differential for their pricing of traffic is much lower than the income per sale. Personally, I find their stuff cliched, but that is my taste…

      1. Mike Geer (MG)

        Exactly. Ha, yes, agree, but I will avoid disparaging their actual inventory πŸ˜‰

        1. ShanaC

          I’m their ideal customer though – female and somewhat hip. Who likes awesome accessories.Either way, I still wonder how they run their ad campaigns. I know the facebook one is very very tightly run, based on how I am targeted.

        2. ShanaC

          ok slight lie, there is definitely stuff I would buy πŸ™‚ That is recent though

  12. Max Yoder

    “Everything is out there on the web. You just need to know where to look to find it. And if you think you are hiding something, you are wrong. So don’t hide anything.”+1 Astronomical Unit

  13. jason wright

    Some companies need a psychiatric evaluation.

    1. William Mougayar

      Companies or their management?

      1. jason wright

        “Companies” would also include investors :-)Every boardroom should have a couch, a very big couch.

    2. Wavelengths

      Anybody remember an investment company run by a guy named Bernie Madoff? From what I read about some of his personal quirks, someone might have caught on sooner that he wasn’t completely in touch with reality.In the corporate hierarchy, the workers do what the top level tells them to do, and they become agents that express the sanity (or lack thereof) of the people at the top.An interesting reference for this is the book “Snakes in Suits,” about sociopaths in the business world.

      1. LE

        “From what I read about some of his personal quirks”Which personal quirks in particular are you referring to?

        1. Wavelengths

          I had heard that he had each of his office locations laid out/decorated in exactly the same way — as if he wanted to feel like he was in the exact same place, no matter what city he was in.He also only permitted employees to use one type of picture frame for pictures on their desks, etc.This level of regimentation appears more like severe obsessive-compulsive behavior than reasonable business practice.

          1. LE

            No biggie on those examples.A need to feel in control basically. Regimentation adds to the feeling of security in some people.Many business people are obsessive over things that others would find stupid. As with any psychological disorder it’s when it get’s in the way of daily activities, or with others, that it becomes a problem. When I sold a business I made a point out of making the potential buyers focus on eccentricities so they thought I was a little crazy and therefore the business had much more potential for them (I would show them how I stapled invoices in exactly the same place and neatly lined up piles of paper and obsessed over small details. It was a manipulation basically to get them to see an greater upside to the business. If an operator sounds and comes across to sharp and together it’s hard to feel you can improve on that.)Keep in mind that sports figures also have eccentricities and superstitions that they follow for good luck. It’s pragmatic in many cases.

          2. Wavelengths

            Ooooh! Nice use of eccentricities! I’m highly amused. And I don’t think the less of you for it.At the time the Madoff empire was unraveling I was having regular conversations with several psychiatrists and psychologists who were particularly interested in sociopathy and psychopathy. (Psychopathy being the extreme end of a spectrum of sociopathy.) Those observations about Madoff came from one of those psychiatrists.I can imagine that if Madoff knew that his entire scheme was built of tissue paper he would have an extraordinary need to control every detail he could.

  14. Kirsten Lambertsen

    So who’s the Cyveillance for monitoring and reporting on (and predicting, maybe?) competitors?

    1. fredwilson

      all the third party analytics providers

      1. Kirsten Lambertsen

        Fair enough πŸ™‚ A quick search returned Trellian’s CI product as maybe the closest thing to a single dashboard for a few of them.

  15. andyswan

    I’m a believer that companies should value their transparency internally and their privacy externally. Never show em everything you’ve got.Fred’s point is a good one– it’s hard to keep things private online — but there’s nothing wrong with planting a few false flags, sandbagging or hyping if it’s to your advantage.

  16. Seenator

    Excellent Post Fred. One small point- The Politico post itself was a re-blog from this post by Micah Sifry…So- maybe you can give a small edit to your post acknowledging Micah for his brilliant work…

    1. fredwilson

      i will do that. i missed that.

  17. Abdallah Al-Hakim

    I think Stephen Colbert mentioned the Wikipedia thing and tried to cause trouble by encouraging his fans to go and modify the pages of who they wanted to be VP. It was meant to be humours and it was in my opinion. However, it is valid observation that has proven to be true. Still, to stick with your theme that you can’t hide from the web – I find it funny that politicians think that few changes on Wikipedia will determine their digital profile. There is a lot more information out there in form of videos, tweets, posts, etc.. that ‘less lazy’ reporters will dig up and research about you.

  18. gregorylent

    “it’s hard to hide from the web”the american government seems quite skilled at that …

    1. kidmercury

      i beg to differ — i think all the information is out there to see, but it is a question of people not wanting to see it……

  19. Wells Baum

    Twitter didn’t lie either >”Ryan started to pull away from the potential VP pack three days ago in terms of unique reach on Twitter. Of the pool of likely candidates, Ryan’s seen the greatest increase in reach over the past month, gaining a 65% increase in reach in the past 30 days. In addition, he’s seen the largest gains in both the number of total tweets and unique people talking about him recently.”Reblogged:

  20. feargallkenny

    I often wondered how much value there is in Google search terms in the form of “company A acquisition” or “company a & b merger” from insiders looking to see if the news they are up to speed on has already happened. Could be an interesting side business for Google …. i wonder if there is anything preventing them from doing so….

  21. Jay Janney

    Fred:A great post, and one I’ll incorporate into my Strategy course the next time I teach it. What you’re referring to is known as content analysis, and John Naisbitt (Megatrends author) was an early adopter of the practice. The idea is to measure how much “space” or activity an is generated for a given news item (In WW II, they gauged the effectiveness of bombing raids by looking at prices in the local newspapers, which were forbidden to report ont he actual bombings). Back in my goverrnment days, We had a security briefing where we were told that CNN knew the first Iraqi invasion was immiment because there was a 2 hour delay getting a pizza delivered on a Tuesday evening 11pm. Someone looked at the parking lot for the Pentagon, and saw it was far more filled than normal. The commuter subway was less full the following morning. Hence, tons of people working late at the Pentagon meant Operation Desert Storm was imminent. We were told the Pentagon had taken steps to “normalize” its appearance during war preparations.So what you are saying is very similar: pay attention to activity, and you’ll develop insights most others miss.

    1. JLM

      .More than 2/3s of the US minesweeping fleet is currently in the Gulf. Most have been there less than a month.Minesweepers are not ships that “cruise”. They stay in port until needed.They are only used for things like sweeping the Straits of Hormuz.Hmmmm..

      1. baba12

        Despite Israel’s desire to have the U.S. commit to an attack on Iran before the Presidential elections, I think you can be certain that whoever is in office come Jan 20th 2013, the U.S. will be forced to attack Iran with Israel by March/April of 2013. Look at Oil Futures prices post April 2013.

        1. JLM

          .I hate the idea of war. It is an obscenity. I hate even “righteous” wars though we must defend ourselves.I am afraid that we are going to have a war w Iran and before the election.I think the Israelis are afraid a second term Obama administration will not provide support and will cut off aid.The Israels will be coming out of Baku at wavetop height.I hope that somehow this can be prevented..

    2. ShanaC

      What is the best way to find behavior and activity to analyze?

    3. Wavelengths

      I was in one of those high-tech startup hubs for awhile. I thought that the “parking lot report” would be a very useful guide to which businesses were booming and which were failing.If the parking lot of a certain office building started to look emptier, it was a pretty clear indicator.At one startup company, the parking lot shone with brand-new cars just after an infusion of investor capital. Three months later, when the milestones were not being met, those cars carried expired temporary tags, as the owners struggled when further investor capital dried up and they couldn’t afford to register their cars.

  22. Mark Essel

    “don’t hide anything” The naked truthThat’s a mighty big statement, and while I embrace it, there’s an element to story telling and spin that can help deliver information without it being interpreted as catastrophic or as damaging as leaks. Maybe that’s the point, fess up and you can deliver and shape the message.Delay good newsOn the flip side, there’s good news that you’d prefer to keep a tight lip on. A significant portion of the value in private equity is information, and the advantage of having it. Your company has a fantastic product in the pipeline, and it’s way ahead of anything else out there. As an interested equity holder it’s ideal to wait until after the breakout product launches. There’s no guarantees but if you did your homework the market will prove you right.

    1. Tom Labus

      There’s a lot fiction in financial statements and a good CFO can make numbers dance in unusual ways.

      1. Dale Allyn

        We need to carefully consider our definition of “good CFO”. The choreography of the numbers is a big part of the problem in our public markets. πŸ˜‰

  23. Elia Freedman

    This isn’t just good advice for web companies. It is also good advice for marriages everywhere. Simple rule of thumb: if you don’t want others to know about your misdeeds, then don’t do them to begin with.

    1. baba12

      those who do misdeeds, all believe they will never get caught.

  24. dineshn

    You are spot on with this, Fred; though I might add the web’s tremendous ability to spread disinformation and FUD is also a scary proposition…

  25. andyidsinga

    thankfully none of my disqus comments are on the web – that would be embarrassing

    1. ShanaC

      Meh – it doesn’t help, we all know you well enough anyway :p

    2. Wavelengths

      I thought about that aspect before signing into the conversation here. But I got tired of being a lurker. What the heck … who cares if this all goes on my “permanent record.”

    3. kidmercury

      i’m a big believer in multiple identities to hedge one’s reputation risk.

      1. Wavelengths

        Are any of your alternate identities NOT conspiracy theorists? πŸ™‚

        1. kidmercury

          under my real name i am sort of a conspiracy theorist, although i cloak it in more academic jargon, so as to make it sound respectable by social norms. those who are awake can usually see through it and recognize kook as my true nature.

          1. Wavelengths

            I’m relieved. I was worried that you weren’t being honest about your true nature. (Affectionately …)For one brief instant I was afraid that you were also JLM. LOL

        2. Anne Libby

          I sometime wonder if @kidmercury is my brother.

      2. yrucremdik

        it can be helpful πŸ˜‰

  26. Steve

    Totally agree

  27. Travis Bochenek

    The general population doesn’t have the skill/knowhow to uncover the internet’s hidden secrets, nor do most businesses. Until there is a news/data resource with unscrupulous morals and the inability to be swayed by any agenda, the information shell game will continue. “Internet honesty” is big business and those companies that can successfully measure, digest and communicate it will be in high demand in virtually every industry vertical.

    1. baba12

      General population has never had the skill/know-how and will never have the skill/know-how. If the general population has the skills and know-how, then many businesses will not be able to sustain their business model or profit margins. I think for those who think of this ideal world where skills/knowledge etc are easily available, accessible and comprehend-able it is a Utopian view just as the Ayn Rand view of everyone is equal and therefore “how I gather and create wealth” is purely my effort and I deserve to keep every bit of it.I think we think we strive to break down barriers and create transparency but I think it is naive to think that we truly get to that state.

  28. ShanaC

    You can lie with web statistics. Lets go back to your Zynga statement. Why is he just looking at FB numbers? Why not look at Flurry numbers as well? Is there a difference? What is the revenue differences from a mobile user, a facebook user, and a both user? As the company shifts into mobile, what does that mean?Unlike other statistics, they inherently don’t mean very much without a lot of context. It isn’t anything like measuring widgets versus cost of steel.I think long term it will become much more like widgets and the cost of steel. Still, at least in the near term, context is king of web statistics.

  29. hypermark

    Doesn’t this argue for new kinds of analytics services that track qualitative and quantitative metrics on the kinds of topics that one sees in a service like Intrade (political races, company and segment performance, box office returns)?

  30. JamesHRH

    Knowing where to look (or caring enough to figure out where to look) evades 99% of people.

  31. LE

    “You just need to know where to look to find it. And if you think you are hiding something, you are wrong. So don’t hide anything.”Along those lines sometimes the more information you release the better chance that the truly important information can be buried and harder to find for the lazy observers.I guess this is obvious but to me it’s no “boating accident” [1] that they didn’t try to cover the updates better by doing the same with the other pages. If you can think of a strategy that you would use, there is sure to be someone else who has thought of it and will execute IRL.[1] Richard Dryfuss in “Jaws” dismissing the cause of a woman’s injuries as a boating accident.

    1. Tom Avon

      Love the Jaws reference. “We’re gonna need a bigger boat”

  32. baba12

    “Everything is out there on the web. You just need to know where to look to find it. And if you think you are hiding something, you are wrong. So don’t hide anything”.I would think that Mr.Wilson (Fred) means that is accurate for those running for public office, don’t think he is referring to transactions between two private parties etc.

  33. Ryan Tanaka

    Half the things I look for doesn’t exist on Google, so I find myself having to make them myself.I wish the web had everything…

  34. Brandon Marker

    someone at NPR was betting on this. Rob Portman was the focus on the 7th, based on Wikipedia edits.

  35. pointsnfigures

    Only accountants and Wall Street traders try to hide things these days-successfully I might add because of the rules!

  36. Luke Chamberlin

    “It’s hard to hide from the web.”Tell that to the Google Docs file I’ve been trying to find for the past 45 minutes!

  37. Dave Pinsen

    High optimal hedging costs have been a red flag for a number of social media companies this year (e.g., Zynga, Facebook, Groupon), presaging poor future performance. In the case of Zynga, I raised this issue in a tweet back when it was trading at over $13 per share (it closed at $3 today):Steep hedging cost for $ZNGA (compare to last tweet re $QQQ). A red flag for Zynga longs?…— Portfolio Armor (@PortfolioArmor) February 9, 2012

  38. Aaron Klein

    Two awesome posts in a row – Android fragmentation and transparency on the web – and I’ve been slammed with work and don’t have time to engage.Such is life, but AVC rocks. πŸ™‚

    1. Wavelengths

      Are you sure you have your priorities straight? Haha.

      1. Aaron Klein

        Indeed, I wonder!

  39. laurie kalmanson

    next: insurance companies have to publish the rates/deals they make with providers and hospitalsbecause, why not?

  40. Ben

    There’s a great story along these lines from the Web 1.0 era, in the introduction of Kara Swisher’s book about the AOL / Time-Warner merger, as she writes about trying to confirm rumors of a big acquisition on the evening of Sunday January 9th (hours before the deal was ultimately announced on the 10th):”I quickly began to type in the online monikers of any executives I knew from my years of covering the company [AOL] and from later writing a book,, about its turbulent history. Thankfully, unlike other big company executives and their legions of public relations obstacle-creators, many online business leaders loved kibitzing back and forth with reporters via email in what I can only guess were efforts to charm us into loving them for their accessibility. Frankly, it worked a lot of the time, so they freely handed out their email addresses and were always very easy to locate instantly. It was true that night, too. **It soon became clear that pretty much everyone in any position of power at AOL was signed on to the service.**” ‘We know.’ I wrote in a flurry of initial instant messages, attempting to be as vague as possible. ‘Tell all.’ “-Ben

  41. Owen

    Epic.I have had at least 6 conversations in the last 24 hours about the fact that our society is moving faster and faster towards more openness. We can’t hide anything, good bad, or middle.We can’t hide that our education.We can’t hide our failures.We can’t hide our accomplishments.We can’t hide our likes.We can’t hide our dislikes. We can’t hide who we love, like, hate, admire, or abhor.We can’t hide our mistakes.We can’t hide our thoughts.We can’t hide our vacations. (a good friend was recently robbed and was id’d via facebook)We can’t hide our work.We can’t hide.For good or bad, we are 100% exposed. Not only is the Emperor not wearing clothes, but we aren’t either.

  42. Carl Rahn Griffith

    β€œ@KeiserReport: Epic #KeiserReport episode on Austrian economics with @Bullionbasis” < Must watch. Really. #paulryan

  43. Robert Holtz

    Undeniable.True for providers as it is for users… doesn’t really matter if you’re for it or against it because it has already happened.And if you still don’t know it, this is your clarion call to get used to the new normal because the decision has already been made and the action has already pushed well passed the tipping point.Privacy as you’ve ever known it is already long over.

  44. Allen Lau

    I agree for the most part except that mobile app data is still somewhat private. There are many services out there to track downloads publicly but engagement numbers are still pretty much all private.

  45. AndrewLipsman

    Fred: Good post. I couldn’t agree more that the Internet can provide valuable predictive insights into individual equity and macro economic trends.One point I would make is that comScore had — and continues to have — success selling our data to both the Buy side and Sell side of Wall Street. Today comScore boasts the wide majority of the top 20 banks, along with a number of hedge funds, as subscribers to our syndicated and custom data services which they use in a variety of ways to enhance their trading decision-making.

  46. Ellie Kesselman

    Fred: Do you like your current Wikipedia photo? There are some nicer ones of you on Flickr, that are years more current, and in which you look much younger. I would be happy to replace the current one with that new one, where you are listening to a conference or such, okay?

  47. andyidsinga


  48. JimHirshfield

    What vetting process? Romney almost picked you?

  49. baba12

    not expressing your views/opinions is not how I would like to live life. I think being clear and expressing ones opinions/views on a given subject should not be used as a means to be against someone. I may surely not like many views expressed by people but as long as they conduct themselves fairly and are sincere in being fair to others one can agree to disagree with a person’s views/opinions. I sure would hope you express yourself always as I doubt you are judged in this forum for expressing yourself.

  50. Andy

    haha, two A+ comments.

  51. JimHirshfield

    You’re over qualified.

  52. baba12

    I may be requesting some help then trying to see if I can open some doors to a specific VC firm.

  53. Ryan Tanaka

    You basically learn to choose the battles that matter and the ones you know you can win.