Posts from October 2012

Book Recommendation: Internet Architecture and Innovation

On the heels of its paperback release, I would like to recommend a book that is required reading in our shop, Internet Architecture and Innovation by Barbara van Schewick. I've mentioned Barbara before on this blog. She is a Law School Professor at Stanford and has written extensively on this important topic.

I am a fervent believer that everything that is great about the Internet emanates from its underlying architecture. That's where Barbara is coming from too, which is probably why we like her and her work so much at USV.

In this book, Barbara argues that the massive amount of innovation that has been made on top of the Internet is directly attributable to its architecture and that there are some parts of the architecture, most notably the last mile in wired and mobile, that are problematic and that do not benefit from the hypercompetitive nature of the open Internet.

This is an important piece of policy work and anyone who cares about the Internet ought to give it a read.


Reflections on Sandy

I ended yesterday’s post with this:

Hurricane Sandy looks to be coming through NYC at that time and I don’t know what that may cause me and my family to be doing at that time. We live right on the Hudson, at the border of Zone A. So I’ve got a few things on my mind today that fit right into this Sustainability theme….

Stay safe everyone on the east coast today. Let’s hope the hype is overblown. And let’s prepare as if it isn’t.

On my way back from a business breakfast, I saw folks in Hudson River Park looking at the Hudson River so I walked over and recorded this video of the Hudson breaching its banks around 10am eastern.

That was the moment I knew that our street would turn into a lake. I just felt it in my gut. Around that time my partner Albert posted this on his tumblr. We traded a few comments and he led me to this page on NOAA’s website. This was the chart I was tracking all day yesterday:

Water levels at the battery

At the time I took that video the water height on this chart was around eight feet. You can see that it peaked at about 14.5 feet. That’s 6.5 feet higher than the time of my video.

After our monday team meeting (which we did on Google Hangouts with great success), I went downstairs and explained to the Gotham Gal and Josh that we should evacuate. I got a little pushback from both but mostly from Josh who thought we could ride out the storm in our apartment.

I was adamant that we should leave. I told them that our street was going to become a lake (or worse a river) and that we would lose power and things would be a mess. I finally won them over and we headed out around 4pm. We went uptown to stay at a friend’s house on higher ground. Before we left, the Gotham Gal and I went to the basement storage room and removed all family heirlooms and anything we couldn’t replace easily and took them upstairs to our apartment. But we forgot to empty the ice makers in our apartment (which caused me to wake up in the middle of the night last night with an “oh shit” moment).

We spent the rest of the day following events on Twitter and TV. The Mayor’s regular updates on TV were helpful, but by far the best coverage of Sandy was on Twitter, with links out to blogs and Instagram. That led me to tweet this out yesterday night.



Our street in the west village did in fact become a lake with somewhere around 5 feet of water at the height of the storm surge. Our building’s basement was submerged and our ground floor apartment which houses the Gotham Gal’s office took many feet of water. The building lost power and I suspect it won’t have it back for a while. It was a disaster from which we will be impacted for months I suspect.

But as bad as our street and building had it, much of NYC had it worse. Lower Manhattan and parts of Brooklyn were flooded way worse than the west village. The subway system took the most severe  flooding of anytime in its history. Many of the subway tunnels between Manhattan and Bronx, Queens, and Brooklyn are flooded. And some of the automobile tunnels are flooded too. There have been power plant explosions, fires, and all sorts of other Sandy related calamaties.

It was a big storm and it wreaked much damage on NYC last night. But the loss of life was relatively low and from what I can tell, city officials and the first responders in the fire and police department did their usual heroic job. We will get through this the same way we have gotten through other disasters.

I may take the week off. I have a lot to tend to on the home front and NYC is not going to be the easiest place to live and work this week. My son’s school is almost certainly closed for the next few days. 

But I’ll likely keep blogging. It helps to be able to talk about this stuff, to get it out, and to discuss it. So we can start doing that while my family and I start digging out.


MBA Mondays: Sustainability Class Wrapup

I've enjoyed teaching the Skillshare class on Sustainability. I've learned a few things about the hybrid class model and I have shared them with the Skillshare folks. It's tantalizing to think about the power of teaching a class to 2,731 people at one time. But when I compare that to the power of teaching 75 people in person, the hybrid model shows it's weaknesses.

I need the real-time feedback from the students in the class. I need to see if folks are getting what I am saying or if eyes are glazing over. I need to know if I need to take another tack on the material before moving on. And I don't get that with a massively open online approach.

So my next class is going to combine the in person dynamic with the power of a massively online approach. The best thing to come from the hybrid class model is the idea of using google hangouts/youtube to broadcast the class to everyone. I am going to do that from now on.

I also like the idea of teaching a four part class with a blog post each week. I can build on that model too.

I am less happy with the discussions on Skillshare and that they did not tie into the discussions that happened on AVC. I need to figure out how to make all of that work better. It's obvious that a teacher (me) can't give real time feedback to 2,731 students. And I think leveraging the students to give feedback to each other (the disqus model), is right. So it's worth working on this model to perfect it.

I want to thank Michael from Skillshare for prompting me to write about Sustainability this month. As I said in my first blog post on the topic, I think Sustainability is a great model for business owners and leaders to take in thinking about the highest objectives of the company. If I have contributed anything to the way business leaders think about Sustainability, then I have accomplished my goals with this class.

I am going to postpone my final office hours which were scheduled for this evening at 6pm eastern time. Hurricane Sandy looks to be coming through NYC at that time and I don't know what that may cause me and my family to be doing at that time. We live right on the Hudson, at the border of Zone A. So I've got a few things on my mind today that fit right into this Sustainability theme. I will report back on a new date and time for my final office hours.

Stay safe everyone on the east coast today. Let's hope the hype is overblown. And let's prepare as if it isn't.

#MBA Mondays

Video Of The Week: Joel Spolsky at Startup School

The startup school talks are great. I've watched a bunch of them. 

Joel Spolsky is the founder and CEO of our portfolio company Stack Exchange.

His talk is a great discussion of the difference between the "get big fast" strategy and the "organic growth" strategy. This is something every entrepreneur really needs to understand. We see a lot of folks pitching us to invest in "organic gowth" businesses and Joel explains why that is a mistake.

Here is his talk (sorry I can't for the life of me figure out how to embed the startup school talks).

#VC & Technology#Web/Tech

Gmail Meter

I tried out a new service this past week called Gmail Meter. It's a free analytics service that tells you stuff about how you use Gmail. It is brought to market by the folks at ShuttleCloud, which does archive and data migration for cloud services. It's a way for them to get to know folks who might become ShuttleCloud customers in the future.

I learned a few things. I get 6,470 legit emails a month from 1293 different senders. I send/reply to 2,676 emails to 777 people. So the send/receive ratio across my inbox is 41% which is higher than I thought. I feel a tad better. But there are also at least 516 people who sent me an email last month that did not hear back from me. That makes me feel a bit worse.

The single highest send/reply ratio in my world is the Gotham Gal who sent me 133 emails of which I replied to 100, for a 75% return rate. I've got work to to do there. Sorry Jo. My partners Albert, Andy, Brad, and John get between a 50% and 70% reply rate. Sorry USV folks. The one cohort that I send more mail to than I get replies from is my three kids. I get a worse response rate from them than all of you get from me. Not sure how I feel about that.

This chart will not surprise anyone here at AVC but it does show that the one time I reply to more email than I get is the 5am to 7am time frame.

Daily traffic

Here are a few more interesting charts:

More gmail meter charts
The first chart shows that I get to most of my email within 24 hours but there is certainly a meaningful percentage that takes longer.

The second chart shows that I send a ton of short emails. 80% of my email is less than 30 words. Whereas greater than 50% of the emails I get are longer than 100 words.

I've asked the Gmail Meter folks to add a chart showing reply ratio on emails less than 30 words versus emails greater than 100 words. When I get that chart I will publish it here because I think that is single best secret to getting a reply from me.

Anyway, I found this data valuable. Maybe you will to. You can try it out at Gmail Meter.

#email hacks

Fun Friday: Who To Follow On Twitter

This fun friday topic was suggested by a community member in the comments sometime in the past week. I like the idea so today we will all share good Twitter follows with each other.

I'll share a few of the best twitterers I know of with all of you and then you can take it from there.

Sports: Bill Simmons

Politics: John Heilemann

Tech: Anil Dash

Finance (& Comedy): Howard Lindzon

Fashion/Culture: Alexa Chung

Music: Bob Lefsetz

When you share twitter handles in the comments section, please link to them so the follow is easy on everyone. Thanks.

#Random Posts

Four "Appearances" In One Day

A few weeks ago Gillian, who keeps me on schedule and a lot more, said to me, "there's a day coming up when you are going to do four appearances in one day." I thought to myself that was a bit much but didn't do anything about it.

Yesterday was that day. I gave talks at Baruch College, Google Hangouts/YouTube, Skyped into an entrepreneurs meetup in Milan Italy, and ended the day talking to the Kauffman Fellows Program at the Alexandria Center in NYC.

The thing I learned yesterday is that sitting at my desk and talking to folks around the world, via the power of Google Hangouts and Skype, is an amazing thing. Of course I've been using these tools for a long time. But yesterday was still a bit of a wakeup call for me.

The Google Hangouts/YouTube thing was a MOOC called Entrepreneurship in Education that is being taught by David Wiley, Todd Manwaring, and Richard Culatta. It was an hour long back and forth on the issues around entrepreneurship in online education. Ki Mae Heussner posted about the class on GigaOm yesterday. Here's the video of the conversation.

The really awesome part of this class is the way that Google Hangouts allows you to have a small interactive group talking about things that is then broadcast to a much larger group. I am going to try to replicate that in my final Office Hours next monday in my Skillshare class.

The Skype into the meetup in Milan was equally awesome. I don't have the video of that to share but here's a twitpic that I saw on Twitter after my talk that gives you a sense of how the folks in Milan experienced it:

Milan talk

As much as I enjoyed the talks I gave at Baruch and the Kauffman event, it was the talks that were delivered online that excite me more. Because online video allows me to talk to folks around the world. And I think that takes the conversations I want to have to a much broader audience and hopefully helps people all around the world think differently and ultimately act differently as they bring their ideas to market.

#hacking education

Seth Godin On Education

I’ve got a ton going on but nothing to say about it today. So instead of a daily post, I am going to share a video with you that has been suggested to me by a few of you in the community and a bunch more over email this past week.

It’s Seth Godin talking about education and what we need to do about it. I watched it this morning and hopefully you can too. It’s 16 minutes long.

#hacking education

The ConnectNYC Fiber Challenge

Possibly the biggest local policy issue in NYC for tech companies is the lack of good broadband infrastructure in the city. We could get into a debate about broadband policy at the local and national level, but this post isn't going to be about that. This post is about something City Hall is doing about the broadband issue.

In the spirit of "race to the top" and other contest based efforts to attack stubborn problems, NYC has launched the ConnectNYC Fiber Challenge in partnership with Time Warner Cable and Optimum Online (Cablevision) to provide fiber build out to businesses.

Here's how it works. You sign up at ConnectNYC, you get and sumbit a letter from your landlord saying they will allow fiber installation in your building, and then you describe how high speed broadband will positively impact your business.

The judges will select the winners and NYC EDC, Time Warner, and Optimum will invest $12mm over two years, with $7mm being invested in year one, into fiber buildouts for the winners. It is estimated that each installation will have a value of $50,000 of investment by Time Warner and Optimum.

In addition to getting a lot of local businesses high speed broadband, this contest will also give an indication to the city and local ISPs of where the most important neighborhoods are for broadband buildout.

We spend a lot of time with our portfolio companies dealing with infrastructure issues around real estate and broadband and I can tell you that this is big problem in NYC. Companies that want to move to low cost neighborhoods with interesting buildings like Red Hook, Gowanus, Vinegar Hill, the Greenpoint waterfront, Long Island City, and other similar places simply cannot do that due to the lack of good broadband. If the city wants to see these neighborhoods emerge commercially, they will need to deal wtih the broadband problem. ConnectNYC is a nice way to get going on the problem. If you are struggling to get a fiber installation in your building, give ConnectNYC a try.


How To Be In Business Forever: Week Four

This is the final post for my Skillshare class on Sustainability.

I will not do office hours this evening but I will do one final office hours next Monday, Oct 29th, from 6pm to 6:30pm. The link to attend that office hours is here.

For this final post, I want to focus on the Business Model Canvas and how to think about sustainability in the context of creating your business model. In order to talk about that, I went ahead and created a Business Model Canvas of my own using

My Business Model Canvas is for a Bitcoin Bank.

If you think about banks in the real world, they are high cost affairs, with huge fixed costs including large branch networks. I am always shocked by how many bank branches I pass in a five to six block walk in NYC. The way these banks sustain these high costs is with large fees for depositors and high spreads between their cost of funds and the interest rates they charge borrowers.

So in thinking about how to create a sustainable Bitcoin Bank, I focused on a few key things:

1) keep the operating costs super low except in areas where there is a unique and important consumer value proposition

2) make it easy to access the bank and your balances within the context of low operating costs

3) keep the fees charged to customers as low as possible

4) allow third parties to build busineses on top of our business

The result is a super simple business model. My Bitcoin Bank would charge a very low monthly fee per Bitcoin deposited and nothing else other than pass alongs for any costs incurred in moving bitcoins in and out of the bank on behalf of our customers. We would not have any branches. We would operate via simple, easy to use mobile and web interfaces. We would keep our operating costs super low with the exception of one area where we would make a large and ongoing investment – in hiring and retaining a top notch and super experienced security team. We would allow third parties to create related businesses on top of our API. Services like lending, investing, etc would not be provided by our bank but by third parties who access our customers via our API.

I believe this business would be highly sustainable because it would focus on one very simple value proposition – security. And in return it would charge the lowest fees possible in order to make and sustain a profit. It would make it very difficult for others to price lower fees for storage and security. And it would benefit from the ecosystem of third party value added service providers operating on top of its API.

Here are some decisions I made in order to increase the sustainability of the business:

1) A focus on very low fees to our customers so that it will be difficult for competitors to undercut our offering.

2) A decision to focus on only one thing, security, and allow others to build additional services for our customers. This allows us to be best in class at the one thing we choose to do and it means our customers can choose to pay for additional services or not, and always on their own terms.

3) A cost model that keeps operating costs as low as possible in all areas other than security, which is our key consumer value proposition.

So when you are finalizing your Business Model Canvas for your final project for this course, think about what your key value proposition is and who is your primary customer and focus on that. And think about what you can do in your revenue model to make it so that it will be hard for others to come in and undercut you. And think about your cost model and how to keep it as low as possible while allowing your company to be best in class at what it does.

Please submit your final Business Model Canvas project here by Thursday, Oct 25th, 11pm EDT. I will pick out a bunch that I like and review them next week on office hours.

That will be the final event in this course. I hope you have enjoyed this class/series. I think sustainability is an important and overlooked aspect of business and it needs to built more tightly into business thinking.

#MBA Mondays