Sunday, October 2, 2011

The Latest from TechCrunch

The Latest from TechCrunch

Link to TechCrunch

(Founder Stories) Meetup’s Heiferman: Working At McDonald’s & The Future Of Social Networks

Posted: 02 Oct 2011 08:00 AM PDT

Sequence 1 Backgroun#5987FA.mov

Meetup co-founder and CEO, Scott Heiferman is Chris Dixon’s guest in this episode of Founder Stories. A serial entrenepenur, Heiferman tells Dixon he started “the first online ad agency in ’94″ after corporate America left him unsatisfied. Called i-traffic, “the idea was to be an online media buying agency even though there wasn’t any media to buy at the time.” Five years later Heiferman sold i-traffic to Agency.com.

Following the exit, Heiferman was unsettled and says he “went a little bit crazy not knowing what I wanted to do with my life.” Heiferman took a job at McDonald’s—a move he credits to the company he was keeping. “I was hanging around with too many lawyers and accountants and at the time I just wanted to see what it was like to be a part of an actual real business.”

After flipping burgers Heiferman jumped back into the startup scene with RocketBoard, a project he describes as “a colossal failure and actually we blew through about $20 million dollars of AOL money.” The silver lining? Heiferman received advice that sticks with him to this day—create products to help the greater good of society.

Resuming their conversation below, Heiferman discusses Fotolog, a company he launched just prior to founding Meetup. Heiferman started the photo sharing site in 2002 and says “it became the number one social network” in several countries. It eventually sold for millions of dollars. However, Heiferman notes Fotolog’s top status eroded when Flickr hit the web and it made Heiferman realize that no company is totally secure against competition.

Lesson learned, Heiferman tells Dixon “I don’t think you can take for granted that any social network is going to be here 10 years from now.”

Make sure to listen to both clips for additional insights, including what Dixon observed while delivering pizza.

Past episodes of Founder Stories are here.


:
Website:

Learn more
:
Website:

Learn more

Scott Heiferman is a Co-Founder and CEO of Meetup, the world’s largest network of local community groups. Over 50,000 Meetups (self-organized community events) happen each week. Millions of people in over more than 100 countries “use the internet to get off the internet” using Meetup, which is built on the idea that every town needs support groups, playgroups, bookclubs, business circles, running groups, community action groups, etc. Previously, Heiferman co-founded Fotolog, a photo sharing network where over 30...

Learn more

Chris Dixon currently works as the CEO and Co-founder of Hunch. He is also a contributing writer for TechCrunch. He previously was the CEO and Co-founder of SiteAdvisor, which was acquired by McAfee. Chris is a personal investor in early-stage technology companies, including Skype, TrialPay, DocVerse, Invite Media, Gerson Lehrman Group, ScanScout, OMGPOP, BillShrink, Oddcast, Panjiva, Knewton, and a handful of other startups that are still in stealth mode. In addition to his personal investments, Chris is also a...

Learn more


Weekly Watch Round Up

Posted: 02 Oct 2011 07:40 AM PDT

Dedgumo-watches-12

Every weekend, we run a quick round-up of the major watch news. Why? Because watches are pretty darn cool.

The Dievas Vortex Professional watch gets reviewed. Durable titanium case and easy to read dial for people who just need a serious timepiece (for serious work and play).

Looking at a modern classic, a very unique classic. The Gerald Genta Gefica Bi-Retro Safari watch get’s remembered and recommended as a collectible.

Love that Japanese deconstructionist steampunk look? Dedegumo watches are custom made by hand and not too expensive.

For a bit more commentary, check out the Hourtime Watch Podcast.

Click to view slideshow.


Chamath Palihapitiya To Airbnb CEO: “If You Want Liquidity,… Make It Available To Everyone”

Posted: 01 Oct 2011 07:34 PM PDT

chamath-palihapitiya-1

Should founders take money off the table in later venture rounds, and if so under what circumstances? An extraordinary private email to Airbnb CEO Brian Chesky from investor and former Facebook exec Chamath Palihapitiya which was leaked to Kara Swisher at AllThingsD brings this question into sharp focus once again. The email is reprinted below, you should read it in it’s entirety.

Palihapitiya doesn’t take issue so much with the founders collecting $21 million of the $112 million round for themselves, but rather with the way that they did it. “My basic principle on this stuff is that if you want liquidity, that's fine, but you should make it available to everyone. Otherwise, no one should get it,” he writes. They took it as a straight dividend which, notes Palihapitiya, “allows you guys to take money out of the business and not dilute yourself.”

Airbnb isn’t the first hot startup to take money off the table during a big venture round. Groupon insiders famously took $345 million from a $950 million round back in December, 2010, before things started getting hairy. And half of Twitter’s recent $800 million round went specifically to buy out employees shares. But there is a difference between how Airbnb and Groupon founders rewarded themselves and how Twitter did it. Twitter spread the money more evenly to employees and early shareholders instead of funneling almost all of it to the founders.

A new class of investors is stepping in to provide liquidity to founders, employees, and early shareholders. With the rise of what I call mezzanine venture capital (DST-type deals that function as a bridge between late stage growth deals and an IPO) it has become increasingly common for startup founders and employees to cash out before an IPO or acquisition. In general this is a good thing as it rewards those who take the risk to build successful startups, but if the rewards are not spread equitably it can backfire. Palihapitiya warns, “If you are viewed as self-dealing and shady, it will only hurt your long term prospects.” Read his entire email below and weigh in with your thoughts in comments:

From: Chamath Palihapitiya
Date: Sat, 1 Oct 2011 11:16:05 -0700
To: Brian Chesky
Subject: Airbnb financing…
Brian,
Cc Marc, Reid, my deal team

Thanks again for giving me the chance to participate in your latest financing. I had a chance to review the docs at length yesterday and I wanted to follow up as, quite honestly, I've never seen a deal like this over ~60 investments I've done and I'm pretty concerned.

I'm all for getting the best valuation you can, minimizing dilution and maximizing control. We did this brilliantly at Facebook…all of our financings (except our first $$$ from Peter Thiel) were done not out of necessity but opportunity. As such, our investors had virtually no control and it resulted in a much better outcome. As we've discussed, I generally don't believe investors add much to a success story and so minimizing their impact is a great strategy when you are onto something that is working.

This said, while several of these concepts are reflected in the current deal, there is one big thing that I am fundamentally against and violates my principles and will prevent me from participating in your round. When I saw that you guys were taking $31M out of the company, I didn't think much of it as I just assumed it would entirely be via a secondary sale.

But as I understand the deal, it seems that you are doing only $9.6M in secondary and $22.5M as a dividend to common (of which $21M goes to you and your co-founders). I am really uncomfortable with this and don't think its in the spirit of building a good, long term business. Effectively, it is a strategy that allows you guys to take money out of the business and not dilute yourself — I'm not sure why this is such a big deal when you guys are almost 90% vested and the financing is at $1.2B where your dilution is marginal. Further, it excludes many of the employees that probably have helped you and your co–founders get the company to this place as most of these folks probably don't have any stock but have unexercised stock options and thus won't get a dividend.
My basic principle on this stuff is that if you want liquidity, that's fine, but you should make it available to everyone. Otherwise, no one should get it. Your current deal is the farthest away from this principle that I've seen in a while…this strategy has been done once before — at Groupon. We can see how "well" they are doing and how short term the investor community is now viewing their motives. I really think you can do better than this…and that you are better than this.

Separately, when you look at successful tech companies, it seems that dividends are an approach used by cash rich operations to distribute excess earnings — in fact, the most successful, cash rich tech company in the world, Apple, hasn't issued a dividend and they have more than $75B in cash! Again, while I think Airbnb will be a good company, this is nowhere near the truth now — you guys still need to scale and build this thing for the future.

I really think you are onto something but I would implore you to not take the easy way out. Treat your employees the same as you'd treat yourself. Do things that you will be proud of and can defend to anyone including your Board, employees, prospective hires etc. In such a competitive hiring market, you are competing with not just your obvious competitors, but also any successful tech company who is also looking for great talent. A principle that treats your employees as well as you'd treat yourself is a huge strategy for differentiation, retention and long term happiness of the exact types of people you will need to be successful. In contrast, if you are viewed as self-dealing and shady, it will only hurt your long term prospects…

In summary, I'm passing on this financing because I strongly disagree with what's going on. I'm not sure who advocated this approach but I did mention this to Reid [Hoffman, another Airbnb investor via Greylock Partners] last night and he was of a similar mind to myself and surprised this was the approach being taken. If you want some good advice — I would ask that you consider pinging him about different ways to think about going about the liquidity portion.

If you change your mind on how to close this financing, let me know and I'd love to reconsider. Otherwise, good luck and lets keep in touch.

Take care,

Chamath


Company: Airbnb
Website: airbnb.com
Launch Date: November 8, 2008
Funding: $120M

Founded in August 2008 and based in San Francisco, California, Airbnb is a community marketplace for people to list, discover, and book unique spaces around the world online or from an iPhone device. Whether the available space is a castle for a night, a sailboat for a week, or an apartment for a month, Airbnb is the easiest way for people to showcase these distinctive spaces to an audience of millions. By facilitating bookings and financial transactions, Airbnb makes...

Learn more

Chamath Palihapitiya is the founder of The Social+Capital Partnership. Previously, Chamath was the executive responsible for overseeing Facebook Platform as well as launching Facebook's online advertising channel. He vacated his most recent role as Vice President of User Growth, Mobile and International Expansion at Facebook in June, 2011. Chamath joined Facebook from The Mayfield Fund, a leading venture capital firm in Silicon Valley where he was focused on consumer Internet, advertising and technology investments. Prior to Mayfield, Chamath spent five...

Learn more


One Up: Gamers Help Scientists Solve Molecular Puzzle That Could Lead To AIDS Vaccine

Posted: 01 Oct 2011 01:52 PM PDT

fat_gamer_kid1

So, this isn’t exactly breaking news, but it’s so awesome that it’s worth sharing again in case you missed it. HIV/AIDS has killed some 25 million people worldwide and scientists have been working diligently since the virus was discovered in 1981 to find a cure. While a cure still eludes researchers, several protease inhibitors have been developed to slow its progress. But last week, HIV/AIDS research took a huge leap forward, thanks to the work of gamers. Yes, gamers.

About three years ago, a team of researchers at the University of Washington created a game called FoldIt to allow gamers to contribute to scientific research by playing with the shape and structure of proteins. Why proteins? Well, there are more than 100,000 kinds of protein in the human body, and understanding the structure and makeup of these proteins is key to understanding how they work and as well as to designing drugs that target them.

As proteins are found in the majority of diseases we suffer from, they are also key to developing cures, and so FoldIt enables gamers to design new proteins and fold known proteins into their most workable forms in an effort to contribute to disease prevention.

According to FoldIt’s website, “Foldit attempts to predict the structure of a protein by taking advantage of humans’ puzzle-solving intuitions and having people play competitively to fold the best proteins”.

And last week, FoldIt became more than just a cool idea, or an exercise for scientifically-minded gamers. Scientists have been attempting to decipher a protein called “retroviral protease” for over 15 years, as the protease is one of the key proteins that allows HIV to multiply and replicate itself in living cells. Using FoldIt, gamers were able to identify the structure of the protein — within a matter of 10 days.

With the structure of retroviral protease unlocked, scientists can now begin taking the necessary steps to build a drug that could significantly slow the speed at which HIV develops. The findings were initially published in a Nature article, which readers can find here.

“Following the failure of a wide range of attempts to solve the crystal structure of M-PMV retroviral protease by molecular replacement, we challenged players of the protein folding game Foldit to produce accurate models of the protein”, the University of Washington research team said in its findings. “Remarkably, Foldit players were able to generate models of sufficient quality for successful molecular replacement and subsequent structure determination. The refined structure provides new insights for the design of antiretroviral drugs”.

In this MSNBC report, the gamers describe the way in which they were able to work together cooperatively to solve a puzzle that has confounded scientists for more than a decade. And what’s so cool is that, while some of the most important progress in the game was made by those with biomedical academic backgrounds, the majority of active players playing with FoldIt did not have this kind of scientific background. Many of them were just average gamers like you and I.

“The monkey-virus puzzle solution demonstrates that Foldit and other science-oriented video games could be used to address a wide range of other scientific challenges — ranging from drug development to genetic engineering for future biofuels”, Firas Khatib, a biochemist at the University of Washington told MSNBC. “My hope is that scientists will see this research and give us more of those cases”.

What a remarkable win for the non-shallow end of gamification. We hear so much about how game layers are being added to consumer tech products to encourage engagement and interaction with products and apps, but with FoldIt, we have a real example of how gamification can help solve some of the trickiest of scientific problems and help make the world a better place.

Way to go, gamers.



Hack Your Culture

Posted: 01 Oct 2011 01:05 PM PDT

Justin Kan

Editor’s note: This guest post is by Justin Kan, cofounder of Justin.tv and TwitchTV. You can follow him on Twitter here and read his blog here.

Behavior is a virus. We spread our behavior to those around us, whether passively or on purpose.

Pop quiz: what factor most highly correlates with obesity? It isn’t income, race, religion, or genetics. It turns out that the best indicator of obesity is your friend group: if you have overweight friends, you are more likely to be overweight yourself. This makes sense, because you develop your behavior set from interactions with those around you. If your friends are physically active and eat well, you’ll have more opportunities to be physically active yourself, and spend more time over healthy meals. Alternatively, if your friends are living a real-life version of Super Size Me, you’re likely on the express train to type II diabetes.

Given enough exposure to a behavior, that behavior will become normative. This is true for both positive and negative behaviors. One simple behavior I’ve seen spread through my own friend group is riding motorcycles. I first started riding a few years ago after two of my friends came by on their bikes (having wanted to start for years, but never having a catalyst until that moment). Fast forward four years and both my brothers, two roommates and many other friends are riding, with many more in various stages of taking the rider’s test and joining the organ donor’s club.

Over the past several years I’ve been surprised to learn that this is also the case for entrepreneurship. For most people, startups are a risky endeavor and something to be avoided. Many are hesitant to quit their secure jobs and try to start a company from scratch. From an expected value perspective, when factoring in some risk adversity attributable to basic human nature, they are correctly maximizing outcomes. However, for a growing group, I’ve noticed that startups are a normalized behavior, and that this generally spreads through personal connections.

My brother Daniel is the perfect example of this. When Daniel graduated from college in 2009, the economy was in a horrible recession, and it was extremely difficult for new grads to find jobs. Initially having very little interest in startups, he started doing sales and business development at Uservoice after finding no options in consulting and banking, where the few friends of his fortunate enough to find work were headed. After a couple years of being friends with founders and early employees of startups, hearing about startups everyday and rooming with startup founders, he made the jump himself and recruited a team to launch Appetizely.

An example of culture-hacking at scale is Y Combinator. One of the reasons I think Y Combinator is so powerful is because it creates a new social norm, especially for those who come from outside Silicon Valley. When you start at YC, your friends and family think you're crazy. By the end, you have another friend cohort: other YC entrepreneurs and alumni. These new friends will provide support and advice, but the most important thing that they give you is implicit assurance that you are not crazy.

The lesson here is that through some clever social engineering you can hack your own life to put yourself in the position to accomplish goals you don’t even know how to begin. This is also also  how ZeroCater started. Over three years ago I was interviewing candidates for a community manager postition at Justin.tv. One interviewee particularly stood out. Arram didn’t have any experience or really any qualifications; in fact, at the time he had been working as a security guard and had never been to college. But, unlike most of the other candidates, he had thought extensively about what he would do as the community manager and had written down his many ideas in preparation for our interview. He was also passionate about creating his own startup eventually, and his excitement was inspiring. We ended up hiring someone else who had more community management experience for the job, but I was so impressed with Arram’s preparation that we hired him anyways to do random office projects.

One of Arram’s minor responsibilities ended up being ordering meals for the company. It ended up being such a time saver for the team that one evening I suggested that he offer ordering as a service to a few other YC startups in the neighborhood. That was the last I thought about it, but a month later I was shocked when Arram came back to me and told me he was quitting to grow it as a startup. Two years later, and he’s recruited a technical team, built out software to manage the entire workflow and serve companies like MTV, CBS and Verizon.

Arram didn’t have the programming or product background that you would expect from someone who would later go on to raise over $1 million in venture capital for a technology startup. He got in the game by doing whatever it took to get into a startup and surrounded himself with startups, making it impossible for him to not think about startups. Just being in the community creates opportunities: how else would you come up with the idea for a food subscription service that solves a very specific company problem?

You can hack your own culture. Surround yourself with people who do what you want to do, and eventually you’ll wake up to find yourself doing the same.


Person: Justin Kan
Website:
Companies: Justin.TV, Kiko, Socialcam

Justin Kan is an entrepreneur, Web developer, and the ‘Justin’ of Justin.tv. Justin.tv started when Justin Kan and Emmett Shear took on the challenge of broadcasting one person's life 24/7. Being web developers, they recruited co-founders Michael Seibel and Kyle Vogt to run the business and build a live streaming video camera. For investment, they spoke with Paul Graham of Y-Combinator (an investor in their previous start-up) and raised seed capital. The Justin.tv website launched in March of 2007....

Learn more
Company: Y Combinator
Website: ycombinator.com
Launch Date: January 4, 2005
Funding: $10.3M

Y Combinator is a venture fund which focuses on seed investments to startup companies. It offers financing as well as business consulting along with other opportunities to 2-4 person companies looking to take an idea to a product. Y Combinator looks for companies with "good" ideas over companies with experience and a business model. The company made its first investments in Summer 2005. Y Combinator selects companies to finance and consult with twice a year. They are located in...

Learn more


“For Those Who Don’t Want To Believe”

Posted: 01 Oct 2011 11:11 AM PDT

anonymous

I feel uncomfortably like a prophet. In January, and again last week, I wrote about the prospect of UAVs used as weapons by terrorists; yesterday a man was arrested who “planned to attack the Pentagon using ‘small drone airplanes’ filled with explosives and guided by GPS.” In August I wrote about omnipresent mobile phones turning the world into a panopticon; today’s NYT has an article about ordinary Koreans paid by the government to snitch on scofflaws with photo evidence. Last year I wrote a piece for The Walrus about the crucial importance of online pseudonymity for bloggers reporting on the Mexican drug war, now that the traditional media there has been terrified into utter silence; yesterday the headless corpse of one such journalist, a woman named Marisol Macias Castaneda, was found next to a scrawled message warning people not to write about the drug cartels on social media sites.

These are not three separate subjects. Cheap and/or ubiquitous cameras and facial recognition make surveillance ever more omnipresent; the dangers and uncertainties of other new technologies, like hobbyist UAVs, lead to calls for even greater scrutiny; and eventually online anonymity/pseudonymity will be the only kind there is. That isn’t entirely a bad thing. It’s because of crowdsourced surveillance that New York police lieutenant Anthony Bologna faces two investigations after apparently gratuitously pepper-spraying protestors. But it means the ability to remain pseudonymous online will only become more and more important in the years to come.

Do the services that connect people online seem to realize this? Sadly, the answer mostly ranges between “No” and “Hell, no.” Twitter is the only major social network that doesn’t have a real-names policy, and the only one with a history of going to bat for its users’ privacy. But while the online journalists in Mexico who dare to report on its brutal drug wars are beheaded after their real identities are connected to their online bylines, while Syrians are detained and interrogated because of their Facebook accounts, Vic Gundotra has idiotically compared Google Plus’s real-name policy to “wearing a shirt to a restaurant,” and both Eric Schmidt and Mark Zuckerberg’s sister Randi have called for real identities to be attached to all online activity.

There’s really not much one can do about that level of monstrous cluelessness. There are downsides to online pseudonymity, yes, but those are massively outweighed by the advantages. Unfortunately, the kind of people who head major online services live such incredibly cosseted existences that most of them seem basically incapable of understanding — or caring — that “even though you have nothing to hide and live your life like an open book, pseudonyms are really important to people who do not lead the cozy existence that you do,” to quote legendary hacker Jamie Zawinski. (To say nothing of the fact that defining what a real name even is is a whole lot more challenging than most Westerners appreciate.)

So I’m not hopeful that Google Plus’s Gundotra or Bradley Horowitz, much less Facebook’s Zuckerberg and Sandberg, will see the light and change their policies anytime soon. And that’s bad news for everyone. True, nobody has to use either service, but it’s incredibly disingenuous to claim that they aren’t increasingly important. Social media are how people organize into movements, these days, and they’re how both truth and falsehood spread when the traditional media fail. The sign next to Castaneda’s headless body was addressed, “For Those Who Don’t Want To Believe.” That’s a pretty good description of anyone who thinks that online pseudonymity is no big deal.

Image credit: “liryon”, Flickr



Gillmor Gang 10.1.11 (TCTV)

Posted: 01 Oct 2011 10:00 AM PDT

Gillmore Gang test pattern


The Gillmor Gang — Robert Scoble, Danny Sullivan, John Taschek, Kevin Marks, and Steve Gillmor — lauded Amazon’s entry into the mobile media universe with the Fire. We were unanimous in our praise for the impact the device will have on the tablet scene, with a price within reach of a whole new audience that has found the iPad resistable and Android tablets even less or more, whichever is less.

Whether the move proves a win or a challenge to Google depends on your perspective about Android. For some (@dannysullivan, @jtaschek, @scobleizer, @kevinmarks) it augurs good times for Android. For others (@stevegillmor) it puts significant pressure on Google to minimize the difference between Android open source and Android +. For all of us, it means significant challenge to a number of different strategies and market force pressure to make streaming the new Web OS.

@dannysullivan, @jtaschek, @scobleizer, @kevinmarks, @stevegillmor


Widely considered a leading “search engine guru,” Danny Sullivan has been helping webmasters, marketers and everyday web users understand how search engines work for over a decade. Danny’s expertise about search engines is often sought by the media, and he has been quoted in places like The Wall St. Journal, USA Today, The Los Angeles Times, Forbes, The New Yorker and Newsweek and ABC’s Nightline. Danny began covering search engines in late 1995, when he undertook a study of how they...

Learn more

Robert Scoble is an American blogger, technical evangelist, and author. He is best known for his popular blog, Scobleizer, which came to prominence during his tenure as a technical evangelist at Microsoft. Scoble joined Microsoft in 2003, and although he often promoted Microsoft products like Tablet PCs and Windows Vista, he also frequently criticized his own employer and praised its competitors like Apple and Google. Scoble is the author of Naked Conversations, a book on how blogs are changing...

Learn more
Person: Kevin Marks
Website:

Kevin Marks is a software engineer. Kevin served as an evangelist for OpenSocial and as a software engineer at Google. In June 2009 he announced his resignation. From September 2003 to January 2007 he was Principal Engineer at Technorati responsible for the spiders that make sense of the web and track millions of blogs daily. He has been inventing and innovating for over 17 years in emerging technologies where people, media and computers meet. Before joining Technorati,...

Learn more
Person: John Taschek
Companies:

John Taschek is vice president of strategy at salesforce.com. He is responsible for corporate product strategy, corporate intelligence and market influence. Taschek came to company in 2003, bringing over 20 years of technology evaluation experience. Taschek currently is also the editorial director for CloudBlog - an independent blog run as an adjunct to salesforce.com’s web properties. He occasionally is on Steve Gillmor’s The Gillmor Gang enterprise web video-cast. Previously, Taschek ran the testing labs at eWEEK (formerly PC Week) magazine....

Learn more

Steve Gillmor is a technology commentator, editor, and producer in the enterprise technology space. He is Head of Technical Media Strategy at salesforce.com and a TechCrunch contributing editor. Gillmor previously worked with leading musical artists including Paul Butterfield, David Sanborn, and members of The Band after an early career as a record producer and filmmaker with Columbia Records’ Firesign Theatre. As personal computers emerged in video and music production tools, Gillmor started contributing to various publications, most notably Byte Magazine,...

Learn more


No comments:

There was an error in this gadget
There was an error in this gadget