You can now invite up to 50 other people to join Gmail....   Google is now letting the dogs out.

The whole world seems to be playing the "WWGD?" game.  (What Will Google Do?)   From browsers to VOIP, the amount of anticipation over Google's next move is out of control... and why not?  The value of Google as a platform is really immeasurable.  There are markets that Google could probably dominate tomorrow if they wanted to code a new offering on their front page tonight.  Google's internal five year plan is probably the single most valuable corporate espionage target out there now...  Who wouldn't want to know what the Google Good Guys are planning to do with all their IPO money? I just discovered Google's book publicity tool last night.  Any publisher can send a copy of their book to Google, and they'll scan it up and tie it into their index, along with a link to purchase the book.  Thought Amazon couldn't be strong armed?  What happens if they discover that a huge proportion of their likely to buy traffic is coming straight from a Google book search?  Maybe Google might want a special discount for Googlers on Amazon.  This company is just a force to be reckoned with and it probably has more flexibility in its future direction than anyone else.  Kind of makes Microsoft seem like old news.

I think it will be an interesting trend to watch as search tools start trying to interface with content and products that are already located within the catalogues of other businesses.  It has already started with Froogle and its only going to continue as search portals encroach into areas like real estate, travel listings, and perhaps even online dating.  What if you could Google search "single brunette AND early 20's AND New York City" and come up with results from Match, Spring Street, Love(at)AOL, AND eHarmony?  Throw in Friendster while you're at it.  There's a level of content that isn't just floating around.... its within a lot of these databases and its only a matter of time before search engines break on through.  They'll be forced to b/c they simply don't have enough content to keep up with the demand for advertising.

Jeff the Intern just came up with a great idea, but I coined the term.  He and Marcy were both needing to work on two different parts of the same spreadsheet, but Marcy had to close out of it before he could just stick in the two numbers he needed to.  He suggested that two people should be able to open the same file and, with two different color cursors, simultaneously add stuff to it.  Brilliant!  I call it "Microsoft Office 2-Player Mode."  :)   Now that's collaboration!

Plus, if you click "Up, Up, Down, Down, Left, Right, Left, Right, B, A, Select, Start" before the file opens, you get 30 lives.

I can invite 6 people to join Gmail.  E-mail me for an account.

Recently, I was at lunch with some private equity folks and they asked me an interesting question... well, rather, they revealed that they couldn't quite get a handle on what it was that I wanted to do.  They saw and appreciated the myriad of activities I had gotten myself into and couldn't quite paint a picture of how this was all fitting together and leading somewhere.

Its a legitmate point.

I also think its kind of interesting.  You have some people out there with no goals and no requiste activities and obviously that's not too admirable.  You have others who have goals but really don't do too much to actually pursue them, and to me, that's even less admirable, because they've identified targets, but out of sheer laziness or fear, fail to motivate themselves to reach them.  Then, you've got other people who have goals, and, in fact, start out with those goals, based on little to no experience whatsoever, and then fully commit themselves to those goals.  That almost reminds me of the "strong and wrong" concept.  How many people go into investment banking or accounting, do all the things they need to do to get hired by Goldman Sachs or KPMG, and then soon realize that they had no idea what they were getting into, because it doesn't match the kind of lives they want to lead?  Yet, by all measures, these were admirable and respected pursuits. 

And then you've got where I am...   pursuing, yet seemingly without goals.  By my own admission, I do not have a singularity that I can neatly point to as my "goal."  I have potential points of arrival, and each passing day collapses another Schrodinger wave function, narrowing the possibilities through my choices, even if I have no particular inclination towards a particular result.  I become, therefore the end result of a series of choices based on particular inclinations, yet without an overall guiding inclination.  Therefore, I am not "aimless" but I might be accurately called "without aim." 

What of it?  Does it matter?  Wherein lies the potential problem?  Well, if you were completely without an overarching plan around your activities, you run the risk of overextending yourself... committing to so much unrelated nonsense, all without synergy, that you fail to accomplish anything.  Therefore, you need to draw the line between what fits and what doesn't.  How to do this...   Well, one could conceivably use this "goal" concept, but I'm not entirely sure that's the most effective.  Most people will admit that there are many roads to Mecca, and so using a goal as your hard and fast line to figure out what belongs in your life doesn't seem like it would be devisive enough.  Too many things could potentially lead you to your goals.  There's no "one way" to be a banker.  Some people major in History at Dartmouth and become bankers, while others are Finance majors at NYU Stern with a minor in math.  No, what is really a much better way to draw the line on what makes it into your Palm pilot or not is your own natural affection for an activity.  "Do what you love."  While it may sound wishy washy, the average person doesn't love much of anything, if we're all honest with ourselves... I mean, real love... true passion.  I have passion for new ideas.  I have passion for working with people who love to learn.  Sometimes, I find that in students.  Other times, entreprenuers or VCs.  The best VCs are undoubtedly lifelong students.  So, while I might not have a definate end result in mind, pursuit of my passions have consciously and deliberately singled out certain activities over others.  I could theorize where they might lead, given potential trajectory analysis, but to put forth those potentials as the overarching guiding principals in and of themselves would not only be inaccurate, it would also taint my natural ability to let my passions discern for themselves what I should be spending my time on.  They would be tainted by my alligence to a "goal" and hesitation to readjust goals once they are chosen... for what is a goal that changes everyday?  So, while my lack of a clear goal statement might confuse others and prevent them from catagorizing me, it also keeps my life as sincere as it has the potential to be.  As long as I do what I love, I will love what I am doing... and with true love for something comes sincere motivation and the desire to excel (a word which has no cap, I might add), greatly over and above the desire to reach a goal, and then... well... stop.

I feel behind in my posting over the weekend because of the "Spite Monkey."   

The Spite Monkey is a irratating little critter who messes up your life in little annoying ways for his own personal amusement.  Over the weekend, the Spite Monkey once again knocked out the cable internet connection to my whole building, and also delayed the installation of an amp to fix the problem.  I can't even threaten Time Warner to jump for DSL b/c I don't have a land line and having one just for DSL is more expensive, PLUS I left DSL because the service was even worse.

After that, he crashed the hard drive on my work laptop, leaving it in FUBAR status.  Unfortunately, my San Fran pics were on there (which was stupid on my part), but FORTUNATELY, I had uploaded my San Fran pics to Snapfish.  You know, it kind of bugs me that I have to pay to get the hi-res images back, but, to be honest, I think this episode really underscores the need for some kind of online storage for photos.  Snapfish will charge me 10 bucks to get a photo CD of 50 pics if I really want it and, to be honest, that's a better deal than paying for some kind of monthly file storage.  I just like the option value of keeping all my stuff on my own drives.  I thought maybe I would burn them to CDs, but then what if my apartment goes up in flames.  (Perish the thought, but stuff like that happens, you know.) 

I'm also thinking of scanning up a whole bunch of old letters, etc and uploading those to Snapfish.  I have a love letter that my girlfriend from 8th grade wrote to me.  You can't replace that kind of sappiness.  Yes, truly, some document/photo archiving is in order.   

The good thing is that GM was able to get me back up in running in a short amount of time.  They had an image of my disk from September, so I have all my progams.  It also has all of the spyware that I got rid of since Ad-aware came to the rescue, so I need to do that again.  More posts to follow...

In my experience, I think I've gained at least a rudimentary conception of value creation in acquisitions, and how to evaluation acquisition targets.  Sometimes, you get a good financial buy, where you are able to pickup an accretive stream of operating income for a good price.  On top of that, operating synergies may exist that allow you cut some overhead and, again, improve your bottom line given your purchase price.  Other times, you have strategic synergies that allow you to distribute your product in other markets or up/cross sell products.

Today's announcement of Six Apart's Acquisition of LiveJournal, to me, anyway, fits a different catagory.  I don't necessarily believe that it gives its users a more fullsome offering, because I think that the user bases are dramatically different and I don't think you have people.  However, where it does make sense is that the offering seems more "whole" as a company now.  The two companies are amazingly complimentary, with LiveJournal really fitting nicely as a free offering to go with the paid Typepad service and liscenced Moveable Type software.  Perhaps that might make it more attractive to a strategic, but I'm not entirely sure that makes the most business sense.  To what end do you create a company that touches all the bases when all of the bases might not be independently viable?   Fred argues that there exists a great opportunity to "monitize" the LJ content with ad placement, but I don't think the average LJ user would be too happy having ads on "their" space.  I think Danah would probably cringe at the mere mention of the word "monitize."  I wrote on Fred's blog that I think you'd see the kind of outrage that baseball fans had when Selig tried to put Spiderman ads on the bases. 

So, yes, now Six Apart is "more complete."  I can see that and perhaps that makes them more formidable, but better?  Not sure.  It kind of makes me think of the General Motors strategy of putting a car in every single damn segment they could find.  At one point, the company had close to 100 different models.  Some were profitable, some not as much, but you always knew that somewhere, GM had a car for you, no matter who you were.  I guess I'm not sure where "complete" gets you. 

I don't think you can upsell the LJers into Typepad, and even if you could, you didn't need to buy them to do it... I'm sure they are aware of the service regardless.  In any case I never liked the idea of buying customers you couldn't win on your own. 

So everyone keeps saying that Six Apart is now better because its bigger, more diversified, has a complete set of offerings... and while those sound better, I guess I haven't heard anyone really come up with a believable business case on how this will translate into better earnings and value.   

Perhaps they just didn't spend that much on it?  That might be the key.  If the stats are right, and LJ has about 90,000 users paying $25 a year, they're bringing in about $2.25 million.  Now, let's say that the acquisition went at a very healthy 4x multiple of sales, making the purchase price about $9 million.  They've raised a little more than that, but not much more, so this would represent a big chunk of the venture money they raised.  Let's say its in the $7-9 million range, so we don't assume they went and spent all their money in one place.  I have no idea what it really was... I'm just pulling numbers out of my butt.  (Well, the multiple isn't out of my butt... you usually see private venture companies go at about 3x forward sales, plus or minus a turn.)  At $7-9 million, with estimates of about 2.5 million *active* LJ accounts, you basically paid $3-4 a viable customer.  Now, the question is, is that expensive or no?  I have NO IDEA.  I mean, can those blogs generate that kind of dough each?  What if only 25% of LJ users (which would be some pretty good penetration) sign on for whatever advertising or business proposition you send their way... now you've got the number up closer to $16 a viable customer and that seems like it would be tough to make back.  Remember, while bloggers can make a lot more than this with contextual advertising, the blog service doesn't get a piece of that.  If the service got a cut, that would be different, but bloggers *own* all the equity in their blogs the way its set up now.

If anyone else has any shorthand models they want to throw around here, I certainly welcome them.  This is about as halfassed as you can get, but its a start.

So I got an iPod for Christmas, along with everyone else in the free world.  I was impressed with how quickly my 1200 song library downloaded, especially considering it was only USB 1.1.   

Anyway, I've been thinking about something ever since Fred started posting his Top 50 Albums postings.  I didn't have a lot to add, not because I don't listen to a lot of music... I listen to a ton...  but because I never listen to albums.  Even when I was younger, I was listening to the radio and taping songs off the radio onto tapes.  Many of the albums I bought were just to get a song or two and perhaps I discovered a third or fourth, but that was about it and I'd skip through the junk.  Sure there were a handful of whole albums that I liked:  most of Pink Floyd's albums, Tommy, Led Zepplin, but very little of the other genres that I listened to were worth getting a whole album over.  Techno.... I dunno.. that always seemed like a song by song genre to me, getting played on the radio and in clubs.  I never saw anyone actually purchase a techno or electronica album.   Seems like most of those artists are happy to distribute that freely, because what they really want are club gigs and radio play.   

Anyway, point being, I wonder if this is a generational thing.  When the downloading wave hit colleges, right smack in the middle of my college years, the focus was on getting songs.   Middle aged iPodders today like Larry at GM are more focused on albums because most of their digital music comes from their own CD collection, uploaded album by album.  I don't know anyone plus or minus at least three years from me whose digital music collection was mostly downloaded as a whole album.  In fact, that was suppossed to be one of the reasons for the music stealing phenomenon... that it was a backlash against being forced to consume music in album sized bites when there were so few albums with more than just one or two good songs. 

It really hit me when I put all my music on iPod and I realized how much of a mess it was.  Songs and artists were poorly labeled and not grouped into albums.  Clearly, the iPod is designed with Uploader Larry Aged 37 in mind more so than College Napsterboy Charlie Aged 25.  I think I have about two weeks worth of relabeling and cleanup to do.   We need to throw some playlists on this mother, because 1200 individual songs with no rhyme or reason just isn't going to cut it.  This morning, I listened to a selection from the "A"s, for no other reason than they came first.  The selections?   Apple of Sodom by Marilyn Manson, As Far As Heaven is Wide by Garbage, Astrocreep by Rob Zombie...   clearly the "A"s are a sketchy bunch.   

Computer slowing up?  Pop ups got you down?   Download Ad Aware! I started out the other night on Liz's computer, which hadn't been virus protected in the four years she's had it.  After exposure to college dorm ethernet, internet in Japan, and now broadband at home, her computer had become a veritable hornet's next of spyware, malware, and just all sorts of nasty critters.  One sweep of Ad-Aware found over 500 items that shouldn't be there, like active spyware and popup programs in her memory and even worse all sorts of trash in her registry.  Now... clean as a whistle!   I did the same thing with my GM computer, which is supposed to be swept for all these things with expensive enterprise wide virus scans, etc...   250+ Items.  It also got rid of this annoying Internet Optimizer code that hijacked my IE error screen, so every time I went to an internet it couldn't find, I got sent to a "search" screen that was a popup nightmare.  This was especially annoying b/c, with a wireless connection, you tend to get knocked off sometimes and that error screen comes up a lot. 

But, the real test was on my home computer, which had a corrupt registry that was preventing me from loading Internet Explorer at all.  After a year of not being able to use IE...   BAM, it was up and running in no time and gone were the over 600 critters that shouldn't have been there.  This program is sweet, and you should get it.

So my computer decided to mysteriously restart in the middle of my previous attempt at this post....  very frustrating.  I'll try not to make any sudden movements this time around.   I think the worst thing you can do when you're retyping something like this is to attempt to recreate what you just did.  It will never come out flowing as nice as it did the first time, because you're bound to leave out one clause  that sets the whole paragraph off.  Better to just start all over again.

So, last night I went to the Union Square Ventures "Holiday" party.  It was really interesting to be surrounded by so many people tied to the New York venture scene.  The tone of the conversations was very different than those I've had in California.  People in New York are much more directly focused on the deal at hand.  There's definitively less smalltalk and people always have a deal on their mind.  Conversations tend to stray a lot more on the West Coast.

I have this bad habit of asking people where they're from at these things and expecting a certain type of answer.  At GP meetings or ILPA, you're always "from" somewhere... representing an institution like Case Western or the Alaska State Pension Fund.  Last night, my, "So where are you from?" questions got answers like, "Westchester"...  or...  "I know Brad."  Not everyone there was so "institutional."  No one seemed to care where I was from either, which is nice, because anytime I go to the Private Equity Analyst conference, whenever I answer General Motors, I might as well paint a big bullseye on my face.  "Hey everyone... look... its a big LP that puts out lots of money.  Get him!!" 

The funny thing at this party was that I'm sure that a good number of the people there were probably writing blogs that I read.  I got into a conversation with Matt, the CEO of Return Path, who is a really personable guy, and I couldn't remember whether or not I read his blog.  Turns out that I did... he writes OnlyOnce.  It was also great to meet the GothamGal (Fred's Wife) although she chose to show up as her alter ego, Joanne, so there was no cape involved.  I think that anytime a significant number of people in a room are invited by Fred, they should be required to wear, "Hello, My blog is..." nametags, so we can match the person to the postings.  I'm sure they do that kind of thing at BloggerCon.

Everyone, regardless of profession, should be using a blog to record their employment experience. Resumes dumb down years of experience to one page, failing to capture or oversimplifying the whole story.  A blog that records, semi-regularly if not daily, your thoughts on your job experience, initiatives you've taken, self assessment compared to goals of what you think your ideal performance should be, and potential mistakes and what you've learned from them would go so much further to constructing a complete picture of what you bring to the table.  Blogs are a great record of your demonstrated ability to think strategically and to communicate with written word--two of the most important attributes that employment candidates need in today's sales and service focused economy.  There will be a time when blogs are almost as commonplace as resumes and employers check the blogs of the top resumes screened out as an interim step between the resume drop and the interview invite. 

Blogs are much better tools than social networking sites to connect to others in your industry.  Social networking sites are focused on the connections themselves, which is as forced and feels just as unnatural as networking for the sake of networking.  No one wants to be seen as the person "working the crowd" to see whose cards he or she can get or how many they can dish out.  Network development should be an incidental outgrowth of sharing of interests and connections should be earned by impressing others with your ability to bring something interesting to the table.  Blogs allow people to demonstrate, before you make a connection, how insightful you can be about your field of interest.  A great comment on the blog of someone else who is established as a thought leader may drive them to comment about your ideas, as well as drive traffic to your own blog and give you the chance to earn the respect and credibility of people in a great network.  You can get tapped into a group by the sharing of ideas, as opposed to feeling like you are walking around with "hat in hand" when you are pinging strangers for connections on a social networking site. 

Blogging helps you become a more insightful worker.  Anyone who has written a book will tell you that the process of writing turns parts of your mind on that pay more attention, pick out insights, and develop theories about the subject you are focusing on.  Your "mind's eye" looks for things to write about and attempts to come up with interesting things to write about.  Plus, you find yourself striving to be consistent in what you think and write, because putting all your thoughts "on paper" challenges you to match them all up in some kind of unified pattern.  You can't write one thing here and contradict yourself later.  The same thing happens to people who start taking up photography.  Whereas you might have missed lots of interesting visuals in your world before, part of your mind is now on the lookout for things that might make for an interesting photo, making you more observant. 

Blogging can be a positive outlet for people who are dissatisfied by their jobs or "between jobs."  A professional blog can be a great way to create something that keeps you thoughtfully engaged in your career in the face of a bad employment experience.  Blogging might help you seek out ways to make your job more interesting or help connect you to people who are undergoing the same frustrations.  Written in a careful and positive way, it can also turn into a great discussion of suggestions you've made to improve your situation or the systematic things about your position that make it difficult and how employers might examine their structure to improve things.  (Of course, you don't want your professional blog to be a long list of complaints about your company or boss that might reflect poorly on you or get you fired).   When you are not working, a record of thoughtful discussion of research is a better and more impressive use of your down time than not having anything to show for it except unsuccessful job searching. 

Blogs need better ways of searching the "About" page.  Standardized fields like industry, college, years of experience, areas of interest, etc. should be tagged in a way that allows me to pick out, for example, all of the Fordham graduates blogging in the investment field.  This is incredibly easy to do and it would go a long way to making blogs more functional social networking sites as well as make it much easier for new blog readers to quickly identify who they would like to start reading.

Link: Inc.com | The Reality of Raising Venture Capital#jump.

Jerry Colonna, who I had the good fortune to meet in person the other day, has a really great response to a frustrated entrepreneur in Texas, but there's one point I want to comment on...

"you MUST get connected. You know that business relies on people connecting with other people and that few great ideas are truly great enough to break through and emerge as successful companies without the founder/entrepreneur/CEO going out and pressing the flesh. So you don't have an MBA. So what? Go out and find a network you can join. If there's none in your area, start a chapter of the Young Presidents' Organization (YPO) or Young Entrepreneurs' Organization (YEO). Go to you nearest university and meet with the professors there."

It is important to be connected, but a lot of people's efforts to get connected are misguided or too forced.  That's why, although I'm a huge proponent of networking, I'm always very cynical about the networking nights that Fordham tries to do with its Young Alumni.  I tried to focus those efforts on a three month mentoring program, where you could build a relationship over time.  To me, networks are what develops naturally out of being a productively functioning and active member of a number of circles.  I never tried to develop a network, but I was always active in pursuing my interests and so my network grew out of that.  If you're growing a network and you don't have one currently, I'd wonder what's going on that is leaving you out of what should naturally be your network given your course of business. 

For example, I have an idea for an online information service related to college recruiting.  That idea comes out of the student mentoring I've done, which connects me to many people in and around the career education world, and some recruiters as well.  It was my participation in this network, because it was an interest of mine, that grew the idea.  By talking to all these people, I found a need and came up with an idea to fill it.  If you ideas are grown in a bubble, away from customers, peers, other entrepreneurs, its probably not a well tested or appropriate product for the market.  If I wanted to shop this idea around a network, I have one already because it is a relevent network that helped grow the idea in the first place.  If you join a network with the intention to see what you get out of it, people will see right through you.

Its a lot like dating.  When you go out to a bar with the intention of hooking up, you're unlikely to build a long term relationship out of that.  People are a bit guarded, because they know you're "on the prowl" and they're trying to play defense.  Its a market that paralyzes its sellers because they're all afraid of getting duped.  Its all too forced.

However, if you just pursue your interests on a regular basis, taking part in activities you enjoy, you will find yourself meeting people with shared interest and you've got a much higher chance of success.  I met lots of great people at the Boathouse in a much more natural and informal way.  I always wonder about people whose only outlet for finding new people is at a bar. 

A lot of times, I find both people who understand this point and people who don't at professional gatherings.  When I'm at ILPA, I talk to the people I like and the ones I find interesting, rather than anyone I feel like it might be fruitful for me to cozy up to.  I think these personal connections are much stickier than those made by new entrants trying to "work the crowd." 

So, not to say that Jerry's suggestions won't bear fruit, they're good suggestions. I just want to point out that networking--the building of really effective long term relationships--happens over time and it happens not because you go out and look for it.  It is the coming together of like minded individuals taking part in activities for their own sake, not necessarily to get connected to other people.  Just be careful not to cross that line between trying to connect and enjoy time with like minded individuals and trying to get something out of them.

On Thursday night, I went straight from LaGuardia to Bar 515.  PS, the Delta Shuttle to Boston is wonderful.  You literally drive up and park about 500 feet from the plane, and the whole process takes about 5 minutes to get on.  Its a pleasure.  Anyway, so I drove straight to the bar, and parked by one of those Muni Meter things.  They really dropped the ball by not letting you insert bills into it.  I suppose that's done on purpose, because they're counting on you not having change.  Its more lucrative for the city for you to get a ticket than for you to pay the meter.
Anyway, so I've got my phone and my keys and I'm shuffling through the bag in my trunk for change.  The moment I closed the trunk, I was like, "Oh shit."

I know at that moment, without checking my pockets, that I had left the keys in the trunk.  It was like I was subconsciously paying attention, but not enough to remember to put the keys back in my pocket, just enough to notice that I left them lying in the trunk.  Anyway, remembering the commercial, I called the Pontiac Roadside Assistance people and they transferred me to OnStar.  I told the lady that I locked myself out and she's like, "No problem, we'll have the drivers side door unlocked in ten minutes...  I just need your PIN number from you."   

Faaaaaaantastic!  They opened it by satellite.  How cool is that?  Anyway, that only got me halfway there, though, because the keys were in the trunk and I don't think my car has a truck latch inside the car.  I know that's hard to believe, but I really checked.  I'll have to go consult the manual on this, but its certainly not in any place that any normal human being would expect it to be.  So, I had to climb into the back seat, pull the fold down seats to get into the trunk, and climb into the truck from inside the car.  I was literally in the trunk up to my waist with my legs flopping around the inside of the car.  I couldn't see anything and I was just blindly groping.  Finally, I found them, and ended this amusing incident unscathed.  That right there makes OnStar worth it, though.  I mean, being a GM employee, we get it for free, but whatever the price is, that incident definately saved me a good hundred bucks and much time wasted, because I'm sure that's what a tow truck or lock guy would have changed me to Slim Jim their way in. 

Its all over. The Red Sox have come back from the dead and have finally made it to the Series. As a Met fan, I was more than happy to watch Johnny Damon stick a fork in them with a slam in the second. It was a beautiful thing to watch. The best part about it was that it wasn't even close. It makes the book thing a little easier to swallow... at least my day ended on a high note.

In other news, I'm pretty excited about a meeting I have with someone from GM corporate this Monday. I think they're part of a research and development group, but GM is so large, its hard to get a handle on what anyone is doing. One of my goals over the next year is to streamline our process of leveraging our relationship with the IT guys in the company. Not only that, we should be better leveraging our relationship with the IT folks from other clients that we manage money for, like Delphi and Xerox, as well. Its the kind of think that just needs someone dedicated to it and willing to keep after these guys... the kind if relationship building we do with our own GPs. We have relationships and connections to such a huge group of IT consumers that its a waste of a resource not to know these guys better--especially since GM can be such a difficult organization to get inroads to. That's probably my number one goal over the next year.

That makes me think of a post that someone wrote about what to look for in a VC if you are an entreprenuer at a startup. In this case, I think connections to a large organization should be one of the things that VCs should look for in their LP base. That would make for an interesting post... what to look for in a good LP. I'm sure that VCs and GPs in private equity in general are looking for more than just dumb money. Over the weekend, I think I'm going to put some thoughts down about this, because its something we think about a lot here in terms of what makes us a more attractive LP.

This is a great post about how the future of opportunites isn't going to be in the nuts and bolts of technology anymore... its on the content and services--how it gets packaged in a way that consumers find value in it.

http://www.adambosworth.net/archives/000026.html

Ok, so this one is going to be a private equity related blog, so all my friends call go back to sleep...

I was thinking yesterday that there's a role that many larger LP's, especially people who are particularly focused on access or co-investments, need to carve out and put a person on. While most groups have a INVESTOR Relations person, no one seems to be filling the role of INVESTMENT Relations person. The primary job of a partner at a firm, in my opinion, should be investment screening and decision making. However, in a world where tons of money is being thrown at the asset class and access is an issue for some, there seems to be a need for someone in the group to focus on marketing themselves to GPs, as opposed to LPs. Now, sometimes that role isn't necessarily marketing, its just managing the role of being a good, value added LP. Like, for example, yesterday I was on an advisory call for Ignition Partners. It turns out that one of their new projects is a perfect fit for another firm that we're looking at, and there's a partner at that firm that has extensive experience in the space, not to mention a geographic proximity to the entrepreneur. I asked the Ignition guys if they were talking with this other group, and they weren't, buy they were interested in the introduction. I made the introduction, and their entrepreneur will be visiting with this other GP soon. Points to GM for actually having something valuable to add to their investment process! (as opposed to just playing the usual LP role of beating the GP up about fees) I got to thinking, and there are tons of ways LPs can form great relationships with GPs. One other area I think is key is just the regular communication. One of the things we'd like to institute here is to do regular calls with our GPs regarding particular sectors of expertise, what companies they've done in an area, what opportunities their looking at, and what their strategy is--in addition to hearing a little bit about which partners are focusing on it. Of course, we regularly keep in touch with our GPs, especially with regard to co-investing, but not necessarily around more formal reviews of different sectors. Sometimes, just being a well informed, knowledgeable LP is being value added. This way, when fundraising time comes around, you don't need to reinvent the wheel, and you know the spaces, the strategies and the partners all very well.

Some LPs have other aspects that make them a value added LP. We try to maintain a connection to the GM IT group in Detroit and help our investments leverage off of good introductions--as you can imagine, navigating the GM infrastructure for purchasing on the IT side can be a nightmare. We have helped make introductions to the right people before, but admittedly, you can never do that kind of thing at the expense of the time you should be spending making good investment decisions. Yet, it does give you a lot of intangible value to a GP, which helps on the co-invest and allocation side.

Upfront access makes this an issue, too. Its not just about being a value added LP when you're in the fund, but getting into a fund in the first place is even more important. How long will it be before LPs start hiring placement agents to start placing them into funds? Its nice to have the luxury of being at a firm that has been investing in private equity for 25 years, but for new entrants, its going to be tough during the next go around. Without examples of how you can be a good LP, how can one group differentiate their money from another? I think there is something to be said for having someone in your group tagged with the responsibility to promote yourselves as an investor, maybe even more so than having a client relations person. If you can promote yourself as a good investor and get access to top performing funds, you'll get the clients you want whether or not you have a good client relations person. Of course, it would be nice to have both. :)

So we looked at real estate in Greenwich today for our new office.   For those of you that don't know, my team is spinning out of GM...  well, partially spinning out.   Let's just say spinning enough to get all the benefits of working for yourself, building equity value in a long term entity, aligning yourself with clients, etc...  but to at the same time, leave enough of a connection to build of off the great franchise that GM has built in private equity as well as off their financial strength.  So, we'll basically do all the same stuff we do for GM, but organizationally, we'll be our own firm.

Ok, so now that I have all that out of the way, the end result for me is that I'll have to be a reverse commuter.  After nearly eight years of working in the same office, all of the sudden I'll be hopping in the car for a 1/2 hour drive.  I did the drive this morning, exactly as I would do it as if I was working up there.  Its not bad at all.  I got up early, hopped right in the car, and went to the NYSC in Greenwich.  I worked out, showered, and then met my team at 8:15.  We looked at a few properties, and I think we found one we all seemed to like.   Its a very very cool space with a lot of potential.  Its exciting actually--exciting enough where I think I'm going to start a new blog.   So many VC's have interesting blogs tied to what they do.  I like the idea of that, b/c it focuses the blog on a particular thing, and you don't feel the need to include lots of personal stuff.  Maybe we'll call it plazablog, or maybe I'll just wait until I go to Stanford and I'll call it MBAblog or something like that.    Ideas?

Today, I met Bono.

In fact, not just met him, but sat in a meeting with him for an hour... right across from him in fact.  And yes, he wore sunglasses at the meeting. 

Bono is joining some former Silver Lake and Blackstone Partners, as well a guy from Electronic Arts and a guy that helped architect the Apple turnaround, to form Elevation Partners, and I met with their team, along with Jeff Barman and Jeff Reals.

In terms of what I think of them, I thought of a potential fantasy baseball trade that I got offered earlier in the day.   Rich tried to trade me A-Rod for Adrian Beltre.  Now, in terms of the pure stats, you could argue that Betre is having a better year than A-Rod easily.  In fact, the only mitigating factor is A-Rod's 19 steals.  However, when you consider how far the Yanks are in first, its probably not likely that he'll swipe too many more. 

However, thinking about this in terms of the pure stats proved difficult.  In fact, the fact that I would be trading for A-Rod really clouded the whole thing and made it difficult to think of logically.  Was I only interested b/c it was A-Rod?  Was I too worried about doing just that that I discounted his real impact? 

The same can be said here.  Its very easy not to take this group seriously b/c of Bono--just the same as its really easily to get blinded by the celbrity factor.  I actually think they have something here, and I have to say, Bono said a lot of smart things about the nature of investing in content... how it needs to be both creator friendly and fan friendly as well, for people to create lasting, lucrative models in the future.  Music companies in the past had a stranglehold on distribution, so they could screw the artist and screw the public, but the internet punched a hole in all that.   These guys want to create businesses around the idea that what's good for the artists and the consumers might also be very profitable as well.

I do think that he'll be engaged in this company and that its not a fly by night thing.  Here's a guy with a lot of political capital to risk... someone who really values his ability to do the right thing by people.  I don't think he's going to let 100% of the driving to the finance guys, b/c I don't think he wants to be dragged down by them if he doesn't agree with what they're doing.  All and all, I think its interesting stuff and work taking a look at.

Did I mention he wore the glasses?