With the decline of the dollar, should we just be adopting Acebucks?
I don't like to be negative about other people's startups, but when I told Howard that I didn't get Acebucks, the company that he, Peter Thiel, Mark Pincus and James Altucher funded, he wrote back...
"You hate it? I like haters"
I don't *totally* hate it, but I do think a conversation about it would be interesting, because it touches upon a lot of interesting topics, like virtual economies, the Facebook platform, platforms in general, etc.... plus, I'm not sure I see the promise of this. I say that given that smart people have already invested in it, so who cares what I think, right?
When I first heard about Acebucks, one of my first thoughts was "Why isn't Facebook doing this?" It seems natural that a place that supports gifting and various forms of profile bling would want to make micropayments go as smoothly as possible. Letting someone else handle that would be like the government privatizing the Treasury and the US Mint. It's almost ludicris IF the governing body sees currency as a major cog in the engine of their society. Certainly Linden Labs sees it as integral to their economy and strategic to their business to run the currency, as does Habbo and Cyworld. Why not Facebook?
Here are a few possible explanations of why Facebook might not do this itself:
1) Facebook sees itself as a network of webpages, not an immersive virtual world. Note the comparisons I made where currencies are big businesses for social spaces. Those spaces are a lot more like our typical definition of virtual worlds thanFacebook is. They are places to play, to build, to be someone else. Facebook is where I connect as the real me to real other people that I actually know. There's not a lot of "virtual" in that definition, and what that means is that you lack the organic elements that create value in the first place. The concept of land ownership and the ability to build things in Second Life are the elements native to the system. Because these take scarce resources, you create the concept of value and the need for currency.
Acebooks has the unenviable task of needing to do the job of going out and encouraging the development of scarcity, like multilevel games and virtual items to create the need for currency in the first place. When step one of your business plan is create the need for yourself, that's not going to be easy. Not only that, one thing that a lot of people don't seem to understand about virtual currencies is that they only make sense when everyone else is just as immersed in the system as you are. If you buy a sword that cuts through anything in Warcraft, everyone you encounter can see and respect the value of that. If you buy a picture of a sword in Facebook, people see a picture of a sword which might be cool, but they don't know you spent 1000 Acebucks on it, nor they they really care, because they're not into the games needed to be played to win Acebucks.
Taking what works in Warcraft, Second Life, and Habbo to Facebook doesn't necessarily guarantee success. These are all unique communities with their own norms.
2) Facebook doesn't want to be Microsoft and just eat the successful people who build on its platform. In the 90's, if you made Windows software, there was always the fear that Microsoft would ride up from beneath you in the stack and swallow you whole. This made for a very uneasy relationship. Perhaps Facebook is just trying to be as developer friendly as possible, and even when people build applications that should absolutely be a critical piece of their business, they're just going to let it fly, and not make a big stink over their success. That would certainly make it a more attractive place to develop.
3) Maybe Acebucks is just built to flip and Facebook is just waiting to see if it gets any market adoption before it trades some hyperhyped Facebook stock and a little cash for it. Facebook has more than enough things to worry about without going off into some kind of currency experiment before it will spend any mental resources and management bandwidth on this. They could just let the Acebook folks test the currency idea to see if it will fly, sort of like outsourced R&D. This would be pretty smart on their part and pretty smart on the part of Acebucks so long as their financing was done at a valuation conducive to the flip.
Either way, I'm just uncomfortable with the idea of a startup built on a platform that could just shut it off or compete against it. You could say that about any app, but few other apps are on missions so critical to revenue generation like micropayments. I doubt Facebook would want to build its own version of Zombies, but a virtual currency might hit too close to home. I suppose with Facebook investor Thiel on board, they'd know a little something about what Facebook's strategy is here. His presence makes this seem a lot more like outsourced R&D on Facebook's part and, in my mind, supports the built to flip possibility.
links for 2007-10-13
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How are we going to get all that great "people like you did x" career data? :)
Starbucks to have free wifi?
I was just telling someone yesterday that there's no way this deal currently makes much money for them. More and more people bring their own access or just go without. They're better off making it free (or ad supported... click through two video ads to login or something) and getting more fannies in the seats. Now, every Starbucks can be an incubator. :)
My Testimony to the City Council hearing on Promoting the Technology Sector in NYC
I have been asked to deliver testimony to the City Council today on promoting the local tech sector, particularly within reference to ITAC's recent report.
Here's what I've written up:
My name is Charlie O'Donnell and I am the CEO and Co-Founder of Path 101--a New York City startup focused on career discovery and development. I am also the Founder of nextNY, a grassroots, participant driven organization of over 1,000 up and coming technology and digital media professionals right here in the city. nextNY is made up of entrepreneurs, designers, developers, investors, marketers, and media professionals--all integral parts of the local digital community. Before founding my company, I worked for Union Square Ventures, a NYC based early stage venture capital fund and then for Oddcast, a local interactive advertising company, as a product manager.
In all of these various roles, I've had a unique opportunity to see the recent growth of the NYC technology community from both the startup and investment perspective--as well as from the perspectives of all of the ambitious people I've met through nextNY.
New York is truly coming into it's own as a hub of innovation and technology over the past couple of years, but I say that knowing full well that innovation has been part of NYC for quite a long time, even long before the Late 90's tech boom. What's happening now plays uniquely into NYC's hand. The technologies that once represented a strategic advantage for Silicon Valley and Boston are being commoditized and it is becoming more and more important to be close to your client and user community than to develop your technology in a particular city. In today's climate, a startup in the video space can and will be just as well served by rooting here in the New York media technology community as it would anywhere else.
Still, given the sheer volume of talent and resources available in the city, we have not reached our full innovative potential. There are several points of friction that hinder the emergence of NYC as a paradise of business creation and cutting edge digital contribution.
First, much of our technological workforce has largely been trained to work for big companies. Their jobs are often about maintenance, efficiency, and satisfying business objectives than they are about pushing the envelope, creativity, and true innovation. They are compensated with lucrative cash compensation, as opposed to the upside that the equity ownership that incentivizes startups. This creates an environment where joining a startup not only represents financial hurdles, but cultural ones as well. It’s hard to tell your NYC friends that you’re tossing aside your job in the Goldman Sachs IT department for a startup company—people just don’t accept that as a legitimate job route compared to that being the norm in the Valley.
One of our best strategic advantages, creativity, driven by the city's arts, multiculturalism, globalism, and critical mass of other creative industries, needs to be fostered and guided into these innovative technology fields earlier. It starts with our education system, and we need to be telling students and showing them how to be the leaders and influential members of the digital community. I grew up in Brooklyn, went to high school in Manhattan, and college in the Bronx--largely through the late 90's tech boom and I had very little knowledge of the innovation and development going on right here in NYC at the time. All I saw were bankers and lawyers. The idea of putting my passions behind creating a company were as foreign as you could get. There needs to be a significant amount of education around the extraordinary opportunity that NYC brings with it. Students should be emerging from school with real ideas and real passions, not just jobs they found at the top of a help wanted list. They need to have the skills necessary to see there ideas through. We face a serious shortage of engineers, developers, and designers, and even fewer of what we have are proficient in the most cutting edge languages and technologies. The ITAC report outlines new initiatives in Workforce Development and Education that would go a long way towards addressing those issues.
Information is also critical. Groups like nextNY serve as a knowledge resource, but even our 1,000+ member collective knowledge is unfamiliar with all of the various grants, city services, and innovation friendly services the city and various independent organizations have to offer. For example, when I worked at Union Square Ventures, I was constantly discovering new incubators at local universities--places I didn't even know had entrepreneurship programs.
When cities want to encourage tourism, they often spend resources on creating a map, a booklet, and a website--all as exhaustive as possible in trying to advertise all of the possible tourist destinations anyone might want to see. What NYC needs is a similar information dissemination program as detailed in the ITAC report. Most importantly, it needs to be a living, breathing, open resource built on some kind of wiki-like platform where the members of the technology community can be just as responsible for its upkeep as various city services can be.
My final bit of support for what ITAC has recommended has to do with real physical infrastructure. Over the years, those involved in technology innovation in small companies and startups have always made due with whatever physical places we could find to conduct our business. We shared insider information about where wifi could be borrowed and where businesses wouldn't mind if you worked at a table for a whole morning and just ordered a cup of coffee or two. This has been highly inefficient. While there are businesses like Sunshine Suites that have sprung up to service part of the need for startup companies to maintain a home, there exists a severe lack of community space--places where creative minds can collaborate freely and connect to each other. A good place to start would be to incentivize as many cafes and similar gathering places to provide internet access free of charge. Municipal wifi may be too difficult to implement, but a very workable, and less expensive substitute would be to make sure that every conceivable place where you would want to set up shop or meet with others, would provide wifi. In the same vein, there should be incentives for other types of innovation support. For example, my startup, Path 101, is currently living in two empty desks provided by another larger technology company called Return Path. It was a favor done for me by the CEO, Matt Blumberg, who knew we were looking for space, but in all fairness, Return Path should probably receive some kind of tax credit for doing its part to support the local innovation community.
If there was one thing I would want to leave off with for all of those who are interested in supporting the technology community in New York City, I'll tell you simply to join it. Instead of asking us to come here and testify, which is great, don't get me wrong, it shows your interest, show up at our community events. Come to the a nextNY gathering, join our listserv, or a New York Tech Meetup. Start reading the blogs of local entrepreneurs and blogging yourselves. Get off the email newsletters and get on RSS feeds. Join LinkedIn. If you don't use the same tools as the technology community and show up to our events (instead of just inviting us to yours), you are never going to be looked upon as a source of active support and your programs will fail to get traction. Supporting a community is just as much a social undertaking as it is a management or financial one.
Jaiku throws in the towel. Founders go to work for Google.
...Because that's what you do when you are a little startup with just a little traction and what you're doing isn't core to Google's strategy. You go to work for them. Jaiku had a bright team and I'm sure they'll contribute significantly to Google's mobile strategy.
Did you really think that Google bought Jaiku for Jaiku? Maybe you don't remember, but they already have Dodgeball... and if they really cared about the service, why wouldn't they just buy Twitter? Look at the traffic between the two sites. Clearly, this isn't about buying or using the service... and I'm glad, because getting bought by Google at such an early stage, unless you are in the business of directly monetizing audience, is just about the worst thing that can happen to your startup if you want it to grow.
Steve Rubel thinks that it will be 45 days before Twitter gets sold, probably to Yahoo!. I highly doubt it. At this point, I think serious entrepreneurs who care about building great services are thinking twice about quick exits. I'd be highly disappointed if Twitter goes to Yahoo! so soon because there's absolutely nothing Yahoo! could do to help that service grow... What strategic advantage does Yahoo! have in the mobile space? Having met @jack and @biz, I feel like they're in it for something more. Don't get me wrong, I'd never hold it against anyone for taking all that cash, but as a consumer of the service, I'd rather see it grow and innovate rather than become a victim of Web 2.0 Whack-a-mole.
Didn't we learn that early M&A stifles innovation from del.icio.us, MyBlogLog, Dodgeball, etc...?
In fact, I'm willing to bet Steve on Twitter. I'll bet $50 donated to his favorite charity that Twitter does not get acquired in 2007. (I have no insider information on that, btw... Blogger's Honor.) All I have is a hunch that those guys are more focused on building a better service, a real business and a large community.
Whaddya say, Mr. Rubel?
Best Pitcher Ever... in Whiffleball
We used to have a guy on my street who pitched like this, but he didn't have the same kind of velocity. I'd say this is as unhittable as you can get.
Twitter Prepping its Mobile Ad Units? It was bound to happen eventually...
While everyone is talking about Google and mobile advertising, has anyone else noticed the emergence of "Tips" on their Twitter mobile notifications? This is surely the precursor to mobile SMS keyword ads from Twitter.
Here's an example... Everyone's favorite CNET reporter Caroline McCarthy answered Nate Westheimer's call for a Silicon Alley band this morning.
Here's what it looked like on the web:
But here's what it looked like on my phone... 26 extra characters tacked on at the end.
Tip: Wow, you look *good*.
Clearly, Twitter is testing out the feasability, useability, and user reaction to things being added on to user twits. If successful (or if the users are silent) you would imagine that its only a matter of time before this becomes:
Tip: Drink Jamba Juice.
The new tracking feature will probably be used to help power ads, too... and what a powerful ad system that would be... AdSense for SMS, essentially. Imagine being able to add 15-25 extra characters onto every single post where someone mentions they are thirsty, or the word "sex" pops up. (Tip: Use Trojan condoms?)
In all honestly, I love Twitter... completely addicted to it. I'd pay a monthly fee for the service if they asked, so certainly I don't mind if if this is what the ads look like. Actually, the ads might make for pretty hilarious content when placed next to the inane things my friends twit about. I'm absolutely find with this kind of advertising and I doubt I'd pay my way out of it if given the chance.
links for 2007-10-05
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Nice publicity for nextNY - Photo credit should go to Oberkirch on that one from a past podcast interview at USV.
The Dvorak Theory of Nonsensical Prognostication and Its Relationship to Calcanisisms and Dave Wining
Let me paraphrase Dave Winer for a moment:
"The Techmeme leaderboard sucks because, now that we have transparency, undeserving others who didn't close to inventing RSS or the question mark are unfairly stealing my web influence. People are saying stupid things about Web 3.0 just to get attention. (PS... Did I tell you what I think Web 3.0 is? Its when mainstream media acknowledges us little guys... and clearly that's a more well thought out vision of Web 3.0 than Jason's and clearly I'm not annoyed that more people noticed a tree falling in the forest than my seminal Web 3.0 post.) There's more important stuff to be blogging about, like Iran. Now, back to blogging about the blogosphere."
So, that's not an exact quote, but it's close.
Don't you just love it when the big name pundits confuse their popularity for indications of the quality of their writing and support for their thinking?
Knock Jason if you will, but I think he's incredibly self aware and so is Guy Kawasaki. They seem to understand their role as pot stirrers, and that's why they're so damned good at it. Truemors? Maybe the worst startup ever, but it was one of the best PR moves ever. For 14k or whatever he spent on it, Guy bought himself even more incredible PR and self-marketing, and not for a moment did anyone confuse him with an actual entrepreneur, nor did he. In the same way, I'm pretty sure Jason knew exactly what he was doing when he proclaimed Web 3.0 to be pretty much exactly what Mahalo was doing. He's not an idiot, Dave, he's incredibly smart, actually. Jason being Jason is exactly why Mahalo is as much of a conversation topic as it is.
All these "big guys"... the Guys, the Winers, the Techcrunches, the Scobles, and the ultimate, the Dvoraks, they serve a function. They are the conversation leaders. They give us something to talk about (or in Dvorak's case, someone to send our hate posts to). In the absence of real news, they suggest topics... and they often do it in a way that inspires others to write a lot more inspiring literature about it. Does anyone out there think that Scoble's post on anything is going to be the best post on it? That's not his job. He points to things... not unlike a Paris Hilton, who we don't actually watch for what she says, but more for the things she "points to" around her... the cult of personality, the flow of news, the lifestyle, etc. The most thoughtful posts are on the blogs only a handful of people read, because they're too long or not controversial enough or they have too much integrity than to shamelessly linkbait by writing "Why Web 2.0 sucks..." posts.
They are the water coolers. We gather around them and talk about their topics because we like to be able to connect to lots of other people talking about the same thing. The tail isn't as long as we think it is, because, at the end of the day, how much fun is it to be the only person actually blogging about cats? That's my theory on why mainstream TV never goes away... because people want to go in the next day to work to be able to talk about what happened on Lost or Grey's or whatever.
The problem is when those folks don't realize that they are just water coolers... when the water cooler starts going "blub, blub, blub" so loud that it tries to drown out other people's conversation, thinking that people are actually at the water cooler for the water and only the water.
I was talking to Nate last night about how the nextNY listserv has been getting a little boring of late. That's because people only seem to be using it for useful things. No one posts the kind of idiocy that Dave despises, and while on one hand I'm glad my inbox isn't full of 300 post listserv threads with namecalling, it does sort of wake people up and gather them and get them talking and that's an incredibly valuable function.
Custom Kitchens at Googies
Emily from Photoshelter does vocals, plays a mean guitar, and writes a helluva product spec from what I hear. She's at the mic on the right with the guitar.
links for 2007-10-04
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Turning point in the Zune vs. iPod war? Funny how MSFT is suddenly doing right by its customers whereas Apple is now the bad guy.