• scottberkun.com » Understanding Apple (Apple now the #1 Music retailer)
  (tags: innovation ipod markets music product)

"I don't drink. I'm just here for the phenomenon." 

That's what I told someone at an impromptu Gary Vee party the other night in San Fran.  I don't have any issues with it--just never got into it and prefer not to start.  To each their own, right?

So, the fact that I'm blogging about a wine videoblogger who owns a wine store in Springfield, NJ should mean something.

I first heard about Gary Vee (Vaynerchuk) at this year's SXSW.  When the sponsored parties in Austin got too crowded, Gary (conveniently sporting several cases of wine) threw an impromptu party at the Marriot.  The buzz was immediate... and my first thought was "Who the f is Gary Vee?"

Caroline McCarthy summed it up best when she said that Gary was the "Jay Gatsby of SXSW".

At first, I was pretty disinterested in the buzz.  By nature, I tend not to like stuff that everyone else likes.  I never saw Titanic and a big part of the turnoff for me was that everyone else did.  Plus, like I said before, I don't drink, so why should I care about a wine guy?

But the buzz grew...  and what I started to realize was that it wasn't really about the wine.  It was about people.  The other day, Gary inspired hundreds of people to just say something nice about someone else as part of "Good People Day."

That was it.  Just talk about good people, and link to them.

*Scratches head*

So now I'm thinking, "Either this guy's a nutball, or maybe he's on to something."

Turns out, it's both.  He's a bit nutty, but what convinced me that he was onto something was meeting him in person and seeing him in action.

Alex is kind of a foodie and so he got excited when Twitter started buzzing about Gary's trip to the Bay Area. Gary was speaking at Google and planned to get a party going that night.  Alex and I were hanging out with Rachel, and we all decided to check things out.

After some Twitter debate, Eos was chosen as the location.  We were some of the first to arrive.  Little by little, folks with that "I'm looking for someone I know from the interwebs" look started poking around. 

"Are you here for... um... "

"Yeah...  you?"

"Yeah...   When's Gary coming?"

The staff reaction at Eos was funny.  Apparently, they didn't know we were coming.

"How many people are coming?

"Well, it's tough to say...  You see, there's this thing called Twitter... and... um... somewhere between 10 and 5000 I'd say is a safe bet."

Soon, there were at least 50 people and the party moved upstairs.  Everyone was really excited and when Gary arrived, things became crystal clear.

It wasn't about Gary at all. 

It was about the wine... but... it wasn't really even about the wine, because it's what wine really represents.  Wine is people... it's people celebrating, it's people socializing.  It's getting to know a good wine and a good person... and that's what Gary does.  He doesn't promote wine.  He promotes people... other people... the company of others.

The only time I actually heard Gary say the words Wine Library was when one of the restaurant staff asked him if he was a critic--trying to figure out who the heck he was.  Points off for them for owning a a wine bar and not knowing, but either way it was only then that he gave her his card.  Other than that, he mixed with the crowd--people he knew and people he didn't.  He welcomed us and was genuinely excited to see us.

There were no logos, no pitches or speeches.  No "sponsor sessions".  It was just a great time and Gary footed the bill for the whole thing.... easily a few grand...  quite easily.  All that wine, some food, and my Sprite.  :)

What I was left with was a great experience and the desire to talk to others about it--exactly what every single brand out there is trying to do and almost all of them are failing at miserable at.

And don't tell me it's easier with wine, because I don't even drink the stuff and here I am talking about it to 2500 people.

All the hot air that gets blown around about social media, community, blogging, branding, etc...  and very little of it can hold a candle to what this random wine guy in Jersey does every single day.

And what does he do?  He's just passionate about what he does and loves people.  Notice I didn't say loves his customers, or loves wine drinkers.  He loves people.  That's critical, because most people aren't there aren't your customers.  They're just people, and if you don't show them some love first, forget about ever being lucky enough to call them customers.

And its making him money, too.  Wine Library does over $50 million a year in business, with internet sales increasing $10 million in the last two years alone.  But, all that seems like an afterthought, really. 

So this meandered a bit.  You want key takeaways?

Here's what I've got:

1.  It's not about Gary.  He promotes other people and encourages people to promote each other more than he ever pitches himself.

2.  He takes it to the streets.  You want people talking about your brand in person?  Talk with them about it--in person.  The sheer amount of people Gary meets in person is astounding.  How many people a year does the face of your company meet?  Does your company even have a face--and not just a face, but does your company have a handshake, too?

3.  Stay positive.  If you needed to feel better about something, who would you rather get a phonecall from?  Gary Vee or Mike Arrington?  The guy just overflows with positivity--and that attracts people.  People want to feel good.  They don't want to get dragged into blogwars, flamewars.  Gary doesn't say that his competitors "must die."  In fact, he probably shops at his competitors.  There's already enough problems out there to get people down each day--people are going to tire of you pretty quickly if you don't immediately make them feel good.

4. Give it away.  Do whatever you can to put your product in people's hands...  even if you have to give it away.  It gets people talking...  and they can't talk about your product unless they have it.

5. Get off your high horse.  By videoblogging about wine, Gary brings a somewhat sophisticated, maybe a little "insider" activity down to the level that everyone can understand... and he clearly wants everyone to understand it.  This isn't the kind of brand that says, "We don't want our ads next to user gen content" or "We only want a certain type of clientele."   Gary screams "join in... everyone!"

When I was in 8th grade, I had a zit on my forehead.

It was small, but I started messing with it.  I tried to pop it, but I made it worse.  It sort of semi-popped and then I went in digging the rest out and.... well,  it just got from bad to worse.  I needed a band-aid to cover the gaping hole I'd dug.

I should have left well enough alone, because no good can come from trying to dredge up what should obviously be ignored.

It's really too bad I never learned that lesson, because then I wouldn't be writing this post in response to Hank's "Blame the VC's" post.

Hank's post is misguided from the start:

"I believe it should be possible to start a small business and to have a small number of profitable customers, and to earn a living. From there, it should be possible to work hard, and to grow your business into something substantial. Until recently, this was the American way..."

Actually, "small number" and "profitable customers" rarely go hand in hand unless you run an ultra-premium high-end service--mostly because of this big ugly thing we economics minors like to call "overhead".  While the number may be larger or smaller depending on your business, I know of very few businesses that achieve profitability without some kind of scale. 

I suppose if you were painting people's houses, you charge them more than the paint and your labor cost you, and you're profitable after Customer #1, but that's not really a scalable business. 

And as for the American way, it certainly didn't work for Henry Ford. 

To my knowledge, he didn't charge the first Model T owner the entire cost of the factory.  He lost money at first, only making money when he found a way to innovate, bring costs way down, and achieve scale.

And on who's dime?

The Wikipedia entry on Henry Ford cites several early investors--VCs if you will, or certainly angels--who foot the bills until Ford finally figured out a way to lower the bills enough to pay them... and he seems to have failed several times before finally succeeding.

"- Backed by the capital of Detroit lumber baron William H. Murphy, Ford resigned from Edison and founded the Detroit Automobile Company on August 5, 1899. However, the automobiles produced were of a lower quality and higher price than Ford liked. Ultimately, the company was not successful and was dissolved in January 1901.

- Ford also received the backing of an old acquaintance, Alexander Y. Malcomson, a Detroit-area coal dealer. They formed a partnership, "Ford & Malcomson, Ltd." to manufacture automobiles. Ford went to work designing an inexpensive automobile, and the duo leased a factory and contracted with a machine shop owned by John and Horace E. Dodge to supply over $160,000 in parts.Sales were slow, and a crisis arose when the Dodge brothers demanded payment for their first shipment."

Noticing a trend here?   Ford went out of his way to get these cars as cheap as possible.  It's not a stretch to think that if Ford would have thought of a way to make money giving cars away for free to get scale (maybe make money just on replacement parts or gas or something) he would have done it--and he would have tried doing it on the backs of his investors, too.

Hank blames VCs for essentially breaking this tride and true apple pie model of business.  The reality is that, for years and years, outside investment has enabled businesses to fill the gaps between overhead and incremental revenue until scale has been reached. 

What Hank fails to realize is that profit and revenues aren't the same thing...so, just because you make revenues doesn't necessarily make you a better business nor does it preclude the need for outside capital. Amazon didn't turn a profit for years... and now they're making lots of money.  Without not only venture capital, but public market investment, that business would have never existed... and they were making revenues, just not at a profit.

Today, what has changed is that outside investors don't need to fund nearly the same amount of overhead... and no one likes funding overhead.  You could pour tons of money into the overhead of a company and never turn a dime of revenue or profit.  That's what the semiconductor business is like.  It can cost millions to develop a chip that just doesn't wind up working in production or that gets leapfrogged by a competitor. 

So, when VCs fund a free model, they're still doing the same thing they always did... fund the gap between incremental revenues and overhead... but those numbers look way different than they did previously.

Here's the difference:

- First, investment financing goes into a much higher percentage of variable cost than it used to.  You are at least funding businesses that has costs because people are using the service.  That's a step up from funding a business before you had a clue as to whether anyone wanted the service in the first place.  Your overhead is lower, and even some of your variable costs are lower.  In the "old days", the amount of dollars it took to create a business online was a lot larger than it is now.  Servers were more expensive.  Bandwidth was more expensive.  You paid Microsoft for all sorts of stuff that is now open source--free not because VC's foot the bill, but because thousands of individuals got to got together to collaborate and donate their labor to solve collective problems.   So, you can turn a profit with a lot less cash.

- We also have new opportunities for revenue that didn't exist before.  Indeed, for example, is profitable.  They've got 50 employees and they've got a helluva lot less overhead than Monster.  You can get your job crawled for free there.  Their model is that it's easy to get your job in their index, but they charge for sponsorship and placement.  So, basically, most of the people who get value from the service don't actually pay for it.  That's only possible when you're not hiring a bunch of salespeople to charge $300 to post a job on the site. 

Lowering barriers to usage and participation, for them, creates a highly scalable, lower overhead revenue opportunity.  Of course, they needed some outside investment dollars from Union Square Ventures to help them get there and now they've got a strong business.   

This is something Twitter is bound to take advantage of.  If you ever use the "track" feature on a brand, like I do with "jamba", you'll quickly get a sense the data coming off of that thing is way more valuable to brands and marketers for research purposes than it probably is to individual users. 

With costs so low and new data-driven business models emerging, people are trying to launch venture backed businesses that look very different than old business models, and perhaps look, to the untrained eye, like businesses that crashed in the late 90's. 

Some will succeed.  Lot's will not.  That's the way it's always been, so to portray the current situation as being something vastly different problematic is naive. 

When cellphone companies give away free phones to make money on minutes, should we cry out that outside investors are funding a broken business model?  After all, it's debt and capital markets financing that makes this delayed cashflow possible.

What about LinkedIn?  What percentage of their userbase pays for that service?  Yet, they're on track for $100 million in revenues this year.  I'm quite sure David Sze would be happy to "blame the VCs" for that!

Hank, you're way off on this one...  but you certainly started a conversation... I'll give you that.

Good luck if you ever need venture financing for your business, btw...   Regardless of whether you're right or wrong, ripping VCs isn't generally a good business model for financing your business.

"Hey, aren't you the guy that..."    

Need more proof that the inmates run the asylum?

The Mets are having a fan contest to select the song that gets played during the 8th inning of their last season at Shea.

They're being rickrolled.

"To post a misleading link with a subject that promises to be exciting or interesting, e.g. "World of Starcraft in-game footage!" or "Paris Hilton blows Busta Rhymes' dick" but actually turns out to be the video for Rick Astley's debut single, "Never Gonna Give You Up". A variant on the duckroll. Allegedly hilarious."

I subscribe to mentions of the word "Mets" on twitter...  the stream went crazy this morning with the call for rickrolloing.  It has 1500+ diggs at the moment, too!

Check out the TweetScan of this move by the fans to get Rick Ashley's "Never gonna give you up" played at the stadium.

I met Chuck Taylor from Affinity Circles at ERE.  He's a cool guy and there may be a lot of opportunity for us to work together.  I like the ideas they have around the future of their product.

He started using Twitter at the conference and I was showing him the tracking tool.  He decided to start following me and I told him that he'd get all my ridiculous little updates throughout the day.  I knew he had better things to read, but he was like, "No, no, that will be cool."

Apparently, I wasn't as cool as he thought...  busted!!   :)

The command you're looking for is "leave ceonyc"...   No worries, buddy.  "Can't win 'em all..."

The latest shiny sparkly thing in the web world is Muxtape.  For those of you who don't know, Muxtape is a music sharing service that allows users to upload and share a playlist of music though a simple interface.

The only problem is, technically, it's illegal.  Artists are supposed to get paid when their music is played.  While the fine print says that you're only allowed to play music you have the rights to play, we all pretty much know the deal...  The company will throw their hands up and say "we can't be responsible for what people are uploading" and then after they actually do get sued, they'll be forced to scramble to sign deals with the labels--the terms of which you know will somehow kill the user experience.

The path of innovation in the music startup world is horribly inefficient.  To do anything interesting, you basically have to start out doing something illegal, or nearly illegal, or something that will dig yourself in a royalty hole before you even get started.  Sing it with me, "FAAAAAAIL."

What we need is a set of APIs, not just to get legal music, but multiple ways of paying for it, that would allow innovaters to build on top of.  Getting and paying for music should be similar to other types of commodity data...like stock market data or player stats for my fantasy baseball team.  I don't care who gets me Metallica's upcoming album, so long as I have choices as to its form and the ways I can pay for it. 

So instead of having a long line of startups trying to sign deals with labels,, which is horribly inefficient and slow, there should be one company that handles digital delivery, rights management, compensation.  Labels should be purely evaluation, business, marketing, and publicity machines.

This company would have a flexible set of delivery APIs... Every song could be streamed, downloaded, previewed, even sampled.  It would be like the Yahoo! Pipes of music.  So, Muxtape could just stream from this company instead of requiring user uploads and doing the storage themselves.

What's even more useful is that these APIs would have liberal grace periods for new companies related to time and volume.  Give them time to prove out interest in their service, get funding, etc., without fear of prosecution or a big royalty bill.  Frankly, the data on which startups are taking off, who's being played, and by who should be worth it for labels to give the companies using this API a long leash and see where they go with it.

When it comes to payment, the APIs should be equally flexible:  Allow premium subscriptions for various types of all you can eat services.  Make insertion of ads from companies like TargetSpot drop dead simple. 

How about allowing users to buy concert tickets through the service and essentially build up credits for free music in the system?  How many times have you heard, "The artist makes more from the concert, so I'd rather spend money that way and download from Limewire and have it go to the labels?"

I easily spent $1000 on concert tickets last year...  and I'm likely to spend that much every year with easier access to free music--and great tools to help make recommendations to me. 

One breakthrough business model that a more startup-friendly model for music distribution gives you is the ability to buy the attention of the influencers.   If you have standardized data about who's listening to what, and when, you have data about where the influencers are, and you could sponsor their streams with more music.  If I was an indy band, I think I'd pay for placement on Fred Wilson radio if I felt like my stuff was appropriate for that station.  Certainly if I was a record label, I'd do that as well.  It's sponsored content.  Labels spend millions of dollars a year to promote bands--why not use that money to just put the right music in the hands of the right people?  Isn't that the premise of music based social networks like MySpace--only MySpace never built out a reasonable toolset that allows bands to analyze and make marketing decisions around reporting, nor a away to offer music to a targeted set of the right people.  Instead, they just had to spam everyone with friend adds. 

Imagine if you got an e-mail saying, "Metallica would like to sponsor your Muxtape.  If you would like to select a different band to be included as the bonus track on your Muxtape, click here, otherwise Metallica will be added."  You could do that with live streams, full-circle data about who's listening to what, and what else they're listening to, and the right set of business tools to allow Metallica to make that buy at scale when their new album comes out.

Ok, so shread this idea to pieces... why wouldn't this work?  Anyone else doing anything like this?

I'm headed out to the ERE Expo in San Diego--I got a very exciting invitation to be a part of their startup panel along with Benjamin Yoskovitz (Standout Jobs), Clint Heiden (VisualCV), and Dan Arkind (JobScore).  What's so cool about our panel is that we all represent different aspects of the job process...

You will be able to discover a career on Path 101, present yourself well with a Visual CV, engage with a company and apply through Standout Jobs and then hopefully make your way through the company's recruiting process, which might be managed by JobScore.  Nice!

Since I was out there anyway, it was startup cashflow-friendly to swing by the Bay Area and stay with friends.  Given the success of our first "Entrepreneurship Listening Tour" we decided to get in touch with a bunch of experienced people to get some feedback and to get on the Bay Area VC radar for later this year.

We're pretty booked during our days, but we'd love to catch up with and meet a lot of people.  On Thursday afternoon, we'll be co-working out of Citizen Space, and then heading out later to 21st Amendment.  Come work with us (or eat/drink with us)!   Tell us you're coming out that night here!

If there's anyone you really think we should meet--smart VC's, entrepreneurs, developers, please let us know.  E-mail us at us@path101.com or follow us on Twitter (@ceonyc and @alexlines). 

"It's Kylie at (Restaurant?) Capital.  I'm just calling to let you know that Josh is on his way there and he's about 5 minutes away."

...or Carly from First Round Capital.

"Hi, Charles. It's Mom. Nana just called. She booked a ride with (Ces and Roy?) tomorrow, so she booked, and she's coming into Brooklyn, okay"

...Who the f are Ces and Roy and why are they driving my grandmother around?  Ohhh...  Access-a-Ride!

Charlie, I'm picking up the (aero bed?) for you in (Lennington Panes?). It's $99.00 and I have a 20% coupon.

...Lennington Panes...   a window shop that sells air beds?   Ah...   Linen's and Things!

I'm looking at Fred's FriendFeed.   So, I guess it's like RSS for people.  PSS?  PeopleSimpleSyndication.

So now I'm seeing the Fred Channel...  All of Fred, all the time.

But, to be honest, I don't want All of Fred.

Fred and I don't share the same music tastes, which is mostly why I don't follow his Tumblelog.

Not only that, but this feed gives me flat Fred.  It takes Fred out of the context of the medium. 

So now I'm seeing his Twitter messages on a webpage.  I hate reading twitter on the web.  I like Twitter because it's live--real time.  It makes me feel connected to people who aren't physically occupying the same space.  Twitter breathes and has a heartbeat.  I don't want to see Fred's twits hours later on a web page.  I want to see when he's listening to some song I prob won't like right at the moment that he's listening to it, b/c it's kinda cool to know what he's up to at that moment--so I get twitter messages on my phone.

A while ago, people asked Fred to separate his blog feeds into VC, Music, and other stuff.  I would have been offended, but Fred complied.

For me personally, if you don't want to read (or at least aren't willing to skip past) my kayaking photos, than don't read my blog... or don't complain. 

How long before people want a VC Fred FriendFeed and a Music Fred FriendFeed.  Than what have we accomplished?  Wouldn't it have just been easier to pipe all the stuff to Fred's blog and locate it all there?  Than, at least each individual node on the network controls itself, its own data, etc.  Now it's all being aggregated up by another social network layer. 

I'd rather hand all my data to myself... on my blog.  I'd still love to post weekly song charts, daily twitter updates (for those who aren't on twitter) on my blog via a timed XML-RPC post.  In the meantime, I like the control of following certain people's blogs, but not their twitters, and their flickr account, but not their blog, etc. 

There's always a lot of talk about ways to promote innovation.  Let's see... you've got incubators, incubator-like investors like Ycombinator or TechStars, StartupWeekends, BarCamps, Coworking, Jelly,

And yet people complain about how hard it is to start a company.  Can't find funding.  Can't find developers.  Need design help.

So when people like Calacanis talk about starting a "startup camp", I actually think it has the pottential to perpetuate a problem. 

There are people who would all too eagerly sign up for Jason's startup camp that, if they don't get in, will just sit on their asses and just work on their TechStars or Ycombinator application.  Don't get me wrong--every entrepreneur should have the attitude that Jason does:

"Perhaps my favorite thing to do outside of building companies is help other folks build companies."

But unfortunately, a lot of startups only look to A-list bloggers and these well publicized programs, but fail to recognize that much of what they get from that kind of connection can and, actually, MUST be replicated to achieve success.  So, it's great if you get into one of these things, but don't wait!!  There may be some people to help you, but no one is going to help if you don't help yourself first.

Build your own "camp"!!

Your industry isn't "Web 2.0."   If you are Snooth, then your industry is wine.  If you are Sportsvite, then your industry is recreational sports.  If you're BricaBox, you need to know the publisher/CMS world.  You need to spend time with the experts, and even the incumbants in the industry--the people who you want to strike business development deals with.

And frankly, you can and should do this on your own.  Established companies want to know who the innovators are.  If they're smart, they want to talk to you earlier rather than later, so you can innovate in a way that helps them out as well, rather than crush them later.

One of my biggest pet peeves is when startups that are stuck in the idea or even early development phase haven't had any conversations with potential customers, partners, etc.  And I don't mean, "Oh, yeah, we talked to one guy who works for Big Media, Inc. and he said they'd use it."   I mean 30 conversations that go in-depth.  Even 50!  Kick the tires of your business plan by talking to the people you're actually trying to get into business with.

Talk to other entrepreneurs, too.  Not everyone can have a sit down with Mark Zuckerberg, but not everyone is trying to build Facebook either--and there are lots of entrepreneurs that are much more local to you and much more accessible that you should be talking to.  Surround yourself with these people.  Join or form small groups of startups that meet weekly to get and give feedback.  Understand the successful companies in your space and what lessons they learned on the way up.

Again, don't get me wrong, it's cool to spend a summer on someone else's dime.  But, if you don't get into Ycombinator, that shouldn't stop you from getting the advice and feedback you need to move forward!

• louisgray.com: LinkedIn Company Detail Shows Silicon Valley Carousel: Silicon Valley Blog
  (tags: path101 profiles rgp)

My friends on MyBlogLog, originally uploaded by ceonyc.

I love when MyBlogLog is filled with friends.

Let me start off by saying this:  Gary Sharma's Alley Reporter site is great, in terms of the service that it offers, the layout, the content, etc.

But, as we all know, the name "Silicon Alley Reporter" originally referred to a trade pub that Jason Calacanis started in 1996.  Jason was a major pillar of the NYC web community in the 90's and did almost as much as anyone to actually make it a community and put it on the map.  He grew a 16 page photocopy magazine into a 256 page glossy through pure hustle, and somehow, even in the worst of times, turn it into something saleable.

I've been fortunate to get to know a lot of people who were around the NYC tech scene back then, and so when I started nextNY and heard people talk about "building the community", it bothered me.  There's been a tech community in NYC dating back years and years--or did everyone think that Mayor Mike had the only startup on the block with Bloomberg, LLC so many years ago? 

In the late 90's, DoubleClick was an alley mainstea, but even before there was DoubleClick, there was Bell Labs.  New York metro area tech has been around for some time.  Fred Wilson's been in New York VC for more than 20 years, for example. 

While I'd say the entrepreneurs of my generation have done a great job in connecting the disparate parts of the tech community, it's important for me to recognize that we are building on the work of lots of hardworking people who came before us.

So when this tech events site called Alley Reporter popped up, it really bothered me.  The only reason anyone would use that name would be to benefit from it's existing cache--built up by someone else's work. 

According to Alley Insider, I'm not the only one it's bothering.  Dow Jones, who acquired the original entity that held that name is looking into asking him to stop using it. 

Apparently, though, the trademark has gone stale.  There may not be a technical reason why it can't be reused, but I don't think this is just a technical issue.  It's an issue of respect.  Jason built up the value of the name, and I think it's just the right thing to do to acknowledge that and get his ok on it.

And frankly, it's also a better business decision.  If Gary went to Jason out of respect and Jason loved the idea of reviving the name, there's no better person in the world who could promote it. 

Similarly, when I started nextNY, I went to Scott Heiferman to get his feedback, because he had been running the NY Tech Meetup.  I didn't need to go to him--I just felt like it was the right thing to do.  By asking Scott if it would be ok to talk about nextNY at a NY Tech Meetup, we were able to get a big boost from his thumbs up and that's where we got a lot of our initial members from. 

The other thing about this project is that there were other people working on putting together event lists that could have been worked with as well.  As a little side project, Lee Semel and I put some resources into NYCTechEvents.com a while ago so that the tech community could have a place to post and share events without signing up for anything.  That site now powers the Silicon Alley Insider's events calendar.  We don't make any money from it--we just wanted the community to have it. 

Somebody once accused me of being down on Alley Reporter because I was jealous his site was "better".  That's just ridiculous. Seriously, I've got better things to do than compete on free events sites that I'm not even running as a business.  If you haven't noticed, I'm trying to run a company. 

Is NYCTechEvents better than Alley Insider?  No, it's not.  It's fine, but like I said, the look and feel of Alley Reporter is really great--top notch even!  Had Gary approached us and said that he had some ideas for an events site, I'm pretty sure we would have just let him update the template or figure out SOME way to work together, because all we want is for people to know what's going on in the community. 

Instead, we have two calendars now...  this is just silly.  I've suggested to Gary that we share events back and forth, but it's been a month since he said he was "giving some thought" to that.  Of course, he can do anything he wants, but since when is playing nice in the sandbox not also a generally good business strategy for startups? 

Similarly, about two weeks after Allen from Center Networks launched a tech directory of local companies, Alley Reporter came out with the same thing.  Again, it was definitely an improvement, but I was actually sort of annoyed for Allen's sake.  He had been promoting Alley Reporter since it came out, and to just copy a feature without even so much as trying to collaborate with Allen?   Seems like it would be better to be friendly with others trying to do similar things and offer to power everyone else's sites rather than just ignore (or copy) the work of others and move forward alone.

My suggestion to Gary is that he take the great site he's built, come up with an original name and domain for it, and open up some conversations about how to work with people already doing things to organize community info.  Play nice in the sandbox and everyone wins.

• kiwitobes.com » Blog Archive » Walmart Growth Video
  Viral Walmart Outbreak
  (tags: growth video virus walmart)

Paul asked me to come on and talk about Path 101, but I thought it was too early for that.  I didn't want to cross that hype line since we don't have our product out yet.

So instead, I suggested that I might come on to talk about the community behind the name of the show, so last week I recorded a spot about nextNY.

And to answer Jen's question, yes, about half my waredrobe is black t-shirts.

Have you ever tried to learn a language from a native speaker? How about being taught a sport by someone with incredible natural talent? I had a college roommate who was nearly a savant when it came to math, but he couldn't explain to anyone how he did it.

In the same vein, most of the great baseball managers were rather mediocre players. The reason was because they had to learn the sport, make mistakes, and work really hard to even be half as good as the next person. That meant spending twice as much effort to figure out how to gain any advantages they could...all through learned and practiced behaviors--behaviors they can actually teach.

It's hard to teach someone when it comes naturally to you.
For college students, much of their online behavior just seems natural--having grown up around computers and the internet. They don't think about how they participate in social media... they just do. Ask them to participate in social meda on behalf or because of a brand, and you'll get a blank stare--despite the fact that they've got glittery corporate logos plastered all over their MySpace profile.

"You want me to ask people to use this?" That's what you'll get when you put a service or product in their hands. They don't understand that the subtleties of what they d on walls, in chat, over sms is what marketers wish they could capture in a bottle and activate with a single click.

So if you think you're going to go hire a bunch of college or high school kids to push your brand around social media, think again. You'll probably find them to be a lot less adept at it than you'd expect, even though its something they do everyday.

Gizmoz is a favorite of Mike Arrington's, because he likes tech for tech's sake.  Being 3D is all you need to be his favorite avatar service.

So when the news came out that Gizmoz raised $6.5 million, he failed to note that they're getting clobbered in web traffic by Voki--the avatar site that I helped launch as its first product manager.  It was also Voki, not Gizmoz, that got nominated for a SXSW web award.

Still, Voki hasn't fulfilled its potential and that's been really disappointing.  Gizmoz just integrated with AIM and that's a heartbreaker for me because I met with AOL about this exact same integration last June. 

AIM has the ability to trigger sounds from flash through the text you type in your chats.  So, you could record custom messages for your character, and, for example, have it laugh your laugh when you type "lol".   How cool would that be?

In fact, I made a mockup of the user interface for this back in June...

AOL loved the idea.... so why didn't it happen?

AOL's biz dev team was undergoing some reorganization, but, to be honest, it was our side that dropped the ball.   We should have just built the integration and showed them a completed product.  That would have easily gotten a deal signed with them.

Unfortunately, we were always short on development resources, because, instead of being dedicated to a product, they were shared across the whole organization.  Oddcast has two other revenue generating product lines--Sitepal for small businesses and its custom business for agencies (Think Monk-e-mail). 

I was a product manager without a dedicated development team competing against companies like Meez and Gizmoz who only did one thing. 

When I left, I left basic plans for AIM integration, and also integration into blog comments as well.  Imagine being able to leave a talking avatar with your own voice as a comment in a blog post.  Why type "first!" when you can scream it at the top of your lungs!?  It wouldn't be that hard to do either...  Our partner API was designed for that kind of remote creation and comments could be threaded with a piece of javascript at the end of your post, just like Disqus works.

That didn't happen either though...   so while I applaud the marketing work Oddcast has done since I left, I sure wish we'd see some more feature development and interesting integrations.   They're a great bunch of people and I wish them the best in the road ahead.

JP Morgan is buying Bear Sterns for just about the same price as Meebo got valued at, right?

Buzz!!   Wrong.

JP Morgan is buying the EQUITY of Bear Sterns for just about the same price as Meebo's equity.

There's a big difference...  one that at least a few tech writers don't get.  While it makes a good headline to compare the two, it doesn't make the least bit of sense.

In the startup world, we mostly deal with companies that have no debt, so equity value and company (asset) value are usually pretty much the same. But when you're talking Bear Sterns, there are hundreds of millions of dollars sitting on top of your equity, and that debt comes first in line when it comes to liquidation of the company.

So if you're sitting there going, "Jeez... Bear has a billion dollar building... that's a steal!" than think again.  If it actually came down to liquidating buildings, all those debt holders would get paid back before the equity holders saw dime one.

So, if you really wanted to buy the company outright for the assets, you'd have to buy out not just the equity, but the debt as well, and those two combined equal the company's market cap.  As of yesterday, Bear's cap was sitting at around $580 million.  Add to that the value of all it's debt (which gives you the "Enterprise Value", which was at $300+ million as of some recent filings, you've got a company whose assets are worth a lot more than $250 million--but still a far cry from where it was.

But wait, so what does that mean if you own all the equity, but not the debt?  That means you get voting control of the company, but if there aren't enough assets on the books to cover the debt holders, you'll lose it and your equity can be worth squat.

So, you could have a company whose assets are worth billions of dollars, but whose equity is worth zero because there's also billions of debt on the books.  That's what some distressed debt investors do... they buy debt with the hopes that the company will go bankrupt, and they'll essentially be left with the rights to the assets.