Web Communities – Proof of concept = business

Guy Kawasaki posts a panel of web community founders he moderates that is truly the most amusing panel I’ve ever seen. Sometimes conference presentations and panels can be entertaining, but I’m the only one laughing – I think everyone finds these guys personable. Yes, geeks do have a sense of humor every once and a while (especially when it’s at the expense of the Ad guys).

The lesson alone is not that these founders defy the notion of “proven teams, proven technology, proven business model”. From the Apples to Microsofts to Googles of the world, they came in with unproven people, unknown technologies and made their business models and created some of the biggest corporations in the world. Logic is defied over and over, but not because success is illogical. There are formulas that work and formulas that don’t, but very rarely are those formulas spelled out in any concrete fashion – experimentation is necessary to mix variables just right.

Each and every one of these companies started with an idea, a notion of what might be useful or entertaining to someone. Some accidentally became the basis for a business, some were more planned out. Each took their ventures day-by-day.  Eventually their ideas got validation and that proof of concept becomes the basis for a real business.  One funny fact: Oprah Winfrey says that she was never a goal setter, flying again against the face of conventional wisdom.

The notion of proven anything is dead anyway. What these guys defy is the notion that you have to play by some predetermined set of rules. It’s a different game today and an idea-driven economy – money no longer buys success, ideas and execution do.

These founders repeat that you can’t plan for success. Bet on good ideas, passion and an ability to execute and adjust accordingly when opportunity arises.

The lesson: drink beer, have fun and do something that amuses yourself. Have enough insight to understand when what amuses you will amuse others and do a little bit every day to move forward.

Happy Friday!

Insanity: doing the same thing over and over again and expecting different results.

To close out the week, I wanted to post some thoughts on a quote I’ve been thinking a lot about lately.

In the typical Google search for the quotation, it’s quoted by marketers, life coaches and sofa philosophers throughout the Internet. This contradictory post that states that this is the dumbest thing ever repeated by smart people stands in the face of all these hoorah-hoorah posts that use the quotation as a motivation to enact change in peoples’ lives, marketing campaigns, organizations or anything else anyone can think of.

Of course, this quotation is not meant to be taken literally, it’s origins are not actually verifiable and it’s not universally applicable.

The quotation in fact encourages experimentation by trying different things. Don’t alter your existence completely, but understand that eventually you need to smarten up if things you are doing aren’t producing the results you desire.

Similarly, it’s well known that persistence is the most common trait that characterizes a successful entrepreneur who’s made it. It could also be said that the quotation discourages persistence. A good quote (source):

Sometimes doing the same thing a second time when it hasn’t worked the first is indeed just foolish. But sometimes it’s shrewd. Wisdom consists, in part, in knowing the difference. Flexibility is a virtue. But in most matters, flexibility properly kicks in only after persistence has been given a fair chance.

So there we go. Persistence and experimentation working one after another. One without the other really isn’t worth much independent of the other.

Flixster – Participatory Communities Still Win

Flixster recently closed a competitive financing round closed and is showing big breakthrough traffic numbers in the past year, as TechCrunch reported in separate posts within hours of each other.

I like what Flixster is doing.  They’ve chosen a select niche that as a founder commented in above blog posts: average ratings don’t mean much, so a place where you can discuss and get recommendations from others is what their community is about.

There’s open questions about whether they can aggregate enough advertising.  Investors see a value in this growing community.  Flixster as it stands doesn’t take much of an editorial approach to movies (differs from RottenTomatoes, my personal favorite for spot-on, one second movie choices)- it’s a perfect platform for mainstream movie premieres.  Critics say that the Flixster crowd is young and mainstream- this proves actually a positive when it comes to aggregating large, movie ticket buying audiences.

Or, it can serve as a social medium for a more participatory launch to take place, similar to MySpace profile advertising.  This seems to be more natural, however.  Every movie has a movie page.  On MySpace, every product has a user profile – slightly unnatural and counter-productive.

iLetYou is a participatory community, but you participate by providing both the market and the discussion.  For us, it’s not just enough that you are able to rent from the widest variety of stores.  It’s really important that the variety of stores allows the personal nature of recommending movies to come through- Vincent’s picks anyone?

The lesson here is that MySpace for dogs, MySpace for Wall Street and so on is a misnomer.  The successful “MySpace for ______” companies are those that simply take the participatory medium and meld it completely to its specific use.  Beyond that, it’s then up the companies to figure out a business model.  The participation age is not hype in Web 2.0.

I’ve always been intrigued by the movie business from end-to-end not just the glamorous side, ever since I was a teenage employee for Hollywood Video.  It has come full circle as I watch and participate in the evolving movie business.  iLetYou now looks to take the video store network into the participation age of the Internet.

Congrats to Flixster.  We’ll be watching them as we dive deeper into the DVD, game and movie space.