Why Americans Should Be More Thankful Than Ever

26 11 2008

I’ve resisted writing much about the economy, but since it’s a rainy day in San Francisco as people start taking off for the long weekend, here it goes…

Last night, I watched Magic Johnson, Steve Wynn and Eric Schmidt on Larry King Live.

It was a surprisingly thoughtful (not that I didn’t expect it but sometimes these interviews are broken records) treatise of what’s ailing now and what to do next. They identified their focus now:

  • People
  • Innovation

Again, it’s called adding value- and these are the key ingredients.

They identified top priorities in getting the economy moving again:

  • Unfreezing credit markets, in a direct fashion
  • Infrastructure Investment. Green technology, physical infrastructure- roads, transportation, etc.

I would also add Leveling The Playing Field to the list, such as Net Neutrality. Steve Wynn mentioned that government is good as some things, such as regulation, and bad at others. I agree wholeheartedly, set the right regulations and rules in place (which is a fluid process) then get out of the way. I believe fundamentally the new administration agrees, no matter what the rhetoric being thrown out there may say.

Steve Wynn also suggested it’s a good time to save money and hunker down a bit. Eric Schmidt continued to focus on the Google mantra of creating innovations and value-adds that people delight in.

All three men were remarkably optimistic. Granted, I would find it hard not to be optimistic but you also have to remember all three are self-made men.

Sage advice is not to ignore the realities of today. I hold that this is healthy for America.

Americans should be more thankful than ever because this is the richest country in the world, by far. Americans should be thankful because we’re free. We can have an open debate about free market capitalism, dangers of greed, and how to best cure the spreading divide between rich and poor without harming the very economic system that got us to where we are today.  Be thankful because amidst the chaos, we live in a place that allows us to strive for a better tomorrow.

Have a wonderful and joy-filled Thanksgiving!


Simple Idea. Add Execution.

22 11 2008

In today’s economy, there’s no financial room for error. Get your cash flow straighted up, or get out.

That doesn’t mean that IDEA error, or trial-and-error, is not alive and well. The zero-cost startup is absolutely a reality, birthed both Six Apart and Google during the post-dotcom downturn. (Please don’t argue the exact timing – Google was born during the bubble, but benefited from a zero/low-cost basis to build something great. Scaling search is a different story.)

There’s never been a better time to start with a simple idea (but it should be big – huge distinction), but do it well. I thought it’d be fun on Friday to comb over a handful of startups I’ve looked at on my blog to see how they are doing.

Startups I’ve commented that have marginally (or more than marginally) improved an existing business model or technology:

Jellyfish: Perfectly elastic cash rebates. Acquired by Microsoft, now powers its Live Search Cashback system.

Farecast: Predictive airfares – buy or wait predictions. I’ve mentioned them on several occasion; I’ve linked to a previous post about the web needing applications that solve real problems. Acquired by Microsoft.

RetailMeNot: Social coupons and deals. Mentioned in an inquiry about gwallet (still yet to launch), but re-reading a TechCrunch post a while back mentioning RetailMeNot as a 3 person operation reminds me how far great execution on a simple idea can go. They just launched BeatMyPrice. Seems mostly like a price comparison wrapper on RetailMeNot. May not be acquired soon, but no doubt they’re making a boatload of cash from the deal/price/coupon model.

Startups that haven’t rocketed upward:

Genietown: Local services marketplace. I liked the concept, but rightly saw a few things mis-executed. If they have cleaned them up, it might not have been enough as they haven’t yet helped Genietown make its growth spurt in a tough, tough market.

Stagr: Apparel startup by Nick Swirnmum (founder of Zappos). Stagr looks like it’s given up on its broad, ambitious model and looks like it’s only selling Stagr branded apparel on their web site. When both the idea and execution go away, we know what happens.

Moral: Building a company is hard. So start simple, and execute every single day.

Facebook App Racket Does Not Strike Me As Wise

18 11 2008

A pretty spot on analysis by Mike Arrington at TechCrunch about the new verified application process as a… Protection Racket.

I also don’t have a problem with this. In fact, I would generally applaud a company for finding a fair way to generate a significant revenue stream.

Except this doesn’t strike me as wise. Name one open platform that has charged a fee for inclusion, and seen this somehow improve the platform. Can’t? OK, maybe Facebook can be the first one to make it work for them.

The only company I can remember charging for inclusion, in a previously open and free product, is Yahoo Directory. Eventually, the Directory became a stale product that was somewhat costly to maintain. It made a whole lot of sense to charge $299/year for inclusion, both for Yahoo and the price was right for the vast majority of sustainable businesses. So far with Yahoo, we know what going down that road does for you.

The step basically admits that your model is becoming stale. You’ve run out of monetization options. Maybe it’s a wise admission (profit extraction), but I would have liked to have seen Facebook exhaust further monetization options first: complete its promised payment system (as Mr. Arrington mentions) or some virtual currency system.

Marc Andreessen said for Ning that a long tail of inactive accounts is valuable. The same applies here. I indeed believe strongly that revenue must be king, especially now. And, yes, quality of applications wil go up – $375 is not a huge amount of money. However, for a company with grand ambitions and broader promise than most any other, I just don’t think this is the right move at the right time.

Only time will tell, I suppose, but we may look back at this moment as an interesting inflection point.

Live Poker for iPhone: Time Wasters Are Rising!

13 11 2008

Zynga’s Live Poker for the iPhone (via TechCrunch and Mashable). Texas Hold ‘Em for Facebook is my original Facebook application time waster; the application for iPhone seems even better. Of note is that it’s also the first iPhone app to use Facebook Connect.

Jason Calacanis also mentioned a category of startups that provide free, lasting entertainment that will do very well in this prolonged recession. Live Poker and Zynga will certainly fall into that category.

Jason also mentions that the days of $3,000 bottle service in New York and Los Angeles are gone, not only for financial reasons but because you look like a jackass doing it. As such, the entirety of high-end nightlife predicated largely on real estate windfalls and a strong(er) economy is a particularly hard trodden space.

There’s a very special category of entertainment that will also do especially well today, and that’s social entertainment with lasting entertainment value. These I think will do well even if there’s a high price attached to them. Guitar Hero, Rock Band and Wii Sports are three easy examples. They’d do well anyway because they’re fun as hell – they’ll do better as people look to stay home but still want the fun company of others.

The days of excess are gone, boys and girls.

Back soon! iLetYou Launches, Rental Fundings

11 11 2008

Haven’t had too much time to blog here again. With iLetYou launched, I’m laser/super/high/all focused on some pressing priorities. On that note, I blogged about two big fundings by Chegg and HomeAway in just the past 2 days. It’s evident a change is happening.

Back soon!