OK, so I took most of the day off. I had a nap. Let the week all soak in. And I asked myself “if Bill Gates gave me $200 million, what would I buy?”
I kept thinking of three companies: NewsGator and either VoiceStar and Ingenio. Well, four, if you include WordPress, but Matt Mullenweg told me he’d never sell to a bigger company so I’m not gonna put him on the list. 🙂
I can just hear Steve Gillmor’s voice now: “get off of the NewsGator kick.”
But, here’s my thinking. Almost every Web 2.0 company points out their RSS strategy to me. And, then they show me their Windows computer and it either has FeedDemon loaded on it, or NewsGator’s Outlook client. If they are a Mac user (a large portion of Web 2.0’s developers are) they almost certainly are running NetNewsWire.
Aside: I hate the name “Web 2.0.” The Web has been through at least 10 iterations since 1994. I prefer something a little more confusing like “Higher Definition Web.” But, heck, Web 2.0 is confusing enough — what does it really mean?
So, let me get this right. NewsGator owns all those RSS aggregators and has the only sync story between all those clients.
Why hasn’t Microsoft bought this yet?
I think it’s a big frog to swallow. Microsoft runs internally like 100 separate companies. NewsGator would need to make at least four of those companies interested in order to have a chance of success. That’s going to be very tough. I assume Yahoo and Google have the same “we can’t swallow that” kind of resistance too, which is why other things are being acquired first.
There’s also the branding problem that NewsGator has — lots of people think it’s only an Outlook client. They are TOTALLY WRONG. Greg Reinacker has a problem, though. It took him more than a year to convince me that NewsGator was more than an Outlook client.
But think of the forcing function NewsGator would have if overlaid on top of Microsoft. It would bootstrap all sorts of teams into building an RSS sync story that would simply be very powerful. It would require all parties going into this with their eyes open, which is why I’m talking in public about it. Imagine if our M&A team would do all their work out in public? Wouldn’t that be a trip? Wouldn’t that increase trust in Microsoft big time? And, wouldn’t that increase the chances that such an acquisition would be successful?
Anyway, onto VoiceStar and Ingenio. The fact that these two are just hanging out there and haven’t been picked up by GY or M is just amazing to me. It’s like seeing $1 billion lying in the street waiting for someone to pick it up.
Which gets me onto the point of this post. Is Web 2.0 a bubble?
Not when there are companies like these two that haven’t been picked up yet.
Not when Google’s advertising revenue and profit lines look steeper than KT-22’s ski slope at Squaw Valley (trust me, it’s steep).
Not when Adobe and Yahoo are working together to make a higher definition Web.
Not when there are billions in VC’s chasing a small number of ideas.
Not when companies like Meetro are so capital constrained that they are all living and working in one house in Palo Alto.
Not when Wifi networks are springing up faster than they are making lattes. Heck, why don’t you ask a trucker about how deep these societal changes are? And Wimax is coming. Wimax is coming. Wimax is coming.
That doesn’t mean that everyone in this industry will succeed. Most of the ideas I’ve seen so far will hit the dustbin within five years. That’s the entrepreneur’s risk. Even the three companies I point out above aren’t guaranteed success. Someone might come along tomorrow with a system that just blows all of these away.
But, I feel like I was Steve Jobs and I just took a tour through Xerox PARC in 1981. I’ve seen the future and I can’t wait for everyone else to see it too.
If you were in charge of Mergers and Acquisitions at a GYM (or A or E) what would you buy and why? Or, would you just put the $100 million back in your pocket and walk away?
PS, I won’t count this as a non-GYM post, even though it really isn’t about GYM.
Update: Shel Israel, my co-author, blogged a recent RSS panel discussion that had both Greg Reinacker and Matt Mullenweg on it.
Update 2: I’m not the only one asking if Web 2.0 is a Bubble. Here’s Om Malik of Business 2.0 magazine asking the same thing.
Scobleizer 
Read this..coming from PBS, damn interesting..
http://www.pbs.org/cringely/pulpit/pulpit20051117.html
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Read this..coming from PBS, damn interesting..
http://www.pbs.org/cringely/pulpit/pulpit20051117.html
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What the fuck you know, Scoble? You have secure job at Microsoft and all these start-ups, Venture Capital issues, etc – are all just pure theory for you!
Or am I missing something? Englighten me!
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What the fuck you know, Scoble? You have secure job at Microsoft and all these start-ups, Venture Capital issues, etc – are all just pure theory for you!
Or am I missing something? Englighten me!
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Dinesh: being disrupted is fun! But, if Cringley knows it. If I know it. Are we actually being disrupted? Hmmmm. Existential questions for Sunday afternoon.
All just theory, huh? You don’t know my past. You don’t know me. And you never will cause you’re rude.
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Dinesh: being disrupted is fun! But, if Cringley knows it. If I know it. Are we actually being disrupted? Hmmmm. Existential questions for Sunday afternoon.
All just theory, huh? You don’t know my past. You don’t know me. And you never will cause you’re rude.
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If Bill would give me $200,000,000 I’d buy Xerox PARC and Bell Labs and innovate, innovate, innovate…
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If Bill would give me $200,000,000 I’d buy Xerox PARC and Bell Labs and innovate, innovate, innovate…
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Higher Definition Web?
What happens for the next iteration? Even Higher Definition Web?
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Higher Definition Web?
What happens for the next iteration? Even Higher Definition Web?
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ceejayoz, that would be the Dense Definition Web. Because from there we could move up to the Ultra Dense Definition Web.
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ceejayoz, that would be the Dense Definition Web. Because from there we could move up to the Ultra Dense Definition Web.
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Scoble…were you directing the ire at me? I ain’t the mobile phone fan or were the 2 comments in 2 different lines targeted at 2 different people. Blogging getting complicated? Blog responses need a conversation-response tie-in without making it look messboardy!! Another feature request 😉
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Scoble…were you directing the ire at me? I ain’t the mobile phone fan or were the 2 comments in 2 different lines targeted at 2 different people. Blogging getting complicated? Blog responses need a conversation-response tie-in without making it look messboardy!! Another feature request 😉
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If I had US$200m, my shopping list would be as follows, in order of preference depending on prices:
1. Adbrite
2. one of the blog software providers
3. Podshow and/or The Podcast Network, possibly Audible
4. digg/delicious or something similar
5. one night with Jessica Alba
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If I had US$200m, my shopping list would be as follows, in order of preference depending on prices:
1. Adbrite
2. one of the blog software providers
3. Podshow and/or The Podcast Network, possibly Audible
4. digg/delicious or something similar
5. one night with Jessica Alba
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You calling it a bubble? Mr. ‘Techcrunch Parties are the Place to Be’? Somehow I doubt your sincerity, just finger to the wind, blowing to whichever thing is the most “interesting” at any given moment.
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You calling it a bubble? Mr. ‘Techcrunch Parties are the Place to Be’? Somehow I doubt your sincerity, just finger to the wind, blowing to whichever thing is the most “interesting” at any given moment.
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1. Newsgator
2. Audible.com
3. Digg.com
4. Thefacebook.com
5. Six apart
Newsgator to sync all this data i’m consuming, audible.com to make it easier for people to spread their content, digg so i can see what’s popular on the net in a single glance (like the memeorandum of life), thefacebook.com just because every single god damn college kid uses it, and six apart for all those wanting to start a blog because framkly i think six apart is better than word press, and anything is better than spaces.
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1. Newsgator
2. Audible.com
3. Digg.com
4. Thefacebook.com
5. Six apart
Newsgator to sync all this data i’m consuming, audible.com to make it easier for people to spread their content, digg so i can see what’s popular on the net in a single glance (like the memeorandum of life), thefacebook.com just because every single god damn college kid uses it, and six apart for all those wanting to start a blog because framkly i think six apart is better than word press, and anything is better than spaces.
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Having $200M to invest is an interesting place to be. One of my business partners, in addition to working with me, also works at a major VC (one of the lead investors in Skype). What’s really fascinating about their process is that they don’t really invest in companies so much as they invest in entrepreneurs. I think they have the right approach.
Which brings to me my point. If I was in charge of M&A at GYM – I would set up a mechanism by which I could invest in serial entrepreneurs. What GYM really need is innovation, and it’s really difficult for *true* innovation to happen in large companies. So what I would do is set up a kind of “feeder system” whereby the entrepeneurs try to create great businesses using chunks of GYM capital. Seeding a new businesses is very cheap. And I’d put more money in if the business looked like it was going somewhere.
In other words, I’d effectively have GYM act like a VC, with the default (but not only) exit for the entrepreneurs being that GYM would acquire the companies when they got to the right point (based on the size of the fund). When the entrepreneurs exit, they would take some time to decide on their next project, and then I’d invest in them again (rather than assimiliating them into GYM).
I think their could be massive value in this model. And being able to keep core teams together as the migrate from one business to the next would, I think, result in ever increasing productivity and quality.
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Having $200M to invest is an interesting place to be. One of my business partners, in addition to working with me, also works at a major VC (one of the lead investors in Skype). What’s really fascinating about their process is that they don’t really invest in companies so much as they invest in entrepreneurs. I think they have the right approach.
Which brings to me my point. If I was in charge of M&A at GYM – I would set up a mechanism by which I could invest in serial entrepreneurs. What GYM really need is innovation, and it’s really difficult for *true* innovation to happen in large companies. So what I would do is set up a kind of “feeder system” whereby the entrepeneurs try to create great businesses using chunks of GYM capital. Seeding a new businesses is very cheap. And I’d put more money in if the business looked like it was going somewhere.
In other words, I’d effectively have GYM act like a VC, with the default (but not only) exit for the entrepreneurs being that GYM would acquire the companies when they got to the right point (based on the size of the fund). When the entrepreneurs exit, they would take some time to decide on their next project, and then I’d invest in them again (rather than assimiliating them into GYM).
I think their could be massive value in this model. And being able to keep core teams together as the migrate from one business to the next would, I think, result in ever increasing productivity and quality.
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It seems that Web 2.0 is here, in the now. We just happen to be trying to find a way to grasp it and its contents. There are currently hundreds of sites that allow interaction with the web and eachother. It seems to me that we have the tools, but they are strewn across the landscape with no real connections. Its the communication between these tools and applications that happen to be gathering all out data. It’s a matter of one platform or approach to gathering this interaction into an easy to use easy to modify approach. The value is in the connection of this interaction and information.
Whatever it is it needs to do the following:
Gather News & information I need
Provide Push Button Publishing
Allow sharing & chunking of all content
Promote Social Networking
Provide Organization of my web & life
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It seems that Web 2.0 is here, in the now. We just happen to be trying to find a way to grasp it and its contents. There are currently hundreds of sites that allow interaction with the web and eachother. It seems to me that we have the tools, but they are strewn across the landscape with no real connections. Its the communication between these tools and applications that happen to be gathering all out data. It’s a matter of one platform or approach to gathering this interaction into an easy to use easy to modify approach. The value is in the connection of this interaction and information.
Whatever it is it needs to do the following:
Gather News & information I need
Provide Push Button Publishing
Allow sharing & chunking of all content
Promote Social Networking
Provide Organization of my web & life
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I really don’t think the concept behind the popular term “Web 2.0” is a bubble. But the term itself is, because it is to plain and simple to put it like that.
Like this whole “user in control” talk that’s going on these days, is a revolution as big as the “Web 1.0” concept. While I’m still searching for the right term, I call it all the “Smart Web”.
Maybe in 10 years from now, we can look back and say this step in evolution of the internet was the real “Web 2.0” leap. But I doubt it. We are just scratching the surface here.
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I really don’t think the concept behind the popular term “Web 2.0” is a bubble. But the term itself is, because it is to plain and simple to put it like that.
Like this whole “user in control” talk that’s going on these days, is a revolution as big as the “Web 1.0” concept. While I’m still searching for the right term, I call it all the “Smart Web”.
Maybe in 10 years from now, we can look back and say this step in evolution of the internet was the real “Web 2.0” leap. But I doubt it. We are just scratching the surface here.
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Here is what I’d do if I worked at MS and had $200 million to spend. I’d open a Microsoft Cafe in Belltown and deck it out with cool products from MS partners from Xbox games to mp3 players as well as Tablets and cool phones running MS software. Serve coffee and free wi-fi and then put real MS product managers in the cafe to answer questions and see how people use their products. Ya, it sounds a lot like an Apple store, but the idea is to get people excited about your products again. Windows and Office? Boring! MSN Spaces, 360? Cool! Get our hands on your cool stuff and then LISTEN.
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Here is what I’d do if I worked at MS and had $200 million to spend. I’d open a Microsoft Cafe in Belltown and deck it out with cool products from MS partners from Xbox games to mp3 players as well as Tablets and cool phones running MS software. Serve coffee and free wi-fi and then put real MS product managers in the cafe to answer questions and see how people use their products. Ya, it sounds a lot like an Apple store, but the idea is to get people excited about your products again. Windows and Office? Boring! MSN Spaces, 360? Cool! Get our hands on your cool stuff and then LISTEN.
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Everywhere I go I see the same comments about VCs investing in entrepreneurs. Which is true, but only in a VERY limited way: VCs invest in entrepreneurs who have *presentation skills*, or who have friends who are VCs (or know VCs).
I’ve been trying to raise VC funding for almost 4 years, and in that time I’ve managed to present to a total of 0 VCs, and managed to speak to 5 in an introductory way (none of which went any further).
So, if I had $200million to invest, I’d set up a way for people to present their *ideas* not themselves. There’s no ace in the VC environment at present for geeks or technologists – there’s only room for geeks & technologists who are very good at marketing themselves, or who know people who can do the marketing for them.
I also dislike the way VCs only tend to invest in entrepreneurs instead of ideas – why is this? What about those ideas that have been proven independantly on the entreprenuer? Do they get left by the wayside for lack of funding?
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Everywhere I go I see the same comments about VCs investing in entrepreneurs. Which is true, but only in a VERY limited way: VCs invest in entrepreneurs who have *presentation skills*, or who have friends who are VCs (or know VCs).
I’ve been trying to raise VC funding for almost 4 years, and in that time I’ve managed to present to a total of 0 VCs, and managed to speak to 5 in an introductory way (none of which went any further).
So, if I had $200million to invest, I’d set up a way for people to present their *ideas* not themselves. There’s no ace in the VC environment at present for geeks or technologists – there’s only room for geeks & technologists who are very good at marketing themselves, or who know people who can do the marketing for them.
I also dislike the way VCs only tend to invest in entrepreneurs instead of ideas – why is this? What about those ideas that have been proven independantly on the entreprenuer? Do they get left by the wayside for lack of funding?
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Tom,
The reason why VCs so often focus on the entrepreneur is because they take the view that this is the most important, and the most scarce resource. What VCs’ experiences teach them is that there is, in fact, no shortage of great ideas and great technologies.
So yes. There are many great ideas and technologies that get left by the wayside. But not because of lack of capital. Rather, it’s because of a shortage of great *people* that can makes successes of great ideas and technologies.
When I look at failing companies in VC’s portfolios, more often than not, it’s not because the technology is bad (although sometimes it is). Rather, it’s because they didn’t manage to find a great, entrepreneurial senior management team to run the business.
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Tom,
The reason why VCs so often focus on the entrepreneur is because they take the view that this is the most important, and the most scarce resource. What VCs’ experiences teach them is that there is, in fact, no shortage of great ideas and great technologies.
So yes. There are many great ideas and technologies that get left by the wayside. But not because of lack of capital. Rather, it’s because of a shortage of great *people* that can makes successes of great ideas and technologies.
When I look at failing companies in VC’s portfolios, more often than not, it’s not because the technology is bad (although sometimes it is). Rather, it’s because they didn’t manage to find a great, entrepreneurial senior management team to run the business.
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We own stakes in several well known local publishing efforts and we know pay per call is going to be huge. There is no winner yet in the local performance-driven advertising business, but whoever masters pay per call could be the ultimate winner
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We own stakes in several well known local publishing efforts and we know pay per call is going to be huge. There is no winner yet in the local performance-driven advertising business, but whoever masters pay per call could be the ultimate winner
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Simon,
“The reason why VCs so often focus on the entrepreneur is because they take the view that this is the most important, and the most scarce resource.”
What about entreprenuers who have no pitching skills but are seriously good at what they do? (Speaking of which – know anyone who’s good at pitching? 🙂 )
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Simon,
“The reason why VCs so often focus on the entrepreneur is because they take the view that this is the most important, and the most scarce resource.”
What about entreprenuers who have no pitching skills but are seriously good at what they do? (Speaking of which – know anyone who’s good at pitching? 🙂 )
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Tom,
“What about entreprenuers who have no pitching skills but are seriously good at what they do?”
Well, one option is to get someone on the team that can pitch. I can think of a massively high profile example where the main technical guy just lives in his bedroom coding almost 24/7. They have a good CEO on board.
The other option is to turn the tables, and have the VCs pitch you. VCs are always actively out there looking for hot deals. If what you have to offer looks anything like a hot deal, the VCs will be chasing you; not the other way round.
The second option is the best way to get a VC financing done. By far.
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Tom,
“What about entreprenuers who have no pitching skills but are seriously good at what they do?”
Well, one option is to get someone on the team that can pitch. I can think of a massively high profile example where the main technical guy just lives in his bedroom coding almost 24/7. They have a good CEO on board.
The other option is to turn the tables, and have the VCs pitch you. VCs are always actively out there looking for hot deals. If what you have to offer looks anything like a hot deal, the VCs will be chasing you; not the other way round.
The second option is the best way to get a VC financing done. By far.
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Simon,
“The other option is to turn the tables, and have the VCs pitch you. VCs are always actively out there looking for hot deals.”
I have to ask – where do you find these VCs? This is actually a serious question, and follows on from the ‘do you know anyone who can pitch?’ question.
ALthough perhaps the comments section of Robert Scoble’s weblog isn’t the best place to ask this one 🙂
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Simon,
“The other option is to turn the tables, and have the VCs pitch you. VCs are always actively out there looking for hot deals.”
I have to ask – where do you find these VCs? This is actually a serious question, and follows on from the ‘do you know anyone who can pitch?’ question.
ALthough perhaps the comments section of Robert Scoble’s weblog isn’t the best place to ask this one 🙂
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found your site after googling for web.20 bubble! congrats you have a good google rank. couple of days ago I posted a related article illustrating my point of view on the subject..
http://ilkeryoldas.blogspot.com/2006/12/web-20-another-dot-com-boom.html
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found your site after googling for web.20 bubble! congrats you have a good google rank. couple of days ago I posted a related article illustrating my point of view on the subject..
http://ilkeryoldas.blogspot.com/2006/12/web-20-another-dot-com-boom.html
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