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 