Schools need to teach “how to find answers to questions on the Internet”, starting at a fairly early age (like middle-school).
We’ve shifted from “knowing it” as the key skill, to “being able to find it”. And I’m shocked at the range of ability (even with adults) on translating a given query to a Google search, refining the query, using Wikipedia where possible, and sifting through results to get a consensus answer.
I’m starting to teach my kids to be power researchers.
I frequently get asked: what should my investor presentation look like? There’s no unilateral answer, because every situation is different.
In his recent blog post, “A hierarchy of pitches“, Eric Ries points out each situation warrants a different presentation emphasis, and he neatly categorizes the different types. For example, a company that’s “printing money” needs to show the growth will continue, the market is big enough, and the numbers are real. A breakthrough technology project needs to show clear IP ownership, and ideas for making products out of the technology.
Good reading if you are pitching a project.
Over creamed chipped beef this morning, I subjected my friend Antonio to my latest rants on challenges and opportunities in the software business. He helped me crisp up a major theme: being smart is no longer a barrier to entry.
Software used to be really really hard: there weren’t a lot of developers (and few that were superstars), languages were primitive, tools were primitive (and expensive), the stack was expensive and buggy, and servers cost real money. Dev cycles of 12-18 months weren’t crazy, because it sometimes took that long to build something meaningful. Sometimes merely having shipping software was enough of a barrier.
Today, things are much easier: dynamic languages are hugely productive, the tools+stack are free, free code libraries are everywhere, and fast servers can be rented by the hour. Smart developers abound (they may not want to work at your company, but they’re out there competing with you). Useful functionality can be built in days, weeks or a few months.
So what does this mean? It means that software efforts doing things that are easy and plentiful generally aren’t going to be worth that much — it’s supply and demand.
For the effort to be truly valuable, it needs some barrier element beyond “we have really smart people with a clever idea”. There are LOTS of smart people out there that can re-implement your idea, or cherry-pick the essential parts. If you only spent 2-3 months building it, you don’t have much of a head start.
The key is to attach the software to some non-replicable element.
I can’t parse the fine details of the rejected bail-out bill, but it feels like there’s a direct analogy between the current crisis and forest fire management.
For example, read this article on the US Forest Service’s shift in policy, including this section:
Their reasoning [to just let fires burn] is that fire is a natural part of the landscape that clears out underbrush and small trees and creates forest openings in a mosaic pattern. Such conditions help keep small fires from growing into the kind of large, catastrophic blazes that have become increasingly common in recent years. They now say that decades of aggressively fighting fires was a mistake because it allowed forests to become overcrowded and ripe for fires nearly impossible to control.
This thinking might be applicable here.
Source:Fire Watch Company
Apple’s rejection of the Podcaster app from the iPhone App Store has been widely blogged. Apple rejected the functionality because it “duplicated” functionality in iTunes.
This is just the tip of the iceberg for a bunch of messy policy decisions facing Apple. Let’s say a third-party $9.99 WidgetExpress app is making $50k day, with 30% to Apple. What happens when a developer submits a $0.99 (or free) competitor?
Will Apple start to reject apps that threaten an existing app’s revenue stream?
We’ve had a Netflix Player/Roku set top box now for a few months, and we’ve used it quite a bit.
The short review: a decent product execution, but with very limited video content. Netflix’s “watch instantly” offerings mostly consists of TV content and older movies. It’s rare that you find recent, top-quality movies. Our kids quickly ran out of new things to watch.
The physical product is very nice and compact (roughly the size of a 1″ stack of CD cases). It has no buttons, and only a power indicator on the front. The remote control is very straightforward with a small number of buttons, and the on-screen menus are simple and easy to understand. Setup and configuration was very easy, and the box has Wifi so you don’t need a wired connection.
We do wish fast forward worked differently. It’s not like a Tivo — instead, it scrolls through a set of small video still frames. When you hit “play”, the box takes a few seconds to rebuffer and resume from the new point. Fortunately, Netflix’s video content doesn’t have ads that need to be skipped.
Also, videos can only be added to your viewing queue through Netflix’s Web interface — you can’t choose new videos through the box itself. This is much more useful than our cable company’s on-screen interface for selecting an on-demand movie, and we’ve found it helpful to limit what our kids can watch (while still letting them choose from a list of options). However, if you sit down at your TV to watch something new, you’ll need to go find your PC to add the movie to your queue.
Bottom line: for $100, we’d probably get one again, but we’re really hoping that Netflix brings more (and better) content on-line.
It’s still unbelievable how powerful Google continues to be. If you need to turn on meaningful traffic volume for a Web site, they’re the only game. And properties that depend on Google for a majority of traffic have a number of risk exposures.
For SEO (organic) traffic, there’s always a chance Google changes the search ranking rules. Stories abound about companies ranked #3 (for some keyword) waking up some morning to find themselves ranked #11 and traffic down 80%. Google is continually battling search engine spam, and even if you have quality content, you could easily be collateral damage in an algorithm change.
I always think of SEO traffic as “bonus icing” — great if you can get it, but don’t depend on it.
For SEM (paid keyword) traffic, there are so many ways Google can (and does) manipulate the system to their advantage. AdWords is like playing poker, but with the house as one of the players, and with some of the rules marked “secret”. If you don’t believe me, read about Google’s infamous “quality score“, and then read this story about a company that hit the wall when Google changed the rules.
For SEM, I always assume: (a) you can’t afford to build your site entirely with paid traffic — you have to find other sources, (b) CPC prices trend up over time, not down, and (c) prices can change quickly.
It’s about time — Google’s shipping their own Web browser (Chrome).
This is an extremely interesting development, and I’m surprised it’s taken this long to happen. I’ve only played with Chrome only briefly so far, but it’s got some interesting features, reminding us there’s still room for innovation in browsers.
Those pushing the limits wth Web apps are always running into annoying browser limitations & bugs. It’s even worse in a relatively fragmented browser market (FireFox in different versions, IE, Safari, Opera, etc.), each with slightly different capabilities. This move gives Google end-to-end control over their destiny.
Chrome is going to have to earn it’s chops in the market to get share, but the (potential) Google apps tie-in is what’s most intersting. Google’s in a much stronger position than Microsoft was with IE — if/when the existing Google apps run better in Chrome, people will switch.
Every entrepreneur should read Fred Wilson’s recent post on the economics of venture funds.
Understanding how VCs make money goes a long way to explaining VC behavior. Fred’s post clearly shows the two mechanisms (management fees and carried interest) in the context of showing the gap between gross and net venture fund returns.
Also see my related post: How Venture Capitalists Make Money