This seems to be one of those periods in Silicon Valley with a lot of startup activity. Leaps ahead in technology have converged with a round of new insights into consumer utility, yielding visions for potential products, companies, and wealth generation—all seeking infusions of talent and funding.
These PowerPoint dreams are the stuff of venture capitalists: business models, market size, revenue growth, needs not met, problems not yet framed. All are attractively packaged and temptingly displayed, aiming to entice VCs to open their wallets. What an interesting job these VCs have, scanning a constant parade of creative new business ideas in search of the next YouTube or Facebook. Too bad for the rest of us, who have to wait for these companies to become household names before we hear about them. As to those that don’t, they never show up on our radar. And without access to VCs’ millions there’s no way we can get in on the ground floor of opportunity.
But wait, there’s another option. You can play VC with human capital, that is, your ability to add value in the workplace. Through either consulting or employment status you can participate directly in businesses you reckon to hold bright prospects. At times like these when so many young companies are looking for help, it’s not that hard. And hey, we’ve all heard the story of the Google masseuse who became a millionaire.
To be sure, just like venture capital, the human capital strategy is full of risk. You may be working for equity only, or for deferred compensation pending certain levels of funding. There’s a very real possibility you won’t take away anything except some interesting anecdotes and a new line on your resume. But if you’re the dice-rolling type, we all know that somewhere out there, currently almost indiscernible from tomorrow’s flameouts, is the nugget of the next billion dollar idea. Can you spot the wheat amidst the chaff?
It’s a lot easier to market your human capital if you’re in Silicon Valley, where demand is high. Opportunities tend to show up on popular job sites here such as Craigslist or LinkedIn. Of course tech talent is always in demand, but startups also need help with marketing, sales, biz dev, HR—most of the usual corporate functions. If you have an appetite for risk give it a try. At worst you’ll gain significant new business experience, and at best—well, we all know one of those promising startups will hit the jackpot.
Friday, December 28, 2007
Saturday, December 22, 2007
Writing History from the Future Backwards
In a conversation with a couple of entrepreneurs earlier this week we were discussing how radio began as morse code and, similarly, the internet began as text. The point was that the beginning doesn't foretell the mature product. We all agreed online media is still in the embryo stage.
No one knows quite how things will end up...in part because the outcome is determined by the sum of the collective decisions of everyone working in the front lines of online media today. We aren't just passively watching the future unfold, we're molding it on the fly. As I've said before, I think that's an incredibly exciting career opportunity.
It's also a significant business opportunity...thus the presence of the entrepreneurs. While biology can't tell us how the species will evolve, it assures us that changes that occur during the process are likely to be substantial. So if you're trying to design products or businesses that will continue to seem fresh and useful down the road, there's little value in noodling over today's status quo and making logical, linear extrapolations. Doing so only puts you in the thick of the greatest competition: the crowded space in the middle of the bell curve, the apex of conventional wisdom.
In the online medium in particular, where there are fewer physical constraints than for most businesses, vision is key. I'm talking about the ability to see where products, services, and business models should be, and then to take on the challenge of bridging the gap between there and where we are today.
Vision has a long and storied history in the annals of technology. It built companies like Microsoft, Apple, Oracle...then later EBay, Amazon, Yahoo, Google. The vision of the founders of these and similar firms has created trillions of dollars of wealth and utility. None of these companies was conceived as an incremental improvement beyond the status quo.
Even if our online media goal is more modest than to found the next billion-dollar empire, we can profit from the insight to look ahead, not behind. The entrepreneurs I was talking to were conceptualizing business models by looking at Web 2.0 technologies and strategies and imagining how those could be applied to successful business concepts that are now predicated on conventional thinking, reinventing those companies in a next-gen paradigm. They're on the right track.
As an aside, I enjoy meeting internet entrepreneurs. They're a smart, well educated, hardworking, innovative, optimistic (a prerequisite for entrepreneurship), and, yes, visionary breed. They're a stimulating group to rub shoulders with, and they're writing history from the future backwards. We should all give it a try; maybe it's not as hard as it sounds.
No one knows quite how things will end up...in part because the outcome is determined by the sum of the collective decisions of everyone working in the front lines of online media today. We aren't just passively watching the future unfold, we're molding it on the fly. As I've said before, I think that's an incredibly exciting career opportunity.
It's also a significant business opportunity...thus the presence of the entrepreneurs. While biology can't tell us how the species will evolve, it assures us that changes that occur during the process are likely to be substantial. So if you're trying to design products or businesses that will continue to seem fresh and useful down the road, there's little value in noodling over today's status quo and making logical, linear extrapolations. Doing so only puts you in the thick of the greatest competition: the crowded space in the middle of the bell curve, the apex of conventional wisdom.
In the online medium in particular, where there are fewer physical constraints than for most businesses, vision is key. I'm talking about the ability to see where products, services, and business models should be, and then to take on the challenge of bridging the gap between there and where we are today.
Vision has a long and storied history in the annals of technology. It built companies like Microsoft, Apple, Oracle...then later EBay, Amazon, Yahoo, Google. The vision of the founders of these and similar firms has created trillions of dollars of wealth and utility. None of these companies was conceived as an incremental improvement beyond the status quo.
Even if our online media goal is more modest than to found the next billion-dollar empire, we can profit from the insight to look ahead, not behind. The entrepreneurs I was talking to were conceptualizing business models by looking at Web 2.0 technologies and strategies and imagining how those could be applied to successful business concepts that are now predicated on conventional thinking, reinventing those companies in a next-gen paradigm. They're on the right track.
As an aside, I enjoy meeting internet entrepreneurs. They're a smart, well educated, hardworking, innovative, optimistic (a prerequisite for entrepreneurship), and, yes, visionary breed. They're a stimulating group to rub shoulders with, and they're writing history from the future backwards. We should all give it a try; maybe it's not as hard as it sounds.
Tuesday, December 18, 2007
A School for Citizen Journalism
One criticism of so-called "citizen journalism"--news coverage by amateur journalists--has been the writers' lack of credentials. Now the group in the forefront of the citizen journalism movement, Korea-based OhMyNews, is addressing that issue by opening a citizen journalism school near Seoul.
The new school offers classes in writing, interviewing, and journalism, including photo, video, and internet journalism. The aim is to improve professionalism and consistency in the growing tide of user-generated content (UGC) online.
If you're a traditional journalist and think it sounds interesting you can go through OhMyNews's "reeducation program" to clear your head of embedded thinking. There are also classes for media executives and PR types, aimed at helping them understand, nuture, and make the most of the citizen journalism/UGC movement.
The OhMyNews news-gathering team tops 50,000 worldwide. Ironically, the company was founded by a professional journalist who understood the power and potential of UGC back in 2002.
So far, citizen journalism efforts in the US haven't been as successful as those in Asia. I don't think that's any reason to dismiss its potential significance. On the contrary, it's a great business model that captures the democratizing spirit of the web. The online medium is a huge, real-time laboratory of social innovation. We all need to learn from each other's experiments.
The new school offers classes in writing, interviewing, and journalism, including photo, video, and internet journalism. The aim is to improve professionalism and consistency in the growing tide of user-generated content (UGC) online.
If you're a traditional journalist and think it sounds interesting you can go through OhMyNews's "reeducation program" to clear your head of embedded thinking. There are also classes for media executives and PR types, aimed at helping them understand, nuture, and make the most of the citizen journalism/UGC movement.
The OhMyNews news-gathering team tops 50,000 worldwide. Ironically, the company was founded by a professional journalist who understood the power and potential of UGC back in 2002.
So far, citizen journalism efforts in the US haven't been as successful as those in Asia. I don't think that's any reason to dismiss its potential significance. On the contrary, it's a great business model that captures the democratizing spirit of the web. The online medium is a huge, real-time laboratory of social innovation. We all need to learn from each other's experiments.
Thursday, December 6, 2007
Another New Skill: SMO
In the last few years search engine optimization (SEO) has become an important function for every online business. Now get ready for the next wave: social media optimization (SMO).
Part of the challenge of working in an emerging new industry is that rules, to the extent they exist at all, are written in sand, not stone. Tomorrow's critical skillset may not have existed six months ago. To succeed, you need an open attitude and an eagerness to learn. Complacent satisfaction in past accomplishments won't take you very far.
Less than ten years ago, web site owners increasingly noticed how great performance in search engines could drive a tremendous increase in business, and the SEO industry was born. As search technologies have evolved rapidly, SEO techniques continue to change and search engine marketing (SEM)--where advertisers choose where they want to appear in search results and pay for the privilege--has matured as a complementary strategy.
In the last couple of years social media has ramped up exponentially. Now companies looking for greater online visibility see tremendous potential in tapping into that popularity with techniques such as RSS feeds and links into sites such as Digg that can drive lots of traffic. Effective capture of social media opportunities has become so valuable and complex that, like SEO and SEM, SMO is being offered as a professional service by specialist firms.
Affirming the importance of SMO, it even has its own Wikipedia entry. However, the definition presented here isn't complete--for example, it doesn't touch on the important ability to utilize tools such as FaceBook widgets to gain more exposure.
So brush up on your SMO skills or hire a professional; it's today's hot online marketing tool and one that's likely to remain important for the foreseeable future.
Part of the challenge of working in an emerging new industry is that rules, to the extent they exist at all, are written in sand, not stone. Tomorrow's critical skillset may not have existed six months ago. To succeed, you need an open attitude and an eagerness to learn. Complacent satisfaction in past accomplishments won't take you very far.
Less than ten years ago, web site owners increasingly noticed how great performance in search engines could drive a tremendous increase in business, and the SEO industry was born. As search technologies have evolved rapidly, SEO techniques continue to change and search engine marketing (SEM)--where advertisers choose where they want to appear in search results and pay for the privilege--has matured as a complementary strategy.
In the last couple of years social media has ramped up exponentially. Now companies looking for greater online visibility see tremendous potential in tapping into that popularity with techniques such as RSS feeds and links into sites such as Digg that can drive lots of traffic. Effective capture of social media opportunities has become so valuable and complex that, like SEO and SEM, SMO is being offered as a professional service by specialist firms.
Affirming the importance of SMO, it even has its own Wikipedia entry. However, the definition presented here isn't complete--for example, it doesn't touch on the important ability to utilize tools such as FaceBook widgets to gain more exposure.
So brush up on your SMO skills or hire a professional; it's today's hot online marketing tool and one that's likely to remain important for the foreseeable future.
Tuesday, December 4, 2007
Online Advertising: Big Changes Coming Soon
In the last few years the internet has seen tremendous changes to the media business in terms of content and presentation—think user-generated content, community, social networking, multimedia, AJAX; Web 2.0. Now it’s time for the ads to catch up. Lately I’m talking to and hearing about a number of companies aiming to reinvent online display advertising. Advertisers and agencies are eager for change as well. All the attention and investment focused on this goal is sure to drive rapid evolution.
Certainly display advertising is ripe for improvement. Traditionally the shotgun approach has prevailed, with a high degree of uncertainty that messages would ever reach receptive audience members. Economically, that uncertainty must be reflected in the form of steep discounts against the value to a seller of being matched to appropriate buyers. If you reduce the risks you reduce the discount but also improve performance. Everyone should win.
Four areas that offer big potential for change are the way online ads are sold, the way they're priced, how they're targeted and displayed, and finally the creative format itself.
In the past several months, Google and Microsoft have made highly publicized acquisitions in the display advertising market while Yahoo, holder of the world’s largest inventory of online display space, announced that taking online advertising to the next level is a top corporate priority. There are also niche players, some of whom are thinking in innovative new directions that don’t necessarily resemble traditional banners or IMUs; StarMedia Network, LocalThunder, Eyeblaster, and Personiva are a few names that have been in the news of late.
In addition, companies such as MySpace are beginning to leverage their deep knowledge of audience members to offer "hypertargeted" advertising opportunities.
Importantly, advertisers and agencies are ready to embrace new systems and approaches. They believe that current advertising solutions only scratch the surface of the potential of the online medium to deliver far better targeting, metrics, audience engagement, and ROI. However, these market players aren’t taking the lead in driving change. Instead, they’re looking to large online publishers or technology-based startups to set the agenda for the future of their industry.
Traditional media are also lagging in the leadership race, in part because both the technological and philosophical innovations required aren’t well aligned with their core strengths. Also, few individual publishers have the scale needed to drive industry-wide change in the face of the inevitable pushback from competitors. This means that a large number of companies with many billions of dollars in revenue are on the verge of having the source of that revenue wrested from their control and potentially given to other media outlets who better serve advertiser needs—not unlike the historic shift we’re seeing today of money moving from traditional to online advertising. Business risks continue to rise for traditional media companies that aren’t undertaking massive redeployment of resources toward technology-oriented platforms and services.
While only a few players are large enough to set the agenda, small companies will no doubt prove to be key influencers by way of solving pieces of the big problem, framing solutions differently, or simply being acquired by one of the big names. I’ve seen this happen in my own career: I used to work for a young internet company called GoTo.com that at one point aspired to be the next hot search engine. Instead we discovered the value in powering monetization for sites with more traffic, beginning with AOL and then Yahoo. We changed our name to Overture Services and eventually were acquired by Yahoo; equally important, Overture inspired Google to improve on the original model and develop AdWords.
The bottom line: keep an eye on online advertising. Revenue is huge and growing. Product evolution hasn’t kept pace with the environments where it’s displayed. And it’s one of those pieces of the economy that touches each of our lives almost every day. We all know the world will look different twenty years from now. It’s a sure bet that one of the areas where it will be most different is in the ways companies communicate with potential buyers about goods and services.
Certainly display advertising is ripe for improvement. Traditionally the shotgun approach has prevailed, with a high degree of uncertainty that messages would ever reach receptive audience members. Economically, that uncertainty must be reflected in the form of steep discounts against the value to a seller of being matched to appropriate buyers. If you reduce the risks you reduce the discount but also improve performance. Everyone should win.
Four areas that offer big potential for change are the way online ads are sold, the way they're priced, how they're targeted and displayed, and finally the creative format itself.
In the past several months, Google and Microsoft have made highly publicized acquisitions in the display advertising market while Yahoo, holder of the world’s largest inventory of online display space, announced that taking online advertising to the next level is a top corporate priority. There are also niche players, some of whom are thinking in innovative new directions that don’t necessarily resemble traditional banners or IMUs; StarMedia Network, LocalThunder, Eyeblaster, and Personiva are a few names that have been in the news of late.
In addition, companies such as MySpace are beginning to leverage their deep knowledge of audience members to offer "hypertargeted" advertising opportunities.
Importantly, advertisers and agencies are ready to embrace new systems and approaches. They believe that current advertising solutions only scratch the surface of the potential of the online medium to deliver far better targeting, metrics, audience engagement, and ROI. However, these market players aren’t taking the lead in driving change. Instead, they’re looking to large online publishers or technology-based startups to set the agenda for the future of their industry.
Traditional media are also lagging in the leadership race, in part because both the technological and philosophical innovations required aren’t well aligned with their core strengths. Also, few individual publishers have the scale needed to drive industry-wide change in the face of the inevitable pushback from competitors. This means that a large number of companies with many billions of dollars in revenue are on the verge of having the source of that revenue wrested from their control and potentially given to other media outlets who better serve advertiser needs—not unlike the historic shift we’re seeing today of money moving from traditional to online advertising. Business risks continue to rise for traditional media companies that aren’t undertaking massive redeployment of resources toward technology-oriented platforms and services.
While only a few players are large enough to set the agenda, small companies will no doubt prove to be key influencers by way of solving pieces of the big problem, framing solutions differently, or simply being acquired by one of the big names. I’ve seen this happen in my own career: I used to work for a young internet company called GoTo.com that at one point aspired to be the next hot search engine. Instead we discovered the value in powering monetization for sites with more traffic, beginning with AOL and then Yahoo. We changed our name to Overture Services and eventually were acquired by Yahoo; equally important, Overture inspired Google to improve on the original model and develop AdWords.
The bottom line: keep an eye on online advertising. Revenue is huge and growing. Product evolution hasn’t kept pace with the environments where it’s displayed. And it’s one of those pieces of the economy that touches each of our lives almost every day. We all know the world will look different twenty years from now. It’s a sure bet that one of the areas where it will be most different is in the ways companies communicate with potential buyers about goods and services.
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