Oh yeah some money changed hands (Opera switches from Yahoo to Google for Search)

Presumably with a straight face Marshall Kirkpartrick over at Read/Write Web writes about Opera switching it’s default search provider from Yahoo! to Google saying “Presumably there’s some money changing hands.”

Ya think?  Search distribution is a big money game.  Google pays $10 per box to Dell for pre-installing the Google Toolbar and pays Mozilla just under $100 million a year. Market rates for toolbar or embedded search box (ie. built in search box in Opera or Mozilla) distribution are steep – Google pays anywhere from $1.50 to $10 per new user from what I understand with most top tier deals in the $3-6 per user range.  I’ve seen estimates that Google makes $12 per user per year per toolbar or embedded search box installation.

What’s interesting is how Google’s dominance becomes self-reinforcing.  Because Google makes more money per search then Yahoo! it can always outbid Yahoo! for distribution deals (on a rational economic basis that is Yahoo! could always overpay).  So no one should be surprised when Google beats Yahoo! on a financial deal based on search economics.  Yahoo! should lose everyone of them.  Now this once again leads us down the Google paid search monopoly path where Google buys market share at a rate no one else can pay.  Just not in the bullying fashion that MSFT was accussed of back in the day.

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Seattle Venture Scene: Madrona on Fire & Seattle VC Scene waking up?

One of the interesting challenges to being a startup guy in Seattle vs. the Bay Area is that there are a lot more VC’s down there versus here.  As a result there is more competition amongst VC’s for good deals and they seem to be relatively hungry compared to Seattle.  VC’s are out and about, working events, building a pipeline and making sure they get the best deals.  Since plugging myself into the Bay Area scene this past year and a half I’ve met more Bay Area VC’s then I’ve met in Seattle in the past 10 years!  Yes, Seattle VC’s do deals, but it always seemed to me that you had to seek them out whereas down south – a hot deal seemed to draw the VC’s out.

Madrona has recently brought on board 3 principals recently – Scott Jacobson, Tim Porter and Suja Vaidyanathan, and from what I can tell – those 3 are working deals like bats out of hell.  I am looking forward to meeting the new Madrona folks but from what I can tell if you’re a Seattle startup looking to raise money – Madrona should clearly be on your list.  It’s nice to see and hear about what those 3 are up to.

Madrona is not alone – Ignition Partners this year hired their first associate – Chris Howard – who I have gotten to meet recently and nicely has a lot in common with my background.  Chris is making an effort to work the street as well.

Great to see the new blood and hopefully it speaks well to the future of the Seattle Startup/VC scene.

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Startup Prime

Over the past year I have had the chance to advise, consult, and work at a number of early stage companies. And as I sit here on a flight to Silicon Valley this morning, I have a few seconds to reflect and come to the conclusion that I sure feel like I am in the prime of my startup-oriented career.

That might seem counter-intuitive to the meme that bounced around in various discussions that 20-something founders were kings and anyone over-30 need not apply. And the analogy is likely not that different to professional sports – sometimes the next hot thing is a rookie draft pick ala Lebron James and other times its a free agent veteran pickup like the Mets picking up Johann Santana.

But the sense I get in talking with other entreprenuers, vc’s, investors, startup execs is that experience and startup experience matter more then ever – the free agent market is hot so to speak. Maybe it’s because we’re entering a down-economic cycle where ideas matter less then execution. Maybe it’s because the dreamy euphoria of the web 2.0 boom is transitioning to a state of what’s real. Maybe it’s because investors are realizing that it’s sometimes best to diversify their portfolios to include some bets on horses with track records. And perhaps it’s a lot of being in the right place at the right time. Maybe us 35 year olds are finally coming up with the better ideas.

As I think about the mistakes and lessons I have learned since jumping headfirst into co-founding my first startup in 1997 and leaving the corporate world behind for good, I will say this: I am adding a lot more value in a lot more ways because of those learnings then I was when I first got started. And I imagine other folks in my shoes are feeling the exact same thing as we all seem to be hearing the same thing from VC’s and hiring startups – experience now required.

So if you’re the equivalent of a 20 games winner with a 3 ERA you’re in luck and demand.

Caveat: Proven experience at a large company does not always apply. Sort of like playing basketball in Europe or baseball in Japan. Success in one sphere doesn’t always apply to others especially when transitioning from the corporate world to the startup world.

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eric’s right: dopplr too closed

Thanks to Scott I am using Dopplr to document my upcoming trips – but the lack of public profiles is a hindrance to discovering folks to meetup with.  As EricM notes if you want to see what happens when you open up your network – just look what happened to LinkedIn:

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I’m Alive and Presenting Next Week at Ignite Seattle (Feb 19)

I’ve been uber-swamped with work, projects, advisory stuff and everything else that comes along with being knee-deep in startup-land and thus despite having lots of things I want to blog just not finding the time these days. Lookery’s going great – just wrapping up our seed round with some very cool folk as well as seeing an almost overwhelming response to our ad program for social net apps. And of course Lookery is even hiring.

Despite all that, I am excited to be presenting next week at Ignite Seattle (Tues. Feb 19 at the Capital Hill Arts Center). My presentation is titled “The History of Online Advertising.” Hopefully the local folks can make it out. Ignite is a lot of fun and draws great crowds.

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end of year rant

A friend of mine, Kevin Merritt, blogged recently that folks should blog about the startups they like to help them out.  In this case, I’m going to blog about things that are driving me nuts, batty, bonkers or just plain up a wall.  I want to get these things off my chest before the end of the year so I can start fresh.

- Firefox for Mac (v 2.0.x) is awful.  Just awful.  It has to be the slowest browser on any platform on the planet.  It crashes all the time, hogs a ton of memory and seriously makes me yearn for IE7 on WinXP so much so that I am finding myself using it more and more in Parallels on my Mac.   Until Camano and Safari support the toolbars and plug-ins that Firefox and IE support, using those alternatives is a non-starter in my world.  Maybe Firefox 3 will be better, it certainly can’t be any worse.

- MacOffice 2004 and Entourage actually are slower then Firefox.  Just pitiful cousins to their Windows counterparts.  Why in heaven’s name did Microsoft not just knock them off literally instead of attempting to re-make them in some seemingly half-ass way for the Mac? Excel 2004 and Entourage drive me especially batty.

- Mac laptops need 2 mouse buttons.  Steve Jobs it’s going to be 2008 already.  Get over it.  You’re damn company’s OS supports a right mouse click natively and has for years.  Get over yourself already.  In fact – the single mouse button at this point almost makes the laptop in many situations.

-  I can’t believe how hard it is to find a Wii.  Seriously the lack of supply in this day and age of endless contract manufacturing in China is mind-boggling.  I have read some estimates that Nintendo left a couple of billion – yes billion – dollars on the table this Christmas season due to lack of supply.  This is almost as stupid as Yahoo was for not having a yield based SEM platform for years until Panama came out some 4.5 years after Google introduced the concept thus leaving tens of billions on the table.

- The GMail interface still drives me nuts.  Seriously when will Google realize some people actually don’t like a threaded view (in fact I hate it).  Classic example of one size fits none.

- When will folks pay attention to Amazon.com’s privacy practices?  After the over-rated digerati uprising over Facebook’s beacon platform, I can’t figure out how Amazon gets such a free pass.  Seriously have you read all the data on and – yes – outside of their domains on their users?  Have you noticed you many dozens – yes dozens – of pages their privacy policy is?

Image representing Twitter as depicted in Crun...

Image via CrunchBase

- Why is Twitter so damn buggy and down all the time?  Recently the Twitter to FB status sync has been broken dozens of times while my Twitter feed misses friends updates.  Twitter’s help desk acknowledges its a known bug.  Fix it please.  The point of twitter is to keep in touch with many friends and not be left guessing what’s going on in their lives.

- TSA and Airport security.  What a joke and waste of time.  Either do it right ala the Israelis (now that’s security) or give it up.

- Laptop battery life or why don’t all airlines have power plugs at their seats yet?  I thought they actually wanted higher paying business customers on their flights?  And why laptops don’t last 8 hours yet on a single charge in normal use modes is amazing to me – we’ve been stuck at >2 hours for 10 years.

Image representing Google as depicted in Crunc...

Image via CrunchBase

- Untargeted online ads.  Seriously in this day and age there’s no reason to be ads by the tonnage anymore.  And the way I’m tracked online, I’m sure somone (likely google) has figured out what my grandkids names are going to be.  I don’t need to see any more dating ads (i’m happily married).

That’s it for now.  <phew> I feel better already.

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the future of social net advertising: making fun of emarketer

Cross post: Full post over at the Lookery corp blog here.

Summary: eMarketer came out with some essentially nutty projections for the future of social net advertising.  As much as I wish and I hope eMarketer is right given my involvement with Lookery and the world market for that advertising grows to $4.1 billion by 2011, their numbers don’t quite add up when you take a closer look.  Yes, $4.1 billion a year for likely the most dominant category of online user engagement doesn’t seem like much when compared to the $20 billion search will pull in, but that doesn’t justify potentially silly modeling by eMarketer.  As you’ll see in the post eMarketer builds its model on some pretty wild and crazy RPM assumptions (that term is explained as well) that would require essentially turning every pixel on your social net profile into ad inventory.  Not going to happen.

That being said – I bet there will be a hundred VC pitches in the next few weeks who will gladly pimp these projections as justification for their ad supported social net startup.  Too bad no one will question their validity.

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seattle 2.0 latest startup rankings released

Marcelo Calbucci runs Seattle 2.0 a blog that has quickly emerged as the running index of Seattle 2.0 web startups. Marcelo’s site is the first comprehensive list of Seattle based-startups and he deserves a lot of credit for his most watched creation: the Seattle Startup Index. If you’ve ever wondered which startups are based in Seattle – now you know. Marcelo – I must apologize for taking so long to give your site some much deserved props – keep up the good work.

Though I don’t want to regurgitate the entire list – it is interesting to see how companies are doing that I have either worked with as a consultant/advisor or have friends there. Here are some thoughts (in order of their appearance on the list):

  • Zillow (3) – my friend Vanessa Fox just left after a brief stay at Zillow – good luck at Ignition. Zillow falls into a strange class of startup given how much money they raised – they have so much cash and so many people (well over 100) that they seemingly skipped the whole startup phase and went right to mid-life crisis. Also amazing how much traffic Zillow has compared to Redfin (23).
  • Widgetbucks aka Mpire (8) – Mpire started in the comparison shopping space a couple of years ago but recently with the launch of its Widgetbucks platform has embraced the distributed e-commerce model. I had lunch with my fellow Loudeye alum Greg Harrison, Mpire’s CTO and Co-founder, last week and was blown away by the success of their widgetbucks platform. Without giving away specifics – its growing like weeds and offering publishers some really cool monetization options behind the banner.
  • JamGlue (18) – This social music community built around JamGlue’s very cool music mashup tools has been growing very strongly and steadily since I started working with Divya Bhat and the gang earlier this year.  They are a very resourceful group and am more then pleased to see them become more and more successful.
  • Judy’s Book (22) – The story has already been told by Andy Sack and am surprised to see it end this way.  As anyone who is familiar with the Seattle startup seen – Andy is not only an active entrepreneur but investor as well.  He’s clearly one of the folks at the center of the Seattle 2.0 orbits and deservedly so.
  • blist (73) – Kevin Merritt, founder & CEO of blist, has begun peeling off the layers of secrecy surrounding the company’s product.  Having seen a demo recently from Kevin, I was more then impressed.  Kevin’s goal of creating a database as easy to use as excel but that actually is a relational database seems to be coming true.  For the first time I really got it – ie. why excel isn’t a relational database and at the same time seeing how you can show that within an excel gui metaphor.  Awesome work by the team and trust me – this is going to be a home run.  I can’t wait to get my live account – as a hardcore excel user with a db phobia – blist will be right in my wheel house – I already 3 or 4 blists in my head that I need to put in a blist.  Also I have no bones endorsing blist for any aspiring engineer looking to break into the startup scene – Yep blist is hiring.  If you want an intro to Kevin regarding a job – just ping me via the comments.  Happy to pass your name along.
  • Others Online (81) – I joined the company’s advisory board earlier this fall and though Others Online looks like a different take on MyBlogLog (a company whose founders are also friends down in SF) – its really building a very interesting service that goes wayyyyy beyond a simple personal introduction widget (which you’ll see on the right sidebar of this blog).  Jordan Mitchell’s, founder and CEO of OO, background in contextual advertising makes for an interesting cross section with the rise of social media.  Another Loudeye alum, Doug Schulze, just signed onboard with Others Online as well.  Look for a fuller story about what OO is up to in the new year.
  • TeachStreet (104) – Founded by Dave Schappell – TeachStreet is well on its way to becoming what could be the ultimate directory for lessons, coaching, tutors, and continued learning.  A former Amazonian who I’ve gotten to know this past year thanks to an intro from Dave McClure of 500 Hats fame (yes a Bay Area guy had to make a Seattle intro at least the intro happened locally), has put together a killer team and are on pace to roll out a killer service for its category.  Given who and what Dave is personally – I just can’t imagine TeachStreet not being successful.

Now where is my current company Lookery on that list?  It’s not – while I am Seattle – HQ is in SF with development out of Boston.  At the very least, hopefully Lookery will be able to help these Seattle web 2.0 startups monetize their traffic.  So if I come asking your startup for a desk to work at for a little while – now you know why ;)

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facebook bites the pr bullet on beacon, but it lives on because in the end users don’t appear to be bothered

Whether his words or his team’s, Zuckerberg eats some crow today via the corporate facebook blog and apologizes for essentially some poor product decisions in Beacon. Responding to some critics, Facebook will offer a global opt-out for Beacon. As I posted previously, Beacon already offered a partner by partner opt-out. Using the same dashboard Facebook added the option via a checkbox at the bottom of the list of partners. As Dave McClure and I grokked this morning and now blogs – given how few users will opt-out why Facebook didn’t launch with this feature is a fair question and they are right to apologize to the offended users.

Jay Meattle over at the Compete.com blog posts an interesting chart showing traffic to the Facebook privacy page. What’s interesting is how Jay notes the spike when Facebook announced it was opening up profiles to search crawlers allowing profiles to appear in Google, et al. search results compared to recently given the public criticism of Beacon. As I predicted – users aren’t concerned and will embrace Beacon’s goals of sharing more of what’s going in a user’s world.

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here comes another bubble

Funniest video ever (at least to startup tech geeks).

Here Comes Another Bubble
here comes another bubble

Set to the tune of Billy Joel’s We Didn’t Start the Fire.

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