Scoble has a well written piece on Android vs. the iPhone for 2011. I’ve been worried/thinking for a long time that Apple was going to have another “Windows” moment for a while, this time with Google beating Apple for control of the mobile space.
Read Scoble’s article here: http://scobleizer.com/2010/12/26/why-2011-isnt-1995-for-apple/
Techcrunch on the same issue: http://techcrunch.com/2010/12/26/2011-android/
eMarketer is predicting that online advertising spend will be bigger than newspaper advertising in 2011. Too bad most of that is search and isn’t the type of $ that directly subsidizes good content…
I’m not really sure how I came across this piece of academic research, but Rebecca Zarutskie of Duke University published a research piece in May 2008 called “The role of top management team human capital in venture capital markets: evidence from first-time funds.” Basically, she looks at various qualities of the partners at first time venture capital funds and runs regressions to see if any of those experiences impact fund performance.*
She concludes that VCs with previous venture capital experience, previous experience as startup execs and experience as management consultants make for better funds. Ok, so other than the last piece, this isn’t too surprising. She also looks to see if other things like having a PhDs or law degrees help as a partner, and she doesn’t find a statistical improvement in exit percentages.
But there is one finding that is statistically significant that I find a little funny:
That’s right, if the partners of a fresh fund have MBAs their fund is likely to do worse than a fund without! The finding is statistically significant.
Is it possible that MBAs make you a worse investor? That would seem like a real problem, since something like 59% of the investors in her sample had them.
Rebecca isn’t really sure how to interpret this finding:
However, I do find, perhaps counter-intuitively, that management teams with more general human capital in business obtained through MBAs perform on average worse than other fund management teams. A possible explanation for this result is that there is an oversupply of individuals of possessing MBAs relative to those with other educational backgrounds who are typically candidates to enter the venture capital industry.
My gut would be that, no, being an MBA does not make you a worse potential investor, but that it might make it easier for you to raise that first fund. And, since the bar may be a little lower for first time funds if the partners have MBAs then the group as a whole may under perform. The reason I’d think it would be easier to raise a fund if you had an MBA is 1) better connections, 2) LPs may like the brand associated with people who have HBS type degrees and well, that’s the two reasons.
Forgive me if someone already wrote about this research a while ago, I just discovered it over the weekend.
*(Her definition of fund performance is the % of deals in the fund that were exited, which is a crude but decent enough metric to make her research interesting.)
Wow, lots of “the sky is falling” reporting going on yesterday when ZipCar announced a new fund raising round. I exchanged DM’s with a couple of local reporters on how the Series G round didn’t have to mean that the company was having trouble, and looks like (hopefully for ZipCar fans) I was right.
Dan Primack actually did some real reporting here and got the scoop - ZipCar’s IPO was taking longer than expected due to regulatory issues and the company needed a top off round of capital prior to going public. These types of last minute financings (i.e. right before going public) can be really lucrative to investors, so props to the firms that stepped up and good luck to them on making a quick, solid return. And serious Kudos to Dan for taking the time to find out what was really happening.
Also, props to Galen Moore for taking the story in a totally different direction and commenting on the lack of ZipCars in less ritzy neighborhoods. As the company grows they are probably going to have to take this sort of publicity into account…
Healy Jones | 
Branding, Marketing strategies, New England Innovation, online marketing | 
12 15th, 2010| 
12 Comments »I’ve made noise recently about how Boston needs a stronger early stage technology press/blog ecosystem.
But I’ve also been thinking about what I can do to help fix this problem. I know that there are real journalists and dedicated bloggers here working hard to put out legit pieces on the New England startup scene. How can I support them?
One of the things that I think helps set the publications in other cities apart is the large number of readers who interact with the articles – in particular, in the comment sections. There are real conversations that happen around the stories by members of the startup communities in the comments on blogs like Techcrunch and Mashable. You don’t see that as much in Boston.
So, my New Years resolution is this:
I know this isn’t much, but if other members of the community would do this too we would not only show our support for the journalists who try to help Boston tech companies get the word out, we would also potentially help increase the dialog that goes on around the local scene. (If I miss a day I’ll make it up the following with an extra comment…)
Maybe this is putting the cart before the horse. I know that other the big tech blogs have a lot of traffic, which leads to the large number of comments. But I also know, from my own blog and from the different blog publishing I’ve done for OfficeDrop, that after there are one or more comments on a post other readers are more likely to come out of the woodwork and post comments. And a healthy number of comments helps build community around a topic.
Here are the blogs that I want to try to help promote. Please let me know if I’m missing any:
Mass High Tech Galen Moore is out there everyday trying to make noise for New England.
BostInnovation I’m hopeful these guys will evolve into our own local Mashable.
Xconomy Boston I love the national ambitions coupled with local coverage.
Scott Kirsner Boston’s best known technology promoter.
Let’s try to help these local bloggers take their message to a national level. Is anyone else up for this? You could show your support by leaving a comment 
The WSJ has a good article on how Google is supposedly gaming their search results to show Google sites over those of third parties. The article suggests “emphysema” as a good example where Google puts its own content ahead of more relevant searches.
Here is what I got when I ran that search on Google:
Google Games Search Results
The Google page show at the top of the list is not only less helpful than the Mayo Clinic and Wikipedia page that it beats, it is also a lower page ranked page with content that is less focused on the actual search term, “emphysema” and is more focused on COPD.
The Google Health page is also less useful, IMHO, than the Mayo Clinic page. After I read the first two paragraphs of the Mayo site I felt like I had a good grasp on what emphysema was, but it took me reading about half of the Google Health listing before I realized that it was actually on a page talking about emphysema. I think this is because the Google page is more focused on the term “COPD.”
I’m not a doctor… but I’d guess that COPD and emphysema are likely the same thing. But I’m pretty sure that if the Mayo Clinic put up a page on COPD it would not rank on the top for emphysema. So it doesn’t really seem fair that Google would promote a page that talks about a different term that the word that I searched for.
Actually, Google does have a little link just below the link to Google Health that goes to the Mayo Clinic’s COPD page, and after glancing at it seems that emphysema is a factor in causing COPD. But this leads to the question as to why Google is curating search results to something other than the actual search term? If I wanted to know about how emphysema leads to COPD wouldn’t I search for “emphysema and COPD”? And why didn’t I understand from the Google Health page that COPD is caused by emphysema – particularly when the very first sentence of the Mayo’s page made it really clear?
But here is the funny thing in my mind:
Why doesn’t Google just SEO optimize their own pages? Wouldn’t that be cleaner? I mean, they publicly publish what the algorithm looks for in a page!
My company is now is a number of Google marketplaces, which are awesome ways for new customers to find our service. I specifically remember having a conversation with one of the product managers for one of these marketplaces about why they didn’t have certain basic SEO stuff in the listings that went into the marketplace (like search engine friendly URLs, for example). He point blank told me that he knew nothing about SEO and didn’t really think it was important! But do you know how awesome it would be for me to have my Google marketplace listings showing up high in Google searches? They are a great potential distribution channel, since people can pretty much check out right there…
Why would Google not build its own services to win at SEO by doing all the simple SEO things right like good URLs, titles and content? How hard would that be? And then would people complain as much when Google’s own services floated to the top of the search results?
So, my message to Google would be: SEO optimize your pages and get some great content on them – and you’ll naturally float to the top of the search results.
I wonder how long it will take for all the VCs relocating to Cambridge to drive up the rent here to the point where all the startups have to start moving back to Route 128.
Inspired by Dan Primack’s BVP’s Cambridge office bathroom photo – I’d post a picture of OfficeDrop’s bathroom but I don’t want OSHA to shut us down
Just kidding, our office space is really cool (and we still have a spare office available for month to month rental if a local startup is interested.)
Check out the photo from the NY Times today of Prasad in our main office area:
Ok, so the Groupon acquisition by Google has fallen through.
Now it’s time to analyze the pieces. Props to the Wall Street Journal for taking on the proposed deal from a different angle. The WSJ compares the proposed Groupon acquisition, at $6 billion, to other large venture backed M&A exits and finds that “If Google had acquired Groupon for up to $6 billion, the deal would have been the largest for a venture-backed company since 1999 and the third largest acquisition on record.” Wow, that’s pretty interesting.
The WSJ goes on to state that this is a sign of the current internet company bubble and negatively compares the price to past bubbles, mainly the telco equipment maker bubble back in the late 90′s.
I find this to be a bit of a stretch, mainly because Groupon is at a run rate of $2 billion in revenue, up from no one having heard of it just a couple of years ago. And it’s cashflow positive. Vs. the telco equipment companies that may have had real IP, but were not generally producing that level of revenue so quickly.
I’m not saying there isn’t a bubble. In fact, I think there is one. But buying a cashflow positive company growing at hundreds of a percent year over year at a 3x revenue run rate doesn’t seem as insane as buying an equipment company growing more slowly with all the logistical headaches of building and distributing a product to a limited number of end customers.
Healy Jones | Branding, Customer behavior, Marketing strategies, venture capital industry | 12 3rd, 2010| No Comments »Very unrelated links, but both I found to be very interesting.
An amazing piece by Justin O’Beirne on why Google Maps is so much more readable than the competition. He must have put a massive amount of work in to this post. I love the modifications he makes to Bing’s maps to make them better based on what he sees Google doing. Awesome stuff.
One of the venture firms I worked for, Summit Partners, used to say that letting a founder take a little money off the table often boosted the company’s growth rate. I know this may sound counter-intuitive – if the founder just got $, won’t they become a lazy fat cat? Roger Ehrenberg has a great post on letting your winners run – even if that means letting the founders take a little money off the table prior to the real exit. I think he explains how a little liquidity can give the founders the confidence to go for the big time with their company.
OfficeDrop is being featured in the New York Times’ Small Business case study section. The Times is doing a case study on how OfficeDrop uses background checks to help ensure clients data is protected.
There are two pieces up today on us, one that talks about how Prasad decided to start doing background checks on our employees:
http://www.nytimes.com/2010/12/02/business/smallbusiness/02sbiz.html?pagewanted=1&_r=1&src=busln
The other is on the “You’re the Boss” small business Times blog. Please leave a comment there if you use background checks or if you are thinking about it:
http://boss.blogs.nytimes.com/2010/12/01/do-you-do-background-checks-on-job-candidates/
