Outsource Your Design to Blog Commenters : The Noo YooToob Case Study.

ickNew Design
Originally uploaded by benbarren

I've been working alot on design across multiple projects at moment, and I'm so happy that I'm working with a great designer, team and clients. Even then it's hard. He says, She says. Or more so, people can only really iterate that they don't like something when they see it, but cant couch it (myself included) in a way that is constructive for the designer, to do an even kicker ass time take two.

So late Saturday night, I'm enjoying some of the comments on the Doyen of Web2 (well exitwise anyway) Youtube, and their testing of new here comes the island ad above the fold looknfeel. Frankly, I think it's red awful. Its the fonts I hate the most. Such a lack of care. Almost looks like a myspace band page. Jeez is everyone just going to give the $15b gorilla leadership ?

Youtube had a top end crisp modern feel when u rocked up there looking to watch some drm approved pg video content (amy winehouse and aussie idol clips is mainly what i use it for) Youtube had Chad, a cofounder who mythically was Paypals designer didnt they ? While it's still limited alpha best to get Jack Welch in there to the UI department, hire Gary Hamel to consult, and accelerate the senior designer, the cofounder doesnt want to design anymore succession planning. Here's the kind of insight all Consumer Experience Sample Group Alpha Testers need :

YouTube Blog Comments Extract : "Bottom line: Car makers, Computer makers, web masters should concentrate in looks. RED color not only looks cheap but so annoying. The actual YouTube looks so elegant, clasic, easy to surf, nice to surf, with soft colors, a nice design for all ages. You can sell rocks as long as the gift box looks amazing. You can sell literally garbage as loong as you describe it in a nice way. IT'S ALL ABOUT LOOKS. This YouTube version WON'T SELL! Not matter how improved it's, it simply looks horrible, no taste at all. You don't have to use the red color in order to match the logo, no no no, the logo looks beautiful by itself."

Or YooToob could do what Apple the king of design does and email a barely legal fellow and get your ad agency to remake his IpodTouch YouTube "loser generated content" (as Valleywag called) it ad via NYT : "I was sitting on the bus and I got this e-mail on my phone,” Mr. Haley, a native of Warwick, England, said in an interview yesterday from the University of Leeds, where he is a “fresher,” or first-year student.The message said, “ ‘We represent Apple and we’ve seen what you have produced and we’d like a chat with you,’ ” Mr. Haley recalled, adding: “This seemed ridiculous and far-fetched. My initial reaction was, someone wanted to steal it.”"

OK its past midnight and I think the clock goes fwd an hour so its really 130am and Im getting into Dave Winer's "quadruple meta-mode" so feel free to watch Mr Nick Haley's Ipod pre-ad agency Touch ad (whose inspiration was a lyric from the song he used “My music is where I’d like you to touch.” or as the first youtube commenter says on Mr Haley's bedroom production : "good work. enjoy having lots of money.")

Facebook Price : Revenue Multiple = 100

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Originally uploaded by benbarren

I lost a blog post on this'morning, but some of the numbers are damn impressive/funny/scary on this Facebook/MSFT deal. The obvious ones : $15B Valuation for only 1.6% equity in return for $240m money to spend. But I love the (add a zero to the "standard" 10 times revenue) ratios that companies have been getting. Peter Cohan crunches the numbers, esp the Price:Revenue of :

"$100 for every one of the $150 million in revenue it's expected to generate in 2007. CEO and Harvard dropout Mark Zuckerberg's 20% stake is now worth $3 billion.. But the really stunning thing about Facebook's valuation is how it compares to Microsoft's and Google's. Specifically, $1 of Facebook's sales is worth 7.1 times more than a dollar of Google's -- whose Price/Sales (P/S) ratio is 14.1 -- and 17.5 times that of Microsoft which sports a P/S ratio of 5.7"

I also like SiliconAlleyInsider (as usual) and Henry's acerbic deal analysis : "let us keep in mind that this was not an outright acquisition like aQuantive. It was not a control position. It was not a major investment that might someday yield a humongous return (could be 5x-10x, if all goes fabulously, but even that's couch change for Microsoft). It was not a minor 5% investment that might at least include a board seat. It was not a deal that appears to include much in the way of fringe benefits other than the right to sell advertising that Facebook doesn't want to sell.."

Also : My morning coffee reflecting/laughing actually on Dave Winer's meta: level 4 post (or "quadruple meta mode" as he calls it), but Firefox crashed and lost my metapost - it seems suitable appendage given how meta Facebook is becoming for social networking/web2/explaining what u do to mainstream/normal people (at least downunder) :

"When I say a piece is too meta, it's not news, it's news about news, what the Big Media guys call a process story. For example, I would prefer to not have this piece, the one you're reading right now, on TechMeme. It's now meta-meta, because I'm talking about the meta-ness of the piece. You can see this could go on forever, now I'm in meta-meta-meta mode. For a brief moment I went into quadruple meta mode. (Sometimes I get so deep into a joke I wonder if people are still with me.)"

santa can i have a facebook app.

sunday 2pm
Originally uploaded by benbarren

I'm guessing every site will have the same "social features" ie Facebook to start with, and then in 2008 some meta-widget which automagically distributes to the bebos of this world, as Google News announced end of week. It's in my wishlist for Santa (and I know alot of clients are asking for it too) Maybe Tuesday there will be more info.

Goog News blog on their facebook app : "This experimental application enables users to create custom sections or select from a set of pre-defined topics, then browse and share stories with their friends on Facebook."

(nb Venturebeat earlier in week covered the adsense in facebook sneak : "These aren’t just any old Adsense ads, according to our sources — developers have been inserting plain-vanilla Adsense into Facebook applications since the developer platform launched in May. Now, Google is specifically building this network for advertisers who want to be on Facebook, and will let advertisers run their ads across all Facebook apps that sign up for it.")

Facebook have been asking their users a similar question, although from a fast moving consumer brands perspective via Searchviewblog : "“How likely are you to install a facebook app from a major brand, like Sprite?” : While "43% of users say they would never install a branded Facebook app. But in second place is the option “If the app is cool, no problem”

PortfolioMag think the perfect Facebook app might be for unfriending people hehe (i have no trouble pressing ignore btw to friend requests. why unfriend ? when u never have to friend in the first place) : "At one point I was chatting with old friend Valerie Buckingham of Nokia, and we decided that the perfect Facebook app would be a cloaking device for unfriending someone. So if you click "Remove Friend," the former friend can never tell. Perhaps if he clicks on your profile he forever sees a static old version, taking months or years before he realizes he's not seeing any of your updates."

To watch : Paid Content have the full vid on a social networking session with all the playaz. ("At the recently held Google Zeitgeist '07, a panel on social networking, featuring Chris Alden, Michael Birch, Reid Hoffman and Esther Dyson.")

To listen : Last nights 3 hr triplej mixup set by Sir Khan + Rob Dowell.

Would You Want to be One of Nigo's Six Employees ?

R35 GTRzilla
Originally uploaded by benbarren

Interesting, cant decide whether I think it's hilarious, tragic, or just another business, but (some of the the quotes in) the Portfolio feature of Bathing Ape and its founder Nigo is an interesting read (nigo is often referred to on kanye + pharrells blog - as if they are in an arms race for consuming high end labels, then turning them into sellable pop) :

"And then there’s the warehouse outside Tokyo, as capacious as an airplane hangar, that’s filled with the Americana that Nigo scours the U.S. Midwest for—more toys, more plastic figures, as well as vintage jeans and antique Coke machines and Mr. Peanut outfits and jukeboxes and toilet seats that play "(We’re Gonna) Rock Around the Clock." The stuff is unloaded from trucks and unpacked, photographed, cataloged, and prepared by a half-dozen employees so that when Nigo next visits, he can sit at his Prouvé desk, play with his toys, and dream that someday, someday, Tokyo’s fashion world will understand."

nb : So coz the (startup) car radio doesn't work ive had graduation (the album) on in the car (all my old ones are scratched-lost etc) where one of Kanye's bigger claims of the album is "i shop so much i speak italian". I've just downloaded the graduate mixtape from his blog, which im hoping is good as Kanye's a great producer/mixer/stealer of riffs, just cant handle his rapping or his talking, coz he doesnt actually rap.

adsense aint going away.

byebye rehab
Originally uploaded by benbarren

No matter what u think about google's hit or miss new product development (which is getting better, bigger and more systemised over time) the core of the adsense engine is very smart. Seeking Alpha :

"In beta testing right now, we have the conversion optimizer and this lets advertisers adopt an ROI driven financial model even more easily than just going straight with a kind of a cost-per-click type bidding. Basically, clients specify, advertisers specify how much they want to pay for a customer and then we automatically optimize for them in each auction how much they ought to be bidding in order to accomplish that goal."

Or over on O'Reilly they are talking me-commerce algorithmic enterprisation : "CleverSet uses behavioral modeling for commerce companies (to enable "me-commerce). These models are used to power recommendations for products, ads, and media. They try to find unique relationships by modeling every user action and pulling in in explicit and implicit data (sadly, they didn't elaborate on this point).""

BeyondVC on where Goog east coast's are being hatched : "I have already seen my first couple of spinouts from the Google New York office, and I expect to see many more. But it is many of these guys that I hung out with above who were some of the original pioneers in New York that have helped blaze a path for many of the new entrepreneurs we are seeing today."

Umair with the final word : "Still think the F8 pseudo-platform is sustainable? It's not. Guess what this means for Facebook - yet another player (the master of next-gen strategy, no less) willing to compete on openness. Oh noes."

Ebay Neighbourhoods : "brainchild of an 'engagement' subgroup of the buyer-experience team."

HermesHautaCourroie
Originally uploaded by benbarren

The collision of commerce and community continues. Ebay and their new : "Neighborhoods - which aggregates postings from eBay blogs, guides and reviews (via signonsandiego)- was the brainchild of an "engagement" subgroup of the buyer-experience team. Among the 600 new neighborhoods is "Shoe Heads," intended as a haven for footwear fashionistas. Others range from Beyonce to Battlestar Galactica, and still more will be formed based on popularity of search terms and community feedback."

"too many hacker entrepreneurs sell themselves short by aiming to only sell themselves to Google"

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Originally uploaded by benbarren

The first of the high profile status applications acquisitions; Google buy the we're not quite twitter, but we have really good features we do Jaiku : "That's why we're excited to announce that we've acquired Jaiku, a company that's been hard at work developing useful and innovative applications for staying in touch with the people you care about most -- regardless of whether you're at a computer or on a mobile phone."

Scoble's point actually is a good one too : "Jaiku’s other strength is in aggregating RSS feeds into one place. Interesting that Google is building a very strong position in the RSS ecosystem with Google Reader and Feedburner and now Jaiku. Interesting, will Google use its RSS position against Facebook? We’ll see come November 5."

The always (dont call it) snarkily enjoyable Donna Bogatin : "Guys, maybe, just maybe, Twitter is NOT FOR SALE! I underscored over the weekend that too many hacker entrepreneurs sell themselves short by aiming to only sell themselves to Google, rather than striving to be the next Google: Y Combinator’s Zenter hacker team big case in low expectations point."

Its cooler these days to not sell ! Facebook Stickynotes developers - J-Squared, who are featured in business week : "Last month a privately held media company made a formal acquisition offer worth more than $3 million; following in the footsteps of Facebook's Mark Zuckerberg, J-Squared turned it down... working for the acquiring company would have been a term of the proposed agreement. And for the J-Squared founders, becoming two more anonymous product managers didn't hold much appeal—not if they could do something bigger. Tevelow and Aigboboh know how this sounds. "My mom thinks I'm crazy," Tevelow says. "She can't believe there are million-dollar deals coming in and we're saying no."

Clip 30% of Rev + Assign Your Blog Uniques to Reuters not.

pink bitz
Originally uploaded by benbarren

The Reuters financial blog network strategy I've been reading about on The Big Picture; "Their business model appears to be essentially a "Seeking Alpha" aggregation approach, with the added element of splitting advertising revenue with the analyst/authors. Over the summer, I was asked to participate in this. I wasn't interested in 30% of the revenue for 100% of my content."

Howard Lindzon received a similar letter to join the Reuters "affiliate" blog network and published it on his blog : quite hilarious. The benefits are pitched as "Reuters will share 30% of the net revenue derived from your Blog by implementing mutually agreed advertising components to your site." (3 times less than the recently acquired msnbc 90% newsvine offers)

The big hook they ask for is : "All traffic to your blog will then be assigned as Reuters traffic. You then become part of the Reuters blog network.. Next Steps: If you agree with the proposed above, please let me know and I will follow up with the appropriate next steps."

Speaking of blog networks and consolidation/growth, Sequoia funded celebrity coated SugarInc (with their popular popsugar site) have bought Coutorture a network of fashion blogs. TechCrunch : "Fashion and celebrity gossip, the two content cornerstones for Sugar, drive massive page views (the company says they are seeing 45 million monthly page views from 5 million unique visitors).. Coutorture has a network of 230 blogs written by readers, who compete for headline space on the main Coutorture site. The company has raised just a single angel round, of $100k or so."

Web 2.0 + 3.0 is Dead. Long Live Web 4.0

mac goldpro
Originally uploaded by benbarren

Ok it's been confirmed it's a bubble, Web2 is over according to Andreessen and Calacanis wrote the epilogue for Web3. Time for DieHard Web 4.0. (can u believe Web 4.0 doesnt have a wikipedia page at all, not even a spoof one, where Web 3.0 has what reads like a doctorate thesis - which I was reading via a link from Feld.com over weekend : Yes they're rivetting, my weekends rock, reading semantic web definitions and RDF tech spex!)

Wikipedia on Web 3.0 : "The Data Web is the first step on the path towards the full Semantic Web. In the Data Web phase, the focus is principally on making structured data available using RDF. The full Semantic Web stage will widen the scope such that both structured data and even what is traditionally thought of as unstructured or semi-structured content (such as Web pages, documents, etc.) will be widely available in RDF and OWL semantic formats."

Nirvana seekers beware though, if people think user generated content generates alot of crap. Machine API to Machine API may be even worse. As Alex Iskold of Adaptive Blue says about the problems with Web 3.0 ideals to do with machine learning based personalisation and outsourced decision making (robots that buy me tickets, find me the best deal then book it etc) on SemanticWeb.com :

1. It lacks memory and is not iterative in nature.
2. Its ultimate goal is to deliver perfect answers, which are unattainable.
3. It is technologically impractical to achieve.

He cites : "A famous example of where the semantic web will take us is to book a user the perfect trip for a budget-minded family with small children, but “the big fallacy in this thing that people miss is that this assumes the computer has a memory of who you are,” Iskold said. Logic and inference are just part of the story. Not to mention the problem of “anti-complete” problems, which are computationally expensive and inherently unsolvable, because there are far too many pathways and too many possibilities to compute to find the “right” answer, he says. “The problem of figuring out the perfect vacation location for an individual -- the perfect answer -- is unattainable, and it’s a ridiculous way of answering the question."

So back to the netscape founder who recently raised $200M+ from the bentley driving private equity alpha+ population (who he conveniently leaves out of his snark post targets) for the Level 3 Platform Ning.com ("Now that I've raised a monster Series C round for my own company, all other funding of all other startups will immediately cease.") is having fun on 2.0 business models : "Subscription fees? Premium services? Ecommerce? Sponsorships? Mobile advertising? Mobile fee-based services? New hosting models? Video advertising? Music subscription services? In-game advertising? Massively multiplayer games? Digital gifts? Affiliate bounties? HA! Don't make me laugh. Oh, wait - YOU JUST DID."

Calacanis is also deep snarking 3.0 : "All responses to blog posts originating off of your blog in Web 3.0--including comments--must require a token pre-approving them by both parties. The "double-opt in rebuttal technology" (aka dobt) that I've patented is now build into Wordpress so there really isn't an excuse to not get your pre-approved token before commenting. Also, we have an open source ping server (mayIinterjectOMATIC.org) that is being setup now."

You Build It. I Fund it.

sunday nap
Originally uploaded by benbarren

It really is very interesting with Google investing in widget developers and Saleforce/Bay-Bessemer investing $25M in Salesforce.com AppExchange developers. Why build it (or never get around to it) when someone else can do the heavy lifting which you fund and enable. I wonder if this will extend to other verticals and websites as more commercial API's become available. From Ecommerce News :

"Silicon Valley venture capitalists Bay Partners and Bessemer Venture Partners have pooled resources with Salesforce.com (NYSE: CRM) Latest News about Salesforce.com to roll out a fund that will invest in companies' development activities on Salesforce.com's platform. Typical investments will equal about US$500,000 each, totaling $25 million over the next three years."

Facebook also have kicked off their FBFund, but it seems their initial suggested entry point email was swamped, so now they suggest website. Bad luck for those that submitted by email. CenterNetworks quoting Facebook's email : "To make sure that everyone understands the conditions of submitting a grant application, we will not review any materials you have sent via email, and any materials you may have sent have been deleted. If you would like to submit an application for an fbFund grant or require more information, please see our website and grant application submission form at http://www.facebook.com/developers/fbfund.php."

The Search4UGC.

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Originally uploaded by benbarren

Good to see/congrats 4 Hugh@APN with the impending search4.com.au (which needs a landing page now there's press) suite of vertical sites. Seems Prime and Fairfax are positioning (some will be posturing) to go a bit UGC too. Neat.

The Australian Media : "All three companies are expected to combine local user-generated content and social networking services with local media and classified advertising sites." And a nice soundbite from Mr Martin : "The aim (is) to make these websites a community hub.. Regional advertisers haven't had the same opportunities to get into online environments that metro advertisers have. Ten per cent of our business needs to come from (regional internet advertising)."

And RWW break that MSNBC have just acquired Newsvine, which is right up that MSM/UGC convergence space. From their founder comes a similar soundbite to what MSM is making about UGC : "Why would a young, efficient independent news startup become part of a large organization? For us, the answer is simple: it's all about growing the community and spreading the idea of participatory news as far and wide as possible."

Random UGC : I'm entranced by Kanye West's blog "Kanye Universe City" at the moment : Catch this kewl behind the scenes with Timbaland on the making of a video beat (but does he employ an urban doppelganger of duncan riley to riff his posts as he jetsets the world or does he log on himself ? : "sidebar props 2 bloggers computer skills in general..I ain't know how hard it was 2 stream this and post that and multiple picture this and double click that... and shout..." im hoping he at least briefs it himself and it isnt a ghostblog written by echomusic who power the site nb it's hard to pull off a black background designed blog but when it is, the design is schweet)

And on the flipside Mia Freedman who has a column in prob the best newspaper liftout section Sunday Age's M-agazine (after being a Cosmo editor and creative services director on the Eddie funded lunchtime Aussie femme take on The View) has a blog with the cute url "mamamia.com.au" - While I'd like even more disclosure (what really happened on that show behind the scenes ? didnt private equity get it ? and what about the tension between hosts ?) - I always like seeing MSM'editors go UGC. She (predictably) talks about poking and I learnt about Kanye's 'sushi sisters'. The more people that get their messages out direct to their audience/co-conspirators the better. (just as radiohead are going to prove) Midnight, Bedtime.

"Local news is not a search problem"

hands full
Originally uploaded by benbarren

Topix is a quite different beast to Technorati, but by focusing on solving the "local news" business has a much healthier dynamic. It's interesting to see how they source their index of local content, and something other newspaper groups might learn from. From Local Onliner on Topix's evolution :

"Lately, it has also been incubating local blogs and other User Generated Content. It is now getting 60 percent of its content from user generated posts; and 60 percent of those posts come in without a linking story. The traffic is disseminated via bookmarks, email, and a number of affiliates who use it for personalized local news, including CNN, Ask, Infospace + My AOL.. New CEO Chris Tolles notes "You don’t have local headlines in a small town.. There is no ‘there’ there. Local news is not a search problem.”.. “Users kept sending feedback on the comments forum.”

"Focus on headcount. Outside of marketing programs, the basis for all cost in Internet software is headcount."

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Originally uploaded by benbarren

I've been stuck deep in updating business plan documents for 5 days and coming out of the fog. Funnily enough once you get in the zone, it's good to be able to document all the things that are in your head and order them. Not to mention being able to communicate and sell them rationally to people that will fund the ideas. I find it's also good to make hard decisions and reflect them in the plan, then see if I can communicate them effectively and get buy in from "stakeholders". (that would be my meetings today)

So it's good to see tip number 1 (from a Redfin founder, via AVC) - definitely the most important along with the golden rule of half revenue/double costs in your forecast : "Focus on headcount. Outside of marketing programs, the basis for all cost in Internet software is headcount. Just figure out whom you'll hire and how much you'll pay and you can't go far wrong." Elsewhere they also mention : "We can’t disclose actual costs here, but they were higher than planned. When we set the plan, many employees were being paid below-market rates, which is not uncommon for startups; as a startup raises more capital and people go into their second year of sucking it up, you have to pay the piper at the employees’ annual review."

A really basic point I'd add to on the revenue side, is accurately defining your product mix and the forecast revenue generated. In a pre-revenue startup what you think will make the money often ends up being wrong (or really vague eg "we will make money from sponsorship/google ads") : Then you end up making (or not) your money from a product you didnt even have in plan. nb The one benefit (for us anyway) of not raising too much money too early on is signing on for revenue targets you will make, just not in the first 24 months :)

The hitch with adopting the Redfin guys mantra of conservative budgeting is it all sounds good until you need to feel tempted to make revenue promises to close a financing. In return they can make you keep your promise and suddenly you're reading blogs about equity dilution, and realising not even your lawyer can help you. Very dotcom actually. So the Redfin guys approach of take the medicine right at the start, heck take it at the honeymoon stage is sage advice : "True underachievers, we’ve performed at or just a bit better than this worst-possible plan almost every month, raising revenue projections only when forced to in December 2006. We’ve been able to stick to our plan mostly because absurd assumptions in opposite directions cancelled one another out."