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Yahoo Keyword: Arbitrage – A Yahoo BiD Coming From Investment Group ? It’s About Damn Time January 7, 2009

Posted by John in Technology.
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Mike Arrington has a report that a group of investors are circling Microsoft for money to take over Yahoo. Finally, someone is making a run at Yahoo. The wounded beast is begging for a takeover and what a bargain that would be. I would love to have the cash to take over Yahoo. Yahoo has amazing assets.

This is the easiest arbitrage and the best investment if the group can get the company at the right price. Also a huge win for Microsoft. I am happy to see some life in the technology financial markets. This would be a fun deal to work. Can’t wait to see the debate – obviously I have an opinion with a ‘capital O”.

A group of well known Silicon Valley executives and top investment bankers are putting together a Yahoo takeover deal that would be financed largely from debt supplied by Microsoft, we’ve learned from sources with knowledge of the proposed transaction.

Under the terms of the proposed deal, the investment group would make a takeover bid for Yahoo at a relatively low premium of around 20% to its current price of around $13 per share, valuing the company at just over $20 billion.

Simultaneous to the transaction Yahoo’s search and search marketing business would be sold to Microsoft. Following the transaction the new executive team would take over the top ranks of Yahoo. A key goal of the new team would be to attempt to attract back much of the executive talent that has fled Yahoo in the last year.

Demo Gods Are Watching – 10 Ways to Demo Your Product August 10, 2008

Posted by John in Technology.
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4 comments

Over at Techcrunch Mike and Jason are busy guys and they run a new event for hot startups.  They’ve seen their share of demos.  They share their observations on how to demo your product – what to do and what not to do.  This list came from TC’s Mike Arrington who reposted Jason’s email on the topic.  The content is good but only available on Jason’s email list (email list:  how web 0.5).

(off topic:  I find it funny that Jason quit blogging and puts out an email blast instead.  I find it a complete cop out by Jason not to blog, but whats worse is his spin that it’s more intimate to do email…come on Jason just tell us the truth – blogging takes up too much time and you have a company to run or turn around).

Here are 10 ways to demo your product or service:

1. Show your product within the first 60 seconds
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Most folks start their presentations with information like the size of the market they are tackling (tens of billions, we only need 1%!), their inflated corporate bios, the philosophical approach they’re
taking, and boring Powerpoint graphics explaining some convoluted workflow of their product.

The longer it takes for you to show your product, the worse your product is. Folks who have a kick-ass product don’t spend five or ten minutes “setting the stage” or “giving the background.” Folks with killer products CAN’T WAIT to show you their product. Their demos start with their homepage and quickly jump into the users experience. If a picture tells a thousand stories, then a product demo tells a million.

Show your product immediately, and if you don’t have a product to show don’t take the meeting.

2. The best products take less than five minutes to demo
——————————————-
The greatest tech products over the past 10 years would take no more than five minutes each to demo. For example:

a) Larry and Sergey could demo Google search in less than five minutes. Here’s a box, type something in and you get a huge reward.

b) Steve Jobs could demo the iPod in less than five minutes. Plug it in, put in your CDs and it syncs your music. Turn it on and use the wheel to select what songs you want to listen to.

c) Chris DeWolfe could demo MySpace in less than five minutes. Sign up, fill out your profile, and add your friends. For bonus points add some widgets to your page.

I think you get the idea: the better the product the LESS time it takes to demo. If your product demo takes more than five minutes to demo, it probably sucks. All the tiny little features that matter to
you are of course important–God is in the details–however, when presenting your company, you don’t have to show them. Larry and Sergey wouldn’t open up the advanced search tab and the list of operators you can use in Google during a demo.

Steve Jobs does take the demo details to a fairly detailed level, but you and I are not Steve Jobs. There is only one Steve Jobs and there is only one Apple. You’re never going to build something as cool as Steve, and as such there is no need for you to talk about your product for five or ten minutes.

3. Leave people wanting more.
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If you take my advice in point two, then folks should be either blown away or intrigued by your core product. If they are not somewhere in that spectrum, you need to rebuild your core product.

When I pitched Mahalo to investors, I had five sheets of paper with different search results on each. I put them on a table and said which one is the best. Obviously I knew my result was the best, and that
simple demonstration lead to MASSIVE discussion: how was the page built? how long did it take to build? what would it cost to make that page? how often do you need to update it? how can you scale that business? how many pages can you create before it breaks even?

It’s best for folks to discover the merits of your product for themselves, and it’s up to you to make such a compelling core product that they are intrigued enough to explore it.

4. Talk about what you’ve done, not what you’re going to do.
——————————————-
Weak startups and their leaders seem to immediately start talk about “what’s next,” as opposed to focusing on the core product. Anyone can say we’re going to add: a mobile version, collaborative filtering, an advertising network, visualizations, a marketplace, a browser plugin, a browser and a social network to their product. In fact, given the amount of open source and off the shelf software out there, combined with the large number of developers in the world, anyone can bolt these things on to their service in a week or three.

Who cares what you’re going to bolt on to your startup? What really matters is the core functionality of your startup.

Steve Jobs has become at once the world’s greatest salesman and product developer because he only announces Apple’s achievements. He doesn’t waste time on what Apple’s going to do: he talks about the here and now. Microsoft’s old strategy was to talk about products that were coming and that put them in the horrible position of having to backpedal when they changed their mind about a product.

5. Understand your competitive landscape–current and historical.
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This year I’ve had three companies show me group SMS messaging products, and most of them did not know what UPOC.com was (Gordon Gould’s group SMS messaging service that was five years ahead of its time). I’ve had three or four companies over the past two years of TechCrunch50 conferences pitch me on Third Voice–the controversial “web annotation” service from Web 1.0. [Side note: I loved the concept of Third Voice so much I considered starting a company like it and even bought the domain name annotated.com.]

When I pitched the idea for Weblogs, Inc. to Mark Cuban, Yossi Vardi and Jeff Bezos, I understood all the niche email marketing and newsletter companies from the early and mid-nineties cold. I researched why they worked and why they failed, and I knew which ones were sold and bought and by whom. When I pitched Mahalo to Sequoia Capital, I knew the history of human-powered search and directories from DMOZ to Yahoo Directory to LookSmart.

If you don’t know the competitive landscape, and the shoulder’s you’re standing on, folks are not going to be comfortable giving you their money, time or attention.

6. Short answers are best.
——————————————-
When taking questions about your product answer questions shortly. This is a very challenging thing for many people–including myself–to do. If you’re like me, you’ve probably thought out your startup’s
issues a thousand different ways. When I sit at the poker table I play a game where I think out every possible scenario for not only my hands, but the hands of my opponents (this is fairly standard among
advanced poker players from what I understand).

Say I have Ace King and I raised out of position and the button called my raise pre-flop. Then they re-raised me on the flop, which had an Ace. What does that tell me? They could have an ace, they could have two aces and have slow played me, they could have a medium pocket pair and they want to see if I have an ace, maybe they are on a flush or straight draw or maybe they suck at poker. Who the hell knows?!?! You can go insane trying to figure all these things out–that’s why poker
becomes very addictive.

The point is all that inner thinking is chaos when you try to explain it to another person. It’s pure madness after 60 seconds of talking. The best thing to do is answer the question with the most concise answer. For example, when asked “what happens if Google enters your market?” answer quickly and with confidence:

a) Google has entered many markets, but they are only #1 in search and search advertising. They trail in social networking to MySpace and Facebook, in classifieds to Craigslist, in news to Yahoo and AOL, in email to Microsoft, AOL, and Yahoo, and in instant messaging to Microsoft, AOL, and Yahoo.

b) We’re not sure if Google will enter our market, but hopefully we’ll have developed our product enough that it will be a real sustainable business by that time.

c) We think Google might enter our market at some point, and if they do they and their competitors will certainly consider buying us–creating a bidding war for our entrenched position.

d) Google is a very big company right now with a very big cash machine that they have to focus on and protect–they will never do our business with our level of focus. We will out execute them on all
fronts.

These are all amazing answers (I did, after all, come up with them), and you can say them in around a minute. However, if you cram all four of these sentences together you’ve spoken for five minutes.

7. PowerPoint bullet slides are death
——————————————-
Do not make slide after slide explaining your business in bullet points, because it’s really, really boring. Powerpoint/Keynote slides that are not boring include charts, product shots, feature set tables
and the like. Things that explain big concepts with ease and grace are great, but bullet points of obvious facts show that:

a) you don’t have the ability to create a compelling story with data

b) you don’t think that much of the person being presented the information

I’m not a huge fan of “funny slides” or lots of graphics for graphics sake. You’re not pitching your company to get laughs–unless you’re on stage–you’re doing it to raise capital, close a partnership or get on stage at a conference. Keep it focused and to the point.

8. How to use this new device called the phone.
——————————————-
When presenting over the phone use a handset and a land-line… only!

It’s amazing to me that any person doing a business call would conduct it on their mobile phone. Mobile phones sound horrible 95% of the time, and they frequently cut out. If you are presenting your company take it seriously and get yourself to a landline. You have limited time and don’t want folks to miss a single word.

Speakerphones are horrible, and putting the person receiving the demo on speaker phone during a demo is just disrespectful. You can hear all the rustling, side conversations and horrible echos when you’re on speaker phone. When doing a demo pick up the handset and speak. If you go to a Q&A session then use speaker phone. That’s why it exists.

Only use a headset if it is very, very high-fidelity and you have the microphone right up to your mouth. Also, don’t eat, drink or breath heavy into the microphone or you run the risk of sounding like an animal. I use an amazing Plantronics headset, and I like me some Green Matcha tea, but I hit the mute key when I sip!

I know it sounds crazy to have a discussion about how to use the phone, but the majority of these young people actually think it’s acceptable to have two or three drop offs in a call–it’s not. Grow up
and get a land line.

9. How to handle questions you don’t know the answer to
——————————————-
After you do your concise presentation you’re hopefully going to get a lot of questions. Here are some important tips to consider when you don’t know the answer cold:

a) take a moment to think about the question. You can even say “Hmmm… that’s a good question. Let me think about that for a second.” Folks appreciate a little consideration when someone takes a
question.

b) if you don’t have an answer be honest and say you don’t. There are many ways to say this including: “I’m not really sure, I’m going to have to think about that for a bit and get back to you,” or “I’m not sure to be honest. What do you think?”

c) feel free to think out loud and brainstorm with the person. You can do this by saying “I’ve never really considered that. Perhaps you can expand the question a little and we can explore it right now.”

d) if you’re not sure of the answer you can always say you’ll cross that bridge when you come to it. “I’m not sure how we would deal with a sudden spike in the cost of bandwidth, we would have to collect more information and answer that question down the road. It is a manageable risk factor I suppose. ”

The worst thing to do when you don’t have an answer is b.s. the person. No one has an answer for everything, except a b.s. artists. So, feel free to say you don’t know–folks find it refreshingly humble
and honest.

10. Always confirm the time of your meeting/call, and always be 15
minutes early.

Blogging is Real Business – Why? Competition and Money is There March 19, 2008

Posted by John in social media.
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3 comments

Mike Arrington writes a nice inside baseball piece on trends in the blogosphere. I wrote one on the difference between influence and attention.

I enjoyed Mike’s post. I’ve been at the ground floor of blogging from the beginning but from a podcasters standpoint -which is technically blogging. In fact was there when Techcrunch was formed and hung out with Mike for almost the first year. He’s right that back then blogging was a community. Now its a cage match.

When I founded PodTech I promoted the idea of a relationship ‘rolloup’ with with bloggers with producing video and not blogging. Even though we had one of the best bloggers on staff. My biggest mistake was that bloggers view everyone as competition  and don’t like to partner including PodTech who explicitly stayed out of the text blogging. I even brought scoops to Mike very early on in the Techcrunch days, but a relationship never happened. We did a lot for others by developing social media models with video with blue chip advertisers willing to work with bloggers – case in point BlogHaus. Bloggers want an incentive with relationships that fund their business – links don’t do it anymore – links are not the scarce resource anymore.

On Mike’s massive rollup idea. I don’t think that a massive rollup will work. Instead blogger and blog networks better get used to the competition because the barriers to entry are low and there is money out there. I see that the market will shake things out and platforms like Techcrunch, b5, paidcontent will build their own affiliate networks. As a result you will vertical markets with economic benefits to those affiliate content networks that do a good job of targeting and serving their users.

Why do I say this? Because traditional agencies are dying. My new venture will hopefull be an asset to bloggers and blog networks because blogs have more value then is being realized by the current crop of ad networks.

The best blog networks that will be successful are the ones who develop create content, serve a distinct audience, develop profession business practices, build relationships rather than burn them, and act with integrity.

The market will weed out blog networks that have no credibility, no integrity, and poor business practices.

TechCrunch Effect Heading to the Deadpool? Update: Apparently Not February 21, 2008

Posted by John in social media.
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2 comments

UPDATE: As of 11:20 am Feb 21 Umair pulled down the post claiming it was harmful to Techcrunch. Note: the post only had 8 comments before Umair offlined it.

My post (below) was in response to that post. My original post below was a supportive post for Techcrunch. Now my orginal post is out of context because there is no original post to reference it.

I find that pulling down posts is bad form especially if the posts are written as editorial content. Techcrunch and other blogs write controversial posts that generate sometimes harsh conversations.


Below is my original post in response to the now pulled down post.

I saw the post today by Umair on the Techcrunch effect. Being a participant with Mike and Keith Teare at the formation of Techcrunch and watching him grow, I have to say that I think the Techcrunch effect is do to Mike’s work ethic and drive. As long as Mike stays around they will be relevant. On the community issie I think that as sites get larger they do get diluted on the community side, but Techcrunch has commenters who are pretty rabid.

What people don’t realize is that Techcrunch isn’t just Mike anymore. It’s a management team and staff that executes Mike’s vision. He’s outgrown the one man band blog to a fully branded publisher. This is a major accomplishment for Mike and his team.

Personally I don’t think that he can scale the way he’s organized but his site combined with events is a profitable model. I think that he’s nailed the events and Techcrunch meetup events. Those events throw off a ton of cash flow. What the Techcrunch growth story beyond that ..is anyones guess. However, it doesn’t matter he is profitable and unless something wild happens Techcrunch won’t be out of business anytime soon. (side note: PodTech is approaching breakeven as well). Being profitable is a good thing and allows companies to control their own destiny.

Overall, I think that Mike’s growth strategy is in alignment with how he has financed Techcrunch – organically self funded. If Mike changes his strategy from financing growth through internal cash flow to external equity capital, then he would have to rethink how he organizes his business.

One thing that I’d like to see is Mike publish his traffic numbers. That would silence the critics.

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