September 2006 Archives

Getting Pinged Out of the Blue: Becoming A Believer

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So I'm an old guy. I never grew up with the Internet being around, but helped bring the Internet into existence while working at Yahoo! That meant that it was an additive experience for me, to be muddied by all my old offline traditional baggage like social interaction preferences and such.

Trying to understand how the new generations who are growing up with the Internet all around them is sometimes a challenge. Seeing Meetro in action was like that.

At first, I didn't get Meetro. I do get instant messaging, having worked on Yahoo! Messenger and probably having one of the largest buddy lists around (a great help in debugging the Yahoo! Messenger login feature of Meetro haha). Using instant messaging is great for a variety of reasons: work, keeping in touch, just saying hi, etc. But these were with a defined list of friends. With Meetro, it's not like that. You don't have just friends visible and available to talk to; you have the entire universe of logged in users and sorted by those close to you.

Being an old world guy, I am used to people being physically close…or not close. You see them. You smell them. You can touch them…maybe if they let you. With Meetro, they were close…virtually. How weird is that?

And they were total strangers.

Many thoughts entered my mind as I stared at the initial screen of Meetro where you see a huge matrix of pictures of people who are logged in now. A little more clicking and you find out they are actually close to you, maybe at the table next to you…!

Do I just talk to them over IM? How do I approach them over IM? What do I say? Is this socially acceptable? What will they think of me? Will people think I’m weird throwing an electronic hello to them? Will they reject me?…I hate rejection!

This goes on for a couple of days and then I get my first random IM from someone in the Philippines.

Whoa. But I wasn't there to return the IM and couldn't reply (c’mon guys get the offline messenging feature up!).

Then a day later, someone from Russia pings me. Some more in the U.S. And I'm around for many of these now and we have some decent short conversations with people I didn't know. Amazing!

It was like a light bulb lighting up in my brain. All of a sudden, I viscerally experienced how and why someone would meet and contact a total stranger over Meetro. I suddenly UNDERSTOOD.

Social norms changing. Internet enables. Walls coming down. New interaction styles emerging. Total strangers wanting and now able to connect easily.

This is the stuff that our children, the people who are growing up with the Internet around all the time, are going to accept as normal while we, the old farts of half old way-half Internet, have to adjust and adapt to.

As an old world guy, I NOW BELIEVE. If you are old world too, will you believe? Or maybe the real question is: Can you?

REPRINTED FROM: Meetro HQ Blog

Check this Meetro widget out. Who's close to you?

To Set the Record Straight...Yahoo! Logo

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EVERYBODY tells people I designed the Yahoo! logo. Unfortunately, that is only partially true. Here are the truths:

1. I actually drew/designed the Jumping Y Guy logo which is the original corporate logo.
2. The Jumping Y Guy had other type when we launched prior to today's logo type.
3. Yahoo! hired Organic to do a redesign of Yahoo! sites as well as the logo.
4. Kevin Farnham (founder of Method Design) was the designer at Organic who executed the type explorations and design of the Yahoo! logo type. Geoff Katz creative directed it from Organic's side.
5. I art directed it from Yahoo!'s side.
6. After the logo type was done, I replaced the logotype under the Jumping Y Guy with the new logo type for unity. The logo type launched across all Yahoo! sites on Jan 1, 1996.
7. Trivia: the original logo came from the T-26 font, Able. (Please don't buy this font and create Yahoo-like text - you'll fail miserably and also be disrespectful of thee brand).

There you have it!

At University Cafe, Blue is the New Black

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This morning, I had a meeting with someone at University Cafe on University Ave in Palo Alto. Being a little hungry for breakfast, I arrived an hour early to eat before my meeting arrived.

Sitting here in one of the more popular cafes in downtown Palo Alto, I scanned around the room just to check out who was there. It was pretty amusing.

There were the "blues" and the "not-blues".

The "not-blues" were people who looked to be Palo Alto residents, or those who worked in various businesses based in Palo Alto. They were dressed in a variety of ways, generally in jeans and very casual.

Then there were the "blues". It was pretty funny. Everybody else here had dark dress pants and a blue collared shirt. It was very obvious that a large population of the venture capitalists also came to University Cafe to have breakfast meetings. Talk about attack of the clones!

You know what - blue does look good. It is a cool color and has a calming effect, more to woo potential entrepreneurs and partners by having that trustworthy effect on people around you (little do they know...ha!). It must be a critical component of the venture capitalist how-to manual, under the chapter entitled "Venture Capitalist Dress Code."

Among VCs, blue is the new black!

Free WIFI Ain't What It's Cracked Up to Be

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Today I went to Starbucks and Noah's Bagels for breakfast in Cupertino. Unbeknownst to me, Starbucks cancelled their T-mobile Hotspot there because....MetroFi launched all over Cupertino.

So I connected to MetroFI and MAN IT WAS AWFUL. It was incredibly slow and right before I left, it crawled to a complete stop. AND, they proxy-served every page so that there was this annoying banner ad on top of every web page.

Remember when we were all excited about free dialup services like Netzero? They forced us to watch banner ads but we could get online for free. Now free WIFI works the same way.

Well OK. Maybe they gotta find a way to support it somehow. But I totally ignored those ads and most of them were terrible anyways. But then, on my T-series Sony VAIO, screen real estate is precious due to its smaller height. So every web page got an extra inch cutoff!

So not only could I not view webpages better, but I couldn't even really get online because everybody else around me was surfing an obviously overloaded connection. I bet they were streaming videos and music too.

In Palo Alto, there is the same deal with Anchorfree. They put banner ads on every page too. AND, Gmail didn't work. Are they blocking specific ports? Or did the Gmail server not respond in time to the browser and just time out? Again, since it was free, I guess everybody got on it and overloaded that network too.

Thank god for the Apple Store network. I managed to find a cafe across the street from the Apple Store in Palo Alto and connected to that. IT WORKED GREAT.

If I were a cafe in Cupertino or Palo Alto, I'd just spend $50/month on DSL and then buy a $50 LInksys router and let people surf much faster than using this broken free crap.

Bring back T-Mobile! I pay a monthly fee to use T-Mobile specifically at Starbucks and in the Admiral's Club lounge at the airport. The price factor limits the number of people using it...and that's great for me....!

The Sweet Spot Number

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In talking to a bunch of companies and signing some up and turning some down (either by me or by them turning me down), I have determined the sweet spot for team size at which it seems to maximize my participation.

It ranges from one and maxing out around 10 or so.

Why is this so?

I find that in my areas of contribution (User experience, Product strategy, Online advertising, etc.) I can make the most impact if there is not someone there at the moment covering that area. While in my role as advisor I do not get on critical path by actually doing the work, I help give them direction on hiring, what they need to do, developing their strategy (in all those areas), and give them an expert to bounce things off of. One goal I try to set for myself in my advisor term is to find resources, internal or external, to replace whatever functions I am advising on so that by the end of the term, they have support in those areas.

I have found that if companies already have people covering that area, then my impact is much less. It also is difficult for company personnel to envision how to integrate my help as well. For example, if there is already a GUI person there, then does it justify giving me my advisor compensation to just be a evaluator of what that GUI person does? For things like GUI and product strategy, it is difficult to express your opinion AND make the team members internalize that thought enough to be able to take it further. And, if you are not an employee and not there 24/7 to drive a direction, it becomes really tough to make that direction stick when someone else is already working on it, and has their own opinion on how things should be done.

That is fine. I do not take this personally. I think that if a company already has support in that area, then that's perfectly fine. I don't want to get into a situation where I am constantly butting heads with already present resources.

By the time a company reaches approximately 10 people, typically many of the areas I would help on are already covered. Time to move on to the next company where I CAN make a large impact...

Where Did They Go?

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I consistently hear this now. Suddenly engineers, GUI folks, and online sales people are scarce.

In the last few months, many new startups emerged. I guess they snapped up all the good engineers because now it seems that everyone has moved somewhere and is planning to stay there for a while. This is why I am trying to make contacts in outsourcing overseas for engineering.

GUI people did the same thing and switched jobs, although most of the ones I've heard of went to larger companies. In my experience, GUI people tend to be more conservative. Not sure why. I haven't seen many take the chance of joining an early stage startup. Many startups have told me stories of failed attempts at hiring a GUI resource on staff. They turned out to be not that good, not experienced enough, or just out of school. I had to go create my own list of GUI design shops and resources, and keep track of everyone who is consulting.

The real scarce resource is online sales folks. The really good ones are truly hard to find. I feel fortunate that I got to know a ton of them at the best training ground for that: Yahoo!. Many of them have moved on, but mostly to higher positions/pay elsewhere. Here's the kicker: to lure them away sometimes requires a lot of tinkering with compensation. For early stage companies, that's really tough because they don't have a lot of cash. I am now trying to see if some of the few out there are willing to consult. Some of them are actually thinking about it thankfully. About every early stage company that is thinking of selling advertising has no experience in this area and certainly no contacts at all. It's one of the most valuable things that I can do is connect them to a truly good online sales person.

Time to get creative in finding ways of solving this personnel dilemma....

Way Too Much of this Web 2.0 Stuff

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How about some Web 2.0 overload? Looking for a new job with a crazy startup?

The favorite gathering place for Web 2.0 businesses has always been Michael Arrington's Techcrunch. Here's a few more:

The Go2web2 Blog of Orli Yakuel

and her amazing Flash powered Web 2.0 company navigator:

Go2Web20.net - The complete Web 2.0 directory

An older list of Web 2.0 companies from Baris Karadogan, Partner at ComVentures dating back to March 2006. Many new companies have emerged since then.

All I can say is "let the buyer beware".... Creativity run amok is cool, but make sure you go deep and seek substance.

Moving Towards a Paper-less World One Signature at a Time

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This week saw the convergence of a few deadlines in financing and me going out of town. Landing in NYC, I realized I didn't own a fax machine and I needed to sign some documents and fax them.

So out I go to the nearest Staples Express, plunk down $150 to buy a brand new Brother multifunction wonder, and then proceed to carry the huge box back to my apartment.

A few sweaty minutes later, I get to my place and set it up. I plug it all in and thankfully after a few tests, it all works fine.

I then sit down to print out a whole bunch of docs and prepare them for faxing to various places. What a big time suck. I need to sign two agreements and create fax cover sheets for both of them. I proceed to print out tons of paper and lay them out on my table and double check what they are and where they're supposed to go. Finally I get that all organized and sign them, and then stuff them into my fax machine multiple times as many people need to have copies of them. I also create another fax for my financial person with wiring instructions, sign that, and then fax it away.

It seems as though the point at which all this is broken is the signature.

I can already email things around. I use Acrobat to generate PDFs all the time so I know that the docs won't be altered. That's not the problem.

The problem is when I need to physically sign something. Then I need to print something out, sign it, and then get back into an electronic state. This is typically a fax machine, but it can also mean scanning in of the doc and turning it into a PDF before emailing. Scanning this in can be problem. I have a Fujitsu ScanSnap seems to work most of the time, but if the paper is even slightly bent, it starts screwing up bulk scanning. Somehow, fax machines seem more resilient in feeding less than optimal paper, but I have to fax it somewhere. A buddy of mine told me to sign up for eFax which I finally am paying for now. It is about $170/year, but it definitely works great and now I have a fax number to boot. When faxes come in, I set it to convert to PDF so now I have electronic versions of all my faxes. I can also fax myself so that it essentially becomes a scanning->PDF solution.

But how can I insert my signature electronically? I suppose I could scan my signature into an image and then copy/paste it into documents. Security-wise, that isn't too great; as soon as somebody gets hold of that image, I'm toast.

Where are all the digital signature solutions? I used to hear talk of companies attempting solutions but I don't hear much about them now. A business opportunity perhaps, in the world of Web 2.0+?

Going paperless is key; it seems ridiculous that one of my most favorite appliances is my paper shredder. When we talk about legal documents, we're talking about pages upon pages of formal wording that I have to go through and it sucks to carry it around, only to shred it when I'm done. Finally, I am starting to get used to reading these docs on the PC screen, although sometimes I find it still difficult (thank god for the ability to print 2 pages onto one piece of paper through MS Word). I have (almost) gotten my entire financial life to go paperless. Somehow, the world of signing agreements needs to get there as well.

If You Want to Have a Web 2.0 Company....

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...you must use the right language in your presentations. Find useful and essential Web 2.0 doublespeak here at:

The Web 2.0 Bullshit Generator

After you finish your presentation, you must have an official Web 2.0 logo. Forget that retro crap. Go 2006 with a true Web 2.0 design! Type your company name here:

Web 2.0 Logo Creator

Since I want David Shen Ventures, LLC to be truly a next generation Web 2.0 company, I am thinking of switching my logo to this:

Generated Image

But if I truly want to be Web 2.0, I must drop some vowels. So...

Generated Image

I am also thinking of switching my page design. So I tried this automatic page layout creator for Web 2.0 design:

Web 2.0 Generator

Check out my proposed new webpage design.

Investor Experience and/or Attention to Detail

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After doing this for about 4 months now and only really seeing maybe 5 investment term sheets, I am already seeing a huge variance in investor experience and/or attention to detail.

My lawyers are great. They are super-conservative and I joke to them about being worst-case-scenario guys. It is truly scary to hear all the crazy things that either have happened in the past or all the possible bad things that COULD happen. In their defense, that's their job which is to protect their client and keep me out of trouble, and in the course of that scare the daylights out of me by talking about possible disaster scenarios.

It is obvious to me that not everyone is employing their lawyers in the same way. Or maybe their lawyers aren't that good, or even stylistic differences in approaching financing changes the equation. Or maybe the company doesn't want to spend the money to do things right. Or the investor either doesn't want to spend legal fees or has no legal help at all.

In reviewing these term sheets, they range from being, "These investor terms are super-dangerous; I can't believe anyone would sign this!" to "WOW these are great balanced terms that serve both the company and the investor". I don't see the ones which are (most likely) initially given to companies which are totally investor friendly and screws the company.

For some of the more experienced investors, I see definitely a jockeying of position for control happening in subtle and not-so-subtle ways. It is the interesting interplay between company and investor, and if you have large assets coming to the table, the company definitely wants to bring that cash in. But either side exhibits differing levels of experience. Generally, I find the big venture firms having more leverage and experience, but sometimes they seem to sign early stage docs a lot quicker and with less attention to detail since less money is involved. When bigger sums of money are involved, then the real jockeying begins as negotiation for rights and control are passed back and forth.

Still, as I ask around, I find that there are many of the big VC firms that also operate haphazardly. I do not know all the reasons behind this yet, but it seems that time is a big limiter, as is cost for applying legal fees, and also experience, especially among junior partners trying to get a deal done.

In some instances, given that it's friends and family who are the angels, I think they operate on trust. They are relatives/friends of the entrepreneurs and give their support by putting up some of their own cash. They typically have little or no angel investing experience and probably not much legal help at all. So terms are not read or read and then not understood, and paperwork is signed on the assumption that the entrepreneur will not screw over their friends/family.

What can I say? I hate reading legal docs too. It's why I asked my lawyer to really simplify my advisor agreement. You can actually read the damn thing if you're not used to legalese, and understand what you're getting if you sign me up. Before that, it was really tough to read; lots of legalese and weird words like "hereunder". What the hell does "hereunder" mean? I see it everywhere in legal docs. Sheesh.

But I have forced myself to really read and understand term sheets and also the final expanded investing paperwork. As investors, I believe that we need to do this so that we can be prepared to defend why we're asking for term changes, and to not be afraid to push for changes even though we're not the lead investor. It is essential that we become experts in this and be good at reading docs, and not be shy about spending a bit on legal fees to keep us angel investors out of trouble.

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This page is an archive of entries from September 2006 listed from newest to oldest.

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