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Will 2010 be the year of social commerce? November 4, 2009

Posted by Simeon Simeonov in Social Commerce.
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I got credit for a great post on social commerce I didn’t write.

As for whether 2010 will be the year for social commerce, I’m not sure. I think 2009 really accelerated the social advertising trend. Some of my posts are here.

Social commerce still has a ways to go. I named this as a key e-commerce 2.0 trend back in 2006 and didn’t explicitly distinguish it from social advertising. I should have.

Hats off to Arrington November 4, 2009

Posted by Simeon Simeonov in Advertising, Facebook, Industry News, MySpace, Social Advertising, Social Commerce, social networking.
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Well, it seems that the Mike Arrington’s pointed critique of social marketing practices is getting even the very large players to move quickly.

Today, we’re adding a fifth principle that clarifies a specific use case that we feel is particularly damaging to the user experience: promotions that include hidden renewals without specific opt-in will not be permitted. Because it’s our belief opt-out offers are misleading and do not have the best interests of the users in mind, we will be updating our Terms of Use this week to better clarify this for users and developers.

via MySpace Says Zero Tolerance For App Scams, Changes Terms Of Use

There is a simple principle at work here. Visibility is key. There are many shady things quietly going on on the Net today.  Once someone shines a big, bright light it becomes harder to hide. Everything starts with visibility.

Space matters (Facebook certainly thinks so) November 2, 2009

Posted by Simeon Simeonov in startups.
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I visited Facebook’s new space a few months ago. VPE Mike Schroepfer gave me the tour. I did like it a lot, although I found a few of the areas quite dark. Maybe it was the jet lag. See the link below for an awesome visual tour.

SU – Facebook Headquarters by Studio O+A & CONTEMPORIST

Space can have a profound effect of culture, communication and productivity. Unfortunately, most entrepreneurs don’t think (or perhaps know how to think) about this enough. Make it a priority. It doesn’t have to be expensive to be good.

Yes, your startup won’t have as much money to invest in its space but that doesn’t mean you can’t create a really cool environment. Agile methodologies have helped spread the concept of more open office spaces. With less to spend on buildouts and partitioning systems there is more to spend on making the space project the energy and culture you want your company to have.

You’ll find two great examples of good spaces that didn’t cost that much in Boston at Allurent in Cambridge (which also houses Polaris’s Dogpatch Labs) and Visible Measures in Boston.

Who else’s space do you really like?

The pressure of money November 2, 2009

Posted by Simeon Simeonov in Uncategorized.
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In some markets, the presence of even a few players willing to do shady business can have a profound effect on the ecosystem. Advertising, particularly the hard ROI kind, is one of these markets.

Here’s what ad networks struggle with—to either run what ads make the most money or else be forced out by other ad networks willing to be shadier than them.

via How To Spam Facebook Like A Pro: An Insider’s Confession.

A new spin on pitching and fundraising September 20, 2009

Posted by Simeon Simeonov in VC, Venture Capital, startups.
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Every conference having anything to do with entrepreneurship and venture capital has the obligatory “pitching & fundraising” panel. I’ve been on enough of them to have a sense of how disappointing they can be for the audience. Experienced folks hear the same old cliches with a slight twist based on the current environment. Newbies find what they hear random and mostly inapplicable to their attempts to raise money. So it may be a little surprising that when the organizers of the MIT Emerging Technologies Conference asked me to moderate just that type of panel I was excited to do it. The reason is that we’ll try to talk about pitching and fundraising in a different way. This post explains how and why.

First the details.

  • The event: Tue-Thu next week (September 22-24) @ MIT. This is part of the Lab to Market workshop.
  • The time: Tue @ 3:45pm at the Kresge Auditorium
  • The panelists:
    • Bill Aulet, serial entrepreneur who’s run an Inc 500 company now at MIT
    • David Frankel, entrepreneur and super-angel now at Founder Collective, a new seed fund in Boston
    • Jeff Glass, former CEO of m-Qube now at Bain Capital
    • Rich Levandov, co-founder of Phoenix Technologies now at Avalon Ventures
  • The details: follow @simeons and you’ll know

The secret to why we’ll do things differently lies in data. I asked the conference organizers to survey the audience about the types of financing they were interested in.

  • A whopping 55% want to know about very early stage, non-VC financing (bootstrapping, customer-financing, pre-seed, seed, angel)
  • Only 18% (1/3) were interested in early stage financing from traditional VCs (top-tier and smaller funds)
  • 10% are looking to Uncle Sam for money
  • The rest want to know about follow-on financings and M&A

At previous events, when I’ve asked about the split between VC and non-VC early stage financing the interest has been about evenly split. Here it’s 1 : 3. Is it just the MIT audience? I doubt it. More likely, the change is due to a big shift in the nature of startup creation as a result of the drop in the cost of building and distributing high-tech products and services. This is especially true of Web and cloud-based businesses but is also affecting life sciences and cleantech. (For more on that, stop by the panel I’m doing on cloud computing on Tuesday, the MTLC Innovation unConference on October 1st and by the Democratization of Innovation conversation Ray Kurzweil and I will have at the MIT Enterprise Forum on October 14.)

It’s a good time to have  a conversation about what’s the right funding path for companies and the value-add of various investor types. The dialog has been heating up. The NVCA recently made some outlandish claims about the economic impact of VCs. TechCrunch responded with a guest post from Vivek Wadhwa. The summary is “when things go well, VCs take too much credit.” My two cents are that if VCs are guilty of claiming or receiving too much credit when things go well, they certainly get too much blame when things go poorly. And I certainly think it’s foolish to only blame VCs for investing too much money in companies. It takes two to tango. In the background there is the “the venture capital industry is broken” refrain delivered by groups with alternative investment models and Bill Gurley’s data-driven commentary (the strong will get stronger, the weak will find something else to do). All in all, a great setup for a no holds barred discussion about fundraising.

I recruited the panelists with the audience’s interests in mind. They have all been successful entrepreneurs. They all are or have been investors and they all know early stage well.

Come armed with hard questions and help make this a great event.

Joining the MIT E-Center September 20, 2009

Posted by Simeon Simeonov in FastIgnite.
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I’m excited to join the Entrepreneurs in Residence at the MIT E-Center. It’s a new structure for fostering innovation and venture creation pushed forth by Bill Aulet who runs the center now. I’m fortunate to be doing this with great group of entrepreneurs including:

  • Susan Whoriskey (Cubist Pharmaceuticals, Momenta Pharmaceuticals, Whoriskey Associates)
  • Jean Hammond (AXON Networks, Quarry Technologies, Spider Systems, ZipCar, HubAngels)
  • Brian Halligan & Dharmesh Shah (HubSpot)
  • Roger Freeman (Solventera Energy)

Having been involved with MIT for years in various ways, I look forward to more regular contact and engagement.

More cloud computing September 15, 2009

Posted by Simeon Simeonov in cloud computing.
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I am doing another cloud computing event next week, this time moderating a panel at a MassNetComms event titled “Cloud Computing – Beyond the Hype – A Discussion on the Real Benefits and Issues.” There is a great speaker line-up:

  • John Considine, CTO, CloudSwitch
    Cloudswitch is about helping enterprises get into cloud computing on their own terms. This is a hot area of innovation. Even Amazon got in the game with their Virtual Private Clouds (VPCs).
  • David Skok, General Partner, Matrix Partners
    David invested in CloudSwitch and has spent a lot of time looking at various investment opportunities in cloud computing and related spaces, trying to separate hype from reality.
  • Omer Trajman, Senior Director for Cloud and Virtualization, Vertica Systems
    I’ve known Omer for many years. He is a sharp technologist, always aiming to tackle the next big problem. He is also not at a cloud computing company per se and will bring the valuable perspective of a vendor looking to the cloud for their own benefit and for the benefit of its customers.
  • Michael Werner, Senior Platform Strategy Advisor for Microsoft’s developer and cloud-services technologies, Microsoft
    Mike wins the award for the longest title of any panelist I’ve had the pleasure of working with over the years. Beyond that, he’s someone who’s deeply versed in technology distribution and adoption by developers and companies and will have an interesting perspective on when and how cloud computing will become broadly deployed.

I hope to see you there. Bring your enthusiasm, skepticism, ideas and questions.

Do social networks care about your privacy? August 26, 2009

Posted by Simeon Simeonov in Advertising, Digital Media, Facebook, Social Advertising, Twitter, social media, social networking.
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Following my post yesterday on Twitter having to think carefully about privacy, a friend pointed me to a study that shows how social networks leak deep personal information, allowing third parties to combine what you do with who you are. Read the story here.

By itself, this may be absolutely OK depending on how much of this data is collected and how it’s used by third parties. However, most of the entities (targeting companies, ad networks, etc.) operate in a rather opaque manner for most consumers. First, you often don’t even know who those third parties are because they have no visible presence on the websites you visit yet your browser makes HTTP requests to them and they typically set multiple cookies on your machine. Many of them don’t even have a web site for a consumer to visit, for example, to figure out which business sits behind the URL and read their privacy policy.

A good (random) example is ad.yieldmanager.com, requests to which are typically hidden in the HTTP redirect chain. You need a tool like Live HTTP headers for Firefox to see them. If you make a browser request to ad.yieldmanager.com or yieldmanager.com you get nothing. The WhoIs record shows that Yahoo owns the domain.  If you go to www.yieldmanager.com you’ll be redirected to the HTTPS version of the page https://www.yieldmanager.com which Firefox will refuse to display because it has an invalid security certificate. You’ll have to go through several dialog screens in Firefox to make a security exception and see the site. It will show a login screen for RightMedia (an advertising exchange bought by Yahoo) but no information for consumers. If you hit the home page of RightMedia, you’ll see a tiny link to “privacy” on the bottom which takes you to the privacy policy of the corporate site. At the end of the third paragraph, there is a link to the privacy policy on ad.yieldmanager.com. If you click on that, you’ll finally get to find out what RightMedia collects from you and what they do with it. Well, sort of.

The privacy policy says “Non-personally identifiable information is automatically sent to the Yield Manager technology by a user’s web browser. This information includes the date and time of the ad request, the user’s Internet Protocol Address, browser type, and the web page that the user is visiting.” How can they be sure that the web page I’m visiting doesn’t have personally-identifiable information? Does my Facebook URL personally identify me? Do my LinkedIn, blog, FriendFeed, Twitter URLs personally identify me? You bet they do. I have no idea whether RightMedia operates on those sites but if they do and if they can see links that can be tied to my account I’d certainly argue that their privacy policy is misleading.

Oh, one more thing. Do you know what’s the title of the privacy policy? “CONFIDENTIAL” Huh? Somebody better fix that.

<head>
<title>CONFIDENTIAL</title>
<link rel="stylesheet" href="http://my.yieldmanager.com/styles/css.php" type="text/css">
<link rel="shortcut icon" href="http://my.yieldmanager.com/images/default_icon.ico" type="image/x-icon" />
<script language="JavaScript" type="text/javascript">if (top.location != location) { // if in frame
	top.location.href = document.location.href; // break out!
}
</script>
</head>

Do you think most consumers care about their information being potentially misused? I haven’t seen the studies but I hope lots do. How many of them do you think will be able to find out that yieldmanager.com/RightMedia exist and get around to finding the privacy policy and understanding it? Right.

In a world where it’s hard to even know who these third parties are let alone what one of the them says they are going to do with your information, how can anyone one be certain whether they’ll actually do what they said they would? Is it too much to ask that consumers have an easy way to (a) find out who collects data as they browse the Web and (b) have the privacy policy of those entities at most one or two clicks away?

Twitter gets in the privacy game August 25, 2009

Posted by Simeon Simeonov in Advertising, Twitter.
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TechCrunch saw Twitter re-writing all links to point to their site. Great idea as it gives them wonderful data. Potentially bad idea from a privacy standpoint if they do anything more than count how many times a link is clicked. If the link is to a URL shortening service, they’d get a lot more data by looking at what the link redirects to. The problem is that the end URLs can be parameterized in any number of ways, including with information that can be considered personally identifiable by the latest thinking from industry associations and the FTC (per David Vladeck’s recent interview).

Q: The marketers make a distinction between personally identifiable and non-personally identifiable information, that they’re only collecting anonymized information.

A: Well, but we saw what happened. There’ve been all sorts of disclosures with allegedly anonymous data. The problem is that it’s like a mosaic. If you have the information released and you can match it to other publicly available data about somebody, you can often put together a pretty complete picture. You know, I think were past that debate. At least, I think the F.T.C. is past that debate; whether the rest of the world has caught up with us, I don’t know. But we don’t find that a tenable distinction. And if you look at our online behavioral advertising report we make this point, I think, pretty emphatically.

I recently went to the OMMA Behavioral conference in SF and talked to a number of chief privacy officers about problems at the intersection of data collection, advertising and privacy. The bottom line was that many companies unknowingly make false claims to consumers and violate laws and self-governing principles. One of the stories I heard was the epitome of how easy it is to get into trouble. It had to do with an SEO change made to a publisher’s site resulting in personally identifiable information going to an ad targeting company. Previously, the targeting company had been collecting some basic URL info from the publisher. The SEO change moved potentially sensitive data from query strings into the path of URLs. The SEO team had no idea of the impact of their change–they didn’t even know about the data sharing deal. There was no notice to consumers or the targeting company. The ad targeting company discovered this after the fact (and after both they and the publisher had significant liability exposure).

I’d love for Twitter to collect and make use of more information about how people use the service. As volumes increase, they need more meta-data to create a better service. However, I hope they have experienced advisors on the privacy side, e.g., folks like Dan Jaye who co-wrote the P3P spec and later did TACODA.

The great terrible CraigsList August 25, 2009

Posted by Simeon Simeonov in startups.
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Lots of press recently about CraigsList given Y Combinator’s call to entrepreneurs last year to find a way to create a more for-profit version. The call was repeated again this year. Lots of analysis followed with plenty of opinions about what’s good and bad about CraigsList. Bottom line is that the site works and it works well despite all its warts. The business should be an inspiration to entrepreneurs everywhere about how to do more with less and how to win through simplicity. Fred Wilson has a good summary post of that.