Jeff Clavier's Software Only

Twittering or not twittering, that is the question

Much has been written on, about and around Twitter – with a clear acceleration over the past… three weeks ? Essentially the traffic on the site, and the number of mentions in the blogosphere seem to be highly correlated – which is not surprising since a lot of the Twitterati are also highly visible bloggers.

I had not paid much attention to Twitter during my 6–months blogging break, but discovered it two weeks ago when hanging out with my friends Scott Beale and Robert Scoble – who have been twittering away for some time. I jokingly told Scott that I would never use “that” but I did twitter quite a bit at Ted 2007, and since then.

What works for me with Twitter is the fact that I can fire one comment, one thought, one message, in 30 to 60 seconds. And not bother with presenting, formatting or developing that idea – because, or I should say thanks, to the 140 characters limit. I have always had difficulty at writing posts of less than 200 to 500 words, and so that artificial constraint is actually interesting. Obviously, the editorial value of these 140–character messages tend to “vary greatly”, and I would expect only a small number of close friends and/or associates to be interested in that “stream of consciousness”.

What struck me, or at least surprised me, what the speed at which Twitter got its mention in the New York times, was called the blogging killer, had its first mashups, and created a passionate debate between fans and opponents. Talking about mashups, Twittervision is really way cool, and could easily be applied to photostreams.

So it is something new and important happening in front of us, or is it a fad that will burn out that much faster ?

I say who cares? If it is truly useful to some people (like Tara “Miss Rogue” Hunt), it will find its (killer) application amongst other publishing and collaboration tools. And in the meantime I have added my own Twitter badge on this blog.

Disclosure: I have no interest in Obvious Corp, the makers of Twitter.

Looking back at three years of Web 2.0 investing

Almost three years ago, I left the fund I was a general partner of and decided to switch my investment focus from mid-stage enterprise software to (very) early stage consumer Internet. Dotcoms as they were, since the Web 2.0 meme had not been cornered yet. Since I had limited investment track record in that space, it was clear that raising a fund – may it be from traditional limited partners or high net worth individuals – would be impossible, or so close to it that it was not worth trying. The alternative (like any bootstrapped startup) was to start investing our own cash in some of the companies that were building a new generation of services for the consumer.

Why the consumer? Because I still could not figure out how to make angel-type investments provide any meaningful leverage/return in the enterprise software space, whereas interesting things were being built for the consumer on a capital efficient basis. So efficient that these companies sometimes managed to launch their service and even generate revenues on very limited outside investment - because hardware, bandwidth and (open source) software costs had decreased by one to three orders of magnitude. And since the burst of the first Internet bubble had drastically lowered salary expectations of early stage startup employees, overall startup costs decreased to a point that a friends and family, or angel, financing of a few hundreds of thousands dollars allowed a company to reach a number of key milestones.

Three years ago, we were busy inviting the same group of friends to a bunch of social networks. Some people were reading blogs directly on web sites or through the first generation of feed aggregators, and all VC bloggers could sit around a dining table. My initial interest in user generated content – text, pictures, audio and the very beginnings of video – led to my involvement in Buzznet (photo sharing), Truveo (video search) and Feedster (RSS search). Around the same time, I came across Userplane (private instant messaging network) for the first time – but did not engage for almost a year. I also made a conscious decision to attend a lot of conferences, events and other geek dinners. This allowed me to meet casually a number of the CEOs I would end up investing in: Dogster’s Ted Rheingold, Edgeio’s Keith Teare, Rapleaf’s Auren Hoffman,… And this blog – started in June 2004 – led me to meet another group of entrepreneurs: Kaboodle’s Manish Chandra, Maya’s Mom’s Ann Crady and Wikio’s Pierre Chappaz just to name a few. A large number of deals also came through referrals from angel investors or firms I have worked with several times.

And then there is the strategy that brings it altogether, putting each companies in a nice set of well defined buckets. I started with 3 buckets: Search, Social Media, Infrastructure. And evolved each bucket with the investments I made, and the ones I passed on. But that will be the subject of other posts in the next couple of days.

The slide below is a list of the companies I have invested in, most in cash, a few in kind, sometimes both. I have also listed two advisory boards I am/was part of: Netvibes, that I met a few days after they had closed their angel round, and MyBlogLog, that was acquired by Yahoo in January 2007 before we closed the angel round that was in the works. Were also acquired – by AOL – Truveo and Userplane, respectively in January and August 2006.

It is common practice for startups these days to keep a stealthy profile even several months after raising a round of financing, and this has delayed the (almost) full disclosure of my portfolio until… tonight. I want to point out however that I have always made these disclosure in private when required, for example when an entrepreneur has contacted me about a company that would be overlapping or competitive to one of  mine.

PS: Peter Rip has an interesting piece: Web 2.0 - Over and Out, in which he suggests that the Web 2.0 hype has peaked, and now the real work begins. We'll also address that aspect in future posts.

Back from Le Web 3, and I am so glad I was there

Unless you have been away for a week in an Internet-deprived location, or don't bother reading blogs anymore, you are at least aware that a conference called Le Web3 took place in Paris (France) last week, and that a very profound and passionate controversy ensued - initially led by mostly negative feedback and subsequently by a wave of positive ones.

I rarely take part of blogging “shitstorms” - unless one of my companies is right in the middle of it of course - since things related to angel investing happen largely behind closed doors. However this time, I ended up in the middle of it. First because my good friend Loic, the organizer of Le Web 3, was taking a beating which turned very nasty and personal - to the point of often drifting away from issues with the conference and focusing on personal anger against him. Second because I ended up driving a large part of the second day of the show as Loic was busy dealing with the “insertion” in the program of Shimon Peres, and French Presidential candidates Francois Bayrou and Nicolas Sarkozy. Since we added 90 minutes of content in the program, whilst trying to keep every speaker who made it to the show in said program, we had to plan (and re-plan) almost in realtime. So some of the complaints from speakers about the last minute changes, the recombination of panels, etc. should also come my way. I will only note that Bruno Bonnell, the CEO of Atari, flew from New-York especially for the conference, and only made a joke when pointing out that he could taken the next flight out had he known that his panel would be delayed by 3 hours (my doing, again). And this is a guy running a public company.

Loic has just posted a very detailed response to the criticism he has received, and so I won't cover the same topics. I would however like to share some reflections I have had at the conference and since then:

• As I said in my closing remarks at the conference, Le Web 3 might have had issues (and the magnitude of these issues really varied from one attendee to the next) but it was a very important event. It was the first time I saw the European ecosystem (like the one we have in Silicon Valley) come together in a palpable way. Young startup entrepreneurs hanging out with more experienced ones, potential partners from large Internet or telco companies, and - at last I should say - investors. I was pleased to see a large number of VCs from all over Europe chatting around with companies presenting at the startup corner or just attending the conference. Since I am not attending European conferences at the same rate as US ones (!!!), I would be happy to be proven wrong but I heard it many times from attendees (the happy ones).
• There was a disconnect between some of the audience and the intent of the conference, that we'll need to address in the future - provided that there is something beyond Le Web 3. This year's program was meant to be a departure from Les Blogs, with a much broader scope and ambition - the Web as a platform, for technology, business, media, etc. but also for culture, society and politics. This shift seemed clear to me, but there were people in the audience expecting a new iteration of Les Blogs - which is obviously not what they got.
• Like Ross, I think that as disrupting as it was, it was a good thing to add Peres, Bayrou and Sarkozy at the last minute despite the obvious risks involved in doing so. I was really disappointed, and embarassed, at the demonstration that many influential French politicians are or feel completely unable of entering into a conversation in English. Why can't they all be like Christine Lagarde, the Minister of Foreign Trade, who has a perfect command of Shakespeare's language and is super smart.
• Loic called for an end of blogger conferences. I am actually longing for conferences recognizing that the content part of the program is second to the networking opportunity. I paid almost $5,000 (if you count incidentals) to attend the Web 2.0 conference this year, and in 3 days I must have spent a maximum of 3 or 4 hours in the room. Why ? Because I was so busy meeting or networking with so a ton interesting executives in the audience. I had a very similar experience at Le Web 3 - until I took over from Loic and then almost ran away from people because the focus was on the program.

I think that Le Web 3 went way beyond the achievements of the first and second edition of Les Blogs, despite or maybe even thanks to the controversy. In any case, I want to congratulate Loic (again) for putting it together, and want to encourage him to push for the limits for next year's conference - or whatever ends up materializing.. in less than 6 weeks. And I hope that this time he will listen when I say that 30 mins is *way* too short for a panel - but that's another story.

PS: I was asked to list my favorite sessions/speakers. I thought that the two panels on gaming were really interesting (thanks to the panelists, not the moderator - me - who demonstrated that he was still very limited in his knowledge of the gaming market). And I really liked the talks from Danah Boyd and Hans Rosling.
PPS: I have to give a special shout to the Netvibes party. As many people mentioned, the music was a bit too loud to have networking conversations but man the dancing was good.
PPPS: I had to update this post with the amusing cartoon that the unique Hugh McLeod just posted. As usual, a pleasure to hang out with you in Paris Hugh.

Tags: lemeur, leweb3

No I never left the building, I was just busy working in the basement

My friend and European VC blogger Fred Destin made an amusing comment in one of his blog entries: Jeff Clavier has left the building, following a discussion I had had with Rick Segal at StartupCamp in the midst of the three sessions I led that day. I basically told Rick that I was in need of recapturing part of my life/time and blogging - both reading and writing - had been the elected victim. So yes, and I have to apologize to my readers, I had largely left the building because of a number of (good) things going on with my portfolio companies and my own business. And my reading had been limited to a few feeds (TechCrunch, GigaOm, VentureBeat, PaidContent) integrated in my Netvibes home page, providing me with the key info regarding my industry.

So thanks to all having emailed me, or blogged, about their concerns: all is well, just incredibly busy with my work, investing and then working with my companies, as well as spending a lot of time speaking at, and attending, conferences. Just as a reference point, four of my investments officially launched their service in the past 10 days.

Oh yeah, and when you are busy and try and make so many things at the same time, you f..k up, like I did last week: I was getting out of my car - on the phone with a company, typing an email (on the phone) to another, and picked up my bag which was in the trunk of my car. In said bag, which was open because I got a call as I was taking something off of it and forgot to close it, my 3 month old MacBook Pro - which flew off the bag to implode on the floor of the parking lot of my office. Fixing the Mac would have cost about $1,500 so decided to get the brand new MacBook Pro for just a bit more money: faster, larger disk and most importantly: it does not burn your b...s when you are using the machine on your lap. The only downside is that Apple seems to have changed the keyboard which now has a very bizarre touch when you type, and makes an annoying squeeky noise.

GoogTube is happening for $1.65B - and I understand why Chad could not attend tomorrow's Search SIG

It is all over the news so you don’t need a rehash: the rumors were true and Google has acquired YouTube for $1.65B in GOOG stock. There are several remarkable facts in this acquisition, and I only have a few minutes in between meetings (before meeting a company involved in online video something, just as it happens) to mention them:

• Copyright issues, pirated content and YouTube often appear in the same sentence – and now that Google owns the company, you can only bet that they will be solved one way or another.
• Google gets another foot in content hosting, after Gmail, Blogger and GoogleBase. They are not only about organizing the world’s information anymore – just in case you wondered.
• YouTube will remain a separate operation, even physically, which seems to indicate that the risk of messing up the secret sauce post-acquisition has been considered.
• From a pure deal perspective, Sequoia Capital (which also backed YHOO and GOOG) adds another icon to the list of successful exits they have had. Their 30% investment in YouTube for $11.5M has turned into $500M in less than two years – a 43x multiple, or more if the GOOG stock gets a pop over the next 30 days.
• Now that the leader (46% of the online video market) has been taken out, I can’t wait to see what happens next – especially as Yahoo was rumored to be involved in the deal until the last minute, and I am sure that Fox, Viacom, AOL and the others were not too far behind.

I have had a lot of questions over the past 48 hours regarding the timing of tomorrow night’s Search SIG on The growing online video ecosystem. No, I was not aware of anything going down but I thought it was a good time to step back and discuss the developments of that industry. And I am not surprised that Chad Hurley declined to join us because of "his crazy schedule" . I look forward to seeing you all planning to attend, and have a great conversation about what happens next with Om and the rest of our panel.

PS:

• Best logo goes to my friends at PaidContent
• The official Google statement is here

SDForum Search SIG: The growing online video ecosystem - October 10th 6:30pm @ Microsoft - Featuring VideoEgg, Dabble, CastTV, POSTRoller

Update: we are trying for the first time to video stream the session at this address (QuickTime 7).

Close to 300 video hosting, sharing and editing sites have been counted to date, serving hundreds of millions, if not billions, of videos a day. Video creation is also growing exponentially, and the availability of decent video recording capabilities in cell phones will only accelerate it. It therefore made to us to organize a session on the developing online video ecosystem, ranging from editing, hosting, advertising to search and aggregation. And to make the picture complete, we have also invited the video content production side of things. We expect, and actually wanted, that we’ll discuss topics broader than search per se - but as we’ll establish it, search and discovery mechanisms are fundamental enablers in the world of videos.

To MC the event, we have also decided to innovate: we will have two moderators, who – amongst so many things – produce the “Om & Niall Podsessions” podcast. Om as in Om Malik and Niall as in Niall Kennedy, who are both actors and commentators of the evolving development of online media. Their recent podcast on the topic of video led to their leading this session.

Will be joining us on October 10th for that session:

• Video Editing and Hosting: VideoEgg – Matt Sanchez
• Video Search: CastTV – Alex Vikati
• Video Bookmarking: Dabble – Mary Hodder
• Video Advertising Network: POSTRoller – Tod Sacerdoti

The event will take place at the Conference Center of the Microsoft Silicon Valley Campus (Building 1, 1065 La Avenida St., Mountain View) which has a capacity of 270 attendees. We suggest that you pre-register on this page of the SDForum web site. Note that we will only be able to accept sign-ups at the door based on the remaining capacity. This will also help us figuring out required food and beverages. To speed up the signing process, please print, fill in and bring this form if you are parking your car on the Microsoft campus

The now well established Search SIG Agenda format will be used:

6:30-7:00pm - Registration / Food & Drink
7:00–7:05pm - A few words about the Search SIG
7:05-8:15pm - Act I: The growing online video ecosystem
8:15-8:30pm - Intermission: Search Networking & Geeking Out
8:30-9:00pm - Act II: Product Demos from VideoEgg, CastTV, Dabble and POSTRoller– and Q&A with the audience
9:00-9:15pm - Open Mike Geek: Announcements (30 seconds of fame & fortune)
9:16pm - You Don’t Have To Go Home, But You Can’t Stay Here

Do get in touch with us (searchsig [at] gmail [dot] com) if you want to use a demo slot to launch a new search startup (one, and maybe two companies can take advantage of that).

And remember, there is a distribution list for Search SIG announcements – if you want to join, send an email to [email protected].

Tags: searchsig

Mo' money to build a bigger Dogster niche

A year ago (give or take 10 days) I wrote about Dogster Inc. – the maker of the highly popular dogster.com and catster.com – turning profitable, an unusual fate among Web 2.0 companies. It was still a very small business, but gave co-founders Ted Rheingold, John Vars and Steven Reading a foundation to grow their company at the pace free cashflows were being generated. Up until then I had considered Dogster as an amusing parody of other social networking sites, and suddenly realized that there might be much more than met the eye.

A few metrics caught my attention: the size of the user base, the consistent growth, a promising ARPU (Average Revenue Per User) and a CPM which was higher than I expected, thanks to an advertising program that was more than pure banner and text ads. These metrics doubled in a few months, allowing the company to scale its operation to 10 salaried employees while increasing its cash balance. The other thing increasing was the list of brand advertisers interested in reaching out to this thriving community of passionate dogs and cats lovers, including the likes of Disney, Target, PetSmart, Clorox/FreshStep, Gap/Old Navy, Warner Brothers, Nintendo and VPI Pet Insurance.

As the company turned in its first six-figure revenue month, it became clear that the small Dogster “niche” was turning into a real business. The economics of that market are indeed significant: 63% of US households have cats or dogs (160M pets total), yearly spending is around $36B, and advertising budgets on pet products are in the billions of USD. It also became clear that the solid organic, and profitable, growth of Dogster could sustain a bit of a booster in the form of an outside financing – which leads to today’s news.

A couple of hours ago, CEO Ted Rheingold announced on the Dogster blog that the company had closed a $1M Series A financing from a roster of angel investors – mixing successful Internet entrepreneurs and experienced investors. As a matter of disclosure, but you already guessed, I am thrilled to be involved in this great syndicate (*). Joining the Dogster board as the representative of Series A investors is Michael Parekh, an active angel investor – and blogger, who in a previous life founded the Internet Research activity of Goldman Sachs. The official press release is here.

Dogster will be using these funds to accelerate the development of new features, hire a number of new employees including a kick-ass Marketing Director, launch a number of new properties in -ster, build new distribution partnerships like the VideoEgg or Userplane one, and more generally have additional means to engage and support our users.

Staying true to the values of the community as it grows 4 to 5–fold over the next 12 months is certainly going to be challenging for the team, but I have total confidence in their ability to bring the company to the next level. Congratulations for the success to date, best of luck for the future.

Now, esteemed reader, give us a hand: think of 5 of your favorites dogs and/or cats, and point their owners to the registration pages of Dogster and Catster.

And yes: Woof!

Oh, I was SO waiting for that headline: “the bubble is back, the new sock puppet got funded”. Greg (Linden), have you noticed the “profitable for 3 quarters”, “positive cashflows”, “making money” mentions ?

(*) Just to list a few of these angel investors: Joshua Schachter - del.icio.us./Yahoo, Adam Beguelin - Truveo/AOL, Michael Tanne – Wink, Jim Young – hotornot, Mike Arrington – TechCrunch, Mike Jones - Userplane/AOL, George Sarlo - Walden Funds, Frank Caufield - Darwin VC, Aydin Senkut - Felicis Ventures, Robert Simon - Alta Partners, Brad Feld – Mobius Ventures,… and more.

More:

• Yes, it is true that Dogster had several funding avenues, and the team elected to only raise a $1M round that ended up being oversubscribed (a lot).
• A great coverage is developing: Matt Marshall on VentureBeat, Liz Gaines on GigaOm, Dan Farber on ZDNet, Bambi Francisco, Tom Taulli on BloggingStocks.
• Rafat is already betting on a CNet take-out. Dude, please let me pay long term capital gains on an exit for once.
• Here is the TechMeme thread.

A few data points on Digg from Kevin Rose at the Future of Web Apps

Kevin Rose is presenting at Ryan Carson’s Future of Web Apps in San Francisco. He spent quite a bit of time covering the functionality of Digg, and briefly shared a few interesting data points:

• Starting in October 2004, Kevin funded the initial build of Digg by himself, paying co-founder Owen Byrne (who he found through eLance), $10/hour for his development work. Then, and still now, Kevin acted as the product architect of the service.
• After launching via Kevin’s blog, the growth of the service led to increased capital requirements to build a scalable back-end. One of Textamerica’s founders, and friend of Kevin, provided angel funding to the tune of $50K.
• The rapid growth continued and required some “serious” funding – matetializing as a $2.8M investment led by Greylock’s David Sze.
• Digg hit scalability issues upon the launch of version 2.0. Throwing in a bunch of servers did not have any effect, it was necessary to re-architecture Digg’s database layer to optimize it.
• Digg has 15 employees, of which 3 PHP developers and 4 guys in charge of operations and scalability. There is a cool picture of the whole crew on the Digg site.

More: As usual, Wikipedia has quite a complete coverage of Digg, and Richard McManus recently published an interesting interview of Kevin (part 1, part 2).

SDForum Search SIG: Search Analytics - September 12th 6:30pm @ AOL - Featuring FeedBurner, Google, Hitwise & MyBlogLog

After an extended summer break (as explained by my esteemed co-chair, Dave Mc Clure, we both have been quite busy), the Search SIG returns with a very interesting program on September 12th, focusing on Search Analytics. And since this is a wide subject that touches other types of metrics and usage, we have decided to broaden the scope quite a bit by inviting a set of companies that measure, track and analyse traffic and behavioral patterns of web sites, blogs and feeds.

Panelists:

Jeff Gillis, Google Analytics
LeaAnn Prescott, Hitwise
Don Loeb, FeedBurner
Scott Rafer, MyBlogLog

Agenda:

6:30-7:00pm - Registration / Food & Drinks
7:00-€“7:05pm - Intros & Announcements
7:05-8:15pm - Episode I: Search Analytics Panel
8:15-8:30pm - Intermission: Networking for Geeks (and non-Geeks)
8:30-9:00pm - Episode II: Live Demos
9:00-9:15pm - Open Mike for product launches or announcements (please email me at searchsig [at] gmail [dot] com)
9:16pm - End of the session

Location & Directions:

We are most grateful to AOL for hosting us on very short notice at the AOL Campus, Bldg #12, Shasta conf room. The address is 401 Ellis Street, Mountain View, CA 94043 (click for map)

Take the Ellis St exit from 101, and head west about 1/4 mile. The AOL building is a 3-story mirrored glass facility, about 3 blocks down on the left hand side. (note: if you get to the light at Middlefield you've gone too far; make a U-turn and come back 1 block)

PLEASE PRE-REGISTER on the SDForum website if you plan to attend (to help AOL plan for enough food & drink to go around)

Dave will emcee the session solo as yours truly will be in (hum) Vegas to attend the first day of TechEd - a long time commitment that unfortunately means that I won't be able to attend this very interesting session.

Tags: searchsig

Public Speaking 101: Turn off your microphone before a loo stop

You might heard of the story of the CNN anchor, Kyra Phillips. who went to the loo with her microphone still on… the air, and whose chatter ended up as a voice over on a segment about Georges Bush. The chatter was relatively benign - she just bitched about he sis in law – as portrayed in some comedies. She then went on to appear on the “Late Show with David Letterman” (a very popular late night show on CBS), and presented the “Top 10” segment with… her top ten excuses regarding the incident, courtesy of  the Washington Post:

10. "Still haven't mastered complicated On/Off switch."

9. "Larry King told me he does this all the time."

8. "How was I supposed to know we had a reporter embedded in the bathroom?"

7. "I honestly never knew this sort of thing was frowned upon."

6. "Couldn't resist chance to win $10,000 on 'America's Funniest Home Videos."'

5. "I was set up by those bastards at Fox News."

4. "Oh, like YOU'VE never gone to the bathroom and had it broadcast on national television!"

3. "I just wanted that hunky Lou Dobbs to notice me."

2. "OK, so I was drunk and couldn't think straight."

1. "You have to admit, it made the speech a lot more interesting."

Pretty darn funny, and a gutsy move as you can imagine how petrified she must have been at 1) what happened, and 2) how much worse it could have been.

Bonus: the footage during which you hear Kyra’s voice over – on YouTube.

Photo credit: NewsBusters