Friday, October 22, 2010

Making Money on Line


When the New York Times punctures a White House meme, it can reasonably be considered a flop.  Last week, Barack Obama himself accused the Chamber of Commerce of using foreign money to push its domestic political activism, which would violate election law.  Unfortunately, as the Times reports, the White House had absolutely no evidence of any wrongdoing.  And Obama failed to mention that plenty of groups on the Left, especially labor unions, raise money outside the US as well.


Now the White House is trying to step back from their earlier accusations of illegality, but they’re still desperately trying to hang onto the line of attack:


White House officials acknowledged Friday that they had no specific evidence to indicate that the chamber had used money from foreign entities to finance political attack ads.


“The president was not suggesting any illegality,” Bob Bauer, the White House counsel, said. Instead, he said Mr. Obama’s reference to the chamber was meant to draw attention to the inadequacies of campaign disclosure laws in allowing groups to spend large amounts of money on politics without disclosing their donors.


White House officials called on the chamber to go beyond current disclosure laws and establish that no foreign money has been used in its political campaigns. “They can put this to rest,” said Joshua Earnest, a White House spokesman. “They have the keys to the file cabinet.”


Is that how it works in the United States in the era of Hopenchange?  The President makes an accusation of lawbreaking without any evidence of it, and the entity accused has to prove their innocence?   In this country, the government has to prove its case, not the defendant, and even before making an accusation of wrongdoing usually has to have some evidence of the crime in the first place.


This kind of rhetoric is nothing short of McCarthyism.  The government makes baseless accusations and then blames the people accused for not clearing themselves.  Will Obama start appearing at rallies with his “little list” of an ever-changing number of foreign contributors?  The White House launched the same kind of baseless attacks on the Koch family and Americans for Prosperity this summer and have yet to offer one substantial piece of evidence that any of these groups or people have done anything wrong at all, except to oppose Obama’s policies.


This is an administration that apparently has never learned the difference between being a political campaign and serving in the government.  In the former situation, this would constitute slander, which is bad enough.  When it comes from the government, it’s a form of tyranny — an attempt to use the power of government to silence dissent.







Today Y Combinator is holding its sixth Startup School, where a roster of Silicon Valley’s most experienced and successful founders and investors come together to lecture hundreds of eager entrepreneurs. The event is always extremely popular, and today is no exception — the lecture hall on Stanford’s campus is packed to the brim.


Today’s event will feature eleven talks, including lectures from the likes of Paul Graham, Mark Zuckerberg, and Ron Conway. The first session — which featured Andy Bechtolsheim, Paul Graham, and Andrew Mason — just ended. You can find my notes from each talk below, and we’ll be posting more later today on each cluster of speakers. You can also watch a live stream of the event right here.


Andy Bechtolsheim


Sun founder Andy Bechtolsheim’s talk revolved around innovation. He kicked off with a brief history of the incredible changes we’ve seen in the computer industry in a brief period of time, with the number of transistors on a chip increasing a million fold since 1970 and networking technology seeing similarly impressive gains.


Bechtolsheim says that there are a few key lessons from what’s gone on in terms of web innovation: first, the time from innovation to adoption can be remarkably short (see Google’s rapid adoption, for example). And the key to success isn’t to be first (after all, there were many search engines available before Google came out). Instead, it’s important to be the first to solve the right problem.


So why is there so much focus on web companies? Bechtolsheim says that it’s primarily because starting one is so cheap, relatively speaking. You no longer need to have your own infrastructure — with AWS, you can get up and running for cheap. It’s also cheaper than ever to raise awareness due to the proliferation of blogs, Twitter, etc.


Paul Graham

YC founder Paul Graham’s talk focused on one of the all-important problems facing budding startups: raising money. And he had good news, at least as far as entrepreneurs are concerned.


There’s an increasing tension between so-called Super Angels and Venture Capitalists (which manifested itself in AngelGate). Unlike traditional angel investors, Super Angels are investing other people’s money, which makes them similar to the VC camp. But, unlike VCs which have historically invested large sums of money (usually $1M+), Super Angels are happy to make many, much smaller investments.


This gives entrepreneurs more control — they can raise exactly how much they want instead of having to take a giant Series A round. It’s also led to larger VCs making small (~$100K) investments to compete more directly with the Super Angels.


This has another consequence: because VCs are mostly price-insensitive at this point (they view these seed investments as options to invest larger sums down the road), they don’t mind if the startup valuation grows higher than it would have. Which is great for the entrepreneur, but is bad for Super Angels who do care about the startup’s valuation. This, Graham says, could lead to what looks like another bubble with skyrocketing valuations, but hopefully without the pop at the end.


In the long term, this probably isn’t sustainable — Graham says that VCs and Super Angels will increasingly become one and the same, as the top VCs who add value are weeded out from the rest. But he thinks that process will take time, since the VC industry moves at a “glacially slow” pace. Until then, we’ll keep seeing those sky-high valuations for companies that appeal to both VCs (who think the company has a chance to IPO) and Super Angels (who think the company has a chance at an early, lucrative exit).


For more on this topic, see our post on The $4 Million Line. Graham will also be publishing an essay covering his talk, which we’ll post a link to as soon as it goes live.


Andrew Mason


Groupon founder Andrew Mason decided to take a different approach with his talk: he gave an old pitch for his original startup The Point, which eventually evolved into the wildly successful Groupon. The Point was a collective action platform that would let users take action together — for example, to raise money to build a dome around Chicago to block out the city’s frigid winter weather (yes, this was an actual initiative on the site).


But Mason’s (old) pitch wasn’t a good one, and The Point never really gained traction. So what went wrong? Mason pointed out some of the original company’s main flaws: it was about a vision more than making a tool that was actually useful. Mason was thinking of what the Point could become five, ten years down the road, without figuring out how to get people to actually use it.


Another problem: you need to recognize and embrace your constraints, and figure out what’s practical. You also need to realize that you’ll probably fail. Many people who are thinking of launching startups are very smart — they’ve succeeded in the past and the notion of failure isn’t really conceivable to them (Mason fell into this camp when he was working on The Point). Now, at Groupon, he constantly reminds himself of ways he could fail — the company has a bunch of magazine covers hanging on the wall near the entrance featuring companies that have gone downhill after massive success, like MySpace and AOL.


Image by Robert Scoble/Scobleizer on Flickr



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When the New York Times punctures a White House meme, it can reasonably be considered a flop.  Last week, Barack Obama himself accused the Chamber of Commerce of using foreign money to push its domestic political activism, which would violate election law.  Unfortunately, as the Times reports, the White House had absolutely no evidence of any wrongdoing.  And Obama failed to mention that plenty of groups on the Left, especially labor unions, raise money outside the US as well.


Now the White House is trying to step back from their earlier accusations of illegality, but they’re still desperately trying to hang onto the line of attack:


White House officials acknowledged Friday that they had no specific evidence to indicate that the chamber had used money from foreign entities to finance political attack ads.


“The president was not suggesting any illegality,” Bob Bauer, the White House counsel, said. Instead, he said Mr. Obama’s reference to the chamber was meant to draw attention to the inadequacies of campaign disclosure laws in allowing groups to spend large amounts of money on politics without disclosing their donors.


White House officials called on the chamber to go beyond current disclosure laws and establish that no foreign money has been used in its political campaigns. “They can put this to rest,” said Joshua Earnest, a White House spokesman. “They have the keys to the file cabinet.”


Is that how it works in the United States in the era of Hopenchange?  The President makes an accusation of lawbreaking without any evidence of it, and the entity accused has to prove their innocence?   In this country, the government has to prove its case, not the defendant, and even before making an accusation of wrongdoing usually has to have some evidence of the crime in the first place.


This kind of rhetoric is nothing short of McCarthyism.  The government makes baseless accusations and then blames the people accused for not clearing themselves.  Will Obama start appearing at rallies with his “little list” of an ever-changing number of foreign contributors?  The White House launched the same kind of baseless attacks on the Koch family and Americans for Prosperity this summer and have yet to offer one substantial piece of evidence that any of these groups or people have done anything wrong at all, except to oppose Obama’s policies.


This is an administration that apparently has never learned the difference between being a political campaign and serving in the government.  In the former situation, this would constitute slander, which is bad enough.  When it comes from the government, it’s a form of tyranny — an attempt to use the power of government to silence dissent.







Today Y Combinator is holding its sixth Startup School, where a roster of Silicon Valley’s most experienced and successful founders and investors come together to lecture hundreds of eager entrepreneurs. The event is always extremely popular, and today is no exception — the lecture hall on Stanford’s campus is packed to the brim.


Today’s event will feature eleven talks, including lectures from the likes of Paul Graham, Mark Zuckerberg, and Ron Conway. The first session — which featured Andy Bechtolsheim, Paul Graham, and Andrew Mason — just ended. You can find my notes from each talk below, and we’ll be posting more later today on each cluster of speakers. You can also watch a live stream of the event right here.


Andy Bechtolsheim


Sun founder Andy Bechtolsheim’s talk revolved around innovation. He kicked off with a brief history of the incredible changes we’ve seen in the computer industry in a brief period of time, with the number of transistors on a chip increasing a million fold since 1970 and networking technology seeing similarly impressive gains.


Bechtolsheim says that there are a few key lessons from what’s gone on in terms of web innovation: first, the time from innovation to adoption can be remarkably short (see Google’s rapid adoption, for example). And the key to success isn’t to be first (after all, there were many search engines available before Google came out). Instead, it’s important to be the first to solve the right problem.


So why is there so much focus on web companies? Bechtolsheim says that it’s primarily because starting one is so cheap, relatively speaking. You no longer need to have your own infrastructure — with AWS, you can get up and running for cheap. It’s also cheaper than ever to raise awareness due to the proliferation of blogs, Twitter, etc.


Paul Graham

YC founder Paul Graham’s talk focused on one of the all-important problems facing budding startups: raising money. And he had good news, at least as far as entrepreneurs are concerned.


There’s an increasing tension between so-called Super Angels and Venture Capitalists (which manifested itself in AngelGate). Unlike traditional angel investors, Super Angels are investing other people’s money, which makes them similar to the VC camp. But, unlike VCs which have historically invested large sums of money (usually $1M+), Super Angels are happy to make many, much smaller investments.


This gives entrepreneurs more control — they can raise exactly how much they want instead of having to take a giant Series A round. It’s also led to larger VCs making small (~$100K) investments to compete more directly with the Super Angels.


This has another consequence: because VCs are mostly price-insensitive at this point (they view these seed investments as options to invest larger sums down the road), they don’t mind if the startup valuation grows higher than it would have. Which is great for the entrepreneur, but is bad for Super Angels who do care about the startup’s valuation. This, Graham says, could lead to what looks like another bubble with skyrocketing valuations, but hopefully without the pop at the end.


In the long term, this probably isn’t sustainable — Graham says that VCs and Super Angels will increasingly become one and the same, as the top VCs who add value are weeded out from the rest. But he thinks that process will take time, since the VC industry moves at a “glacially slow” pace. Until then, we’ll keep seeing those sky-high valuations for companies that appeal to both VCs (who think the company has a chance to IPO) and Super Angels (who think the company has a chance at an early, lucrative exit).


For more on this topic, see our post on The $4 Million Line. Graham will also be publishing an essay covering his talk, which we’ll post a link to as soon as it goes live.


Andrew Mason


Groupon founder Andrew Mason decided to take a different approach with his talk: he gave an old pitch for his original startup The Point, which eventually evolved into the wildly successful Groupon. The Point was a collective action platform that would let users take action together — for example, to raise money to build a dome around Chicago to block out the city’s frigid winter weather (yes, this was an actual initiative on the site).


But Mason’s (old) pitch wasn’t a good one, and The Point never really gained traction. So what went wrong? Mason pointed out some of the original company’s main flaws: it was about a vision more than making a tool that was actually useful. Mason was thinking of what the Point could become five, ten years down the road, without figuring out how to get people to actually use it.


Another problem: you need to recognize and embrace your constraints, and figure out what’s practical. You also need to realize that you’ll probably fail. Many people who are thinking of launching startups are very smart — they’ve succeeded in the past and the notion of failure isn’t really conceivable to them (Mason fell into this camp when he was working on The Point). Now, at Groupon, he constantly reminds himself of ways he could fail — the company has a bunch of magazine covers hanging on the wall near the entrance featuring companies that have gone downhill after massive success, like MySpace and AOL.


Image by Robert Scoble/Scobleizer on Flickr



Sharp to stop selling and manufacturing PCs « Akihabara <b>News</b>

To pursue its growth Akihabara News is seeking for several more editors via an intership program for 6 to 9 months. Please send us a mail @ jobs@akihabaranews.com. Message. We are moving away from Feedburner, please update your RSS ...

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Austin Collie (thumb) and Antonio Johnson (knee) have undergone surgeries, the Colts announced Thursday.

Lindsay Lohan Photos &amp; Pics | BREAKING <b>NEWS</b> - Lindsay Lohan Avoids <b>...</b>

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eric seiger eric seiger


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