My friends went to a Web 2.0 conference and all I got was a Threadless T-Shirt

threadless

What has been the best use of the Web 2.0 collaborative features? Wikipedia? Facebook? Nope.. it is the T-Shirt site - Threadless.

Threadless is a t-shirt site that solicits designs that are rated by its members, sort of like Digg meets T-Shirt design. The winner gets a cash prize and bragging rights when it sees print. The projected sales for 2007 are expected to be around $30M. Last month Threadless opened its flagship retail store in Chicago.

Most of the t-shirts are sort of whimsical, like this one:

haiku

Two things surprised me about this story; their sales figures (I expected it to be closer to 5-10M, it is 30M) and that they want to have a brick and mortar presence.

Brady Forrest at O’reliey advances the following explanation for a physical presence by Threadless:

It makes more sense when you remember that Threadless is built on community. Having a physical space lets them give back to the community in ways a website never will. It helps them expand the brand beyond their current internet-found customer base, while maintaining the personal and respectful relationship with their t-shirt artists — something that they couldn’t do with many partners.

To me, the explanation is as whimsical and as haiku like as the t-shirts that Threadless sells.

They are already growing by a factor of 3 every year; if they want to expand, they should try affinity groups - schools, teams and like. Having a store in a cold, parking starved Chicago is somewhat puzzling to me.

As one of the slogan on Threadless t-shirt says, “I don’t want EVERYTHING, if I got it all, where would I put it?” There is a lesson in that quote somewhere!


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Forensics of a Start-up

the frank peters showRecently, Frank Peters of the Frank Peters Show posted an item about his latest podcast interview. The title “Media Matchmaker: autopsy of a failed startup” caught my eye. Frank spoke with the two cofounders of Media Match Maker Betsy Green and Jim Mahoney.

It was a refreshing change to have someone talk about a company that did not make it, and to try and understand what lessons could be learned from it. It was also personal for Frank, as he is an investor in the company.

The interview is a must-listen for entrepreneurs, and angel investors. Frank, in his typical relaxed way, manages to get to the heart of the story. Betsy Green, a pretty engaging speaker as well, gives an honest account as to how personality issues affected (for the worse) a start-up that was otherwise destined for super stardom.

media matchmaker

When first conceived, the Media Matchmaker idea was believed to be disruptive. People who make movies need sponsors. Advertisers want to place their products in movies. Enter Media Matchmaker, an eBay type marketplace that would allow buyers and sellers in the media ad market to connect.

Frank spoke to the principals of Media Matchmaker separately, as they are not speaking with each other, as well as investors in the company, to try and understand what happened. It was a great interview.

But then there was the drama behind the drama.

An attorney from DLA Piper, claiming to represent Media Matchmaker left a threatening comment on the Frank Peters blog.

As I was saying before you hung up on me, we represent Media Matchmaker. We are concerned about a recent posting on your site “Media Matchmaker: autopsy of a failed start-up.” The title itself is deformity as it falsely suggests that the company is defunct. Moreover, as an apparently disgruntled investor and creditor in the company with apparent allegiance to other investors and creditors, you are acting with conflicted interests. Further, you illegally taped the CEO of the company without her consent, in violation of the laws of the State of California. See Cal. Penal Code Section 632……. You are have now been placed on notice of your improper conduct, and any continued posting of the story will demonstrate — without any possible question whatsoever — that your conduct was intentional and malicious.

Clearly the commenter had not listened to the entire interview, at the end of which the CEO says that she is looking for an additional $500k in funding and that “maybe this interview will help us (find the funding)”, so clearly the CEO was aware that she was being recorded.

This led one of our bloggers (Sunny) to leave a comment on Frank’s blog.

It does not seem that Mr. Zucker has listened to the interview, especially the last few minutes of it. The CEO, is looking for additional 500k funding and says “… and may be this interview will help us (find the funding)!” (See at 53:45) I think this particular statement is an affirmative consent for taping and broadcasting within the “four corners of the documents” or in this case, within the “four bits of the mp3.

So, please, stop waving Section 632 gun! It is as effective as a wet noodle.

No matter what the reasoning, the fact that someone would actually attempt to put someone on legal notice via comments on their blog, is, to be sure, somewhat distasteful. It is almost as bad as sending a Dear John letter via SMS.

It reminds me of a recent conference where one of the keynote speakers (Sean Parker) was served with a legal summons, at the conference (for Facebook). The person who had served him had actually bought a ticket to the conference, and attended with the intention of serving the summons!

Recently, the CEO of AnywhereCD Michael Robertson posted a very thought provoking article on why the CD selling site was “unfortunately on its last flicker of light before it officially flames out in a few days” (September 30th).anywherecd

Clearly, as entrepreneurs and investors, we all want to learn from not only the success stories, but also find lessons in the tales of failure.


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Do Entrepreneurs have ADD?

Finely honed instincts, the ability to make split second decisions, and the agility to change directions in an instant - these characteristics are all the hallmarks of a great entrepreneur. But these are also the attributes of the classic “hunter” profile of a person with ADD.

egyptian hunterThe Hunter Vs. Farmer hypothesis was proposed by Thom Hartmann in an attempt to explaining possible origins of the attention deficit hyperactivity disorder (ADHD).

The classic “hunter” profile describes a nomad, who is always on the lookout for the next big kill. For the hunter, the excitement lies in planning the hunt, and executing the strategy. After the thrill of success, it is time to move on to the next hunt. A nomad at heart, the hunter is rarely satisfied with resting on his or her laurels for very long.

egyptian farmerIn contrast, the “farmer” profile portrays a person whose life is centered around a predictable life of sowing and gathering. Risk is mitigated through meticulous long term planning.

Over the centuries, farming populations have generally enjoyed more prosperity and stability over nomadic tribes. On average, farmers have more wealth, whereas the distribution of wealth among hunters is highly variable. While hunters move between feast and famine, there are, indeed, the small numbers of super-hunters who will make the big kill, and reach the pinnacle of success.

It is indeed the lure of the big prize, that motivates and drives most entrepreneurs, and makes them strive towards reaching greater heights. At the basis of the hunter-farmer theory is the feature of “hyperfocus” that successful entrepreneurs seem to universally posses. Hyperfocus is a form of mental concentration that is a benefit of ADD, and enables a person to accomplish very specific goals.

While hyperfocus is actually a gift, it can give a person a bad reputation as being absentminded because of ignoring events around them that do not pertain to reaching the goal, or for kids with ADD to be considered as “disrespectful of authority”.

egyptian farmerThe hunter-gatherer hypothesis seems to find parallels in the field of entrepreneurism. There is the prevalent feeling that an entrepreneur who starts a company might not indeed be the right person to continue to lead it once the organization has grown to a certain level. While a VC attempting to remove a founder from a company, and bringing in the “right kind of CEO” to lead it, is looked down in general by entrepreneurs, there might, in some cases, be a good reason for doing this. The “hunter” personality - the visionary - who initially leads the company, might one day need to hand the reigns over to the “farmer” - someone who excels at building teams, rules by consensus, and believes in meticulously planning where the company will be in a few years.

The lifecycle of many companies might indeed demand that it be driven by a hunter in the early part of its cycle and transition on to being led by a farmer as it matures - such as Ebay chairman Pierre Omidyar handing over the reigns to Meg Whitman, when the company got to a certain size. However, there have been as many examples of entrepreneurs such as Bill Gates, who lead Microsoft from a garage (dorm room) startup to a monolithic company. Yet again, there are examples of visionaries such as Steve Jobs and Michael Dell who left their companies (Apple, Dell) and then returned to re-innovate and re-invigorate their respective enterprises.

So while starting a company might indeed require the hunter mentality, the growth and future success of the company might call for the initial pioneer to either transition into a more “farming” mind set as the company grows, or find someone with the right skill set to take the company to the next level.


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TechCrunch40 top company award: Everything Mint is Yodlee again!

ImageWe have all been following the excitement over Tech Crunch 40, and then the top company award was announced, and I had to do a double take!! Mint won the $50,000 award - for “an impressive personal finance application”.

Anyone remember Yodlee?

ImageYodlee has had a patented personal finance application since August of ‘99. It allows secure one-stop access of all financial (bank) accounts, mortgage accounts, brokerage accounts and airlines mileage accounts. The dashboard adds up all balances in the asset and liability accounts, and provides a quick net worth summary. The program has tons of other knick-knacks such as tracking spending month by month.

I have used Yodlee Moneycenter for a couple of years now, and it is one of the best web based apps that I have ever used.

Mint seems to have fewer features than Yodlee, and Yodlee has a commanding head-start (they launched back in ‘99) with several thousand financial institutions that they are compatible with.

The funny thing is that a couple of years ago, I was approached by someone promising “to find funding” for exactly this idea, if I would come up with a business plan for the latest and greatest “personal finance application”. I did some research that showed that financial aggregators, as they are called, are nothing new. 10’s of companies have been built around this same idea, all touting very similar features.

Country Provider / Service name
AUG 99′ US VerticalOne launched
SEP 99′ US Yodlee launched
JUN 00′ US AOL “AOL Personal Finance” is announced.
JUL 00′ US CitiBank “My Citi” launched
AUG 00′ US Yahoo “Yahoo Finance” launched.
SEP 00′ AUSTRALIA eWise launched & AMP “Account Minder” launched.
OCT 00′ US Chase Manhattan Bank “Chase Online Plus” launched.
FEB 01′ US Merrill Lynch “My financial picture” launched.
US American Express “Account Profile” launched
MAR 01′ US Wells Fargo “Wells Outlook” launched.
US Fleet Boston “smallbizfleet” launched
JUN 01′ AUSTRALIA Macquarie Bank “Enrichment” launched
KOREA Hanvit Bank “e-Clips” launched
JUL 01′ AUSTRALIA nineMSN “Account Master” launched
SEP 01′ JAPAN Monex securities ” Money Station” is announced.
OCT 01′ JAPAN Nomura Security is announced
JAN 02′ JAPAN E*trade “Money Look” launched

* From E-aggregation: The present and future of aggregation services in Asia Pacific, Fujii et al.

The technology for building a financial aggregation software has been around (all over the world) for a while.

What really needs to be understood was why so many companies have come into the market and exited, and have not been able to make a go in the personal financial landscape. (Needless to say, when I told the “VC representative” that this kind of software had been done many times over, and not worth doing again, he was not very thrilled!).

CashEdge provides a similar service and has relationships with about 500 financial institutions. MSN Money also has personal financial management software.

 


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