Marcelo Calbucci

    After TechFlash broke the news of entrepreneur-turned-VC Rob Monster closing his venture capital “branch” to focus on his startups, there was a flurry of ill-informed or just plain nasty comments on the blog post. That triggered this question on my head: Can successful entrepreneurs become successful VCs? That question got a bit more steam after I thought all the criticism Ignition Partners has received due to their “lack of entrepreneurial experience” over the last couple of years (maybe more).

    Let me ask you a question: Can a great doctor become a great teacher? Or, can a great teacher become a great engineer? Or, can a great actor become a great singer?

    There is no question on my mind that great entrepreneurs can become great venture capitalists and vice-versa, but that doesn’t mean that it’s guaranteed path to success. The skill set to be a great entrepreneur is different than the skill set to be a great venture capitalist. We all like to point success stories of people that are good at both, but I find that correlation irrelevant. I much rather prefer to get funding from a VC that has a track record of investing on successful companies, than from a successful entrepreneur-turned-VC that has yet to prove he has the “eye”. At the same token, I prefer a serial successful entrepreneur investing on my company than a wealthy doctor that has no clue about startups.

    I think VCs need a good eye at spotting a good deal, not a good knowledge on how to bring a product to market. VCs won’t be running the business for you, so if they know how to setup payroll, or how to prepare a balance sheet, or how to manage a 25-person startup is irrelevant. They won’t be doing that. At best, they will help with strategic thoughts and introductions, besides funding, of course. I’ll even say that a VC who has too much “hands on” experience might be the opposite of you need as an entrepreneur.

    And just to finalize I feel really bad Rob Monster couldn’t make his model work at this time because he tried something every innovative in startup investing. And I also feel strange that every time anyone blogs or comments on Ignition they are quick to point out Entellium and other Ignition failures, but they never mentioned their successes. Ignition has absolutely a brand issue in town, but for the smart people you have to know the “news” is what people want to read, not necessarily the reality.

Disclaimer: I have no affiliation and never done business with Rob Monster or Ignition.

    I have many addictions, including a very common kind of addiction amongst entrepreneurs: data-analyctites.

    We do a lot of AB Tests at Sampa and last Friday we just wrapped up test number 902 and are ready to start 903 (903 stands for March 2009, not nine-hundred tests). 902 was about when to show our customer about premium packages: Before they sign up, just after they sign up, or when they hit a limit on their plan. We also did it with another dimension, one showing one upgrade option, the other showing two upgrades options.

    But this post is about a common mistake I saw at MSN when we released new versions of the product. As soon as we released a new version that had a dramatic different design from the previous version, a big change would happen on the data points we collected, sometimes up, sometimes down.

    The problem with that was the fact that too much had changed at once. So, a new version that would cause a 7% gain in the number of page views was highly celebrated. But there was 12 changes that happen at once. Couldn't some of the changes have brought a 15% gain while others took away 8%? We'll never know because they were done all at once.

    You might say a gain is a gain and that's a good thing. I agree. It's only a bad thing when people try to justify the 7% gain in one of the 12 changes and use that argument to push more changes forward. Well, if you changed so much on your homepage how do you know which changes are really responsible for a gain in PV, UU, conversion, upgrades, etc?

    By far, the most common mistake I see people making is to change their product and launch a new homepage all on the same day. If you do that you really won't know how much your user experience has impacted your business or how much your new branding has affected conversion and expectations.

    You should not consider the individual pieces of your product without considering the whole, but you can't justify gain/loss based on one of many features if you did it all at once.

    One thing that I really like about this time of the year is the number of events for startups and entrepreneus. There are events all year around, but the Spring and Fall events are usually better than the Summer and Winter ones.

    Next week I'll be attending NWEN's First Look Forum on Tuesday followed by the WTIA Industry Achievement Awards on Wednesday.

    The week after I'll be going to the nPost Networking on March 31st.

    In April I'll be a judge at the UW Business Plan Competition and on May we'll have the Seattle 2.0 Awards (which I'm hosting) on May 7 and the WTIA Fast Pitch Forum (ex-Investment Forum) on May 27.

    One thing that I really like about this time of the year is the number of events for startups and entrepreneus. There are events all year around, but the Spring and Fall events are usually better than the Summer and Winter ones.

    Next week I'll be attending NWEN's First Look Forum on Tuesday followed by the WTIA Industry Achievement Awards on Wednesday.

    The week after I'll be going to the nPost Networking on March 31st.

    In April I'll be a judge at the UW Business Plan Competition and on May we'll have the Seattle 2.0 Awards (which I'm hosting) on May 7 and the WTIA Fast Pitch Forum (ex-Investment Forum) on May 27.

    There is a wide range of social network connections policies at an individual level. This is, how I consider who I invite and who I accept on social networks might be different from what you. But most people that I know use two different standards: One for Facebook and one for LinkedIn.

    Facebook has the widest range of "personal policies". I know people that will accept any Friend invite, no matter if they even heard about that person before. I also know a person who is using Facebook as an exclusive "family network". Seriously.

    On LinkedIn I see mostly two standards: 1) Those that accept/invite anyone they've done business with, or would like to do business with, and 2) Those that are only people they've met in real world.

    My social network policies are these:

• On Facebook I'll invite or connect with anyone that I know (physically or virtually) and that I know he or she knows about me.
• On LinkedIn I only invite/accept people I have met on real life.
• On Twitter I'll follow mostly people that I've met, know personally and find their tweets (mostly) relevant to me.

    The sucky part is that I have not found a way to get my LinkedIn connections into FB, or FB into LinkedIn, or to find out about my existing FB/LinkedIn friends that just joined Twitter. I'm sure there is 100 early-adopter tools out there, but I'll wait for the "de facto" to rise to the top.

    I hope you all saw about the Seattle 2.0 Awards that the team at Seattle 2.0 is putting together. I learned a lot on the last two weeks about many people that I've come to know for years, about human nature in general and about myself.

    First, I hate asking people to sponsor the event. I'm not a great sales guy and the whole process is hard. If I don't tell personal friends about the sponsorship they might ask "why didn't you told me about it", but if I do, they might think "he wasn't my friend, he just wanted my company sponsorship money". Any way out of that?

    More important than anything is what I learned about Human Nature...

    I remember a talk by Tom Huseby (SeaPoint Ventures) a few years ago where he said "startups are all about bursting the next resistance bubble" and he made gestures as if he was inside a balloon and pushing out for it to burst. It did resonate with me.

    My take on, not only startups, but anything you do in life is that there are forces pushing you forward and there are forces pushing you backwards. For you to achieve success you have to add energy into the forces that are pushing you forward and suck the energy out of the forces working against you.

    Make no mistake, I'm talking about people here. The Seattle 2.0 Awards has brought the best on some people that I've known for years and some that I never thought they even knew I existed. And they are putting a lot of energy to help me. The flip side is to find the people you thought were your friends, or at least acquaintances, working against you. Even if in a subtle way.

    It really boils down to selfishness and egocentrism. Usually this people have a hard time doing anything that doesn't bring a personal gain to them. Sad. Very sad.

    But I don't want to end this post on a down tone. I want to say that you learn more (and faster) by doing things that are outside your comfort zone and that stretch you on many directions. This event has been like that in many fronts. I'm happy and we are very close to finalizing the best Startup event Seattle has ever seen.

    After months preparing for this, I'm happy to announce the Seattle 2.0 Awards. An Award to recognize the top of the top from the Seattle startup scene. This is the first award of its kind in Seattle.

    Not only the Seattle 2.0 team has been pitching in on ideas and suggestions, but we've got 30 amazing people who will help us select the finalists (after the public nominates them).

    Check out the official blog post.

    On top of that, I'd like to take time to thank Danielle Morrill. She got started on the Seattle 2.0 by making sure our events calendar was up-to-date, then she started writing about events, then doing video-blogging and she is now the Editor-in-Chief for Seattle 2.0. She is a rockstar waiting to happen and she is not only putting her time towards making this event happen, and she is sacrificing her personal time to make sure the Seattle 2.0 Awards is a success. I'm not articulate enough to say how much I appreciate the work she's doing for this award. So all that I can say is Thank you very much Danielle!

    I have written on how Google is becoming Microsoft, even having trouble with the federal government over its (near) monopoly of search advertising.

    Yesterday I realized that Facebook is the new Apple.

    You probably read my rant about Josh Lowensohn shallow headline about a Facebook press event. And then I remember Dan Lyon on CNBC calling out the press coverage of Apple, like Apple is the puppet master.

    Well, Facebook not only is obsessed with design and cleanliness of its UI (like Apple is), but they also have the press eating at their hand.

    The one clear difference between Apple and Facebook is the whole debacle about the Terms-of-Use revision from Facebook last week in which they reverted it back. Apple would just have said "fuck it".

    For the longest time (maybe 10 years or so) people have been proclaiming the death of newspaper and mostly the newspaper industry has just shrugged that idea as if it wouldn't happen any time soon, and so it seemed. But then all started to crash on the last 6 months and like a domino effect, over the next few years a significant percentage of newspapers will be gone (50%? 60%?) and then in another decade 95% of them are gone.

    My prediction is the same thing will happen to Radio and to TV, but it'll take longer.

    Radio is already having revenue issues (so is TV), but the "radio-wave" part is the old way and their structure make it cost ineffective if they have to run 10x cheaper than they are running right now. I'll predict that 50% of radio stations will be gone in 5 years and 95% will be gone in 20 years.

    And TV... exactly same deal.

    The problem has nothing to do with their content and everything to do with the business model and with the delivery mechanism. Newspapers are dirty, radio is limited, and TV doesn't personalize to you.

    In terms of delivery mechanism, all will be replaced by digital transmission on demand through all kinds of networks, including wireless. It's like you can read a newspaper online, you'll be able to listen to radio and to watch TV. That should not be a surprise to anyone, a lot of us already do that, but once it reaches that tipping point where your Aunt Ruth is using it, you know the time has come.

    In terms of business model, the problem is the cost of producing the content (value) by the return it brings. People will still want to read news, listen to talk radio and music, and watch TV shows. So the need for the content is not going away. The problem becomes when the cost to produce an excellent content is $100, but the cost to produce a great content is $10 and the cost to produce good content is $1. At those differences, good for $1 might be enough for some, and great for $10 might be enough for others.

    So, unless the content producers (journalists, movie makers, singers, talk-show hosts) figure out how to cut their cost by 10x, they might be out of a job soon.

    I also wonder a lot about all the students of journalism that are going to hit the market on the next couple of years and all the ones that just graduated. There won't be enough work for them anywhere, even online, because those experienced ones will also be fighting for online audiences.

    The flip side of that (and for me to end at an upbeat note) is that I think people can consume 5 times more content then they are consuming today, it's just that the tools and services are not at their optimum. It's like RSS readers made me able to read 10 times more online content than I could before them. Most people don't even have a clue about RSS yet.

    This just come over on my RSS feeds from Josh Lowensohn (Webware):

Facebook live blog: New features on the way

    Which made me go: REEEEAAAALYYYY? NO!! I thought they stopped developing new features when they reached 120 million profiles.

    </end-of-rant>