And now for something completely different. No – this isn’t going to be yet another blog post on how you, the entrepreneur, should react to the credit crisis. That’s later today. Instead, this is my extreme fanboy blog post for my friends at Harmonix and their amazing new version of Rock Band (very creatively named Rock Band 2).
In addition to being a magnificent video game (and a great example of what we are looking for in our HCI theme), the Harmonix story is a fabulous entrepreneurial tale. Don Steinberg wrote a long article titled Just Play that’s in this month’s Inc. Magazine. Yours truly makes a very small appearance in the story which is a testament to both the brilliance of Alex Rigopolus and Eran Egozy as well as their incredible perseverance (the story, not my appearance in it.) Forget about "macro issues" – these guys show what it’s like to spend a decade where they are weeks (and days) away from going out of business before waking up one day to a blockbuster success.
Now on to the game. I’ve had the original Xbox 360 Rock Band Special Edition since the day it shipped and have logged plenty of hours on it. I got Rock Band 2 when it first shipped, but this is the first weekend I’ve been at my Keystone house since it showed up. We had a full house (six adults) so all we needed was some easily procured food and alcohol to disappear into a Rock Band induced departure from reality.
Five of us had played (a lot of) Rock Band. We all love the game, but had the same complaint – the UI for creating and managing a band was difficult. Rock Band 2 fixed this problem – suddenly our band (the name is not work safe – please feel free to guess in the comments) was optimally set up (and modestly dressed – we all looked way hotter in Rock Band than in real life.) Three hours of touring in Boston, New York, Montreal, and Chicago ensued.
The next morning – when I was alone downstairs – I figured out how to export all the Rock Band songs to Rock Band 2. I also finally got around to setting up Xbox Live and bought another $200 worth of Rock Band songs (Rush, Red Hot Chilli Peppers, and Boston anyone?) Our jam session continued with vigor on Saturday afternoon and into the late evening.
My partner Jason Mendelson – who is a drummer in real life – amazed us all on hard and expert level (where he managed to survive Boston’s Foreplay.) To reward him, I just bought the Xbox 360 Drum Rocker Premium Drum Set. I decided I was a bass guitar player and managed to graduate from medium to hard. Another weekend and I might even be able to play expert on a song here and there.
Alex, Eran, and everyone at Harmonix – you guys are amazing.
Fred has a fantastic blog up titled Capital Efficiency Finds It’s Moment. It – combined with his posts My Thoughts On "Startup Depression" – are full of suggestions that entrepreneurs should be thinking about and taking action on right now. They are both completely consistent with my post Ok Entrepreneurs, Time to Step Up.
I’m not into Gloom and Doom. I love the Warren Buffett quote that goes something like "We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful." Part of the brilliance of this is to be harshly rational and evaluate the current situation through a realistic lens at all times.
Fred’s post help us focus on this. He’s not shouting out gloom and doom. Rather, he’s suggesting that the thing VCs and entrepreneurs have been talking about since the dawn of our good friend Web 2.0 – namely capital efficiency – should now be front and center in every startup company. That doesn’t mean you should freak out, stop doing anything, and go hide under your desk. Rather, it means that you should sit down with your management team, look carefully at your business, and decide if you are running at your optimal level and spending / investing every nickel wisely.
This is good advice in any market context. Sometimes it takes the rough and tumble "market downtown" and a rapid approach of a "highly uncertain future" to bring this into focus and make it a priority – for all of us.
If you are interested in Social Computing in the Enterprise, NewsGator has just put up a Social Computing Best Practices & Resources on their web site. In addition to a bunch of NewsGator generated content, it has useful links to some of the key blogs on Social Computing in the Enterprise as well as the analysts who cover this area.
NewsGator and Burton Group are also doing a webinar series on IT Best Practices for Enterprise Social Networking – check it out if you are into this stuff.
I just got off the phone with a bank that I work with on a number of companies we have an investment in. They are in the category of banks that aren’t really impacted (at least not yet) by the current incarnation of the credit crisis because of where in the banking layer they play.
One of the things that came up was how I feel the macroeconomic issues impact things with certain companies. I told them I have no real clue and am paying attention to sales trends, but that I’m not getting worked up about it. As I saw the Q3 performance numbers roll in for our portfolio companies they looked how I generally expected them to; some of our companies blew away their numbers on the upside (hard to do in Q3 since it’s later in the yearly budget cycle), some missed, and some came in around where we expected them to. There weren’t any huge surprises either direction since we are deeply involved in our companies and tend to have significant granularity on how they are doing.
In our call, I told the folks I was talking to that I think they are generally, along with several of their peers, in a great position in the current environment. When they asked me what I thought they should do differently, or what they should be careful not to do, I strongly suggested that they behave in the way they always have to their clients and VC partners – stay steady, transparent, clear, and direct.
I have a deep philosophy that the time to build trust is during turbulent, confusing, and uncertain times (aka "now"). If the bank stays steady and rational, they’ll earn a lot of trust and goodwill from me, their clients, and others that will pay dividends for a long time. If they start doing erratic things, like jacking companies around with harsh credit terms just because of fear on everyone’s part (and greed on theirs) they will trample good relationships and destroy long term goodwill.
I lived through this during the dotcom bubble. There are some VCs and bankers that I’ll never work with again due to their totally irrational behavior when the chips were down. Consistency of behavior and clarity of thought and purpose matters a lot all the time, but especially when things are confusing.
As we got off the phone, we all hypothesized that the root driver of all the noise (not the root cause of the problem, but the amplification of everything) is tightly coupled to the current US election cycle. I’ve heard this hypothesis from others and wonder how much truth there is to it. I’m not a political historian so I don’t have a long term view on this, but I sure do remember the "It’s the economy, stupid" for Bush vs. Clinton. Hmmm.
Of all the macro events happening in the world, there are two occurring in the US right now that seem to be dominating most people’s thinking: (1) the US election and (2) the credit crisis (or whatever it’s being called today).
While I don’t watch TV news (and therefore get to miss out on all the talking heads on CNBC and CNN) I do read extensively online, especially about startups, software / Internet technology, and venture capital. Most of my general business news is either via headlines (once a day in the morning when I scan several newspapers), alerts (whatever WSJ, CNN, and NYT alerts send out during the day or tidbits my friends put on twitter), and business magazines (Forbes, Fortune, BusinessWeek). The business magazines are usually already two weeks old by the time I get to them (in the bathroom) and they lag the actual events by another week or two.
So – I get a nice mix of current sentiment (via headlines and alerts), two to four week old stories (via magazines), useful industry information, and a small mix of random stuff, without getting sucked into the day by day, play by play endless noise, chatter, and punditry. While this isn’t a pure or organized stream of information, I’ve found the tempo enables me to stay "informed enough" without being distracted.
Since I returned from my Q3 vacation two weeks ago, each day seems to bring more bad news and overall negative sentiment. In the last week I’ve started to notice a bunch of doom and gloom among entrepreneurs, especially high profile ones. In most cases, these aren’t cautious warnings, or suggestions of behavior modification, or real analysis of what’s going on. Rather, it’s an emotional response which is starting to creep into the zeitgeist of an otherwise typically optimistic set of people.
If you remember that Fear Is The Mindkiller you’ll quickly realize the correlation between the general commentary (the sky is falling, the world financial markets are collapsing, all your money will disappear, things will never be the same) and the notion of "killing your mind."
My recommendation to all of you entrepreneurs out there is to get off the negative sentiment treadmill, step up, and lead. The people working for your company are likely confused, concerned, and overwhelmed with all the noise in the system. In the near term, building your business will likely be more challenging on a number of dimensions. So what – that’s the normal cycle of business. You don’t need to be a blind optimist and spout happy talk, but you do need to have a clear sense of purpose and goals for your company. Leadership 101.
When I look back at the dotcom apocalypse that was 2000 – 2002, I realize some of the best companies I’ve ever been involved in were created during that time. In the midst of this, I remember the endless stream of "the Internet is over" and "the information technology business in now a mature business and there will never be innovation again." Yeah – whatever.
Get some exercise, take a shower, eat a good breakfast, and get out there and build a great business.
As part of Automattic’s acquisition of Intense Debate, I committed to convert all of my blogs over to WordPress. The process has begun and should be done soon. In the mean time, I’m on a quest for all the great WordPress plugins. I’ve already got the Lijit Search, FeedBurner, and MyBloglog plugins queued up. If you’ve got other recommendations, please leave them in the comments.
I love charts like the following – so many pretty colors and funny names.
Matt Galligan, the co-founder of SocialThing (now part of AOL) is giving a talk on Social Networking: Using Facebook, MySpace and LinkedIn at the ATLAS Institute (on the CU Boulder campus) on October 13th from 6pm to 8pm. This event is co-sponsored by my friends at The Van Heyst Group and Silicon Flatirons. Matt’s an entertaining speaker who was part of the inaugural TechStars program in 2007 – he’s got plenty of great stories and has been living in the social networking world for the past few years.
Gnip 2.0 has four big new features.
If none of that means anything to you, that’s ok. Shane Pearson, Gnip’s new VP of Products translates it into "more English" in his post titled What we are up to at Gnip.
If you are a developer, wander over to the Gnip API v2.0 spec and take a look.