I love ReadWriteWeb. I respect Marshall Kirkpatrick. But I’m completely baffled by his article R.I.P. Enterprise RSS.
Marshall says “It’s with a heavy heart and a sense of bewilderment that we conclude that the market for enterprise-specific RSS readers appears to be dead.”
Huh? Marshall, are we living in parallel universes?
NewsGator has built its business on Enterprise RSS. It has two primary revenue generating products around Enterprise RSS: Social Sites Professional and Social Sites Enterprise. There are now over 120 companies using these products representing over 800,000 users. Per the press release NewsGator issued today, customers that bought these products in 2008 include:
In addition, NewsGator had a spectacular Q4. They solidly beat the plan for Q4 that they had established at the beginning of 2008 (and met their 2008 overall plan on the top line and were ahead of plan on the bottom line.) NewsGator added around 30 new customers in Q4, including six in the financial services sector, one of the areas most impacted by the economic downtown.
How many enterprise software companies can say that?
Marshall goes on to say “Newsgator, one of those three companies, announced today that it has closed another round of funding. Years after the company launched, it appears to us that the funding is a life-support line for a company that has largely left enterprise RSS behind and has been humbled into selling advertising widgets.”
For starters, when we did the first round of financing of NewsGator in mid-2004, the company consisted of one person (Greg Reinacker). 4.5 years later it is 55 people and dominates the market it plays in. You can call it “Enterprise RSS” or “Social Computing for the Enterprise” – I don’t really care. What I do care is that the customers that have bought NewsGator’s products love them, are using them, and are realizing Marshall’s words “Any company that steps up to make serious strategic use of such software should be at an immediate advantage in terms of early and efficient access to information.”
The notion that NewsGator’s funding “is a life-support line” is totally absurd. One of my goals with all of my “more mature” (e.g. older than three years) portfolio companies is to make sure they are “fully funded through becoming cash flow positive.” This financing unambiguously gets NewsGator to that point with plenty of room to spare. NewsGator still had cash in the bank prior to this financing; the last time I checked an incremental $10m of financing is a meaningful amount for any company.
Marshall, I invite you out to Denver anytime (or we will come to you) to spend the day at NewsGator, really understand their products, and get a deep understanding of how NewsGator is spreading “Enterprise RSS” to the corporate masses. Seriously, come spend some time, do some real research, and help the industry understand the value of this stuff.
Late last year, Phil Weiser (the omnipresent head of Silicon Flatirons and CU professor of Law and Telecommunications) asked me if I was interested in doing a “One-on-One” public interview series with him. Phil and I have stirred up plenty of trouble together over the past few years and I’d never pass up an opportunity to share a stage with him.
So – on February 3 from 5pm to 6pm at the Wittemeyer Courtroom in the Wolf Law Building at CU Boulder we will be doing our first One-on-One on “Finance”. Here’s the summary:
Our first interview will focus on the basic questions around the state of corporate finance and what it means for start-ups, evaluating the role of angel financing, venture capital, private equity as well as the public debt and equity markets. Our discussion will touch on whether venture capital is now in trouble, as some suggest, whether the private equity model can come back from its bust (which Brad predicted), whether Wall Street’s model of financial engineering was corrupt and unsustainable, as Michael Lewis has suggested, and when the current credit crisis will end. If you have questions for Phil to ask Brad, please email him ahead of time at phil.weiser@colorado.edu. After the event, we will post a podcast for those who cannot make it in person.
The very popular Boulder Denver New Technology Meetup will happen immediately afterwards – I’ll stick around and see if I can cause more trouble at that event also.
If you can’t make the February 3rd One-on-One, the next one will be on April 14th and will discuss the nature of entrepreneurial ecosystems and what Colorado has going for it.
As I sat at Gate C18 of the Las Vegas McCarran International Airport on Friday afternoon, I heard the phrase “Wheel of Fortune” about 120 times during the 40 minutes I waited to board my flight home. I was amused the first three times, increasingly annoyed the next 37 times, and then just numb the remaining 80 times.
While I was on the edge of one of those “going postal” moments (if my plane had taken 50 minutes to board, I might not have made it as the Las Vegas police officers would have taken me somewhere dark and quiet for destroying a Wheel of Fortune slot machine with my bare hands), it did occur that me that the phrase “wheel of fortune” has some applicability to my universe.
I hate big tradeshows. I haven’t been to one since Comdex in 2000. While most of my trips to Las Vegas were for short term debauchery (of which I rarely participate in since I don’t gamble, don’t like strip clubs, and don’t drink much), I thought I’d give CES a try this year since most of my partners and a bunch of my friends were going.
I had fun – a lot of fun! I managed to spend a day walking the floor of CES; Jason summarized what we learned on a creatively titled post What We Learned at CES. I also got to go see the new iRobot 562 Pet Series (I just bought one for Amy’s February 1st life dinner gift – shhhh – don’t tell her), my friends at BugLabs and DeviceVM, and lots of cool Boxee stuff.
I sandwiched my floor walking between two awesome dinners – one at Guy Savoy in Caesar’s Palace and one at Nobu in the Hard Rock. I managed one strong run, got to party with Topspin, hung out with my dad, and didn’t get enough sleep. And – I caught a cold.
But I saw a lot of really cool TVs.
The first night of 24 Season 7 went better than expected. I’m looking forward to tonight’s “surprises”. In the mean time, here’s an assassin joke that puts it all in perspective.
Job Opening
The FBI had a job opening for an assassin. After all the background checks, interviews and testing were done, there were three finalists; two men and a woman.
For the final test, the FBI agents took one of the men to a large metal door and handed him a gun. "We must know that you will follow your instructions no matter what the circumstances. Inside the room you will find your wife sitting in a chair…….Kill Her!"
The man said, "You can’t be serious. I could never shoot my wife." The agent said, "Then you’re not the right man for this job. Take your wife and go home."
The second man was given the same instructions. he took the gun and went into the room. All was quiet for about 5 minutes. The man came out with tears in his eyes, "I tried, but I can’t kill my wife." The agent said, You don’t have what it takes. Take your wife home."
Finally, it was the woman’s turn. She was given the same instructions – to kill her husband. She took the gun and went into the room. Shots were heard, one after another. They heard screaming, crashing and banging on the walls.
After a few minutes all was quiet. The door opened slowly and there stood the woman, wiping the sweat from her brow. "This gun is loaded with blanks," she said. "I had to beat him to death with the chair."
MORAL: Women are crazy. Don’t mess with them.
Jack Bauer would be proud. Don’t underestimate Renee Walker.
I’m going to be hosting TechStars Meetups in Seattle and Houston this month when I’m in those cities. If you are considering applying for TechStars 2009 or interested in learning more, please register and come hang out with me.
1/20/09 @ 6pm: Seattle, WA. W Hotel.
1/22/09 @ 6pm: Houston, TX. Hilton Garden Inn.
Attendance is limited to 15 people per meetup so sign up now if you are interested.
CU just received a $17 million grant from NASA to probe the faint sounds of the early universe and better understand the lunar environment. I wonder if the Colorado Center for Lunar Dust and Atmospheric Studies will adopt Pink Floyd as their official band. Whenever I hear of something NASA is funding, I think of the exchange between Josh and Leo in the West Wing episode The Warfare of Genghis Khan.
Leo McGarry: My generation never got the future it was promised. Thirty-five years later, cars, air travel’s exactly the same. We don’t even have the Concorde anymore. Technology stopped.
Josh Lyman: The personal computer?
Leo McGarry: Where’s my jet pack, my colonies on the Moon?
I think Go Fast is making my Jet Pack.
Given that I have poor impulse control, I want it now.
Yesterday, NewsGator announced the release of their AdBurner Online Advertising Program. AdBurner is a partnership between NewsGator, Technorati, AdMeld, Gigya, Medialets, and Tremor Media.
If you’ve been following NewsGator’s progress, you know that they have two major parts to their business – their (1) enterprise products and (2) media products. They had an excellent year in 2008 with significant growth on both sides of their business along with an especially strong Q4.
With over 100 active customers on the media side of their business, NewsGator kept hearing the following things:
Last fall a group of us started talking about how to accommodate our customers’ requests for these things. There’s a longer list of “can you …” but we decided to focus on these five issues as they came up regularly in our discussions with our customers. I suggested strongly that we should partner with other companies to deliver these services to our customers. The consistent message from our customers is “we love working with you guys – will you just take care of all of this stuff for us?”
AdBurner is the result. NewsGator has partnered with and integrated Technorati (#1), AdMeld (#2), Gigya (#3), Medialets (#4), and Tremor Media (#5) into a single offering. While Technorati and AdMeld are investments of ours, Gigya, Medialets, and Tremor are not so NewsGator chose from a portfolio of potential partners that were like minded, interested in using NewsGator as an indirect channel (to NewsGator’s existing customers), and recognized the value to the customer of delivering a portfolio of services through one company (in this case, NewsGator).
As I mentioned above, there are a lot more “can you questions” that our customers are asking us (#6 through #17) and now that NewsGator has released the initial version of AdBurner, they are starting to explore the next wave of partners for their media products. All of this is being customer driven and is in response to real customer needs, which I find to be particularly powerful.
I have 2,143 lawyer jokes queued up. Here’s a good one:
The devil visited a lawyer’s office and made him an offer. "I can arrange some things for you, " the devil said. "I’ll increase your income five-fold. Your partners will love you; your clients will respect you; you’ll have four months of vacation each year and live to be a hundred. All I require in return is that your wife’s soul, your children’s souls, and their children’s souls rot in hell for eternity." The lawyer thought for a moment. "What’s the catch?" he asked.
Now some of my good friends are lawyers and several of my very best friends are ex-lawyers. You probably know one of them – my partner at Foundry Group – Jason Mendelson. When Jason started his blog, he made the wise choice of starting a series titled Law Firm 2.0. His first post – Why Start-up Lawyers Frustrate Me – pissed off all of his lawyer friends, generated 54 comments, and was reprinted all over the place. Not a bad start for a blog.
He continued posting about Law Firm 2.0. One day he was approached by some interesting folks at a company called FirstDocs who shared a lot of similar ideas. You can read about it more in Jason’s post Our Investment in Law Firm 2.0. The outcome, as you might expect, is that we closed an investment in FirstDocs at the end of last year.
Now, we usually do not invest in companies aimed at vertical markets. However, we make exceptions when we have extremely deep domain knowledge and expertise. In addition, we view having past success as a bonus, such as our previous experience in the legal vertical market with Stratify (which Iron Mountain acquired in 2007.)
A lawyer died and arrived at the pearly gates. To his dismay, there were thousands of people ahead of him in line to see St. Peter. But, to his surprise, St. Peter left his desk at the gate and came down the long line to where the lawyer was standing. St. Peter greeted him warmly. Then St. Peter and one of his assistants took the lawyer by the hands and guided him up to the front of the line into a comfortable chair by his desk. The lawyer said, "I don’t mind all this attention, but what makes me so special?" St. Peter replied, "Well, I’ve added up all the hours for which you billed your clients, and by my calculation you must be about 193 years old!" (ahajokes)
I look forward to seeing Jason, Dan Gaffney, and the team at FirstDocs increase the efficiency of lawyers.
There are many things I love about my wife Amy, but I especially like her brain. Over the holidays, she came up with the idea for having a year of living alphabetically. As a writer, she spends a lot of time with words and – besides have one of the most amazing vocabularies I’ve ever encountered (I don’t every have to use the lookup feature on the kindle – I just should “Amy, what does “ossiferous” mean?) – she’s really good at not misusing dashes or having run-on sentences.
B is for Being. The first part of this week is being brought to you by the letter B and Amy explores Buddha’s last words. If Buddha was Yoda, he would have said “Best you do, there is not less or more” before he died.