Posts Tagged ‘facebook’

#twitter bullshit math?

Sunday, October 11th, 2009

I have been twittering for a year or so and something is starting to bother me about the math.

First, consider my use:

  • Have experimented with posting rambling updates on my food intake, following the rich and famous, and forwarding intriguing nuggets of news or ridiculously funny (to me anyway) posts by acerbic wits.
  • Have connected my blog with www.twitterpost.com in order to automatically tweet the headline and drive tweeple to read the blog.
  • Have been playing with www.SocialOomph.com (formerly tweetlater) to automate “thanks for following” notes and have begun earnestly tweeting opinions and one-liners on the #leadership topic thread.
  • I am now adding about a dozen new followers per day and am at a whopping 300 or so followers.

Might not sound like much but I’ll get to that in a minute.

In my time playing with twitter, I have noticed something troubling. The majority of my followers have bailed on me—Over 600 people have followed me but only half are still with me. So I had a look at the quitters and learned they were for the most part selling something. Real estate agents, vitamin salespeople, work at home gigs, get rich fast schemes, get more twitter followers schemes, etc. Yes it’s true some people find my tweets annoying or boring and leave annoyed or bored. But when I look at the profiles of those who recently started following me, about half are individuals or organizations seeking followers whom they can pummel with promotional messages. Then I looked at other twitterers with 1000, 5000, and over 10K followers.  It was more of the same junk followers inflating the follower total.

The “rules of the game” in twitter are often regurgitated by many “social media experts.” The central message is: You get more followers by following others. The logic goes like this. Since many people follow the “rule” of following when followed, you quickly add followers just by following. Soon you can have thousands of people who follow you. Of course that’s just nonsense. Nobody I have ever met can actually read more than a few dozen active twitterer’s daily feeds. I saw one active twitterer with 14,000 followers and 14,000 people she followed. Come on. Really? You can read 14,000 people’s posts? Of course not. Nor can you read the posts of 5,000 or even 1000 people. I cannot find the data to prove my point, but I am willing to bet there are millions of people with at least 1,000 followers  and of those, most are junk followers.

Although all twitterers post noise of one kind or another, only the best tweets are worth reading. Keep in mind the Worthy-Post to Noise-Post ratio (the twitter equivalent to signal-to-noise ratio in telecommunications) must round to zero.

Now it is true there are celebs who post actively and intelligently. As a result they have millions of followers. But for the vast majority of not-so-famous people, their followers are mostly junk.

Why don’t I have more than a few hundred followers? First and foremost, I am not a celebrity. Nor am I very funny. I don’t tweet more than a handful of times per week. And I don’t follow the must-follow to build follower rule. I only follow those people who post tweets that I am actually willing to read almost every day. Fortunately most dont post more than once a week, or I’d have to drop many of them. So unless I have a lucky break on America’s Got Talent or become the next Washington State Governor, I will have only a small handful of loyal readers and a bunch of other followers who have forgotten that they followed me and I am lost in their collection of 3,987 twitter friends.

Net net: I have to believe that when the early adopter enthusiasm wears off, twitter will be a cool way to stay in touch with celebrities. A handful of intelligent blogger/tweeters will eventually have a solid following. A cultural revolution in the making will have a brief moment of international awareness like the riots in Iran this summer. The rest will live with a false sense of twitter follower fame until the next  social media darling comes to replace twitter or facebook or both.

Is twitter really like television in the early days? I don’t think so. There isn’t a mass adoption of a new medium. Twitter isn’t really new. It’s just like instant messaging and text messaging, only more unbridled in its reach. There is a lot of conversational noise that hasn’t died down yet. Kind of like the vibrating cacophony of voices in the audience before a concert. Once the real program begins, the masses will ignore each other until intermission. I suspect the same will happen to twitter.

of widgets, bubbles, and wildebeest

Friday, November 7th, 2008

 

 

 

 

  I was asked eariler this week by a friend – a seasoned veteran of internet investing – what my opinion was on widget world aka web2.0 and if it was indeed time to stick a fork in it, then what was next? It’s a funny topic.

Web2.0 is bursting for the same reasons that Web1.0 met its filmy end. Lack of business model. Lack of management talent. Irrational exhuberance. Herd-like behavior of institutional investors.

I distinctly remember in 1997 how entrepreneurs with absolutely no business model (…oh hell, not even a revenue model…) could get financing from angels and soon thereafter VCs because they were going to “disintermediate” something using the “new power” of the internet. I now sheepishly admit to succesfully raising money for a bplan that called for a website in which all consumer product was free. Why were we fixated on free? Because Nicholas Negroponte and other pundits often quoted by WIred Magazine were saying “Information wants to be Free!” on the internet and that was one of the drivers for disintermediating shopping malls, newspapers, book publishers, catalog merchants, etc.

As I came to know my fellow entrepreneurs, I discovered that most had no prior management experience and almost none had professional management training. They were techies with hubris posing as business acumen or else they were inspirational salesmen and women with a brilliant command of jargon. And most were pretty darn young. My peers claimed I was a gray-beard at the ripe age of 35.

All was well for a while.  All boats rose with the tide of consumer enthusiasm and the massive infusion of loose capital. Many of us crazy entrepreneurs were able to raise capital on a napkin plan, stake out solid growth in consumer visits and page views on rude software in a semi functional browser (t was 1999 after all) We had convinced ourselves that eventually we were all gonna make a lot of money from a business model TBD in the future. My MBA counted for nothing. My 10 years of operating experience in F100 companies counted for nothing. Well, for a few years anyway.  Then it all came home to roost. Most of those “businesses” proved fatally flawed. Web 1.0 popped. No bailout from congress for us.

Then along comes Web2.0  a few years ago, and those of us with an ounce of short term memory still functioning, said “huh?” We wondered what happened to all the people who just learned their lesson from Web 1.0  Here we were once again with engineers filled with school boy test taking skills thinking that was the same as brilliant business skills.  Once again we had bplan devoid of P&L linkage to product plan. And once again we had a heard of Wildebeest investing in these ventures because they didn’t want to miss out on the next Google or Facebook or Youtube.

 

 

 

And now the Wildebeest are running in the opposite direction. Web2.0 companies aren’t making any money. In fact, Facebook, on the backs of which many Web2.0 companies were formed, isnt making money yet. Then the credit crunch hit and the DOW lost over 40% in market value in about 12 months. Panic ensued and for a few weeks there was no investment by any of the VCs. It’s already thawing now as VCs start quietly entering the dealflow again, but it’s a whimper compared to 2 years ago.

What’s next after all this?

I am an optimist. Web 3.0 will start with more seasonsed veterans of the first two Web phases. VCs are asking for bootstrap business plans and business models that have inherent cashflow from (gasp!) paying customers. There will be fewer investments made, the tech VC industry will consolidate to a much smaller number of players. But they will be better investments in fewer plans. And where? I believe the iPhone is the watershed moment for the mobile device as the next place. It’s been hyped for over 10 years but I think the time has come. Facebook will finally make money when a viable consumer application that has inherent value runs on it. In the same way that Microsoft was a silly company until Word, Excel, Outlook, and Powerpoint became mainstays of business operations, somebody is going to find the killer app on Fbook. At which point Fbook will face the same choice MSFT did when Lotus succeedded with 123.  Build? Buy? Kill? Tax?

Is tech investing in the internet dead with Web2.0? No. No way Jose. It’s just finally growing up. And although i’d like to believe it’s mature, there is probably room for another bubble or two to burst in the next 5 years or so.

Scary Times

Friday, October 31st, 2008

pumkin

It’s Halloween. Kids are having fun scaring each other and eating candy. And acting really weird.  This evening’s antics serve as an appropriate background for the past week. Two of the start-ups I am working with are suffering from a lack of funding. Not because their businesses are bad. No, they suffer from a lack of funding because they had the bad fortune of needing to raise a round now when most VCs are running like crazy headless chickens in the midst of the credit crunch. Thanks to Sequoia’s hysterical 100 CEO meeting a few weeks ago and the wacky deck they let out onto the blogosphere, many VCs act like they need to be afraid to be intelligent.

Have seen a few VCs actually step up in the midst of this and say “wow, now that the big boys are out, let’s step up our investment focus so that we pick up the best deal flow.” But those contrarians are rare. Has anyone noticed that Warren Buffett isn’t hiding? No, he is buying and since cash is king, he gets a great price. Lord if only I had a bigger bag of cash, I’d be shopping for companies, too. It’s amazing to me how little faith VCs have in the future. It’s ironic, given that they are supposedly in existence to provide capital where banks fear to tread. Well, here we go again. Time for a hunker-down period just like they had after the Internet bubble burst. As a result of that last chicken phase, many missed out on youtube, google, facebook, and other winners this go-around.

This gets me back to the CEOs I am working with. I am proud to be associated with these companies. They have built great products. They are not daunted by fearful VCs. They scrap for bits of investment from those with intestinal fortitude, they scrimp on costs, they build product, and with a little luck and the hard work they put into these ventures, they will come out on top. And leave the chicken VCs behind.

Trick or treat? That all depends on who’s handing out the candy. Today it’s the VC hemming and hawing at the door, but in the not too distant future, it’s the CEOs who stick it out through the hard times. And win.

Happy Halloween.