Brad Feld – Page 2

August 3, 2011December 2, 2011

OnMedea Raises $50 At A $1 Billion Valuation

I did it!

So, my mom sent me a check for $50 because she wanted to buy a piece of my growing media empire. (The growing part is a yet-to-launch blog on the insane nightlife of La Canada, CA called “La Canada Nights”.)

I told my mom her share of the company would be based on a $1 billion valuation (as it seems that’s the only valuation there is for a company these days).

For that $50 she will own 0.00000005% of the company. As part of my deal with Manka Bros., I own 50% of OnMedea (valued at $500 million), Manka Bros. owns another 20%($200 million) and Khan Manka, Jr. owns the remaining 30% ($300 million). My mom’s share will come out of my piece.

While some would say this is an outrageously high valuation and a sign that we are truly in a bubble – it’s really no more ridiculous than Airbnb, LinkedIn, Zynga, Groupon, Facebook or (fill in Y Combinator’s next spin-off here).

You could argue – hey, your annual revenues are in the low four figures, Zynga makes hundreds of millions (mid nine figures).

Point taken.

But here’s my point: A pumped up valuation is exactly that.

The key question for the entire financial ecosystem of Silicon Valley is, why do you do it? Answer: Because you can’t stop yourselves.

A fair valuation is not even on your radar because greed and jealousy take over. ‘That guy over there is 21 and got $200 million, I’m 25 and I’m only getting $100 million? F that!’

Why is everyone so desperate to reach THE BIG $B? Is just because of that one line of dialogue in “The Social Network”? Goddamn that is shallow… oh, yeah, right… I forgot who I am writing about.

Seriously, what’s wrong with a $350 million FAIR valuation and then show the world that you can grow and be worth more? Or a $50 million FAIR valuation? This obsession with “BILLION” is going to bring the entire system crashing down in the next year or so.

Bullshit is bullshit is bullshit…

But I digress… today, yippee-ki-yay, OnMedea is worth $1 billion dollars!

Suck on it.

Jill Kennedy – OnMedea

July 1, 2011July 11, 2011

AMC Networks Had An IPO Today…

Manka Bros., Khan Manka, OnMedea, Jill Kennedy, AMC Networks, Zynga, LinkedIn, Jeff Weiner, Reid Hoffman, Mark Zuckerberg, Sheryl Sandberg, Charles Dolon, Joshua Sapan, Edward Carroll, Sean Sullivan, James Gallagher, John Giraldo, Neil Ashe, Alan Schwartz, Dr. Leonard Tow, Robert Wright, William J. Bell, Charles F. Dolan, James L. Dolan, Kristin A. Dolan, Patrick F. Dolan, Thomas C. Dolan, Brian G. Sweeney, Marianne Dolan Weber, Rob Battles, Bob Broussard, Mike DiPasquale, David Evans, John Huffman, Ellen Kroner, Steven Pontillo, Thomas Ziangas, Charlie Collier, Evan Shapiro, Jennifer Caserta, Sarah Barnett, Kim Martin, Jonathan Sehring, Arlene Manos, John Barbieri, Harold Gronenthal, Ed Palluth, Mark Pincus, Cadir Lee, Dave Wehner, Reggie Davis, John Schappert, Owen Van Natta, Dave Ko, Colleen McCreary, Mike Verdu, Steven Chiang, Bing Gordon, Brad Feld, Jeffrey Katzenberg, Reid Hoffman, Mad Men, Don Draper, Jon Hamm, internet IPO, internet bubble 2.0

… and Wall Street shrugged.

Zynga announces a $1 billion IPO and every freakin’ investment bank in New York is clambering to get in on it.

These are the very same banks that were recently slobbering all over LinkedIn and would most likely kill anyone who tries to stop them from getting in on the Facebook IPO.

What am I missing here?

AMC Networks (AMC, IFC, WE, Sundance) represents highly-regarded premium television content (Mad Men, Breaking Bad, The Killing, Walking Dead, etc.) – the kind of content Hollywood needs people to watch. The kind of content only Hollywood can make. And the kind of content people really love.

Sounds likes a win win win. And a buy buy buy.

Zynga represents little $1 digital pigs for sale in Farmville. Not what you would call premium content.

Sounds like a lose lose lose.

“Mad Men” or “Digital Pig”? AMC Networks or Zynga? Which would you imagine to be the Wall Street darling?

Cable Networks (and their two strong revenue streams) are the bread and butter of giant media corporations.

If Wall Street shrugs at a pure-play cable network spin-off like AMC Networks, what does that say about the future of old-school big media? Being an employee of old-school big media, I’m not sure I like what that says.

Should they adapt to the changing (but unproven) business models and stop distributing quality content – focusing instead on selling little digital versions of Don Draper for $1? Or should they continue to do what they best until they simply disappear because their audiences die of old age?

Personally, I blame the whole VC/Y Combinator mentally for creating this unearned enthusiasm for certain companies that are, when you really look at them and see what they produce, pretty boring, uninspired and a waste of time.

But more billionaires will be minted – and I suppose that’s ‘End Game’.

Jill Kennedy – OnMedea

May 12, 2011May 12, 2011

All The Facebook’s Men

1000Memories, Accel Partners, Amish Jani, Andrew Hyde, Andrew Mason, Andy Sack, Ashton Kutcher, Aydin Senkut, Ben Silverman, Bin 38, Bob Davis, Bob Iger, Brad Feld, Brian Kempner, Chris Hughes, Christopher Steiner, Dan Nova, Daniel Gaisin, Danielle Hootnick, Dave McClure, David Brown, David Cohen, David Kirkpatrick, Demi Moore, Demo Day, Diego Gutierrez, Dustin Moskovitz, Edmond Yue, Eduardo Saverin, Emmett Shear, Eric Lefkofsky, Fergal Mullen, FirstMark Capital, Founders At Work, Francis Duong, Gaurav Tewari, Gerald Levin, Gerald Poch, Greg McAdoo, Greylock Partners, Harjeet Taggar, HBO, Highland Capital Partners, Irena Goldenberg, Jared Polis, Jeff Bewkes, Jeff Weiner, Jeff Zucker, Jessica Livingston, Jessica Mah, Jill Kennedy, Joanna Shields, John Hsin, John Palfrey, Jon Miller, Jr., Justin Kan, Justin.tv, Khan Manka, Larry Wilson, Laurence Albukerk, Lawrence Lenihan, Li Ka-shing, Loopt, Manish Patel, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, Matt Nichols, Michael Arrington, Michael Gaiss, MySpace, Nick Marsh, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Paul Cianciolo, Paul Graham, Peter Bell, Peter Thiel, Reddit, Richard de Silva, Richard Heitzman, Rick Heitzmann, Robert Morris, Ron Conway, Rudy Adler, Rupert Murdoch, Sand Hill Road, Scott Shane, Scott Switzer, Sequoia Capital, Sergey Nazarov, Shabbir Dahod, Shawn Broderick, Sheryl Sandberg, Sterling Phillips, Sumner Redstone, Tapzilla, TechCrunch, TechStars, TextPayMe, Toy Story 3, Trevor Blackwell, Y Combinator, google, Eric Schmidt, Tina Brown, The Daily Beast, Barry Diller, Dan Lyons, Google Smear campaign, Burson-Marsteller, Chris Soghoian, Jim Goldman, John Mercurio,

As soon as I read The Daily Beast story about Facebook’s alleged smear (whisper) campaign against Google, I immediately thought of the scene in “All The President’s Men” with all the newspaper editors sitting around deciding which stories to run the next day.

When Watergate is brought up, there is stiff resistance from a couple of the editors.

This scene (replacing ‘Watergate’ with ‘Facebook’) could easily have played out at The Daily Beast with the change of a few words in the screenplay:

INT. THE DAILY BEAST – BUDGET MEETING

SEXY BEAST EDITOR: Let me tell you what happened when I was having lunch today at Locanda Verde–

TINA BROWN: Correction – when you were drinking your lunch at the bar of Locanda Verde–

The room erupts in laughter.

SEXY BEAST EDITOR: –this Facebook guy, a good one, a pro, came up and asked what is the “Google smear” compulsion with you guys and I said, well, we think it’s important and he said, if it’s so goddamn important, who the hell is Dan Lyons?

INNOVATION EDITOR: Fake Steve Jobs for one – but I digress. Ask him what he’s really saying – he means to take the story away from Dan Lyons and give it to his people at the Sexy Beast.

SEXY BEAST EDITOR: Well, I’ve got some pretty experienced people sitting around, wouldn’t you say so?

INNOVATION EDITOR: Absolutely, and that’s all they do, sit sit sit – every once in a while they reprint Michael Arrington, some reporting–

SEXY BEAST EDITOR: Well, what if Dan Lyons get it wrong–

TINA BROWN: Then it’s Barry Diller’s ass, isn’t it? And we’ll all have to go work for a living.

The room clears, only a couple of Editors and Tina Brown stay behind:

SEXY BEAST EDITOR: I don’t think we should cover this story, period.

TINA BROWN: Go on.

SEXY BEAST EDITOR: It’s not that we’re using unnamed sources that bothers me, or that everything we print Facebook denies.

TINA BROWN: What then?

SEXY BEAST EDITOR: I don’t believe the goddamn story, Tina, it doesn’t make sense.

TINA BROWN: It will, it just hasn’t bottomed out yet, give it time.

SEXY BEAST EDITOR: Look, why would Facebook do it? My God, Google is self-destructing before our eyes – just like MySpace did, Friendster, the bunch of ’em. Why would Burson-Marsteller send emails to bloggers urging them to write negative stories about Google, unless they wanted to get caught? Why would Burson go to Politico, The Washington Post and The Huffington Post, unless they wanted to get caught?

TINA BROWN: Are you saying Google started a whisper campaign against itself?

SEXY BEAST EDITOR: Jill Kennedy at OnMedea thinks it’s possible – Google needs some positive press, corruption’s always a good one. Get off the story, Tina – or put some people on Google’s public relations team – fair is fair, even in our business.

—————————————-

Hey, we’re early enough in this conspiracy where all theories are in play.

Jill Kennedy – OnMedea

Click here to read the scene from the original script of “All The President’s Men”

January 13, 2011April 3, 2011

The Trouble With Groupon

I believe Groupon is headed for failure.

Even if they somehow survive, I fear they are doomed to be a company we all view with complete indifference.

I don’t write this lightly. I was amazed and sort of proud that they had the balls to turn down Google’s $6 billion offer.

Founders and senior management becoming fabulously wealthy excepted, there really is no upside to signing away your soul to a giant soulless corporation (take that Manka Bros.!) if you have a solid business or at least unique concept that absolutely cannot fail.

I was rooting for this upstart that had the guts to resist billions. I signed up and started to get the daily deals that were offered – “40% off a facial ($75 value!)”; “Pay $10 for $20 worth of hair products (not my brand)”, etc… these horrible “deals” kept coming and coming and I kept NOT BUYING. Now I believe they should have sold.

Groupon is not a terrible business – a little annoying, a notch above Spammer – but it’s basically a business that pushes all this crap on people that they don’t need (and from my experience, mostly stuff that I don’t even want). The brilliance they have is that they make you think you’re getting these amazing deals and you’d better buy soon or they’re gone forever. Consumers will wise up to this fairly quickly.

Sure, millions are buying (with Groupon keeping well over 50% of the proceeds) and it’s probably good for some of the small businesses that are participating (though I have heard of several disaster stories) – but it’s really just a sexier online version of Valpak – those blue envelopes of local coupons that we all get in the mail and we mostly ignore.

If Groupon really wanted to add value to my life, they would offer “50% off my Trader Joe’s bill”; “$5,000 off a 2011 Prius”; “$10 will get you $20 in cash”, etc. Things like that would be valuable to me. I would buy those. But Groupon can’t offer these things because Trader Joe’s and Toyota would be crazy to do it (and wouldn’t even dream of it) and the shit Groupon actually has to offer isn’t really… real. It’s just made up facts and figures to make you believe you’re getting a great deal.

Let’s say I own a Day Spa and offer $50 off a $300 massage. What makes it a $300 massage? I own the Spa, I set the price – there is no $50 value to be saved. I could go to another spa and get a $50 massage and save $200 more than I would have buying the Groupon. Groupon’s genius is convincing consumers that they are saving money on these great services when, really, the cheapest option is NOT TO BUY GROUPONS. That costs zero ($0) dollars.

And now, because the business model is so easy to replicate, I’m getting offers from Groupilicious, CouponYou, My Little Deuce Coupon, CouponDeville, Grouper With A Squeeze of Lemon, etc. and it will never stop because local businesses will always try to drum up sales by knocking 40% off a price that they set themselves. Buy it wholesale, mark up the price 100%, offer a Groupon for 40% off – still make 20% on the sale. It’s not difficult.

Right now Groupon is sexy. Even sexier after turning down Google. They are hiring an army of MBAs in their 20s, everybody dresses down – it’s a real startup mentality, it’s Chicago, it’s exciting. Hell, an IPO is coming!

But I look into the future, and all I see is Valpak. Ever been to a Valpak office? Not sexy. Not exciting. No roller skates, no ping pong – the only perks there are 20% off bagels when you buy one dozen.

Jill Kennedy – OnMedea

November 5, 2010December 9, 2011

Advertise On Facebook – Reach More People Than 10 Super Bowls!

Does this mean an ad will cost $40 million dollars per spot?

So, I was just on Facebook – along with 800+ million of my friends (soon to be be 7.3 billion) – and couldn’t help notice the sidebar banner ad pitch to “Advertise On Facebook” (see left).

Now, I’ve never noticed an ad on Facebook. Not one. And I don’t think I’m alone.

So why would I pay anything to advertise on Facebook? Because you can’t afford NOT to have your product or brand in front of 800 MILLION POTENTIAL CUSTOMERS. Right?

Because fear works when you’re pitching your platform to advertising agencies – “You need us more than we need you.” So it’s better to make an expensive ad buy on Facebook, even though no one will see your ad, than to be left behind.

Do they think we’re idiots? At least on television, even if the ad is being skipped in fast motion, you see the product. On Facebook, you don’t even notice the ad and, if you did, you wouldn’t care because you don’t want to see advertising when you’re on Facebook.

The only ad tactic that seems to work on Facebook is the one where hot young girls (old dudes pretending to be hot young girls) to “Friend” guys and then post non-stop about how they “LOVE THEIR NEW NISSAN SENTRA” and how much “The New Coke Zero ROX!”

Let I said before, Facebook, unless they start to charge user fees or do those horribly annoying ads that pop right in your face when you log in, is on the road to becoming worthless.

Jill Kennedy – OnMedea

November 3, 2010October 10, 2011

Y Combinator Is A Stupid Idea

I wanted to call this entry “Y Combinator Is A Bullshit Idea” but the ads on the side wouldn’t have displayed due to the “bullshit” in the title.

So, I just read the Christopher Steiner article “The Disruptor In The Valley” at Forbes.com (which is about Paul Graham and his company Y Combinator) and I immediately thought of the bit from “The Simpsons” (Season 12 – Episode 9) when Homer is undergoing medical experiments for money. He tries an appetite suppressant:

HOMER: “I’m BLIND!”
SCIENTIST #1: “Who’s gonna buy a pill that makes you blind?”
SCIENTIST #2: “We’ll let marketing worry about that!”

Y Combinator is basically offering Silicon Valley a pill that makes them blind (but marketing will fix it).

They offer a little bit cash to grab a whole lot of equity in these tiny start-ups – most which are not even close to being ready for that kind of exposure (or financial decision).

However, with the right spin, PR and influence behind them, they (apparently) ARE ready for the additional money that others might throw their way (for another giant chunk of equity)… IF they can manage to get through the grueling YC BOOTCAMP.

So many of these companies just aren’t ready and, frankly, just aren’t necessary.

It’s like the YouTube star who gets a small role on “The Big Bang Theory” and can barely speak because they’re so nervous and everyone realizes they have no acting skills whatsoever.

This is not to say that there aren’t a lot of geniuses out there with a lot of great ideas. There are. Most are much smarter than me (but not as smart as Khan Manka, Jr. – I’m under order to say).

But these geniuses (and mostly non-geniuses, let’s be serious) are being exploited by Paul Graham and company and tossed to these VC wolves who will eat many a carcass to get to the next Facebook (which MUST BE STOPPED… but I digress).

Seriously, in another Hollywood analogy, any start-up attempting to get their business going through Y Combinator is like the screenwriter in Los Angeles who will pay people to read their script because they “work at a studio.”

The chances of success in one of these cattle call models is virtually zero.

Zero for everyone except Paul Graham (and partners).

As a quick primer, allow me a paragraph (from Wikipedia) to explain Y Combinator to those who may not know what it is:

Y Combinator is an American seed-stage startup funding firm, started in 2005 by Paul Graham, Robert Morris, Trevor Blackwell, and Jessica Livingston. Y Combinator provides seed money, advice, and connections at 3-month programs. In exchange, they take an average of about 6% of the company’s equity.

Compared to other startup funds, Y Combinator provides very little money ($17,000 for startups with two founders and $20,000 for those of three or more). This reflects Graham’s theory that between free software, dynamic languages, the web, and Moore’s Law, the cost of founding a startup has greatly decreased.

In other words, throw a bunch of shit on the wall and see what sticks.

Great for Paul Graham (based on his idea, Y Combinator would have gotten $20,000 from Y Combinator), but terrible for almost all of those thousands who apply to his program every year just in the hope of getting the YC stamp of approval (and 60 lbs of chili).

So Y Combinator is a Venture Capitalist that funds your start-up so that your start-up can get funded by another Venture Capitalist.

Enough with these f-ing VCs, man.

Whatever happened to creating a company, becoming successful and growing it based on that initial success?

Success because you have a product that people really (REALLY) want.

Thousands of techies are just sitting around coffee shops and cafes in all the “Silicon Valleys of the world” trying to think up new ideas that Paul Graham (and others like him) might like.

Not because it’s an idea that the start-up founder actually believes in anymore – but because it’s one that might get funding.

I mean, fuck passion, right?

These days it’s not whether your company succeeds or fails, it’s whether it gets funded in the first place and a mention on TechCrunch.

Jill Kennedy – OnMedea

P.S. – Also Digg is dead – R.I.P. – so is Electus and Comic-Con… but I digress… again.

May 12, 2009May 12, 2011

All The President’s Men – Washington Post Budget Meeting Scene

Here is a companion to “All The Facebook’s Men” – the actual scene from the original screenplay of “All The President’s Men”

INT. WASHINGTON POST – CONFERENCE ROOM

NATIONAL EDITOR: –let me tell what happened when I was having lunch today at the Sans Souci–

ROSENFLED: –correction–when you were drinking your lunch at the bar of the Sans Souci–

NATIONAL EDITOR: –this White House guy, a good one, a pro, came up and asked what is this Watergate compulsion with you guys and I said, well, we think it’s important and he said, if it’s so goddamn important, who the hell are Woodward and Bernstein?

ROSENFELD: Ask him what he’s really saying– he means take the story away from Woodstein and give it to his people at the National Desk–

NATIONAL EDITOR: –well, I’ve got some pretty experienced fellas sitting around, wouldn’t you say so?

ROSENFELD: Absolutely. And that’s all they do, sit sit sit – every once in a while, they call up a Senator, some reporting–

NATIONAL EDITOR: –well, what if your boys get it wrong?

BRADLEE: (after a beat) Then it’s our asses, isn’t it?

SIMONS: (indicates the meeting is over) And we’ll all have to go to work for a living.

As the men rise and head for the door, the FOREIGN EDITOR moves toward BRADLEE and SIMONS who remain seated as before.

FOREIGN EDITOR: I don’t think either Metropolitan or National should cover the story.

Bradlee and Simons look at him.

FOREIGN EDITOR (CONT’D): I don’t think we should cover the story, period.

BRADLEE: Go on.

FOREIGN EDITOR: It’s not that we’re using unnamed sources that bothers me, or that everything we print the White House denies, or that almost no other papers are reprinting our stuff.

SIMONS: What then?

FOREIGN EDITOR: I don’t believe the goddamn story, Howard, it doesn’t make sense.

BRADLEE: It will, it just hasn’t bottomed out yet, give it time.

FOREIGN EDITOR: Ben, Jesus, there are over two thousand reporters in this town, are there five on Watergate? Where did we suddenly get all this wisdom?

Bradlee and Simons say nothing. They respect this guy.

FOREIGN EDITOR: Look – why would the Republicans do it? My God, McGovern is self-destructing before our eyes — just like Muskie did, Humphrey, the bunch of ’em. Why would the burglars have put the tape around the door instead of up and down unless they wanted to get caught? Why did they take a walkie-talkie and then turn it off, unless they wanted to get caught? Why would they use McCord–the only direct contact to the Republicans?

BRADLEE: You saying the Democrats bugged themselves?

FOREIGN EDITOR: The FBI thinks it’s possible–the Democrats need a campaign issue, corruption’s always a good one. Get off the story, Ben — or put some people on McGovern’s finances; fair is fair, even if our business.

He leaves.

Jill Kennedy – OnMedea