Paul Buchheit – Page 2

August 5, 2011August 5, 2011

Wall Street Reminder: Nobody Knows Anything

OK – so the U.S. got downgraded by S&P (AA+) for the first time in its history. Whatever. It’s all just a game anyway.

Most talking heads throughout the weekend will say Monday will be a bloodbath on Wall Street and that many investors will be clamoring to yank out their cash.

But I must remind anyone who has money in the market (me!), out of the market and all those on the fence that “nobody knows anything.”

This phrase, coined by William Goldman in “Adventures In The Screen Trade” (worth a read even for non-screenwriters), is absolutely true in almost all industries and in almost all cases where someone is trying to predict the future.

In the movie business, the phrase was basically referring to the major studios’ inability to know what movies would work at the box office and what movies would fail. As it turns out, with all the historical data at our fingertips… nobody knows anything.

And the same goes for Wall Street:

Meredith Whitney, hotsy-totsy Queen of the Double-Dip, has no clue where the markets are going (though she seems to be praying for a downturn – probably more out of concern for her reputation than for the country).

That whack job Ray Dalio – founder of Bridgewater Associates (subject of a brilliant piece by John Cassidy in the New Yorker) – has no clue where the markets are going (though, to be fair, the whack job has been more successful than most in guessing lately).

The government, your parents, your children, Warren Buffett, CNBC, Fox News, Bloomberg, TechCrunch, your friends on social networks – nobody knows anything.

If they did, then Wednesday night I would have received a text or seen a tweet or a Facebook status update that said “The Dow will fall 512 points tomorrow – you may want to make a couple of portfolio moves.”

I didn’t get that message from any of those people who “know so much”. Just like I won’t get any correct message this weekend about what will happen on Monday. Because nobody knows anything about what will happen on Monday!

So this weekend, as we all think about our personal finances, don’t make knee-jerk decisions based on something someone says on television or an internet blog.

This may sound overly simplistic, but just go with your gut and calm the freak down. There are a lot great healthy American companies out there and they deserve your confidence.

But, then again, I don’t know anything either – and I certainly don’t know how “Rise of the Planet of the Apes” is going to perform this weekend – perhaps $35 million, perhaps $65 million. It’s a crap shoot.

Jill Kennedy – OnMedea

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 26, 2011August 2, 2011

Debt Ceiling Impasse 1 — Social Media 0

American Idol, Ari Emanuel, Ben Silverman, Bruce Gowers, Cecile Frot-Coutaz, Freemantle Enterprises, Gaude Lydia Paez, Jeff Weiner, Jeff Zucker, John Pritchett, Kara DioGuardi, Ken Warwick, Kevin Reilly, Khan Manka, Manka Bros., Nigel Lythgoe, Nikki Finke, Paula Abdul, Peter Rice, Randy Jackson, Rupert Murdoch, Ryan Seacrest, Scott Grogin, Sharon Waxman, Simon Cowell leaving American Idol, Simon Fuller, Terry Semel, Haley Reinhart, James Durbin, Scott McCreery, Lauren Alaina, Jennifer Lopez, Ben Silverman, Jimmy Iovine, Accel Partners, Ben Silverman, Bob Iger, Chris Hughes, David Kirkpatrick, Dustin Moskovitz, Eduardo Saverin, Gerald Levin, Greylock Partners, HBO, Jeff Bewkes, Jeff Zucker, Jill Kennedy, Joanna Shields, Jon Miller, Khan Manka, Li Ka-shing, Manka Bros., Mark Cuban, Mark Zuckerberg, Matt Cohler, MySpace, Nicolas Carlson, OnMedea, Owen Van Natta, Paul Buchheit, Peter Thiel, Rupert Murdoch, Sheryl Sandberg, Sumner Redstone, Toy Story 3, Mitch McConnell, President Barack Obama, Harry Reid, Nancy Pelosi, Michele Bachman, John Boehner, Sarah Palin, Jo Bonner, Martha Roby, Mike Rogers, Robert Aderholt, Mo Brooks, Spencer Bachus, Terri Sewell, Don Young, Eni F.H. Faleomavaega, Paul Gosar, Trent Franks, Benjamin Quayle, Ed Pastor, David Schweikert, Jeff Flake, Raul M. Grijalva, Gabrielle Giffords, Eric Crawford, Tim Griffin, Steve Womack, Mike Ross, Mike Thompson, Wally Herger, Daniel Lungren, Tom McClintock, Doris Matsui, Lynn Woolsey, George Miller, Nancy Pelosi, Barbara Lee, John Garamendi, Jerry McNerney, Jackie Speier, Fortney Pete Stark, Anna Eshoo, Michael Honda, Zoe Lofgren, Sam Farr, Dennis Cardoza, Jeff Denham, Jim Costa, Devin Nunes, Kevin McCarthy, Lois Capps, Elton Gallegly, Howard McKeon, David Dreier, Brad Sherman, Howard Berman, Adam Schiff, Henry Waxman, Xavier Becerra, Judy Chu, Karen Bass, Lucille Roybal-Allard, Maxine Waters, Jane Harman, Laura Richardson, Grace Napolitano, Linda Sanchez, Edward Royce, Jerry Lewis, Gary Miller, Joe Baca, Ken Calvert, Mary Bono Mack, Dana Rohrabacher, Loretta Sanchez, John Campbell, Darrell Issa, Brian Bilbray, Bob Filner, Duncan Hunter, Susan Davis, Diana DeGette, Jared Polis, Scott Tipton, Cory Gardner, Doug Lamborn, Mike Coffman, Ed Perlmutter, John Larson, Joe Courtney, Rosa DeLauro, James Himes, Christopher Murphy, John Carney, Eleanor Holmes Norton, Jeff Miller, Steve Southerland, Corrine Brown, Ander Crenshaw, Richard Nugent, Cliff Stearns, John Mica, Daniel Webster, Gus Bilirakis, Bill Young, Kathy Castor, Dennis Ross, Vern Buchanan, Connie Mack, Bill Posey, Thomas Rooney, Frederica Wilson, Ileana Ros-Lehtinen, Theodore Deutch, Debbie Wasserman Schultz, Mario Diaz-Balart, Allen West, Alcee Hastings, Sandy Adams, David Rivera, Jack Kingston, Sanford Bishop, Lynn Westmoreland, Henry Johson, John Lewis, Tom Price, Rob Woodall, Austin Scott, Tom Graves, Paul Broun, Phil Gringrey, John Barrow, David Scott, Madeleine Bordallo, Colleen Hanabusa, Mazie Hirono, Raul Labrador, Michael Simpson, Bobby Rush, Jesse Jackson, Daniel Lipinski, Luis Gutierrez, Mike Quigley, Peter Roskam, Danny Davis, Joe Walsh, Janice Schakowsky, Robert Dold, Adam Kinginger, Jerry Costello, Judy Biggert, Randy Hultgren, Timothy Johnson, Donald Manzullo, Robert Schilling, Aaron Schock, John Shimkus, Peter Visclosky, Joe Donnelly, Marlin Stutzman, Todd Rokita, Dan Burton, Mike Pence, Andre Carson, Larry Bucshon, Todd Young, Bruce Braley, David Loebsack, Leonard Boswell, Tom Latham, Steve King, Tim Huelskamp, Lynn Jenkins, Kevin Yoder, Mike Pompeo, Ed Whitfield, Brett Guthrie, John Yarmuth, Geoff Davis, Harold Rogers, Ben Chandler, Steve Scalise, Cedric Richmond, Jeffrey Landry, John Fleming, Rodney Alexander, Bill Cassidy, Charles Boustany, Chellie Pingree, Michael Michaud, Andy Harris, C.A. Dutch Ruppersberger, John Sarbanes, Donna Edwards, Steny Hoyer, Roscoe Bartlett, Elijah Cummings, Chris Van Hollen, John Olver, Richard Neal, James McGovern, Barney Frank, Niki Tsongas, John Tierney, Edward Markey, Michael Capuano, Stephen Lynch, William Keating, Dan Benishek, Bill Huizenga, Justin Amash, Dave Camp, Dale Kildee, Fred Upton, Tim Walberg, Mike Rogers, Gary Peters, Candice Miller, Thaddeus McCotter, Sander Levin, Hansen Clarke, John Conyers, John Dingell, Timothy Walz, John Kline, Erik Paulson, Betty McCollum, Keith Ellison, Collin Peterson, Chip Cracaack, Alan Nunnelee, Bennie Thompson, Gregg Harper, Steven Palazzo, Wm. Lacy Clay, Todd Akin, Russ Carnahan, Vicky Hartzler, Emanuel Cleaver, Sam Graves, Billy Long, Jo Ann Emerson, Blaine Luetkemeyer, Denny Rehberg, Jeff Fortenberry, Lee Terry, Adrian Smith, Shelley Berkley, Dean Heller, Joseph Heck, Frank Guinta, Charles Bass, Robert Andrews, Frank LoBiondo, Jon Runyan, Chrisopher Smith, Scott Garrett, Frank Pallone, Leonard Lance, Bill Pascrell, Steven Rothman, Donald Payne, Rodney Frelinghuysen, Rush Holt, Albio Sires, Martin Heinrich, Stevan Pearce, Ben Ray Lujan, Timothy H. Bishop, Steve Israel, Peter King, Carolyn McCarthy, Gary Ackerman, Gregory Meeks, Joseph Crowley, Jerrold Nadler, Anthony Weiner, Edolphus Towns, Yvette Clarke, Nydia Velazquez, Michael Grimm, Carolyn Maloney, Charles Rangel, Jose Serrano, Eliot Engel, Nita Lowey, Nan Hayworth, Christopher Gibson, Paul Tonko, Maurice Hinchey, William Owens, Richard Hannah, Ann Marie Buerkle, Brian Higgins, Louis McIntosh Slaughter, Tom Reed, G.K. Butterfield, Renee Ellmers, Walter Jones, David Price, Virginia Foxx, Howard Coble, Mike McIntyre, Larry Kissell, Sue Wilkins Myrick, Patrick McHenry, Heath Shuler, Melvin Watt, Brad Miller, Rick Berg, Gergorio Kilili Camacho Sablan, Steve Chabot, Jean Schmidt, Michael Turner, Jim Jordan, Robert Latta, Bill Johnson, Steve Austria, John A. Boehner, Marcy Kaptur, Dennis Kucinich, Marcia Fudge, Patrick Tiberi, Betty Sutton, Steven LaTourette, Steve Stivers, James Renacci, Tim Ryan, Bob Gibbs, John Sullivan, Dan Boren, Frank Lucas, Tom Cole, James Lankford, David Wu, Greg Walden, Earl Blumenauer, Peter DeFazio, Kurt Schrader, Robert Brady, Chaka Fattah, Mike Kelly, Jason Altmire, Glenn Thompson, Jim Gerlach, Patrick Meehan, Michael Fitzpatrick, Bill Schuster, Tom Marino, Lou Barletta, Mark Critz, Allyson Schwarz, Michael Doyle, Charles Dent, Joseph Pitts, Tim Holden, Tim Murphy, Todd Russell Platts, Pedro Pierluisi, David Cicilline, James Langevin, Tim Scott, Joe Wilson, Jeff Duncan, Trey Gowdy, Mick Mulvaney, James Clyburn, Kristi Noem, David Roe, John Duncan, Charle Fleischmann, Scott DesJarlais, Jim Cooper, Diane Black, Marsha Blackburn, Stephen Lee Fincher, Steve Cohen, Louie Gohmert, Ted Poe, Sam Johnson, Ralph Hall, Jeb Hensarling, Joe Barton, John Abney Culberson, Kevin Brady, Al Green, Michael McCaul, Michael Conaway, Kay Granger, Mac Thornberry, Ron Paul, Ruben Hinojosa, Silvestre Reyes, Bill Flores, Sheila Jackson-Lee, Randy Neugebauer, Charles Gonzalez, Lamar Smith, Pete Olson, Francisco Canseco, Kenny Marchant, Lloyd Doggett, Michael Burgess, Blake Farenthold, Henry Cuellar, Gene Green, Eddie Bernice Johnson, John Carter, Pete Sessions, Rob Bishop, Jim Matteson, Jason Chaffetz, Peter Welch, Donna Christensen, Robert Wittman, Scott Rigell, Robert Scott, Randy Forbes, Robert Hurt, Bob Goodlatte, Eric Cantor, James Moran, Morgan Griffith, Frank Wolf, Gerald Connolly, Jay Inslee, Rick Larsen, Jaime Herrera Beutler, Doc Hastings, Cathy McMorris Rodgers, Norman Dicks, Jim McDermott, David Reichert, Adam Smith, David McKinley, Shelly Moore Capito, Nick Rahall, Paul Ryan, Rammy Baldwin, Ron Kind, Gwen Moore, James Sensenbrenner, Thomas, Petri, Sean Duffy, Reid Ribble, Cynthia M. Lummis, Jeff Sessions, Richard Shelby, Mark Begich, Lisa Murkowski, Jon Kyl, John McCain, Mark Pryor, John Boozman, Dianne Feinstein, Barbara Boxer, Mark Udall, Michael Bennett, Joseph Lieberman, Richard Blumenthal, Christopher Coons, Edward Kaufman, Bill Nelson, Marco Rubio, Saxby Chambliss

For the past week, I’ve been instructed by a few Facebook friends to update my status by cutting and pasting a sentence or phrase that reflects their outrage of the current Debt Ceiling Impasse...

… or to email my Congress person…

… or to Tweet THIS if I want change…

… or to text someone that ‘I’m mad as Hell and I’m not going to take it anymore.’

And after all that updating, and reposting, and retweeting, and Google+ing, what’s the result?

– Debt ceiling impasse.

– Unstable global financial markets.

– Multiple stories about the inevitable downgrade from our AAA credit status and a coming stock market collapse.

Now, perhaps there are a few young congressional aides that are monitoring the ‘Facebook Status Update Situation’ and how many constituents actually posted the sentence of choice – but, really, is Congress listening?

Of course not.

Support or dissent from social media is like “American Idol” voting. So silly – but since it’s so easy to participate… why not?

It’s just another reason I feel Facebook is worthless. Superficial passion. “My day was awesome!” “My kids are the best students!” “Here’s the greatest recipe for Apple Pie!”

On “American Idol”, viewers are urged to phone or text (standard text message rates apply) as many times as they can for their favorite contestant. If you can’t get through – please keep trying!

Millions and millions of “votes” for Scott McCreary. Millions and millions for Lauren Alaina. Yet more millions and millions for Haley Reinhart (why, I’ll never know – don’t be hating me Haley fans – I just don’t think she’s talented).

And the winner is? Oh, I don’t know… we don’t care. The producers have agreed on… I mean, America has voted on… let’s say… Scotty!

You realize the votes aren’t counted, right?

If they actually did count the votes, the viewers would see those counts. Because that would add an interesting dynamic.

But producers can’t do that because then they wouldn’t be able to kick off the contestants they don’t like.

The same thing applies when social media takes on politics. When one person can re-post something a thousand times, it’s a superficial reading of what is really going on.

“Millions of emails have flooded the in-boxes of members of Congress.” Yeah, millions and millions of emails from three guys in Utah. And all went straight to the Congressional Spam folder.

And every political party is doing it – which creates nothing but muddle.

I am fairly certain the Tea Party people are flooding their status updates with “Don’t Raise The Debt Ceiling At All. Take Back America!”

And Republican Facebookers are pasting “Make Obama a one-term President.”

And the Democrats: “Don’t let the corporate jet owners win again!”

Is there anyone counting who is updating their Facebook status the most times? What do you think? And what do they win if they post the most? At least Scotty McCreary gets a record contract. Social Media activists get… ignored.

We all know where the Debt Ceiling Impasse is headed no matter how many Tweets are Tweeted – and so does President Obama. The U.S. will be kicking the can further down the road and a six month or one year debt ceiling extension that will accomplish very little and will be reluctantly signed on August 1st or 2nd.

Then Congress goes on vacation for the month of August.

The issue will be taken up again in early 2012 – two weeks or so before another possible default. And the Facebook status posting and Tweeting will begin another cycle… just in time for the new season of “American Idol”.

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.

October 21, 2010April 3, 2011

Juan Williams Had TWO JOBS!

Remember, whichever side you are on in this debate, Juan Williams had TWO JOBS during the worst economy since the Great Depression when so many people out there can’t even get ONE JOB.

I think it was good of NPR to fire Juan Williams if only for the simple fact that they can now hire an out of work Political Commentator who can get off the public dole.

Interesting that Fox News would reward a guy with a $2 million dollar contract who basically said that Muslims who are dressed as their religion requires(!!) make him nervous on an airplane.

Juan Williams perfectly fits the mold of the “Fox News Liberal”.

Jill Kennedy – OnMedea

October 8, 2010April 11, 2011

Digg – R.I.P.

Lesson #1: If Google offers you $200 million for a business that has no real focus or vision – TAKE IT.

Lesson #2: If the due diligence doesn’t back up a $200 million valuation and someone else offers you $80 million – TAKE IT.

Lesson #3: If you ignore Lessons #1 and #2 and decide to redesign your very popular (but unprofitable) website – MAKE SURE IT DOESN’T SUCK.

Lesson #4: If the redesign of the website sucks and the entire world complains – DO SOMETHING ABOUT IT.

Lesson #5: If Lesson #4 is ignored and senior management continues to party like its 2006, YOUR COMPANY IS DYING.

Lesson #6: If your company is dying and you don’t have the cure, LET IT DIE WITH DIGNITY AND START OVER.

I’m afraid we’re at Lesson #6.

DIGG IS DEAD – R.I.P.

If only the Business Week cover from 2006 were true.

While many of the employees of Digg will find it difficult to start over, the founders and senior management team probably will not. Especially Kevin Rose, who is an early investor in Twitter and Zynga. So don’t cry for dude. Dude is fine.

Now I’ve Dugg many stories over the years – mostly an endless link-fest of Slide Shows and Superhero complaints – but it’s time to move on.

I suppose I’ll just have to “Like” instead of “Digg” (until Facebook becomes worthless – and they are on that path!). After that, I’ll probably have to “Shout Out” or “Yeah, Baby” or whatever other little button some company wants me to click whenever I like the new taste of Coke Zero.

“Digg” was cool and nobody can take 2006-2008 away from you guys. That was your time!

So long Kevin, Matt and Jay – who cares if you’re not Billionaires? Remember, Millionaires can still get chicks and buy drinks at any bar in the world.

Jill Kennedy – OnMedea

September 15, 2010April 3, 2011

Facebook To Reach 7.3 Billion Users By 2015

OK, it’s September. The power players in the media world have completed their ‘summering’ and can now return to the passion of their lives – ridding the world of boredom and malaise by producing films, TV shows, games and websites. So… it’s great to be back.

The title of this blog is truly remarkable and, frankly, bullshit.

I received the chart to the left from a friend of mine at Facebook (which was pulled from a recent management presentation).

Takeaway: The number of Facebook users by 2015 will EXCEED THE EARTH’S POPULATION.

Sounds impossible I know. But I suppose nothing is impossible when it comes to Facebook. Because at Facebook it’s not “Impossible”, it’s “I’m Possible”.

A couple of months ago, I wrote a blog titled “Facebook Is Worthless”. I stand by the arguments in that blog (even though I received the wrath of many a Facebook insider who doesn’t want to see the value of their stock options go down) because, no matter what Facebook senior management tries to tell the press, no one seriously believes they are profitable. I believe the real numbers would freak too many people out who are praying for an IPO in the near future.

Just because everyone is on it doesn’t mean the future is bright. Just look at the AOL and Microsoft monopolies in the 1990s.

Jill Kennedy – OnMedea