MattMaroon.com

I saw this article today about platforms. While I agree with some of its points, the overall conclusion that "Building a business exclusively on top of another service is irresponsible and naïve." is flat out wrong. I always laugh when I hear stuff like that and think "tell it to the guy who made Mob Wars." He’s making (irresponsibly and naively I guess) millions per year exclusively on top of another service.

Being in the Facebook App business now, I sort of know what the author is talking about. You do have to be ever-mindful of the fact that you’re playing in somebody else’s back yard. You’re playing by their rules, and are totally at their mercy.

Still, it can be worth it because there are a few mitigating factors. For one, their interest and yours are usually at least somewhat aligned. Facebook’s success is in no small part due to their platform. It’s expanded the utility of what would otherwise be little more than a place to cyberstalk people (which granted, is popular in its own right) into what is now a place to cyberstalk people and play games. It’s doubled in usefulness.

An application platform doesn’t want to run off all of its developers. Even though they sometimes seem capricious and arbitrary, you can be reasonably certain they’re not going to screw you for no good reason. They can, of course, or they can screw you for a good reason, so it’s a risk factor you certainly should be mindful of. But it’s not as bad as it sounds.

And that risk factor, in the case of some of the more popular platforms, is made up for overwhelmingly by the platform itself. With Facebook or Myspace, you have the ability to grow rapidly and virally, much more easily than you would on the net. Our most recent game, Football Tycoon, has grown to over 50,000 users in about two months, and is gaining a significant chunk of new ones each day. That’s something that just wouldn’t have been doable as a standalone website due to the lack of a compelling invite system.

An iPhone app can take advantage of the app store’s distribution network to sell or give away millions of copies in no time. A Twitter app can leverage the intense engagement users have with the service to quickly build a product that thousands of people will love.

It’s just a matter of risk and reward. You’re taking the risk of your overlord making changes that aversely affect you, but you’re gaining the reward of virality, distribution, or engagement. It’s a tradeoff to be sure, but not one that isn’t sometimes worth making, or that is patently irresponsible or naïve, so long as you’re mindful of it.

One of the things every startup worries about is getting plugged on TechCrunch. I know we did. Will they cover us? Are we ready for the exposure yet? Can our server handle the traffic? We had the first one covered since we were part of Y Combinator, but the rest were concerns.

Everyone wants that TechCrunch bump, and wants it to go smoothly, but what nobody told us was all of the crap that happens as a result of the coverage. I don’t blame any of it on TechCrunch, it’s just a side-effect of their success. Once you get listed on their site, if you have contact information available you’re bombarded by a stream of annoying bullshit.

The worst was a Dell salesman. I think his name was Matthew Lamm. He emailed pitching hardware, which would have been fine if that were the end of it. We weren’t interested in buying their stuff and told them so. Then he put me on some sort of list, to which he sent out every out of office notification. Every time there was a holiday I got email notifications about his being away. A salesman I don’t know whose product I was not interested in buying was telling me he was away for Christmas. It was just frequent enough to annoy me, but not quite enough for me to take time out of a busy day to filter them out. Worse yet, I finally sent him a terse email, got off the list, only to wind up back on it when he left Dell and a new salesman took over his accounts.

As annoying as that was, though, at least he had some sort of email software that sent them all individually. A few of the CrunchLeeches (what I call them since they feed off of the blood of startups covered) just send out one giant email with everyone CC’ed, meaning that everyone who replies is emailing you too. Limelight Networks is the most recent offender. (I’ve had this problem with RockYou too but not due to TechCrunch.) Just this week I got a Season’s Greetings from Limelight, which I think is a CDN (way to pitch static file hosting services to a fantasy sports startup there buddy) and surely enough in came the replies. I am willing to sell the list of a few dozen emails found therein to any competitor who wants them. It’s not very nice, but then neither is Limelight blasting my email to a bunch of people I don’t know or care about, and adding more garbage to the giant pile of emails that greets me every afternoon when I wake up.

Then there are the slightly less odious but many times more voluminous headhunters. Every single one in the entire country at this point has cold-emailed me to tell me about a candidate they have who would be great for us. Of course, we use Ruby on Rails and Flash, while all of the candidates are .Net or Java guys. I suppose Rails and Flash devs are too in-demand at the moment to waste time with headhunters, but still, it would be nice if they at least tried to match up technologies, rather than just spamming me every programmer they get who likes sports. Or, you know, didn’t bother me at all.

All of which is not to say that it’s not worth being on TechCrunch. It is, especially if you’re the right kind of startup. It’s just that your junk folder is going to be bursting afterward.

Someone asked me recently what the most interesting thing I’ve learned from doing a startup was. I couldn’t think of one specifically that stood out, but here are my top two.

#1: It’s probably easier to raise $5 million in funding than it is $500,000.

That’s not what you’d expect. I would have guessed difficulty in raising funds would be linear, but it isn’t.

The primary reason is that there are two typical investors: angels and VCs. Angels are just wealthy people who typically sums of between $10 and $100k, with $50k probably being a good average.

VCs are institutional investors who raise funds often totaling in the hundreds of millions, and are paid in such a way that they are incentivized to deploy the entire amount into investments. So, VCs like to make bigger investments because then they can make fewer. That means less due diligence, fewer board meetings, etc.

Not many VCs make it their business to invest amounts of money that small. It happens, but it’s often just something they do to lock up right of first refusal on future rounds. A lot of companies would much rather raise $500k than $5m, so they’ll do it if they like you enough, but it’s relatively uncommon.

Raising $500k from angels means convincing somewhere between 5 and 20 different people, all with their own habits and goals, to invest in you at the same valuation and terms. That happens too actually, even outside of the few syndicates that exist, but again, it’s hard to pull off.

#2 Our patent system is deeply flawed, but it works pretty damn well in spite of itself.

Before starting up, my view of patents was pretty simple. You invent something, submit a patent, and if approved you’ve now earned the right to make it exclusively. Sounds easy, right?

In reality it’s anything but. An actual patent does little beyond give you the basis with which to sue someone. And when you do, you’re not on very firm footing, as patents are overturned possibly more often than not.

It turns out they’re anything but ironclad rights to a monopoly on your invention. They’re really just ammo. They seem to function, in the real world, much the way nuclear weapons did during the Cold War, to create a sort of mutually assured destruction with each company’s arsenal preventing their opposition from pushing the launch button. The legal fees involved most often wouldn’t be worth it for either party.

Also there are the patent trolls (more akin to terrorists with roadside IEDs in the war analogy) which I think are an integral part of a working system. Most people dislike them (hence the name) but they serve a valuable purpose, which is to create a secondary market for IP, further incentivizing innovation.

Trolls don’t just pull patents out of their ass and start suing. They buy their IP from companies, often ones in bankruptcy, which gives a little back to investors who might otherwise have lost it all, encouraging them to try again. Or they buy them directly from inventors, freeing people to create without having to worry about executing their innovations as a business. A lot of brilliant inventors don’t have the slightest interest in the process of manufacturing a product or getting it onto store shelves.

Certainly the trolls go too far sometimes, but on the whole it’s a respectable business model, and one that I think encourages, rather than stifles, technological progress.

(Note that I’m not necessarily talking about software patents here, which I think are the biggest blight on the system, just patents in general.)

When we first started writing the Football Survivor Pool app for Facebook, we looked into the various football apps in their directory to see if there was already anything like it. Interestingly, I found that despite Facebook’s sizeable American user base, almost everything I came across with the term in it was soccer. Real football was nowhere to be found.

Our Survivor app did pretty well for the short time it was open for registration. The nature of a survivor pool requires it to not be open to new members indefinitely, and since we had the idea so late in the summer we were only able to register people for a couple weeks. Still, we were happy with the response.

We quickly realized that Survivor Pool had somewhat limited viral potential. We decided to give away the same prize to the person who referred the winner as we were to the winner himself, so that definitely incentivized people to tell their friends. But, they pretty much installed the app, made their pick for the first week, invited some friends once, and that was it. There wasn’t much reason for them to come back to the app on a daily basis, and by the time they had to come back to it, registrations had closed.

Still, we were growing at a pretty decent clip, since giving away a free 50″ plasma screen seemed to get a higher than average acceptance rate. We also used feed items to remind people to invite a bit. Overall it was well worth the effort, and we’ll probably expand on that app in the future.

Earlier in the summer I had started playing Mob Wars, which is a tremendously popular social game, and I’d become rather enamored of the genre. It reminded me of some of the elements of RTS and RPG games, but at a slower, more casual pace. It kept me coming back a few times a day, each for a relatively short amount of time. So I was able to keep up with the game, enjoy it, and yet not waste hours a day. My time is valuable to me, as is true of most people, so I really appreciated that.

I became convinced (and still am) that this is one of the next big things in gaming. Mob Wars isn’t the last word though. It’s a great start, and a great app, but it’s still early. It’s more Karate Champ than Street Fighter 2.

So when, in my search for football apps, I stumbled across a soccer-based social game called Premier Football, I was pretty excited. Even when I found out that by football they meant soccer, I thought a sports-based social game was a pretty sweet idea. So despite the mediocre reviews, I signed up.

What I found was a very good idea with very poor execution. The app was slow and buggy. The UI was confusing at best, in many places borderline unusable. The graphic design made me throw up in my mouth a little.

Still, the app had a couple million installs and a couple hundred thousand monthly active users, so I pushed on to find out why. And I did. Buried deep down below all the garbage were a couple pretty nifty ideas.

So I took them and ran with them, mixed in some concepts from other social games, changed the sport to real football (or as Euros call it, American football) and formulated what I felt was a great game. With a whole lot of coding on Chad’s part, and some help with the mechanics and UI from both of my cofounders and a few beta testers, we’ve got what we think is a pretty spectacular early version. Introducing Football Franchise.

The idea is pretty simple. You have a football team and your goal is to make it the best. You can train your players (and name them after friends which is more fun than it sounds like) and play matches against other teams. With the money you make from those, you train more players, and buy certain upgrades and licensing deals that make you even more money. As your team wins games you gain experience and level up, unlocking new upgrades.

From the response we’ve gotten from early beta testers and users, I think this one might just be a hit. I look forward to improving it over time. Game design is something I’m fairly new to, but I’ve been playing them avidly for as long as I can remember, even one professionally for a few years, so I think I can learn it.

Give it a shot and let me know what you think. I’d love to hear how I could make it better.

Every now and then a company launches that’s in your space, or sort of tangentially in your space, and you hear about it through a Google alert or something. And occasionally, one of those sets off scores of alerts, blog entries, and emails from friends. Enter OneSeason.com, which even got Reuters coverage when it launched. I really need to find out who their PR agent is.

At first, I got kind of excited, because I had heard about something like this not long ago. Except with one crucial difference, which was that you would be buying shares in the actual athlete. More on that in a second.

With One Season, you’re really buying nothing. Everything I read compares them to the stock market, but with the stock market, you’re buying shares in a company. In the short term, those share prices (for stocks that don’t pay dividends at least) might be determined largely by sentiment. But in the long run, they’re determined by some sort of real world value. Each share has an expected value, even if held on to, because it might pay dividends later, or the company might be acquired for cash by a competitor or in a leveraged buyout or whatever. There are actual ways you can profit from holding a stock beyond selling it.

One Season is, instead, selling a virtual good with no possibility of objective value. They’re basically digital baseball cards, except unlike with baseball cards, you don’t have a 20 year old piece of cardboard to justify the $500 you spent on it. And unlike many other virtual goods, for instance gold or weapons in World of Warcraft, you’re not getting something that has utility within the broader context of a game or activity you otherwise enjoy.

(I’ve seen a fantasy site that actually does something like that. It issues virtual cards, and you use those to build your team. That, I think, is pretty nifty.)

It’s also been compared to Tradesports, Betfair, and Intrade, though those markets trade contracts that pay someone when an event occurs and the contract is resolved. Holding shares in Obama will pay you $10 per if he wins. So again, there’s genuine incentive to buy the shares, a tangible return, and a clear, objective way to price them. They trade based on what the traders think are their odds of winning, and when they deviate from that, the smart money sneaks in and makes a profit by correcting it.

Really, what you have in One Season is a pyramid scheme. It’s a digital product that has no tangible benefits or even utility in a game. The only way to make a profit is if more people decide they want these valueless shares. And the only way for those new people to make a profit is if other people want them.

Which might happen, who knows? But much more interesting to me would be a site that actually sold shares in an athlete, and paid a return of some percentage of his salary and endorsement revenues.

That might be a great way for rookies to allay some of the risks of their job. The average career in the major professional sports is only a few years, and doesn’t pay nearly as much as most people think. And it’s somewhat unpredictable going in. Some players are overhyped (I’ve still got a stack of Chris Webber rookie cards from when I was in middle school. “Next Michael Jordan” my ass) while some players are under-hyped. Some are hyped appropriately but get injured or stab a stripper outside of a nightclub. You really just never know.

It could be sort of a market-based insurance for athletes, and a neat way to invest for sports fans. And beyond the IPO, there’d be a huge market for trading those shares as the athlete rose through the ranks. Imagine how much you might have made if you bought 1% of Kurt Warner when he first was called up from NFL Europe.

I remember hearing of such a thing once, but to my knowledge it hasn’t launched yet. Which is too bad, because that would be a market. If you think One Season, on the other hand, is a market, then please loan me $10. My friend Chuck Ponzi has an investment opportunity that will guarantee turning it into $20 in a week, and I’ll give you $15.

Oh, and tell your friends.

There’s been a bit of a stir over a piece that appeared on Sarah Lacy’s blog about Y Combinator about the most recent Boston Demo Day. Sarah herself was shocked because she “thought it was a pretty balanced piece.”

I think the commotion was mainly caused by the writer’s lack of understanding of what exactly Y Combinator does. He didn’t seem to paint an overall negative picture (or at least he didn’t appear to intend to) but he also didn’t paint an accurate one.

Although the comparison to American Idol is tongue in cheek, there are some unfortunate real similarities.

It’s well-known that the recording deals that the Idol winners sign are extremely one-sided in favor of the producers and record companies and rather unfair to the artist. The same can be said for the “winners” of Y Combinator funding. Sure, they get some cash and valuable guidance and experience but they have no choice but to give up a sizable chunk of potential revenue. Generally, they give up on average 2 to 10 % *** of ownership which Y combinator argues is crucial for the success of the project.

I’ve long viewed it as a shame that Y Combinator gets compared to some sort of reality TV show, as it’s really nothing like one. You don’t compete against other startups in your batch (in fact, it would be more accurate to say you cooperate with them all), nobody gets voted off, and winners aren’t selected at the end. And the moderators aren’t either gay or Donald Trump.

Despite his mistaking equity for revenue, he essentially summarizes decision you make any time you take any money, which is that you give up something for it. With Y Combinator, you do it at a lower price than you would a normal angel or VC round, but you also do it at an earlier stage and you get more value add for it. That’s clearly the standard in investing. Earlier stage = higher risk = lower valuations.

So it’s an exercise for the startup to determine if it’s worth it. What shocks me about a lot of the coverage about Y Combinator is that people seem to think that this is any different than any other investment round. It isn’t. It’s the same decision a startup essentially makes every day. They also seem to think the 6% average for the somewhere over $15k they get on average (making the valuation in excess of a quarter million) is a noteworthy amount. Maybe it’s my own naivety, but when I was in that position, my thought was something like “these guys are giving me a valuation of over $300k and we didn’t even have a PowerPoint to show them.”

Also, having been through it, Y Combinator’s investment terms are pretty founder-friendly. They get a few of the standard protective provisions that anyone other than your grandma would require, but they’ve often frequently even waived those. I have a feeling that most angels would have vetoed a lot of the smaller exits that have occurred amongst teams they’ve funded.

And then it continues…

Y Combinator has invested in and supported over 100 startups*** which is very impressive. While the majority of them are still struggling and/or plugging away, there have been a few successful exits and acquisitions. They’ve included; Reddit, Zenter, Anywhere.FM, Loopt, Justin.tv, Scribd, Xobni, and Disqus, to name a few. While some of these names are well-known, none of them can be considered home runs ala YouTube, eBay, or even Digg or Twitter. (The latter two still haven’t cashed in their chips yet.)

First of all, 5 of those 8 haven’t exited or been acquired. (Or at least if they have, their founders owe me a beer, cheap bastards.) And second, Compete.com disagrees with the last statement involving Twitter.

I don’t know what scribd’s and reddit’s revenue streams are like, but they can’t be any less than the big goose egg Twitter is putting up. And they do it without the 25% downtime.

Despite the many cool hip services that continue to come out of this factory, the hit ratio appears to be a little low (but the jury is still out on what THAT ratio should be). One can’t find fault with the startups but perhaps with the selection process and the members that make the selections. It’s a skill that can’t be taught, much like making selections in professional sports on draft day. You either have the touch or you don’t. Doesn’t matter how much money you have, if you don’t spend it wisely than you’ve lost. It’s like being a quarterback with a multi-million dollar arm but a ten cent head.

Y Combinator is 3 years old. You really couldn’t expect someone to pick an eBay in 3 years. In fact, even if they did, you wouldn’t know it yet. Whatever the jury decides is a good hit ratio, it’s going to take a while longer to figure out how many cents Y Combinator’s head is worth on the metaphorical quarterback’s body.

Sarah seems to have a few mathematical misconceptions as well that color her thinking.

It reminds me of the risk-reward I hear potential grad school students weighing. In my case, I never considered getting a journalism degree because I didn’t have the money, and I didn’t want to take out a loan. Others argued it would increase my earning potential by x% so that investment would be worth it. The main argument was the connections you get from attending a well-heeled journalism school. So maybe, if I’d come out to a lucrative daily paper job, it could have seemed a good bet. But since those connections—and J School training–are primarily rooted in the daily newspaper world, I’d argue it could have actually cost me career value long term.

That’s results-oriented thinking. It might seem like a bad idea in hindsight given the totally unpredictable shitstorm daily newspapers are weathering at the moment. But that doesn’t mean the decision to enter J school, years before anyone could even have guessed such a thing would happen, would not have been the better one.

And true, her decision seems to have worked out well, but who knows where she’d be if she went to school. She might be Barack Obama’s VP nomination for all we know. It’s impossible to say. You just have to make the good decisions given the information you have at the time and then never look back.

It’s much the same with Y Combinator. You simply have to decide if being funded by them increases your startup’s chances of success by 6.4%. I know a lot of people who’ve been through it, and almost all would do it again.

1% of Facebook is also worth hundreds of millions (at least).

1% of Facebook (which is worth more like tens of millions according to their internal valuations) is worth as much as it is because they sold sizable chunks of their equity to investors to get the sort of funding needed to make it where they are today. And they sold those chunks to people like Peter Thiel who brought a lot of advice to the table, the kind you don’t get over dinner. And I’ll bet Zuckerberg didn’t get weekly doses of Glop either.

It’d be like going to someone’s house for dinner then paying them for the meal they intended on giving you for free. Or, perhaps it’s more like taking out an insurance policy, and most of the best entrepreneurs don’t like insurance or safety nets. That’s why they are entrepreneurs!

I’d agree that if you could somehow get all of the advice and connections you can get out of Y Combinator for free, you should do that instead. I seem to remember some proverb about milk and a cow that basically said that if you were employee #5 at PayPal, go ahead and pass. But for most people that just isn’t a reality. A lot of startups give a couple percent equity to an advisor who provides no funding at all, and often they are smart to do so. For the right person, I would have.

You don’t have infinite slices of equity to pass around, and you don’t know how much you’ll have to give up later on. That 6% you don’t give up could wind up being a big chunk of your holdings– maybe even the only thing you’re left with.

Actually, you sort of do have infinite slices. With each funding round, you print more shares, and all previous holders (including Y Combinator, if they’ve funded you) get diluted. There’s no ceiling on the number of rounds you can do. You could sell 6% at a time as many times as you (and any preferred shareholders you picked up along the way) think is wise, though you won’t because outside of Y Combinator, it’s very rare to sell so little.

So there’s been a lot of talk about the Xobni/Microsoft rumors floating around. I thought I’d weigh in on it a bit because a lot of people apparently don’t understand the interplay between venture funding and acquisitions.

First, I should mention that I’m not privy to any information you guys aren’t. I do know the Xobni founders (Brezina was the first person I met when I went to the Y Combinator interview) but I don’t know any more about the situation than I’ve read on TechCrunch. It’s not really my business anyway, and I just want to be clear that anything I write here is my own speculation and should be taken as such.

One thing all of the big blogs covering the situation don’t mention is that the founders may not have had the ability to sell to Microsoft at the rumored $20 million. They took a VC round a year or so ago and raised $4.25m. I have no idea how much equity they gave up in the process, but suppose it was 50% of the company, which would be a large amount but a reasonable guess given how young Xobni was at the time.

That gives them a post-money valuation of $8.5m, which means that $20 million would be under a 2.5x return for the VCs. A VC accepting such a small ROI is uncommon. I suppose they might do it if they thought, for some reason, that it was the best result they could hope for. But the funding round was only a year ago, and barring something catastrophic, VCs generally don’t accept much below a 5x return. They usually swing for the fences. That’s their job.

(Also note that if Xobni gave up less equity, that makes the multiple even lower. At 25%, that makes it barely more than 1x. It seems almost impossible they gave up much more than 50% as well. VCs have found, over the years, that they do better when they leave the founders feeling that they still own enough of the company to make it interesting. Buying 90% of a company doesn’t benefit you at all if the people running it no longer care what happens.)

For all anyone can tell, things are going well for Xobni. TechCrunch says they’re at 50,000 beta testers, and that’s pretty solid. They’re hiring, and just got their first outside CEO. Once again, I don’t know exactly what’s going on there, but it seems safe to say there has been no catastrophe. If I were their VC, I’d be holding out for a bigger payday than 2x as well, at least judging from the information I have.

Some people have said something to the effect of “surely the VCs don’t have control of the board and couldn’t veto an acquisition if the founders wanted to go forward with it.” That’s clearly wrong. Almost every Series investment creates preferred shares, which gives the investors some protections, the most basic of which being that the founders cannot sell or merge the company without approval from both a majority of the preferred shares and of the overall ones. This is absolutely necessary from their perspective. Otherwise an unscrupulous founder might turn around and sell the company (which now has a $4m balance sheet) to his wife for $1.

So again, I don’t know anything specific about their terms, but I’d bet my house that the VCs could nix the deal. And they probably would for $20 million. I would if I were them.

I also hear “what if the VCs think Microsoft will just include Xobni-like functionality in the next Outlook?” I’m pretty sure this occurred to Vinod Khosla when he funded them, and the founders when they started the company. Anyone whose business is a plug-in is cognizant of that possibility. Luckily, a big corporation trying to clone your product suffers from a Zeno’s Paradox of sorts. By the time they catch up to where you were when they started copying, you’ve advanced even further. And so on and so on ad infinitum.

But unlike the real Zeno’s Paradox, the laws of calculus don’t favor the megacorporation. The laws of bureaucracy imply that they’ll always be behind. In programming, throwing more money and more developers at a problem doesn’t mean you’ll proceed at a faster pace. But having to get every detail signed by four layers of management ensures you’ll move at a slower one.

Which doesn’t mean that Microsoft isn’t a threat. But it’s one the investors knew about going in and accounted for, so them suddenly sniffing around doesn’t change much. It only validates their initial judgment, which was, when they put over $4m into Xobni, that the company had a future, and would be worth 5x (which I’d guess to be $40m or above) or more at some point in the not too distant future.

Everything I’ve just said is pretty much common knowledge. It’s neat to see it in action though. You hear a lot about the tradeoffs of VC funding versus angels. Most people in the industry know that taking that big check from the VC means more outside interference and drastically reduced exit opportunity. But it also means getting more money, and all of the perks that go along with that, while giving up the same amount of equity you might to an angel to get ¼ as much cash.

So in the end it all comes down to what you want out of it. If you’re swinging for the fences, which apparently the Xobnis are, take the big check and try for the grand slam. (Sorry for the baseball analogies, I run a fantasy sports site. What do you expect?) This makes extra sense if you’re a Marc Andreessen or Peter Thiel type and you’re already set. Or if you just have the attitude that if you fail, you’ll just shrug it off and try again until you don’t. But if you’re just a young guy trying to bank a couple million fast, go with angels.

Had Xobni taken $1 million instead of 4, they’d all be buying beach houses right now. On the other hand, Microsoft might come back and offer the $40 or $50 million it would take to make the VCs agree (I think it would be a good idea for them to do so) and they’ll be buying beach house and Bentleys. Or nobody might buy them for awhile and they might get bigger and bigger, and it’ll be private jets. At this stage, who knows?

I have to say, I also wouldn’t be surprised if Fred Wilson is correct and becoming another cog in Microsoft’s giant wheel isn’t particularly appealing to the founders. Part of the reason anyone starts their own business is that the thought of someone telling them what to do keeps them awake at night. I once had a nightmare that I was middle management. I’d rather starve, and I’m not the only one.

Which is not to say that I would be totally opposed to being acquired, even by Microsoft. But I’d only do so if either I was guaranteed a large degree of autonomy, or I had fast enough vesting that if I quit after 6 months, I’m still happy with the money I got.

Wow. Apparently the folks at Twitter read this blog. (Who doesn’t, right? I’m like GigaOm, but with copy editing.) Within hours of my last post, Twitter got rid of the miserable excuse for a Chief Architect, Blaine Cook, who was to blame for all of their problems. (Well, at least according to TechCrunch.)

I had no idea that I had such a tremendous amount of influence in the web community. Scores of people complain every day about Twitter’s abysmal performance in blogs or on Facebook (or even on Twitter) and presumably many times more do so via emails to support. They all go ignored. I post “What is that site, 20 lines of code? Fix it already,” and almost instantaneously the wheels start turning.

What should I use my God-like powers of blogging manipulation for next? I’m thinking of maybe convincing Yahoo to just sell themselves to MSFT for $8.25 a share so my RSS feeds will be reduced by 10 per day.

Any suggestions? Power like this must be wielded carefully.

One thing that always cracks me up is the disconnect between the tech world and the other 99.9% of the country. My favorite example of this is Twitter. All you hear inside the black box is how great Twitter is. People in The Valley actually consider it a source of news. If you consider “OMG, Charlton Heston just died!” or “Going to the gym.” news, then yeah, it’s the new CNN. But to anyone who doesn’t generally breathe through their mouth it’s just a bunch of Facebook status updates.

Also, that’s ignoring the fact that any time something newsworthy does happen, Twitter just stops working. I’m mystified as to what the folks over there do all day. I’ve been using that site for almost a year now, and if they’ve launched one new feature in that time, I couldn’t tell you what it is. And yet it still goes down whenever Barack Obama sneezes.

What is that site, 20 lines of code? Fix it already.

Mike Arrington finds Twitter indispensable, and I can see that given his job. But the mainstream is still oblivious, and it’s going to stay that way. If you want to know why, try explaining Twitter to your dad. Hell, try explaining it to your wife or girlfriend. Oh wait, I forgot, you’re in the tech industry.

Startup School ’08 was a blast. I had been out a little late the night before at the Y Combinator party in Mountain View and hadn’t slept properly due to flying in, so I missed the first few speakers. I arrived just in time to catch Greg McAdoo. His speech was fairly interesting, and familiar if you’ve seen him speak at Y C events before. He sure does love surfing analogies, but they are apt, and it was great to get Sequoia’s perspective on what makes a big success. I was taken aback by their statistics. He said they’ve funded 700+ companies over the years with 150+ acquisitions and 150+ IPOs. That’s a hell of a success rate, and surprised me coming from even them.

One of his slides mentioned things Sequoia likes to invest in, and browntech was on the list. None of us knew what that was. I suggested maybe it meant tech in India. Either way, it became the running joke of the day. I even asked Mike Arrington what it was, and he didn’t seem to know. If he doesn’t, who would? (My actual guess was water purification, and some people said oil/chemical cleanup. A cursory Google didn’t answer it, so maybe I’ll email McAdoo and find out.)

David Heinemeier Hansson‘s speech might have been the best, and was certainly the most fun. He took a few jabs at the entire Silicon Valley mindset. Also, he sounded like Kermit the Frog. During the Q&A I wanted to ask him to sing It’s Not Easy Being Green. “Hi Mr. Hanson. Loved your talk. Do you think it could be nicer being red, or yellow, or gold?”

Also I wanted to ask him in which universe 500 x $40 = $125,000 (as one of his slides said, and he repeated aloud) because I want to move there. Apparently all startup revenues are multiplied by 6.

Jeff Bezos’s speech was the one I had anticipated the most, but was probably the least interesting. The buzz has been disappointment all around. It was basically a commercial for AWS, which everyone in attendance either used or knew about and had decided not to use due to whatever limitation. It reminded me of back when I was a kid and we’d order WrestleMania on pay per view an hour before it started, and the whole time before it began all they played was one commercial after another for WrestleMania. You’ve already sold us, give us something more.

It was also humorous how many handlers the guy had. There must have been 10 of them. I’m pretty sure Bill Clinton was less well-guarded when I saw him speak. I wonder if all of those people have some important function, or if it’s just a very nerdy version of Entourage. I guess the guy who had to answer the AWS questions Bezos couldn’t must be his Turtle.

He did have one analogy I appreciated very much though. He pointed out that a century or two ago, if you wanted to run a factory on electricity you had to generate it yourself. Nowadays making your own electricity would be ludicrous. He likened cloud computing to that, which I felt was pretty apropos. Developers don’t want to be sysadmins. They want to make websites and let someone else worry about generating the “electricity”. That’s the best non-technical way I’ve ever heard to explain what cloud computing is and why it is so obviously the future.

Mike Arrington’s presentation was better than I expected. He basically talked about the startup industry from the media’s perspective, and gave a few tips on how to interact with them. I actually found that helpful. Now I just have to figure out how to spin a story such that DeadSpin would care about it.

Marc Andreesen’s segment definitely had some gems in it too. He gave one piece of advice from one of my favorite recent reads, Born Standing Up, which is to focus on being so good that people can’t ignore you. Accomplish that and all else will fall in line. Words to live by.

He also spoke about a lot of the things that make his blog so enjoyable. How people are so often fooled by randomness, especially in financial endeavors like startups or investing. Or how economic forecasters basically don’t know anything. Marc clearly understands probability and seems genuinely humble about his success because of that. I suppose it would be hard to be anything but when you truly understand the way those things work.

Between the Y Combinator event the night before and the after-party at Paul Graham’s house in the hills, I met lots of Hacker News guys and a lot of people who read this here blog occasionally. And it was nice to run into so many alumni again too. The list is now around 200, so it’s getting harder and harder to keep them all straight. I’m anxious to see how much the list grows by this summer as well.