links for 2008-04-30
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Search online conversations in realtime - discover what people are doing right now.
links for 2008-04-29
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Discover the hidden communities behind the places that you visit. Brightkite lets you make the connection and start a conversation.
links for 2008-04-28
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A webservice that allows you to shorten a URL, post it directly to your Twitter-account and follow whoever has clicked on your shortened link.
Innovation, Customer-focus, & Long-term Thinking
Here is a fascinating interview with Jeff Bezos of Amazon. Jeff has been on a mission since day-one of Amazon and has done an amazing job of both short-term execution excellence while keeping the company focused on the long-term goal. This post is primarily directed at my colleagues at nGenera (yes, rather than dedicate an entire post to this, I’ll just announce it here - BSG Alliance has transformed into nGenera - check out our awesome new Web Community at nGenera.com).
Amazon is really hitting a stride executing on multiple fronts - it is quite amazing to see a company excel across so many diverse capabilities at once. nGenera colleagues take note - Amazon is not a software company, not a services company, it is many things at once geared toward delivering compelling customer experiences. Think about it - they are an e-tailer, an e-tail platform - both sales and physical distribution, a web-services platform, and a total consumer hardware solution provider (Kindle is more than just a device - think iPod - it is software, commerce, services and hardware wrapped in one). Sound familiar?
Here is a favorite quote
Q: Few CEOs have taken as much flak as you have for spending on innovation, in both good times and bad. What’s your philosophy?
A: My view is there’s no bad time to innovate. You should be doing it when times are good and when times are tough—and you want to be doing it around things that your customers care about. For us, it’s such a deep-seated belief, I’m not sure we have a choice.
Below is a re-post of this post by Tim O’Reilly which highlights some of my own takeaways and another favorite quote. The emphasis is mine.
Business Week has a great interview with Jeff Bezos as part of their innovation issue. The interview is entitled How Frugality Drives Innovation, but Jeff talks about far more than frugality. Here’s my favorite bit:
Q: Every company claims to be customer-focused. Why do you think so few are able to pull it off?
A: Companies get skills-focused, instead of customer-needs focused. When [companies] think about extending their business into some new area, the first question is “why should we do that—we don’t have any skills in that area.” That approach puts a finite lifetime on a company, because the world changes, and what used to be cutting-edge skills have turned into something your customers may not need anymore. A much more stable strategy is to start with “what do my customers need?” Then do an inventory of the gaps in your skills. Kindle is a great example. If we set our strategy by what our skills happen to be rather than by what our customers need, we never would have done it. We had to go out and hire people who know how to build hardware devices and create a whole new competency for the company.
Well worth a read. Another great line: “The key is to pick things that you think are really iimportant, and then focus on them.” It seems obvious, but so few of us do it as consistently as we should!
links for 2008-04-25
links for 2008-04-15
Further validation of Twitter as a customer experience touchpoint
These blog posts further highlight now Twitter has become a natural outlet for customer feedback as well as a relevant touchpoint.
http://www.readwriteweb.com/archives/how_to_get_customer_service_via_twitter.php
http://www.thisisgoingtobebig.com/2007/12/does-jamba-know.html
Below are companies which have set up Twitter Channels.
Comcast Cares (twitter - @comcastcares)
I noticed recently that Comcast set up a Twitter channel for soliciting customer input directly from the social web. JetBlue is another. I’m not sure if this type of Twitter support will scale as-is, but I’m sure a service could arise to enable it to scale in the same way as services and software exist for supporting customers via email & chat.
What is more interesting than these companies setting up channels on Twitter, is the potential use of Twitter for companies to (a) deliver a superior customer experience and (b) engage with customers to facilitate customer-driven innovation of their products & services.
With the growing volume of Twitter users, companies now have a direct channel to solicit, facilitate, and monitor feedback from a growing number of their customers. The topics can be rich, including:
- feedback on positive or negative aspects of a company’s offerings by monitoring Twitter as users tweet among their Friends and Followers (use the Twitter “Track” feature)
- customer support requests if a company is maintaining a Twitter account
- new offering ideas or offering enhancement ideas from monitoring or direct tweets to the corporate Twitter account (would suggest both for enabling true customer-driven innovation)
- referrals - many happen between Twitter Friends & Followers already, but active company involvement can both facilitate and amplify referrals which lead to sales
These are just some ideas, however, Twitter appears to me to be one of the richest and most opportunity rich areas for companies to truly engage with their customers to drive loyalty, sales, and new innovation. The big outstanding question is how much penetration in society will a service like Twitter get? How many people are eager to tell a group of people, some of which are truly “weak ties“, what they are doing?
I think the use of Twitter will indeed grow beyond its initial intention of ‘what are you doing?’. First, it already is. Second, if people know that they can be one mouse click or SMS message away from telling the company that just ticked them off what they think, I think adoption will grow. When my second Kenmore washer crashed recently within 20 days of getting it, I know I would have loved a better channel than the hours of phone time spent. In fact, I did Twitter the experience to my friends (i.e. became an active detractor). Third, if a customer can truly provide input that is valued and used by companies for new offering ideas, I think the service would also drive adoption. Don’t you have a lot of ideas for products and services that you use daily, but feel that no viable channel for providing your ideas to each company exists? I know I do.
I have always felt that the growth in Social Media services would lead to better overall customer experiences, and force marketers and companies to be more responsive to customer demands and more open to co-innovating with customers. I think Twitter presents one of the best Social Media services to help realize this outcome. I’ll be watching Comcast, JetBlue, and others as they embark in the Twitter universe.
UPDATE: Noticed that Sarah Perez wrote a nice post on ReadWriteWeb on this topic recently.
links for 2008-04-13
Entering the Web 2.0 Innovation Abyss
Fred Wilson put up a great post last week which generated a ton of commentary on the post itself and across the blogosphere on the topic of a ‘new path to liquidity’ for startups. Be sure to scan through the comments. Umair Haque had a supportive follow-on post as well. Fred hit on a very compelling point for me personally as a heavy user of a series of Web 2.0 applications and services which have been acquired by the likes of Yahoo!, Microsoft, Google and others only to see the services and apps stagnate in their innovative capability post-acquisition. One might say upon acqusition, these compelling products and services enter an Innovation Abyss inside their larger parent companies. At the same time, as an entrepreneur and entrepreneurial deal-maker in my current role, Fred’s post and subsequent conversation generated strong interest for me as well on the topics of paths to liquidity and the overall VC model.
I think Fred was spot-on in his post. However, it is critical to really parse what he was saying. Felix Salmon wrote a follow-up to Fred’s post on Seeking Alpha, and I believe missed the point Fred was making. Felix seemed to interpret Fred’s post to be saying he was looking for more or better liquidity opportunities for his portfolio companies in an effort to generate a higher rate of return for his fund - hence the statement about ‘greed’.
Quite the contrary, I suspect that Fred and Union Square Ventures and others like it are generating just fine RORs for their limited partners. What I believe Fred was expressing was the statement I made at the top of this post - that the acquirers are not doing justice to the innovation being funded by VCs. What Fred is looking for is a new path to liquidity which generates returns that are comparable to those he gets by selling to Google et. al., but that the targets will also do something with the innovation and keep the founders and core team behind the innovation incented to continue to build their compelling products or services, only now post-deal with more leverage and resources.
Look at a service like FolderShare. It was quite amazing what was accomplished with that service prior to the acqusition by Microsoft. What has happened since? In my opinion, the quality of the service may even be lower as part of Microsoft. How about del.icio.us, to which Fred refers. I cannot point to anything innovative since the Yahoo! deal. I still use both services, but was hoping for something positive following those deals.
In short, I do not believe Fred was asking for higher returns or even more potential acquirers - he appeared to clearly be asking for more appropriate acquirers for his innovative portfolio companies. He may make better returns if he continues to hold the stock post acquisition, but that is not the point. Also, in the absence of better options, Fred and his brethren have an obligation to maximize ROR for their limited partners and execute their fiduciary duty as board members of their portfolio companies, which will mean to continue to sell their portfolio companies in the manner in which they have been - regardless of it may end up stifling the innovation in a portfolio company. Fred appears to be pleading for better exit options for his portfolio companies to help those companies continue to deliver the customer experience gains he expects as a user of the many products and services in which he invests. I hope plea is answered with new paths to liquidity.
The post and its many responses caused me to think more about why this is happening, and I believe I have a hypothesis outlining the underlying reasons behind the situation Fred outlines relative to today’s VC model and the overall technology start-up environment. I do not think the answer for this particular issue outlined by Fred is a private liquidity market such as Opus-5 or Goldman Sachs’ GS True Market, or, while plausible in its own right, a new private exchange for accredited investors as suggested by Roger Ehrenberg. Smells like an opportunity.
I will address these reasons in a subsequent post as part of this mini series and hopefully suggest some opportunities. Like Fred’s reference to pmarca in his post, I too cannot seem to get through posts which are too long (though pmarca authors a very compelling blog). I’ve made my point here, so I’ll cover other points in the next posts in this series.
links for 2008-04-11
links for 2008-04-10
links for 2008-04-09
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