Archive for the 'Entrepreneurs' Category

Ribbit acquired by BT

Tuesday, July 29th, 2008

When we were raising our first fund, the founders of Ribbit decided to take a chance on us. They accepted the terms for our financing of the company before we had even completed the first closing of the fund (which happened in August, 2006). Now, just two years later, BT (British Telecom) has bought the company. ribbit_logo_white_450.gif This is bookends: The founders of the company helped us raise our fund by showing our investors that experienced entrepreneurs would agree to work with us and now they have made us look good by creating our first outcome. We feel pretty good about these four guys, the cofounders: Ted Griggs, Ramani Narayan, Peter Leong, and Crick Waters, not to mention the other 25 employees of the company.

More important to us, however, is what happened between the bookends. From our point of view, there were two key events in the development of Ribbit in which we believe we played a role. First was finding out about the company; the founders discovered us because of the very first post I wrote on our web site, “I Want To Buy Phones“. In that post, I bemoaned the state of office telephony based on the experience that I had trying to get a telephone system for our office. We wanted a telephone service that didn’t require old proprietary hardware or that didn’t obligate us to a particular service. The founders of Ribbit were just beginning to develop a platform for delivering just that set of services. (One thing that’s true: We will be customers for Ribbit, even if we no longer own equity in the company!)

Second was pushing the company toward a riskier strategy when it wasn’t clear that that was the right thing to do. We pride ourselves on being risk-oriented, big-idea investors looking for the most impactful, world-changing business plan. Last summer and fall, Ribbit was struggling with how much it believed it could accomplish: Should it be a platform for developers? An enterprise services company? Or a consumer services company? Classic venture investing would argue that the company should focus on one thing that it knows it can accomplish. Gilman and I talked about it between ourselves and decided that we should take the chance to push the company toward doing everything at once; Gilman, as the director of the company and lead for our investment, pushed hard for the company to take on the developer platform as a path toward providing both enterprise and consumer applications of the technology.

The company took up the challenge. It introduced its developer platform in September last year; its enterprise application, Ribbit For Salesforce, in October, and its consumer service, Amphibian, in January of this year. And, thanks to the chief marketing officer, Don Thorson, the company adopted a position as “Silicon Valley’s First Phone Company”. We think it’s the combination of all of these things that lead BT to see so much value in the company so early.

Ribbit isn’t just bookends; it’s a demo for our style of venture capital: aggressive, risk oriented, go-for-broke investing looking for ways to change the world we live in. Thank you, Ribbit!

Are You (Really) My Friend?

Monday, July 7th, 2008

I have hundreds of friends I’ve never met. Being a gentleman of a certain vintage, I like the idea that attractive young women will accept my friendship without having ever actually met me. So you might notice in my Facebook profile that I have quite a few such “friends”. Other Facebook users seem to want to be friends with famous people or visible people or whatever.

I have been hearing the drumbeat about FriendFeed recently, so I signed up in an idle moment a week ago. Little did I realize that I unleashed a frenzy of new friendings; immediately, I started getting “subscription requests” from people I had never met and who did not identify themselves by their real name. (Since June 30, when I signed up, I have received 38 such subscription requests from people such as “miguel”, “Mrsth”, “Georges” and “Jassim”.) I had thought that this was a service that consolidated various feeds from my real friends into one place; now I’m thinking that it should be named “StrangerFeed”. I searched for a way to remove myself from FriendFeed, but there isn’t. And once you identify a service and give FriendFeed your credentials, you can’t remove the service.

This is the Social Graph? When I hear people talk about the social graph, I shudder. I had thought that the idea of a “social graph” was that you could map your social network in terms of how close different people are to you (one degree, two degrees, etc) in different contexts (parties, sports, passions, etc.). That is not what is actually happening; what is happening is that these so-called social networks have discovered that they must grow or die. So they are abusing the social graph to incent you to connect to as many people as possible, so that they can advertise or promote to those people.

I have not actually met Mark Zuckerberg (and we are not Facebook friends, either), but I have heard him talk several times with confidence about the social graph. What he talks about and what I experience when I use Facebook are two different things. For me, Facebook is entertainment — I play Scrabulous, see how many pretty girls will accept my friend requests, try to steal icons from my “friends” in Packrat. And FriendFeed has innovated by introducing a whole new kind of spam, social spam. Remember Gator?

Kindling Excitement

Wednesday, January 2nd, 2008

We so LOVE hot new products, the Geek and the Gadfly do. We’re getting pretty excited by Amazon’s new Kindle. Amazon has done an amazing thing with the Kindle, which is to get it right enough in its first version that you can see how it will play out and be a successful product. It is, indeed, the iPod for book readers.

First clue: Multiple people from different walks of life who don’t know each other each have remarked to the Gadfly on how interesting and engaging they find the idea of the Kindle. The Geek (of course) was the first to do so, by ordering the Kindle early enough that he got one of the first. But the Gadfly suspected him of just being a geek and wanting the device to check it out technically. But then the Gadfly got a ride from his friend Michael (also geeky), who had one in his car with him and professed to actually being reading books. And then his friend Sara, who is the chief editor of Publishers Weekly (like the bible of the book industry!) and a major thought leader in book publishing, brought hers on vacation with her and was clearly using it to read books . The clincher: the Gadfly’s 22-year-old son ordered a Kindle online because he loves the idea of being able to bring books when he travels without carting the actual books.

The Gadfly reported all this to the Geek and got this evaluation in return:

“First off, it’s not a book and using a Kindle is not a ‘book experience’. That said, the Kindle will change the way you read. I now use the Kindle to read all of my newspapers (San Francisco Chronicle, Wall Street Journal, and New York Times). I’ve also completely read half a dozen books (three non-fiction including one highly technical book and three science fiction books) and have started four new ones. I am convinced that I will read just about all of my future books (as long as they don’t contain too many illustrations or pictures) using the Kindle. Here are my reasons why:

“1) It’s lighter than a book: I can hold it with one hand for a very long time while I’m reading. I can book surf and read a chapter here and a chapter there…I no longer have decide ahead of time what I want to carry with me on my trips.

“2) I can buy books on impulse. I’ve bought more books in the last few weeks on the Kindle than I did in the last six months in print!

“3) It’s really fast to download and you can store a ton of books (literally) especially if you add a 2GB SD card. (To offset the cost of the SD card, the books are 40%-70% cheaper than their printed versions.)

“4) I love the fact that Amazon stores everything you bought and you can move easily between local memory and remote storage.

“5) The device is really well designed as a starting point: The key/button layout is a bit frustrating in the beginning, but you get used to holding the Kindle after reading the first couple of books and then it becomes intuitive. The screen isn’t as good as paper, but it’s easier on the eyes than a LCD screen and works well out doors. The battery life is pretty good as long as you use the wireless on only when you need it; I’ve read two complete books on one charge.

“6) It’s a completely different experience than the Sony Portable Reader System PRS-500, primarily because the Kindle is not tied to the personal computer. Just turn it on and go. It could be the difference between a device designed by an electronics manufacturer and a device designed by a major bookseller….

“The Kindle is a 1.0 device and has lots of problems. But it’s good enough that you learn to overcome them to get something that will change the way you read. In fact, I think the Kindle is a bigger breakthrough device than the iPhone.”

There you have it: The Gadfly’s partner thinks Kindle is a really big deal! (Gadfly might suspect Geek of being particularly motivated by the fact that Amazon’s inspiration for the design of Kindle clearly came from the Star Trek PADD.)

Having had these experiences with friends and partners about the Kindle, Gadfly finds himself going back to his days as a pundit and thinking that this is exactly what makes for a successful product, very much the same kind of reaction people had to the iPod, the PalmPilot, the IBM PC, even VisiCalc, all great products in version 1.0.

Gadfly is tempted to opine that the trick in this case is a technical trick that most commentators are reluctant to describe because it’s too techie for consumers: Amazon built an EV-DO cellular phone into the device and then made a deal with Sprint to allow them to bundle the cost of the service into the price of the device and the books that you buy. So there’s no subscription cost for the device or for the wireless service, but it works almost everywhere in the U.S. EV-DO is not available almost anywhere else in the world and does not cover 100% of the US, but it’s much more available than WiFi signals, which is why it was such a brilliant thing to make it a free part of the Kindle. But it actually doesn’t matter; the fact is that this device is completely worthy of a Steve Jobs Merit Award for product design and it’s amazing that it came from a retailer, Amazon.com. Jeff Bezos should get recognition (since I’m pretty sure he personally drove the project through his company) for adding real value to the book industry and showing that Jobs isn’t the only guy who can make really cool products the first time out the door!