Billions in Local Ad Dollars Surge to Online — But Just a Trickle to News | Street Fight

Tom Grubisich wrote a great piece on the failure of local news sites to capture the boom in revenue happening in local online.    He made a great point on the news market not capturing this local revenue.

 “The issue that no one seems know the answer to is how to channel even a small fraction of the billions of dollars that flow to local non-news digital into news.

I have spent a lot of time trying to understand why ads worked in newspapers before.  I mean, of course, people read the paper to get the news not to find out about wedding dresses at Macy’s.   But the surprising thing is that a lot of people get the newspaper not to read the news but to find information about just that same wedding dress in a marketplace the newspapers have created that gets delivered with the paper.   In other words, over the last 50 years, newspapers created a market place for local shopping that they owned. Newspaper "gone to the Web."

  • You are never going to make an effective local ad by sticking ads in online news stories
  • You have to create new market local market places online
  • No matter how much local news a digital news business like Patch creates, it will never be successful financially without taking that audience and creating a set of commercial marketplaces.

Billions in Local Ad Dollars Surge to Online — But Just a Trickle to News | Street Fight.

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The newsonomics of Amazon vs. Main Street » Nieman Journalism Lab

A great piece on the importance of retail advertsing to the newspaper business and the indirect fight between Amazon and the papers happening now.

“Classifieds has decimated by interactive databases. National has migrated strongly digital. Retail, which made up of just 47 percent of newspaper ad revenues 10 years ago, is now up to 57 percent of newspaper totals. Now that advertising, albeit in just a few markets initially, will have to compete with Amazon-forced marketplace change.

Amazon, of course, isn’t targeting newspaper revenues. It’s targeting customers — selling more to current ones and engaging new ones. Further hits to newspaper revenue are just another unintended consequence of accelerating disruption of all business as usual. “

The creation of new marketplaces for shopping on the web, tablets and mobile are at the center of what the newspapers must to move past relevance in retail shopping to being critical players for local retail shopping in the next 10 years

The newsonomics of Amazon vs. Main Street » Nieman Journalism Lab.

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Newspapers’ Next Move In Expanding The Reach Of Digital Ads | Fast Company

From a piece in Fast Company about our efforts to recreate a dominant Shopping business with the newspaper and media industry.  We are just getting started but with over 225 newspapers now live and hundreds more committed, when we relaunch the business, it will be interesting quick.

Newspapers’ Next Move In Expanding The Reach Of Digital Ads BY David Gardner

As a newspaper executive, what do you do when advertising revenues are tied to declining circulations and undermined by the impact of the Internet and social media? Well, you could crawl up in the fetal position under your desk (not advised)–or you could look to innovate your way out of this dilemma.

Innovation is exactly what many major United States’ newspaper organizations—organizations such as Hearst, Gannett, McClatchy, The Washington Post and others—are doing again. Yes, again. How many readers are aware that Cars.com, CareerBuilder.com and Apartments.com are all innovations driven by newspaper industry consortia?

The newspaper industry is about to undertake another paradigm shift in consumer advertising and promotion of products and services. This effort, being led by ShopCo CEO Ben Smith IV, is just getting under way. Smith and his team are still very much in the ideation phase; when we last spoke, they didn’t yet have their Silicon Valley office.

There are many reasons why the newspaper industry needs to find new ways to engage with consumers:

  • Newspapers are in the business of creating and supporting communities; newspapers are a part of the fabric of our society–each newspaper is a trusted brand.
  • Major retailers have proven that there is a strong, mutually-beneficial relationship between members of a community and their local papers. Retailers have seen that a newspaper’s ability to influence a consumer is second to none.
  • Retailing is a weekly event; shoppers look forward to seeing what specials retailers are offering during the coming week.
  • There are more deals being offered by retailers than consumers can possibly be exposed to due to space limitations in printed advertising.
  • Consumers like to shop, they like to be exposed to new products and services and rely on advertising to help them gain a new understanding.
  • Digital shopping experiences aren’t about the media, they are about connecting to viable, thriving marketplaces.

Social media is a key driver in today’s consumer marketplace, and retailers need a way to connect to consumers in a manner more consistent with social media.

Why don’t consumers merely rely on Internet search engines? The simple answer is there is no relationship. The newspapers, retailers, and consumers collectively benefit from a nationwide, coherent solution exposing them to products, services, promotions and deals they need to know about. The vast majority of the time, consumers know what they are looking for, they simply need a place to look to determine what is being promoted.

The media companies behind the ShopCo came together because they need a national, not a regional, solution. It also needed new eyeballs and minds looking at how to solve the challenges of a digital age–the innovation needed likely would not be developed inside the walls of the newspaper organizations themselves.

While it’s unclear yet just what the ShopCo solution will look like, Smith has clear ideas about where he wants to offer media organizations.

“Our goal is to ultimately provide our advertiser partners 50 million unique visitors who are engaged in an exciting shopping experience. We will be looking at a wide variety of new features and options on our roadmap, but we will continue to focus on enhancing the user experience and traffic growth as well as launching new web, mobile, social and tablet enhancements.”

As ShopCo is a holding company financed by the newspapers, Smith maintains considerable autonomy about the nature of the solution he and his team create. Smith’s toughest challenges are building the right team, maintaining a tight focus on consumers and advertisers, and dealing with the explosion of new opportunities.

While it would easy to believe that the newspaper business is stodgy, old and not very engaged in the 21st century technology and social media trends, nothing could be further from the truth. Stay tuned.

Dave Gardner is a management consultant, speaker and blogger who resides in Silicon Valley. His firm helps clients eliminate business execution issues that threaten profitable and/or sustainable growth. He can be reached through his website gardnerandassoc.com or Twitter @Gardner_Dave. __

[Image: Flickr user Hector Garcia]

via Newspapers’ Next Move In Expanding The Reach Of Digital Ads | Fast Company.

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The Newspaper Industry and Digital Ads

 Newspapers are probably never completely going away.   In fact, they are never going away.  Newspapers have traditionally supported themselves through advertising. Advertisers pay newspapers to publish their ads, which gives the papers the money they need to publish the paper, pay reporters and perform administrative tasks. Now that many newspapers have entered the digital age by offering online editions, advertising may seem to be superfluous, but it’s not. Newspapers still rely on advertising, although they may use digital media rather than traditional print ads.  The fact is today, newspapers still make more money from print ads and paid circulation that digital ads.  That will change.

Newspaper Advertising Before The Digital Age

Newspapers began printing advertisements before the American Revolution.  The first recorded newspaper advertisement was for a home in Oyster Bay in 1704, according to AdvertisingAge. Within 25 years, Benjamin Franklin had made newspaper advertising a regular feature, becoming the first to print pages of advertising, and by the 1740s he was also printing advertisements in magazines.

newspaper advertising, Lyles studio, 1915

newspaper advertising, Lyles studio, 1915 (Photo credit: Wikipedia)

Thus, newspaper advertising was common forty years before the American Revolution, although the idea of developing businesses to create ads didn’t come along for another hundred years. The first ad agency opened its doors in 1843, and by the turn of the 20th century newspapers were using advertising rather than newsstand prices to support themselves.

Advertisement, Boston, Massachusetts

Advertisement, Boston, Massachusetts (Photo credit: Wikipedia)

In the 115 years between then and now, advertising evolved along with consumer protection laws. The federal government banned patent medicines, required food manufacturers to list ingredients on labels and broke up monopolies in the early 1900s; this led to changes in advertising, including businesses regularly advertising food products in newspapers and companies using sex appeal to sell products for the first time.  The government also began to pass laws against deceptive or fraudulent advertising in response to advertising’s overwhelming popularity in the early part of the 20th century.

The mid to late part of the 20th century saw newspapers competing with other types of advertising such as television and radio advertising. However, newspapers continued to support themselves with ads despite the fact that these new types of advertising were more popular. This pattern was to be repeated as the digital age began.

Electronic Newspapers Precede Internet Use

In the 1980s, people did not yet regularly go online, although there were services such as Compuserve  that offered limited online capabilities. Several Associated Press newspapers partnered with Compuserve in 1980 to offer online editions, including the New York Times and Los Angeles Times. Compuserve ended its collaboration with the Associated Press in 1982; however, The New York Times continued to offer a limited number of articles online.

During this period, newspapers were more concerned with experimenting with getting stories online than with advertising. They continued to run print advertisements rather than get their advertisements online.

Birth of the Internet

In the early 1990s, people began to sign onto the Internet from their homes. Newspapers began to experiment with putting updates online, and many were predicting that newspapers would become extinct because of the availability of Internet news.

During this era, newspapers also experimented with a new form of advertising: 900 numbers. Some companies paid newspapers to run ads for their 900 number services. For example, churches and synagogues in Atlanta offered free previews of sermons on a 900 number and paid for print ads advertising the number. Similarly, some newspapers encouraged subscribers to subscribe by 900 number. While the ads involved with 900 numbers were still print ads, this was a step towards online advertising; it was the first time newspapers had used telephone services for advertising purposes.

Although many newspapers were fully online by 1995, newspapers were slow to move towards online ads. Print ads continued to be dominant throughout the 1990s. In the 21st century, however, the newspaper industry became aware that it would have to get online in order to keep its readership and its ad revenue. By 2005, companies had spent over $2 billion on online newspaper ads. In 2010, companies spent more on online ads than print ads. That year, they spent $25.8 billion dollars on web ads–$3 billion of which was specifically for online newspaper ads–and only $25.7 billion on newspaper print ads.

As of 2012, many newspapers have both a print edition and an online edition. Sponsors can buy ads in the online edition, the print edition or both. Many newspapers put their classified sections online so that readers can click on ads they want; in addition, advertisers may purchase banner ads or other types of ads that run online.

Print ads also take advantage of digital media now. Newspapers rely on graphic designers who know how to use software to create digital ads rather than typesetting ads manually, and sample ads are often emailed to advertisers for approval before being printed in the newspaper.

In spite of opinions they need to be restructured to small local businesses, print newspapers and print ads still exist today, but they take advantage of digital media for production. In addition, newspapers produce the bulk of their ads for the online edition to attract more advertisers as well as more readers.  At ShopCo Holdings and FindnSave, we are helping the industry take another step forward in digital advertising across the web, mobile, tablets, and social much like their efforts with CareerBuilder, Cars.com and other efforts in the 1990’s.

We are still working on that new name I discussed earlier and now you can see where the idea for 1704Media came from.

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Building a Shopping Solution

I have been involved in ShopCo Holdings just about two months now as the Chief Executive Officer.   I figured it is about time I start sharing a bit about it.

ShopCo Holdings is a company backed by 12 large US Media companies to bring innovative shopping solutions to their historical local audiences.

It is an exciting opportunity to bring back the fun to shopping across the web, social, mobile, and of course on your couch with tablets.  With the backing of  Advance, A.H. Belo, CNHI, Cox, E.W. Scripps, Gannett, Gatehouse, Hearst, Lee Enterprises, McClatchy, Media News Group and the Washington Post, we now have over 176 newspaper sites using the FindnSave platform and expect to break 200 soon covering the majority of the Sunday audience for shopping.   We are fast at work to bring a new solution to market across Mobile, Social, and the Web that will enable fun discovery of shopping opportunities across the entire country from San Francisco to Mobile.

It has been a blast from building out a team, but alot of work as we have had to make some tough decisions to clean up the focus of the business.

From figuring out the fastest way to get from headquarter in Silicon Valley up to our operations in Chico, Ca (hint it is not a car and leaves from Palo Alto Airport and is rather scary) to figuring out what an FSI is, there has been alot of learning.

We have found a few things:

  • Shopping is supposed to be fun and all about discovery not price comparison and search.
  • Mobile changes everything, and a tablet on your couch is an even bigger deal.
  • We have a great team that is growing everyday.  If you care about shopping and want to build cool stuff, reach out.
  • The media companies and our advertisers are 10 times as innovative as Silicon Valley gives them credit for and hold sway over incredible content and audiences.

If you want to work with us, you all know I am a relationship focused entrepreneur and I look forward to discovery opportunities to work with you.

Just reach out to us. We are a company built on the partnership of 12 of the largest media companies in the country and look forward to extending the partnership to anyone who can help us bring fun social discovery shopping solutions to 50MM consumers.

A good place to connect my annual event where we shoot some Trap and have some Chardonnay.    So I hope you can find you way to Shotguns and Chardonnay.

Finally, ShopCo Holdings is a pretty tough name to identify with so we are working on a new one. 1704Media.com is one on the list as it recognizes the heritage of our investors, back to year the first ad placed in a newspaper in  the Boston News-Letter.

Let me know what you think about it. Or better yet if you have a better name.

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Victor Belfor, Ben Smith: Backing A College Dropout Might Be Your Smartest Investment Strategy

 

BelforI recently invested in two companies whose founders either had little interest in school as students or who dropped out of grad school: MixRank and Influitive. Both management teams are driven, hard working and well

prepared for the difficult road of creating a business from scratch.

It got my co-author Ben T. Smith IV and I thinking. We all know that Steve Jobs, Bill Gates and Mark Zuckerberg famously never finished college. But getting to know the founders of MixRank and Influitive suggested that there must be many more with a passing interest in school and perhaps for good reason. There must be a pattern.

With a bit of research, we found over 50 CEOs and founders of successful Silicon Valley companies and many times that running companies elsewhere. Carly Fiorina, for example, didn’t finish her J.D. Sergey Brin and Larry Page got their master’s, but dropped out of the Ph.D. program. Michael Dell dropped out of pre-med.

Image representing Michael Dell as depicted in...

Image via CrunchBase

Ellison attended University of Illinois at Urbana-Champlain and University of Chicago, but didn’t graduate from either. Kevin Rose dropped out of University of Nevada Las Vegas, and the list goes on and on.

In 2001, Michael Spence received a Noble Prize in Economics for his work on information flows and market development. One of his most famous works was the Job Market Signaling Model, where he observed that employees signal their respective skills to employers by acquiring educational degrees. Employers pay higher wages to more educated employees because they know these employees have greater abilities and conclude it will cost less to teach them new skills than employees with lower abilities.

In other words, the education itself may or may not have value to the employer. What’s important to employers and what they are paying for is the signal that the students are sending about their intelligence and willingness to work hard.

What these employers look for in employees is the ability to succeed in a competitive and challenging environment. These are great qualities and we as investors are fans of graduates of good schools. But let’s take this one step further.

What many employers don’t look for in young professionals many investors demand of their CEOs: the ability to focus on what is really important, a predisposition for risk-taking and a healthy dose of irrationality. Can you imagine a bunch of somewhat irrational, laser-focused risk-takers in a corporate environment? You probably can’t.

Ben T Smith IVFor that reason, most entrepreneurs do not make good employees. In fact, when we look at our investments over the last 10 years, we find in our limited data set that investing in people who were great employees – especially ones with more than 5 years in corporate positions – frequently brings lower returns.

Here’s how entrepreneurs themselves think about it:

When we I asked MixRank co-founder Ilya Lichtenstein about his time in college, Ilya replied, “Yeah, I graduated from University of Wisconsin-Madison in 2010. I didn’t go to class much though, was too busy making money with affiliate marketing.” Fellow co-founder Scott Milliken says: “I didn’t spend any time in classes either. In my last semester at Berkeley, I was working 40 hours outside of school and taking 21 units. (I) attended 2 out of 5 of my classes. School wasn’t nearly as important to me as making money and getting professional experience.”

Influitive founder Mark Organ, who dropped out of a Ph.D. program, says, “quitting a Ph.D. program to go build a startup is a touch of madness. Trust me, I know. It was risky. But a founders’ sense of probabilities is different. He over weights the value of the big win, no matter how slim the odds are of achieving it. And it’s not about the money either, at least to me. We are only here on this earth a short time. We might as well take every opportunity to build something truly consequential before we turn to dust. It’s a way of achieving immortality.”

Running a startup is about making big decisions every day. There’s always a shortage of resources with too many opportunities to pursue and too many masters to serve, including customers, partners, investors, employees. Running a startup is all about making difficult trade-offs and being laser focused. But it also requires all-consuming passion to get through the tough times. It requires a slightly irrational power of conviction.

So what signals to an investor that a 20-something kid asking for a million dollars has what it takes? Perhaps it is dropping out of a really good school to pursue her passion and ambition. What struck us after we compiled the list was that successful dropouts came out of many schools, but three colleges dominated the list. They weren’t just good schools, they were great schools:  Harvard, Stanford and MIT.  Not only do they offer fantastic academics, but also have a deep culture of entrepreneurship and thought leadership.

So next time a Harvard dropout pitches you a social network de jour, take her seriously. Getting into Harvard is difficult. She dreamed about going there for a long time and worked hard to do it. The decision to drop out was agonizing. And yet, here she is. And we wouldn’t want to bet against her. Oh yeah, we both graduated, but don’t hold that against us.

(Victor Belfor (pictured top) is an entrepreneur and investor and currently runs strategic alliances at RingCentral, He graduated with an engineering degree from Kiev Polytechnic Institute and is pursuing his MBA at Wharton.. He can be found on Twitter @vbelfor. Ben T. Smith IV (pictured above) is CEO of ShopCo, a venture partner at Accelerator Ventures, and a serial entrepreneur and investor and the co-founder of MerchantCircle and Spoke. He is available on Twitter @bentsmithfour) He graduated from U.C. Davis in Engineering and Carnegie Mellon’s Tepper School with an MSIA.)

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Ben Smith, Steve Goetz: You Are Welcome To Our Facebook Passwords If You Turn Over Your FICO Score -peHUB

Dear Employer. If you think our Facebook passwords are necessary to review our job applications, you are welcome to them. In exchange, we would like to see your FICO score and the recent credit applications of key executives.

Is this the next step in job candidate-employer relations?

Recently employers have begun asking job applicants for Facebook passwords under the assumption the social networking site will reveal the real story of who they are. We are not convinced.

Take my co-author, Steve Goetz, for instance. He is married, has a toddler and lives a fairly routine life. Employers would be bored out of their minds by the first page of his Facebook profile.

Dig back a few years and you may see a different story. But does it really matter that someone dressed like Jimmy Connors in ridiculously short tennis shorts and carrying a wooden tennis racquet ran in the Bay to Breakers race 10 years ago? We think not.

Let’s give employers the benefit of the doubt. We assume they are trying to achieve a more candid representation of candidates in order to gauge how “responsible” they may be and how they would represent the business.  Is the job candidate ethical?  Do their actions reflect core company values?  Would the business be harmed by this person’s actions?  Can I trust this person to make me (the hiring manager) look good?  All fair questions when looking out for the best interest of the business.

The question then becomes are “we” employers willing to reciprocate?  We meaning the executive team, the board, the full measure of the organization.  Collectively we are asking candidates to put their faith in us, in the company execs and the board to be the financial stewards of the organization, to insure we are properly funded and staffed to deliver the greatest financial return. We are asking them to believe we will remain motivated with clear direction and good intent.  If we fail in any of these tasks, we put the candidate and their family at risk, and we jeopardize our employees’ livelihood and their ability to achieve the American dream.

As candidates, we’ll gladly give you access to our Facebook accounts. We’d like to think our fiscal responsibility at home really doesn’t impact our fiscal responsibility at work, but perhaps it does. However as employers, are we willing to turn over our FICO scores and a completed credit application from every member of the executive team and board? Perhaps we have reached a point in the modern employer-employee relationship where some kind of good faith disclosure by employers showing credit worthiness is necessary.

In other words, in the event these disclosures become routine, what do you think we employers should be prepared to provide to job candidates that allow them to evaluate our fiscal responsibility?  As you chew this over, here is another thought.

Should they become routine, what is next? Where will the next battleground be drawn? Here is our suggestion on where it should not be, as absurd as some of this will sound:

  • No, you can not ask for the login to my match.com account.
  • No, you can not come by and open my mail.
  • No, you can not look at the last ten phone calls I made,.
  • And no, you can’t see my old Flickr account, should I even be able to remember the password.

Instead, try these tried and true methods:

  • Talk to people who worked with me before. Yes, some of them don’t like my haircut and a few other things.
  • Do a quality interview where we really get to know each other.
  • Review some of my prior work and ask about what I learned.
  • Spend a little time with me in informal settings.
  • Have me hang out at the office and mingle with employees. Don’t just stick me in a back room to interview.
  • And of course, feel free to check me on out LinkedIn and Google, and ask me about interesting stories from my experiences.

(Steve Goetz (pictured above) has worked in business development at MerchantCircle, and Excite@home and was the founder of Gardner Design Group. Ben T. Smith, IV (pictured top) is CEO of ShopCo, backed by 12 of the major newspaper groups; a Venture Partner at Accelerator Ventures; and a serial entrepreneur, investor, and advisor to technology and media companies. He is the co-founder of MerchantCircle.com and Spoke.com, and a former partner at A.T. Kearney. Ben is available on btsiv.com.)

 

 

Ben Smith, Steve Goetz: You Are Welcome To Our Facebook Passwords If You Turn Over Your FICO Score -peHUB.

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Ben Smith, Mark Boslet: Career Building Like A Startup: Thoughts On Reid Hoffman’s “The Start-up of You”

In the 40 years since the publication of What Color Is Your Parachute, the job market has collapsed, collapsed again and changed almost unrecognizably. The time has come for a new job hunter’s bible.

Our vote goes to Reid Hoffman’s and Ben Casnocha’s new book, The Start-up of You. We say this not because it bubbles up from the controlled chaos of Silicon Valley, where we both live. What distinguishes this new look at career building is its application of startup building techniques to the upheaval of the modern job market. It is an invitation to make your own luck through strategic networking.

We think enough of the slim treatise that my co-author, Ben T. Smith, IV, gave a copy to each business school graduate this year at the University of California, Davis and the Tepper Graduate School of Business at Carnegie Mellon University.

What makes it thought provoking is its improvisation on traditional themes. What Color Is Your Parachute gave job seekers a new way to think about their professional passions and counseled them to target attractive jobs rather than lists of open positions. It worked, at the time.

The Start-up of You takes the process several steps further. It advises seekers to adjust constantly as markets change and to network 24/7, not just when you don’t have a paycheck. Opportunities are made, but you need to be in the right place at the right time, and that means laying the groundwork ahead of time.

To make its case, the book offers the example of Sheryl Sandberg, the chief operating officer at Facebook. Sandberg took the risk of “pivoting” out of one profession into another when opportunity arose. She started at the World Bank working on public health projects in India, enrolled at Harvard Business School and joined former professor Larry Summers at the Treasury Department. There, networking led her to a conversation with then Google CEO Eric Schmidt. Sandberg, one of the most important value builders in the valley, also spent time at McKinsey & Company.

She asked Schmidt for career advice and received the observation that fast growing markets create opportunity. In short order Schmidt offered her a job at fast growing Google. The next step was Facebook.

Hoffman illustrates his new view of the job market as well with his own story of relationship building with Zynga co-founder Mark Pincus, whom he met when he was at PayPal a decade ago. “I felt inspired by Mark’s wild creativity and how at times he seems to bounce off the walls with energy,” Hoffman writes. “It’s our similar interests and vision that have made our collaborations so successful.”

The two invested in the social site Friendster, bought the Six Degrees patent, and then started their own social networks: Pincus, Tribe Networks; Hoffman, LinkedIn. The close association led Pincus to contact Hoffman when he created Zynga and to name him to the board. With that Hoffman gained access to one of the hottest Internet opportunities of the past few years.

That Hoffman’s or anyone’s career journey is long and unexpected is no surprise to many entrepreneurs. Ben Smith has his own war stories to tell and they are reflected in the advice he gives young job seekers, whether they are associates of his former firm, A.T. Kearney, new graduates, or budding valley engineers. Build a reputation by getting things done, develop a diversified portfolio of authentic, trusted relationships, and invest in your career with extra dedication and learning. In other words, play for the long term. This is, in our opinion, exactly what Hoffman and Casnocha are trying to say.

There are many useful observations in The Start-up of You. Here are several worth thinking about:

1) Use ABZ Planning. Plan A is what you’re doing right now. Plan B is what you pivot to, or shift to, when your Plan A roadmap takes an unexpected turn. Plan Z is your fallback position, the place you turn when your career goes up in smoke.

The process is full of trial and error. “ABZ Planning isn’t something you do once early in your career. It’s a process as important for someone in (his) forties or fifties as for a newly minted college grad,” say the two authors.

2) Build new school relationships. It is old school to contact someone only when you need something. Start building a rapport by doing someone a favor and don’t keep score. The first thing you should do in any new relationship is to find a way to contribute. Walk away from meetings with a couple of actions items on how you can help. As you develop a network, remember the fastest way to change yourself is to “hang out with people who are already the way you want to be,” Hoffman and Casnocha say.

3) Favor a quality social graph over a large one. Most people can maintain only between eight and 10 truly close professional alliances at one time. That’s not to say a Rolodex should only have 10 cards. But when it comes to real allies – people you would invite to dinner to brainstorm on career options or who will be in your corner during a fight – less can be more.

More casual relationships with people you e-mail occasionally or ask for small favors can run into the hundreds, perhaps thousands.

4) Invest in yourself and prioritize learning. “Develop habits of behavior and habits of thinking that increase the likelihood that you find yourself in the right place at the right time.” Take a curious person out to lunch and try to determine the source of their curiosity. Identify someone in your network who always has his or her hand in interesting things and learn how they find opportunities – potentially breakout ones. Court serendipity. Set aside a “yes” day and say yes all day. Join organizations. J.P Morgan belonged to 24 associations at the time of his death.

At MerchantCircle, Ben Smith’s company, there were a few people who started in one role and spent a lot of time learning new skills. This is not easy. It is not accomplished working 9 to 5. It takes an investment and a lot of hard work to look at SQL on the side when your primary responsibility is the community team.

At the same time, hard work is no guarantee of success. One young person at MerchantCircle who kept asking to be CEO, was offered a chance to dig in and learn product management on the side. He did not. He is still probably wondering four years later why he is not CEO of Facebook. It is important in any role to create options for later on.

5) Explore pivots. Have coffee with someone in an adjacent industry. Experiment with side projects. Set aside one day a month or every few months to work on something different, perhaps a business idea or a new skill you want to develop.

Building online payments provider PayPal wasn’t all smooth sailing from day one to its eBay acquisition, Hoffman and Casnocha remind us. The company changed its business model, brought on new executives and merged with another company before it was purchased.

Careers builders should be willing to adapt their “business models,” too. If you are at a big company, working for an investment bank or in the consulting world and want to do startups, hang out with people who are doing startups. Work with them on the side over a long period of time. Years before Ben Smith left A.T. Kearney, he had gotten to know Tim Connors, then at Sequoia Capital, then U.S. Venture Partners and now PivotNorth Capital. It was with Connors and a few other people that he founded his first company, Spoke.

In the end, young people need to realize a career investment is one of the most important investments they will make. It goes well beyond picking a great school and should be part of the relationships and reputation they build every day.

Ben T. Smith, IV (pictured) is a serial entrepreneur, investor, and advisor to technology and media companies. He is the co-founder of MerchantCircle.com and Spoke.com, and a former partner at A.T. Kearney. Ben is available on btsiv.com. Mark Boslet is a reporter at peHUB.

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The less discussed, other sinister plot at groupon. – surya says too much. – surya says too much.

For all the critics from the sidelines of any game, politics, business, investing, startups, parenting, charity, and even football.  Some people are hitting Groupon now.

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

via the less discussed, other sinister plot at groupon. – surya says too much. – surya says too much..

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Tony Scott, Ben Smith: So They’ve Offered You The CEO’s Job. Here’s What You Need To Know Before Jumping With Joy | peHUBpeHUB

Tony Scott, Ben Smith: So They’ve Offered You The CEO’s Job. Here’s What You Need To Know Before Jumping With Joy

So you’re in the running for the CEO’s job at a startup. Already a creeping sense of uncertainty has set in as you prepare for the next interview. What do you need to know about the company? What rocks do you need to peek under?

Senior executive changes are happening with increasing frequency in today’s vibrant technology market. Seasoned managers move from one early-stage company to another, and from established companies and venture firms into the startup world. Some of the savviest new-gen Web companies recruit directly from brand name consumer and media outfits.

If you’re in line for a CEO’s gig or another senior leadership role at a pre-IPO company, you’ve got a lot to think about. Asking the right questions is critical to make sure you’re not jumping into a boiling cauldron of hot oil. Here are several suggestions from successful – and not so successful – executive appointments we’ve been part of.

Remember the company and board have been trying to put the best shine on the emerging business. Now you have the upper hand. If you don’t ask the tough questions and require full disclosure of current initiatives and strategies, as well as those in the planning stages, the only person you can blame later is yourself.

We suggest sitting down with every board member and with members of the team. Assess their motivation, dedication and willingness to spend more than just 9 to 5 at their jobs. You need to feel at home and confident about the path ahead.

Here are several specific suggestions:

  • First, any prospective CEO candidate should ask for the most recent board decks.We suggest looking at the ones from the last year at a minimum. Once you’ve reviewed them, you might insist on a walk-through of the two most recent presentations, perhaps as they were shown to the board.
  • Second, It is important to ask about the last people who left the company.This includes directors and non-management-level employees – both those who left voluntarily and who were terminated. Ask why they left or were terminated, and the impact of their leaving.
  • Do your own due diligence on departures. Look on LinkedIn for people who were associated with the company. You may find core team members who are no longer there, even after you’ve been assured none have left. This is an obvious red flag. You need to know why this wasn’t disclosed. Keeping information like this under wraps to a potential new CEO is highly questionable behavior. We have been amazed by founders who claim no executive turnover when a quick LinkedIn search uncovers three former CFOs.
  • Talk to users, partners and customers.Find a way to subtly get access to people who know the business. Talk to them to understand how they feel about the company’s value proposition and leadership team. With Internet companies, customer feedback is always in the data. So get access to Omniture, or a similar account, and have someone walk you through the data. In the last few years, we have all seen companies position their consumer traction as great when in fact organic traffic is off, daily or month average user numbers tell of an engagement problem and revenue success is driven off advertising optimization, not user growth.
  • Ask about the severance agreements with senior members of the team.You want to know how expensive it will be to make changes and whether your own package will cause resentment. Seek information on bonuses to the senior team members and to rank-and-file.
  • Find out about the founders.What are their roles, what are their ownership positions, do you have the ability to change what they do? One of the most dangerous situations is when a founder of an early stage company has been moved aside as CEO against his or her will and is still at the company in a senior executive role. It is a common axiom in the venture business that better returns come when founders stick through to exit. So this change is not a minor risk. What’s more, the natural instinct of team members will be to discuss issues with the founder, and the natural instinct of the founder will be to continue to meddle in external and internal issues. Disputes where team members go around the CEO to founders can easily become political struggles that destroy morale and even entire companies.
  • CEO candidates need to assess the board.Find out from direct conversations with each board member about their commitment to the company. You need to gauge your ability as a new CEO to add or change independent board members. You need to understand the relationship between board members and the founders. Go beyond the board and talk to investors who are not on the board.
  • It is crucial to understand a company’s financial position, both operationally and from capitalization standpoint. Be sure to understand the cap chart and the preference stack. There have been plenty of examples in the past, though not as many recently, where the preferences of investors would make almost any exit worthless for the senior team and the team as a whole. Now may be your best and only chance to negotiate a better package for you, your executive team and the rest of the staff. No one wants to work at a startup where the only potential for a positive outcome is a Google– or Facebook-like exit.
  • Review the pitches to partners. Understand past exit discussions and how the company was positioned in those discussions. This will give you some of the best insights on exit potential and, more importantly, on the board’s view of exits.
  • Finally, find out what a day looks like at the company. Go to lunch with a random group of employees. Go for drinks after work. You’ll find out what people are really thinking. Make sure to show up at the company offices before 9 a.m. and after 5 p.m. Are people there? Are they working happily? Are they motivated? Are they fun?

You may think you’ve found the world’s most wonderful opportunity. But you need to make sure. Remember, you’re investing your time and you can never get that back.

(Tony Scott (top photo) is the president of ChampionScott Partners and has recruited board directors, CEOs and executives to over 100 startups. He can be found at http://www.championscott.com. Ben T. Smith, IV (second photo) is a serial entrepreneur, investor and the co-founder of MerchantCircle.com and Spoke.com. Both were former partners at A.T. Kearney. Ben is available on Twitter @bentsmithfour and btsiv.com.)

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