Earlier this week, research firm Inside Network published a fascinating new report that looks at the spending and usage patterns of the users who are driving the success of hugely profitable social games like Farmville, Mafia Wars, and Texas Hold’Em. This afternoon, I caught up with one of the report’s coauthors, Charles Hudson, to gather a little more detail about that study -- and what he found most surprising about its findings. How many people did you interview for your research and how did you find them? Going into it, we talked to a lot of developers about what tools they were using for customer acquisition. It turns out
6 min read · 25 June 2010
With so much attention paid this year to Groupon and it’s reported valuation of north of $1 billion, numerous stories (including right here) have asked the question: is it Chicago’s time to shine? With regard to most startups, I don’t think so, but given real estate prices in the Windy City, I wish it were. Consider this 4,700-square-foot penthouse apartment whose 360-degree views, gourmet kitchen, steam room and more will be shown to prospective buyers on Saturday. Starting bids for the property? $600,000. Try finding that much real estate for less than a few million dollars in Northern California.
3 min read · 24 June 2010
Facebook announced in April that it would begin integrating offers, such as Netflix trials, as a payment option for its new, universal virtual currency called Credits. Though Facebook initially announced plans to integrate the offers of two venture-backed monetization startups, TrialPay and PeanutLabs, Facebook has yet to make the PeanutLab’s offers available to users and competitors. Related or not, competitors in the space are beginning to cry foul over Facebook's relationship with TrialPay. One major bone of contention, claim two sources who asked not to be named, is that the process used to vet competitors to TrialPay was neither impartial nor clear. “They just asked to give a presentation on the company,” says one source familiar with the matter. “It turned out that the presentation was the equivalent of a , but was never notified of that and in fact, their executives were told to skip over background about the company’s fraud protection and customer service.”
4 min read · 22 June 2010
Despite few exits to date as either institutional or individual investors, Marc Andreessen and Ben Horowitz expect to raise their second venture fund later this year, according to The New York Times. Since closing its $300 million debut fund last June, Andreessen Horowitz has backed 24 companies and committed two-thirds of its capital, including $50 million used to acquire less than 5 percent of Skype last fall. (Andreessen Horowitz was part of a consortium led by Silver Lake Partners that bought a controlling interest in the Internet call carrier from eBay.) At the time of the acquisition, Andreessen told peHUB, "One of the big pieces of input we got when raising the fund was to be responsible, but not conservative. We want to calibrate risks against big opportunities, and we think is a very big opportunity."
3 min read · 22 June 2010
Plenty of employees have been fired for publicly disparaging their bosses online. I'm not sure it has happened before to someone whose work involves dressing like a giant pierogi, however. From the Pittsburgh Post-Gazette: Andrew Kurtz, 24, of New Brighton, one of the 18 men who take turns posing as pierogies in a crowd-pleasing race after the fifth inning of every game at PNC Park , was dismissed by the team Thursday because he posted disparaging remarks about the Pirates on his Facebook page...
1 min read · 21 June 2010
For the July issue of Venture Capital Journal, I wound up interviewing a number of VCs on the issue of entrepreneur backgrounds. I wondered how many of them approached the less-than-straightward situations that periodically arise. What I learned is that seemingly few venture investors view a personal black mark in black and white terms, even when it's a doozy. Among those who were helpful with the story was David Cowan of Bessemer Ventures. Here's where he stands on the issue:
2 min read · 18 June 2010
4 min read · 18 June 2010
Glassdoor, an increasingly popular employment site driven by user submissions, has added a very simple new feature that makes the site all the more compelling: pictures. Want to see the warehouse where Netflix processes all those returned DVDs? (I did. You can check it out here.) Interested to know if AT&T’s offices are as soulless as you might imagine? (Oh, man, they are.) How about learning where you'd be seated while waiting to interview at the real estate site Zillow? (Unfortunately, the rest of the office isn't quite as scenic.) There's even a photo posted from the men's room at CNet. I'm not linking to that one because you don't need to see the men's room at CNet and because the contributor's name is atop the photo. Given that Glassdoor promises visitors access to its rich data in return for their anonymous contributions, I'd guess this is an oversight. Oops.
1 min read · 17 June 2010
Earlier this week, it was announced that TerraPower, a startup with a design for a next-generation nuclear reactor, had raised a $35 million round of funding from Charles River Ventures, Khosla Ventures, Bill Gates and others, after raising what the company is calling a first round of (undisclosed) "tens of millions" of dollars in 2008. Its vision is ambitious to say the least. To power its reactor -- which will take another 10 years and billions more dollars to get built -- TerraPower expects to use the depleted uranium waste created when uranium is enriched to run in conventional power plants. Not only would doing so dampen the risk of nuclear proliferation, says the company, but there is already enough depleted uranium in the world for its reactor to power the whole planet for 100 years. Indeed, given the scope of TerraPower's plans, it isn't surprising that it's the first spin-off of Bellevue, Wash.-based Intellectual Ventures, the 10-year-old company of Nathan Myhrvold, Microsoft's former chief technology officer. Brainstorming revolutionary ideas, patenting them, then spinning them off into standalone companies is half of Intellectual Ventures’ reason for being. The other half, of course, is buying up tens of thousands of patents that are then used to protect royalties-paying customers from being sued, including, reportedly, Cisco, Intuit, Verizon, Google and Apple. (Theoretically, Intellectual Ventures could also start creating infringement lawsuits. It hasn’t done so, but according the The Recorder, it has begun selling some of its unneeded patents to organizations that aren’t afraid to sue.)
7 min read · 17 June 2010
In 1997, Margit Wennmachers co-founded OutCast Communications, quickly transforming it into one of tech’s top public relations firms. Its many social functions have been attended by nearly every tech entrepreneur, investor, reporter and startup executive in Silicon Valley. Its long client list includes Facebook and Bloom Energy, along with such public company heavyweights as Amazon, Yahoo, and Salesforce.com. Now, after helping Marc Andreessen and Ben Horowitz launch their year-old venture capital firm, Wennmachers is leaving Outcast to become a partner alongside them. I caught up with her earlier today to ask more about her role, and the usual -- but not unprecedented -- transition she is making from public relations to venture capital.
4 min read · 15 June 2010
