I had an interesting conversation this week about Twitter.  I explained to a friend that I have an account, used it for awhile, abandoned it for awhile, and have revived it in an attempt to learn more about it as a social medium.  Here is how I view it and my three self-imposed rules of thumb:

1) Utility - I only follow folks that might learn something unique and useful from on a weekly basis.  If I find that I’m not learning anything unique and useful on a weekly basis, I stop following them.

2) No Reciprocity - I don’t follow folks because they follow me.  In fact, I’m not sure why anyone would follow me as my tweets are rarely insightful (you can see for yourself here at http://twitter.com/ocvc if you’re so inclined).

3) No Location Details - I learned (the hard way) never to post with specificity my location in real-time unless I’m prepared to be approached.  Nothing like having a dinner out with my family interrupted by someone “eager” to meet me.  Yeah, I know…common sense here but I was naive enough to think all would be good.

I’m still not sure just how useful Twitter is to me but am giving it another go in an attempt to learn.  Wish me luck and if you have an interesting Twitter experience, please share it!!!

Happy Tweeting!

I was at D7 the other week and spent a fair amount of time discussing the “value of free” with attendees.  The juxtaposition of traditional media and consumer Internet hinges on this concept so I thought I would explain a bit about what I am referring to.  At the risk of oversimplifying here, a vast majority of consumers expect information/entertainment (a.k.a. “content”) on the Internet to be free in that they are not accustomed to paying for the content the Internet provides them.  In fact, there is a whole generation of consumer digital denizens that only know the “Web 2.0 / free” world of the Internet.  This poses a potential problem for the related industries: how do we make money if the consumer of what we produce/source/distribute expect that it will remain free?

The answer has historically been that the value exchange for such content was simply this: I provide you with my (valuable) time and you provide me with the content to occupy such time.  In the exchange, you then sell advertising against my time based on my gender, age, socio-economic status, and other such demographics (a la broadcast television through most of its history).  This has historically worked reasonably well for all when there were finite choices for content.  See where I’m going here?  That’s right, this model becomes a bit challenging as the sources of content outpace the Total Consumers Time (a.k.a. “TCT” - calculated as the total number of targeted consumers multiplied by the daily total number of minutes they spend on line).  The issue has become somewhat exacerbated  the past couple of years as the rise of social media and Web 2.0 tools has turned these consumer into creators of content themselves such that all consumers may someday become creators of content on-line.  Additionally, the number of minutes consumers spend creating content and consuming consumer created content (a.k.a. “User Generated Content” or “UGC”) only lessen the TCT…which, in turn, negatively affects the advertising revenue of the “professional” content creators and distributors.  The primary current solution is to spread advertising budgets across more and more content sources such that even when annual ad budgets increase, they are allocated across a broader spectrum of destinations…for the time being.  Less you think I’m against consumer Internet, I’m not.  Not even close…

The power of the Internet and all it entails is that it is becoming easier to qualitatively and quantifiably measure the reach and impact of advertising relative to an advertiser’s targeted demographic.   Furthermore, advertising is changing to take advantage of such technical capabilities and the sophistication of tech-savvy consumers and is becoming much more interactive.  More and more brands are exploring “branded entertainment” and looking to develop certain deep psychological associations with their products and services based on where and how they advertise.  While I strongly believe that this will, eventually, lead brands away from UGC to high-quality professionally-produced content for the bulk of their advertising budgets, I’m really curious to get all of your thoughts on this matter.  So, what do you think about the “value of free” and where online advertising is headed???

For all you night-owl entrepreneurs who struggle to make it  to our early morning affairs, we’ve heard you and are responding.  Register FAST, this will “sell out” ’cause, what’s not to love???  Booze, food, digital media, and Laguna Beach… 3 of my favorite things.

DATE: Thursday, April 23rd

TIME: 5:30-9:00PM

LOCATION: [seven-degrees] 891 Laguna Canyon Rd. Laguna Beach

At OCVG’s first evening event of ‘09, learn from some of the quickest minds in Digital Media how they’re challenging the powers that be, raising BIG $$$ from VC’s and creating some of the coolest companies on planet earth.  As an added bonus, OCVG will host this mega networking event at [seven-degrees] in Laguna Beach — one of the hottest venues in Orange County.  We’ll have lots of munchies and FREE wine & beer.  Don’t miss out.  Stake your claim and RSVP NOW at www.OCVG.com.Our panelists include:

Dennis Mudd, Founder & CEO, Slacker, Inc. – Slacker creates the perfect personalized radio station for every listener by combining the knowledge of music experts with your preferences..  Since inception five years ago, the company has raised $53 million from “A-list” VC’s including Mission, Centennial, Rho, Austin Ventures and Sevin Rosen.  Before Slacker, Dennis was CEO at MusicMatch, sold to Yahoo for $160 million in 2004.

Jason Feffer, Founder & CEO, SodaHead.com – SodaHead is the premiere opinion-based social community for user-generated Q&A on today’s hottest topics.  Founded only two years ago, the company has raised more than $12 million from savvy investors including Mission Ventures, Mohr Davidow, the Tech Coast Angels and legendary Silicon Valley “über angel” Ron Conway.  Before founding SodaHead, Jason was VP Operations at MySpace.

Mark Kern, Founder & CEO, RED 5 Studios Inc. – Red5 is an independent online game developer led by the talent behind Blizzard Entertainment’s Massively Multiplayer Online (MMO) hit, “World of Warcraft.”  To help fund their drive to become the leading studio for creative, original MMO games for global markets, the company has raised more than $18 million from top-tier Silicon Valley VC’s Benchmark and Sierra Ventures. 

MODERATOR: Bong Koh, Venture Partner, Prism Venture Partners – An expert in starting, growing and selling companies, Bong focuses on digital media and consumer Internet investments at Prism’s Santa Monica office.  With $1.25 billion under management, bi-coastal Prism is a leading investor in digital media start-ups. Before joining Prism two years ago, Bong was a VC at Advanced Technology Ventures.  Prior to this, Bong was co-founder of Mobilocity, a mobile solutions provider he sold to a joint venture of Qualcomm and global ad agency Omnicom. 

That’s right, Mixergy’s Lunch 2.0 is back in The OC, baby!  Please join Andrew and I at Earth Media Group for lunch tomorrow.  Details and registration can be found here: http://blog.mixergy.com/wp-content/invite/EMG.html

After an overwhelmingly positive response, I’ve decided to give the “office hours” idea a go for the first six months this year and then will make a decision as to whether to continue them.  My hope is that this becomes something that continues without my presence or involvement — a free, no-hassle, relaxed atmosphere for folks in the start-up ecosystem to network over coffee.  I’ve decided the third Thursday of every month is good (at least for me for now), but will rotate between south and north county venues.  So, the first OC VC Office Hours will be Thursday, January 15th from 9am-11am PST Pacific Whey in Ladera Ranch.  If this begins to build a crowd, I’ll use a widget to list the upcoming dates, times, venues, etc. on this blog and will send out updates.

I will send out real-time updates via Twitter if things change.  You can sign up for them at Twitter and rest assured that I’m not a prolific Twitterer.  I look forward to meeting you on the 15th.  I’ll wear be wearing a black hat with the Okapi Venture Capital logo on it to make it easier to find me the first few sessions.

While my free time allocation to blogging has waned of late, I have been spending more time out and about discussing a variety of topics with lots of interesting people.  I’ve enjoyed these meetings and, based on the feedback I have received from a number of folks, think I will make a go of “OC VC Office Hours” in 2009.  So, if your interested in meeting with me to discuss technology, markets, start-up investing, or other such topics, stay tuned for more details.  I will attempt to establish some sort of regular schedule, publish it on this blog, and provide any updates/changes through my Twitter account (so, if you’re interested in attending and haven’t already done so, sign up to receive my updates at http://twitter.com/ocvc).  Perhaps I can now finally get some value out of Twitter.

In the interim, please have a safe and happy holiday season and I’ll catch you next year.

I’m sitting here on my laptop wishing the novocaine would wear off my gums/cheek so I can safely eat lunch… or, better yet, that I could somehow magically transfer the sensation to my separated shoulder.  Yeah, that would be nice.  Anyway, I recently returned from a ski trip to Park City and accumulated a fair amount of material for my blog but have been a bit hindered in my “input abilities” — having suffered a level 3 AC separation on my right shoulder (I’m right-handed) — but have finally figured out something that works and thought I’d share some observations.

The guys I went skiing with are, by and large, not in the technology industry in any fashion and so it is always interesting to me to run things by them and get their thoughts as “lay people”.  Once such conversation revolved around social networks and which of us had Facebook profiles.  While I was amazed that most of the guys had never heard of Facebook, I had to remind myself that my profession puts in at the tip of the innovation sword and that there is ALWAYS a lag effect as to when the general population embraces some new technological wonder (if at all).  At one point, one of the guys simply asked a question that will stick with me for quite awhile:  “I don’t get all this social network stuff…what happened to picking up a phone and simply calling your friends to get together in person?”.  An excellent question if you stop to think about it.  Here’s why.  My immediate reaction was to tell him that social networks are about “discovery” and meeting new friends…but then I started thinking about it.  Here I was in Utah with a bunch of guys I only get to see about once a year due to mutual time-constraints talking about meeting new friends.  What the hell???   I barely have time for the friends I already have let alone making new ones…  I’m beginning to wonder what the point of social networks really are other than yet another online diversion to occupy increasingly precious time.  Anyone feel the same these days?

I was discussing the social networking phenomena with some VCs while at CES and one of the more prolific VCs in the sector remarked that over 60 percent of American teenagers and kids have their biographical details and/or pictures on one or more social networks (e.g. MySpace, Facebook, Bebo, YouTube, etc.) and that the number continues to grow despite privacy concerns.  While I find the numbers a bit staggering, I can’t honestly say I’m surprised.  The media has been glorifying exhibitionism and celebrity status for years and a vast majority of today’s social network denizens literally grew up with the Internet and American celebrity pop culture…and share their lives in a very open way.  So where am I going with all this?  I’m not quite sure yet as to my final destination here so much as I am about the general direction I seem to be heading.  I think there should essentially be a stratification of privacy such that different protocols and permissions exist for each personal fact (or, from a metadata perspective, set of similar facts) in a way so as to afford “user-controlled flexible privacy” for individuals and organizations.  So, anyone familiar with anyone working on something along those lines?  If so, please let me know…

A bit of additional color commentary here.  I recall reading a book about ten or so years ago, the author and title of which currently escape me, the central premise of which was that privacy ceased to exist years ago and that the best we could hope for in today’s age was the illusion of privacy.  So what’s my point?  I guess my point is that, illusory or not, there currently seems to be two primary degrees of privacy on-line: 1) freedom from embarrassment from others knowing certain details about you (e.g., web sites visited, products purchased, and other facts coming to light in the public forum that is the Internet), and 2) freedom from theft/fraud (e.g, ID theft, fraudulent e-commerce, etc).   The former at the center of on-line advertising sector(s) and the continuing quest for contextual and personal relevancy and the latter at the center of the security sector.  Both areas still ripe for innovation.  Well, I’m off to check my Facebook account so until next time, happy venturing…