August 2011 Archives

Why I blog

 
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Committing to this blog is one of the best professional decisions I've made. I say committing instead of starting because they are very different things. I've started many blogs, but have only committed to this one. Last year I set out to do 100 posts and ended above that. This year I set out to do fewer, more in depth posts, on the order of at least once per week.

It's not an easy decision, and one that is constantly in your face, simply because blogging takes a lot of time. A good post may take 3-5 hours when all is said and done. That time (for me) is often directly taken away from other professional activity, so the opportunity cost is quite high. In other words, I must have a good reason for doing so or else I really shouldn't be doing it.


Writing leads to understanding

Blogging forces you to write down your arguments and assumptions.  This is the single biggest reason to do it, and I think it alone makes it worth it.

You have a lot of opinions. I'm sure some of them you hold strongly. Pick one and write it up in a post -- I'm sure your opinion will change somewhat, or at least become more nuanced. 

When you move from your head to "paper," a lot of the hand-waveyness goes away and you are left to really defend your position to yourself.


Getting over your fears

Blogging is a bit like public speaking, and people are scared of it for good reason. You are really putting yourself out there. 

If you do it right, you will stay stupid things every now and then. You will piss people off.  It's scary at first to hit Publish and push your ideas into the public sphere. 

In the process though you will learn how to live with a thick skin and how to confidently state your opinion. You will also come to be more zen about putting yourself out there in general. In my opinion, these skills are essential for good entrepreneurs and hard to learn elsewhere.


You can reach the right people

When I committed to this blog I had zero following, on Twitter or otherwise. When you have a following, blogging makes a bit more sense since your posts have a built-in audience and are often automatically amplified to some degree, e.g. submitted to social news sites, retweeted, etc. 

Yet even without that built-in audience, you can reach the right people. You can still submit your posts to social news sites yourself. People will still find you via search engines. You can @reply the right people on Twitter.

Fundamentally, people like reading blog posts, and you can use that fact to your advantage. 


You can stand out

I love under-utilized resources, e.g. Twitter for PR and newsletters for M&A. Blogging is one of these under-utilized resources.

Because it does take a lot of effort, most people won't touch it. But that means if you do, you are all the more visible.

Why are Chris Dixon, Mark Suster and Fred Wilson some of the most well-known VCs?  I know they are smart, high-quality investors, but if you look in the VC world there are actually a lot of those types. You know them more because they stand out as a result of their blogs and all the other stuff that flows from them.


**

Maybe I've convinced you to commit to a blog, but probably not :). In any case, if you do decide to do it, please take this additional advice with regards to your blog:

  1. Don't be bland. Bland blogs don't get you any of the above benefits. You won't stand out or reach the right people because your posts are bland. You won't get over any fears or understand anything better because you didn't really say anything. I know it's hard, but really state an opinion. Really put yourself out there or the whole thing isn't worth it.

  2. Don't hold back. There are so many startups, and yet there is seemingly so few startup blogs that tell real stories with real numbers. If you accomplish something, in the blog post you write about it, why don't you tell us exactly what you did? Not only will it make clear to yourself what contributed to the accomplishment, but it will help others as well (and therefore attract them to your post). Give us the real numbers!

  3. Let people know. If you do take the time to write "real" posts, please take the additional time to let people know about them. Yes, it can feel weird submitting your own post to HN, but if you know what you wrote is solid and useful, people will want to read it. Let the right people know on Twitter. You're doing yourself and others a disservice if you don't market your good work.

  4. Engage. No one likes trolls, but that isn't a good enough reason not to engage with people about your ideas. Engaging amplifies all the benefits stated above. The first decision here involves turning on comments and watching for comments on other sites. I would then try to respond to any comment that warrants it as quickly as possible.

Here are a couple posts that come to mind that really do the above (not by me):

How DuckDuckGo got in TIME's 50 Best Websites of 2011

 
2011_TIME_bestwebsites.pngDuckDuckGo was named one of TIME's 50 Best Websites of 2011. I thought other startups might want to know how this awesome inclusion came to be. I'm sure each story is slightly different, but here is one data point for you.

Every article is written by someone, and this one was written by Harry McCracken, TIME columnist and editor of Technologizer (bio). It's sort of obvious but often overlooked that if you want to be covered somewhere, the right person has to know about you. They of course have to want to write about you as well, but step #1 is having them actually know you exist.


First Contact

In this case, the first significant contact I know of occurred via the DuckDuckGo community (although Harry could have known about us way earlier of course). Last July we helped make the community stronger by introducing duck.co, a forum where people could cross-communicate more fluidly. 

A few months after that I started a thread about emailing journalists when appropriate, and specifically mentioned Harry. That same day I also tweeted to him in response to a comment he made about WolframAlpha, which was what prompted me to include the article in the thread.

Occasionally others have posted similar threads (and again at least one other time mentioned Harry). I know that as a direct result of those threads at least two people wrote him about DuckDuckGo, and he said he would check it out way back in last Nov.

Now just to be clear, I'm not paying anyone to write these emails. In fact, I haven't even hired a PR firm or consultant yet (though have explored the possibility). I write such emails myself as well. However, I've found that emails from real users go much farther than from people associated with the company. I figure people perceive them to be just more authentic, which in many cases is true.


Twitter 

In Harry's case, I checked my email and I don't believe I ever wrote him personally, nor have ever met Harry in person (though I'd like to!), or even talked to him over the phone. We have communicated via Twitter, however.

Here's a secret. Twitter is severely under-utilized as a communication channel. Lots of very influential people are on there, and some that don't have big celebrity names or sites behind them actually have very few followers. That means that your interactions with them are more likely to be noticed (assuming they use/check Twitter).

The tech press world is pretty small, and most of them are on Twitter. It's sort of part of their job nowadays... Harry actually has a lot of followers, so he's a bit different, but there are plenty of others that don't. And it's not just journalists -- same goes for investors, M&A folk, executives at big companies, etc. 

It's a great strategy to get noticed and break through real availability bias. For many reasons, people treat Twitter different than email, and depending on the person, may be more likely to engage with you there.

Now I personally don't have time to stalk people on Twitter. I hate wading through 50 billion tweets. That's why I continually prune who I'm following. But a lot of these folks make really interesting people to follow, including Harry (who I follow). They see a lot of stuff and so generally tweet out cool things.

Yes, I know there are other monitoring options -- twitter searches, software etc. -- feel free to mention in the comments. I'm just telling you how I do it. I look at what my followers say, and respond when I can or is appropriate. I also have one running search for mentions of DuckDuckGo (pro tip).


Bigger Stories Take Time

Harry first mentioned us on Techland back in Feb at the end of an article about the Google "Farmer" update. In March, we had a little blurb printed in the print edition.

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Then in June he mentioned us in a TIME business article, also about Google. That same day he also wrote an awesome feature in Techland as well, comparing us to In-N-Out Burger.

I responded over Twitter (saying thx), and got replies back as well. Most recently, those articles were actually summarized in the latest issue of Reader's Digest, which I mentioned and noticed this tweet (not directed at me specifically, but related). Anyway, I'm just saying there was ongoing communication, albeit lite.

In other words, it was over six months from what confirmed first contact to major article, which as noted above could have been longer in reality. I presume over that period Harry actually used and liked our product, and that compelled him to write the feature.

Of course there are other ways to try to jump it more quickly, e.g. you can try to push a hot story with a particular angle, and I've done that as well. However, that also works a lot easier if you've had contact before, preferably over a decently long period of time.

Additionally, I'd rather be mentioned every now and then in many articles than have just one feature and never get mentioned again. This was the best of both worlds, but I would take that trade-off.


TIME's Top 50

All you can hope for is a feature, and honestly I thought that was going to be the biggest story, at least for a long time. Then one day I saw this tweet.

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You can see that I re-tweeted it (as @duckduckgo). As a result of that RT I know a bunch of people "nominated" DuckDuckGo.

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I'm not sure if these nominations had any effect or not, but they couldn't hurt! After that, I didn't think about it again until yesterday.

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Not a Unique Snowflake

I must say this is not a unique story for DuckDuckGo. We've been covered many times in high profile places and it usually is a result of both community action and a longer communication history with the journalist. 

Two quick cases in point. First, our feature in Wired from this Jan was over two years in the making! Ryan Singel has mentioned us in passing a lot (thank you Ryan!), and it actually first started back in April, 2009. We have kept in touch and when the time was right for a feature, he did one.

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Second, earlier this year we won the About.com Best Search Engine award for 2011. This was a direct result of the DuckDuckGo community, as it was a voting thing.

We spread it of course on duck.co and Facebook and Twitter. Google actually mentioned it on their Facebook page (and for all I know other places), which made this really tough from our perspective. 

Actually going into the final night we behind by a decent amount and I didn't think we'd get it. But the community pulled itself together and pulled it off. Amazing.



Takeaways

I take a few things away from this experience.

  1. Things take time. We've been live now for about 3yr. They don't need to take that long of course, but don't expect results over night.

  2. People and relationships matter. You have get the right people to know about you. Twitter is great, but there are lots of other ways do to that as well.

  3. Product matters. People need stories and angles but if they like your product they fundamentally want to find a way to write about it.

What is Google's real market share in the US?

 
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As the US government looks into Google from an antitrust context, a central question has to be what is their real search engine market share in the US? As someone who runs a search engine, I've followed and studied the numbers floating around for a while. And yet they've never really sat right with me.

Comscore and Hitwise are two primary providers of search engine market share numbers. Their two latest reports peg Google's share at around 65% in the US, and that's generally what the press reports.

That seems high indeed, but everyone I talk to "in the wild" who runs high traffic sites actually sees a much higher percentage of their search engine traffic coming from Google, usually from 80-90%. There is some similar data on Quora and HN for reference. If you check those out, you'll see some people (including myself) have seen some sites with less Google % and higher Bing or Yahoo, but these seem isolated cases on particular verticals (and overall smaller traffic sites).

What makes this even weirder is Hitwise also recently came out with a report saying Bing/Yahoo users click on more links than Google users, so you'd expect the Google % everyone sees to be slightly lower than their real market share. But it's the opposite.

Bottom line is something doesn't add up here, and I'm not sure what is going on exactly. Rand Fishkin (CEO, SEOMoz) suggested that it has to do with counting internal links on Microsoft/Yahoo sites:

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It's hard to believe this would account for the entire difference, but maybe so. It would be great to see #s calculated off of clicks to external sites. That wouldn't be perfect either and would still overstate Bing/Yahoo as noted above (though that could be controlled for). Hitwise seems to already have that data, so putting out a report like that should be relatively straightforward.

The closest thing I've found to that data is from Statcounter. They report Google's US market share at a much higher 80%, which they glean from their analytic (click) traffic. Their browser share #s don't seem way off, so one might imagine that their search engine #s would be equally representative. 

Another possibility is Bing and Yahoo are sending a TON of traffic to a small number of sites. We already know that Bing users use IE way more than Google users, which could indicate that they would be a very different group of people cilcking on different sites. 

However, that again seems unlikely to account for all of the difference. You would then expect to see more comments on those Quora and HN threads where people associated with some of those sites would step up and report such.

It's not that Hitwise/Comscore/et al. can't report higher #s. For example, they report 90%+ Google market share in other countries. Just not the US.

So what is it? 65% or 80%? That's a huge difference (~25% in relative terms).

Update: good comments on HN.

Startup M&A availability bias and what to do about it

 
Forewarning: the following is just a theory -- I have nothing to back it up beyond anecdotal evidence. 

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Why do some startups get acquired and not others? Here's a thought experiment. Suppose you have two startups in the same space with about equal traction. What factors could lead one of those startups to get acquired over the other?

I believe a major factor is availability bias on the M&A side. That is, the buyers know more about one over the other and are (often legitimately) biased in their favor.

You might think that this initial bias wouldn't help much in the end because the buyer would proceed to evaluate both startups and pick the one they thought was better. However, the bias isn't easily severable. If they know more about one, they're going to be primed to pick that one, assuming their foreknowledge is positive. 

And from my (albeit limited) experience, not all M&A departments take such a top-down approach. They may only consider the one company they know about. They may also not even be considering that space at all but for knowing about that company.

So, what can you do about it? 

First, you need to determine your acquisition targets. Make a list. Go wide. Put anyone on it that you think has some synergistic or strategic reason to buy you.

  • Newsletter. When you meet people at the targets (either randomly or strategically), ask them if you can add them to a special newsletter you send out quarterly where you include inside info about your industry based on your unique position within it. Who can refuse that? We did that at my last startup and it worked well. If there is one secret in this post, this is it. I love it because it fires on lots of cylinders: it keeps you in their mind while at the same time (if you do it right) showing your company is awesome and that you are awesome (given how you choose to frame the insights).

  • Investors. Investors, especially ones with lots of startups, are involved in acquisitions all the time, e.g. super angels. These guys know the M&A guys and they talk startups. By virtue of being involved with them, I believe you have a leg up. Now this alone is not a reason to take external funding, but I believe it is a real benefit. (There is another related benefit of substantially increasing the price, but I'll leave that for another post.) For the record, my last company had no external investors and we did get acquired, I believe that occurred from doing the immediately above and below tactics.

  • Partnerships. The more they know you, the greater the availability bias when they think about acquisitions. And if you're already doing a partnership with them, it honestly makes a lot of sense. Assuming the partnership is fruitful, you're actively showing them how you can benefit their company. Also note that partnerships, if initiated by a buyer, can be a potential acquisition in disguise. That happened to us. We had the newsletter, then they reached out for a partnership and it turned quickly into acquisition talks.

  • AngelList. This is a new one that I discovered the other day via Naval, and which prompted me to write this post. Check this out. It's the corp dev (M&A folks) on AngelList. Wait, what? They're not investors... But just as AngelList has started expanding into Series A and later financing, I believe they'll also keep growing down the chain to M&A. It makes perfect sense. They have startup profiles, and startups updating their traction metrics. They can then make it super easy for you to maintain that newsletter I was talking about above. This channel is currently under-utilized (given it is so new), and so is especially attractive.

  • Press. Pretty obvious, but it really helps. People trust certain channels, and press is often one of those. In startup land, that Techcrunch/Techmeme visibility can help here for sure, but other targets may play better with more specialized places (such as trade magazines). Then there is the more creative tactics -- I didn't put it up for this purpose but a ton of people saw the DuckDuckGo billboard, which has led directly to partnerships.

  • Networking. Of course, you can't beat literally getting in front of the right people in a casual context. I hate to say it, but living where your targets are can help here if you can get to the same social events. You can get around this somewhat by going to conferences and the like, but people are thinking about different things in that more professional context (and are often bombarded).

Let me take a step back and say you don't have to want to get acquired to take these steps. If it turns out for one reason or another that it eventually makes sense for you, then you'll be in a better position. Also, they could help in other things, like business development.

Apply to Open Angel Forum Philly II

 
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Antonio Tedesco and I held the first Open Angel Forum Philly in March. We're calling it a success as investors want to come back and companies were offered funding

That's why we are proud to announce that we're making it a regular event and OAF Philly II will be held on the evening of Sep. 20th (again at Morgan Lewis).

If you are involved in a startup that is looking for seed funding, please apply (there is no charge to apply or attend if selected): http://ye.gg/oaf

For those of you not familiar with Open Angel Forum, the idea is to get the best regional angel investors in a room and put 5-7 great startups in front of them. We hope it is a funding powder-keg.

We should have an awesome group of investors attending, just like last time. If you are an angel investor in the mid-atlantic region and want to come, please let us know.

We're also looking for a few sponsors.

Here is what we're looking for with regards to startups:
  • US companies. You do not need to be associated with Philly. In fact, last time we had companies from Austin, NYC, Minneapolis and Chicago, in addition to Philly.
  • Working demo, preferably already launched with some engaged users. The event format is a five min demo followed by a five min Q/A followed by networking. It's not a traditional pitch event with slides, so a working demo is essential.
  • Products matching our investor preferences. Our goal is to get you funded, and to do that you can't look too different than things our angel investors generally invest in. This generally means software of some form.
  • Terms matching our investor preferences. Same as above, our angels are looking for good deals. This generally means reasonable valuations and seed rounds (essentially first money in). 
Here is the process:
  • We're accepting applications for OAF Philly II through Fri August 26, 2011.
  • Antonio and I will then go through and select the companies that fit the above criteria.
  • We will then try to hold Skype demo sessions with all those companies. Last time that was about 25 startups. We may involve some other angels in this process.
  • We will then extend invitations until the six slots are filled.  We're aiming to do that by Sep 12th.
Feel free to ask questions in the comments, and I'll do my best to answer.

And apply already! http://ye.gg/oaf