Boston vs. NY Venture Capital

I’ll be moving to NYC in a month, and potentially refocusing this blog on NYC. Because I’ve been spending a lot of time thinking about NY, I want to begin discussing it in the upcoming weeks.

There’s been a Boston/ NYC rivalry as long as I remember.  Having grown up in NJ and living in Boston for the last six years, I’ve felt a good amount of it, though nothing was better than watching the Giants beat the Pats…

Everyone knows that Menlo Park is at the top of U.S. VC, but Boston isn’t too far behind.  Interestingly enough, NYC takes much more of the online credit for this.  Why is this?

I think the answer is definitely cultural.  The NYC tech world is filled with Julia Allison, trendy Soho Meetups (that I’m hoping to be a part of when I finally move next month), and the media.  Boston, on the other hand, is comprised of brilliant, but nerdy MITers, medical devices, and the boring VC town of Waltham.  As developed as the industry is here, it definitely lacks the community that exists in Menlo Park and NYC.  I’m very excited to hopefully join that community in NYC, even though I am a consultant and don’t spend much of my professional time working with startups.

Coolest iPhone App

I’ve been playing with lots of iPhone apps, and I’ve come across one that is really amazing.

https://www.pageonce.com

Pageonce allows users to store logins and passwords for a plethora of websites, ranging from bank accounts to airline points.  With one simple login, it allows users to check their account balances, scheduled flights, status of Amazon orders, Netflix mailings, and limitless other accounts. The iPhone app allows me to view all of these quickly and easily on my thin black box of magic.

I can only guess that people are very concerned about security with such an application.  However, they use encryption for all of the passwords, and once you log in, you can’t really see any information that would be very damaging if stolen.  Also, it allows for me to remotely wipe the application from my iPhone incase it’s stolen.  In the event that it is stolen, I’m okay with the theif seeing how much cash I have, Starwood points, and that I rented The Little Mermaid on Netflix.  No account numbers are displayed, so it’s relatively safe.

iPhone App Wishlist

Lots of iPhone apps have sprung up, and I’m sure many more are being written.  Here are a few that would be nice:

1. Netflix app – Over the last week, I had talked to people on two separate occassions about movies that they recommend I see.  It would have been great to quickly and easily add those movies to my queue.
2. Google Chat – I’m sure this is on its way.  The iPhone web interface is a start, but isn’t great
3. Delicious – less of an app, and more of a feature – it’d be nice to tag pages on the fly
4. Zagat – I’m sure this is coming as well.  They have a blackberry app, so an iPhone app is logical
5. Free RSS reader – surprised there aren’t more of these.  Using my iGoogle page on the iPhone for this now

First post with iphone

I ended up not camping out at the apple cube in manhattan on launch day because I had to drive back to Boston the following morning. However, I waited my 3 hours in line 3 days after launch, and I’m now a proud owner of a 3g iPhone and I love it.

I also just installed the wordpress app on it, so I’m hoping that the iPhone will help revitalize my blog, given that now I can post anywhere.

Looking forward to many more postings to come!

First Post with Firefox 3

Firefox 3 launched yesterday, with a large marketing campaign to set the record for most downloads of a program in a day.  Funny enough, it looks like they bit off more than they could chew.  I tried downloading on 4 separate occassions throughout the day, and the servers were down each time.  I was finally able to get the download both on my PC and Mac in the evening.

First impressions?  It’s definitely feels a bit speedier, I like the crispness of the UI, and the smart location bar is very cool.  My only gripe is that my deli.cio.us plugin didn’t support firefox 3, so I’ll have to find a different one or wait for an upgrade.

It’s interesting to see a piece of software evolve that is supposedly so simple.  The browser is function is very basic – it is an enabler of content.  Unlike a product that is the focus of your use and allows you to create or edit content (e.g., Powerpoint), the browser plays more of a background role.  However, it’s facinating to see where the innovation is happnening in browsers:

1. Making the user experience faster and more secure.  This is pretty self explainatory – faster load times and improved security features
2. Organizing information – there are lots of ways of organizing links (my new favorite is google notebook), but the browser is still the primary domain for that.  This is illustrated by the smart location bar.  I think this is where the browser may eventually start bumping heads with someone like google.  Previously, if I wanted to find a link that I went to a few days before, I would search on google.  Now, I can use my smart location bar, and find the link faster.  This will surely take hits away from google.
3. Improving the user experience as a whole – the biggest jump here was the introduction of tabbed browsing, which really changed the way I browse the web.  I think additional things include a crisper layout and auto fill of forms.

It’s great to see Mozilla continue innovating, and it’s particularly interesting seeing a non-profit consistently staying one step ahead of the Microsoft behemouth.

Can the iPhone become too popular?

As we wait for the next coming (June 9), the rumor mill has been crazier than ever.  One of the rumors about the 3G iPhone that I find interesting is the possibility of it being carrier subsidized, and therefore, cheaper.  Although this may be a great thing for Apple, it makes the iPhone much less appealing to a certain segment of users.

The future of free?

Interesting recent posts by Hank Williams at Alley Insider and Charlie O’Donnell’s response at This is going to be big.

The topic is how “free” business models make having a small business online unsustainable.

This is because in the digital world, advertising, the only real revenue stream, cannot support a small digital business. If businesses were based on the idea that people paid for services then small companies could succeed at a small scale and grow. But it is very hard to charge when your competition is free. – Hank

Hank essentially blames VC’s for this, because they fund companies until they become large enough to sustain an advertising revenue driven business model. Therefore, small internet companies cannot exist because they cannot compete with the “free” companies that are VC funded.

Charlie’s response was, (and this is quickly paraphrased), that up-front fixed costs are very low, as compared to other businesses, therefore, it is fairly cheap for VC’s to eat costs while they develop profitable businesses.  Charlie uses the analogy that Henry Ford would give away his cars until he reached scale in the factory.

For the most part, I agree with Charlie. However, Hank’s argument does have some merit. I can see it being very difficult for a small online business to try to remain small. The problem with the internet is that both large and small businesses have very low fixed costs, so VC funded internet startups can provide free services while they grow large enough to achieve advertising revenue scale (Charlie elaborates further on this). Hank’s contention with this is that because these free services are subsidized by VCs as growing companies grow, they prevent small online companies from existing because there is an expectation for their services to be free as well.

My take on this is that it’s the small/niche companies’ fault for not differentiating themselves. The reason that small businesses in the non-online world can compete with large businesses is that they provide a niche and specialized service – whether it’s a specialty product, geography focus, or more personal service. Small/niche online companies can charge users for their service, but they need to be differentiated enough from large companies to warrant such a charge. I don’t think that there are many businesses that can and should provide a very segmented/differentiated product on the internet, and I think that’s due to the nature of the internet. The internet evolved to be scalable and to reach a large number of people. By it’s nature, the internet does not make it economical to do differentiated business with a small segment.

Therefore, I think Hank should not be blaming VCs for further developing the model that is most economical, but should instead consider the nature of the internet.

Official iPhone Prediction

So everyone is talking about the 3G iPhone.  The  inventory shortage, the AT&T CEO chatter, and open apps coming in June lead to lots of speculation.

Here’s my prediction:

•  3G iPhone gets announced in June.
• Launch is in August/ September

Logic:  It’s definitely coming.  But it needs FCC approval first, and Apple doesn’t want the news coming from FCC filings.  Steve wants his dog and pony show, and he’ll have it in June.  Then he’ll file it with the FCC, and hopefully have it approved in 3-4 months.

Government Absurdity

I normally don’t talk about politics (I was a poli sci major in college, so I’ve learned to avoid the topic), but this really gets me.

The 2010 census is going to cost  $14B+.  Yes,  that was a “B”  for billion.  I know the dollar is weak, but that is absurd.

Let’s think about this. Did some quick math – $14B/ $300M residents = $46.66 (6 repeating, ofcourse) per person for the census. We pay that much to have every person counted.

Even more math: $14B/$117 (number of taxpayers in U.S.)= $119, which is the average price every taxpayer pays for the census. I could understand if this was to get us to Mars, introduce renewable energy, or even buy tanks, but to count people?!?

This makes the Big Dig look like a minor budget deficit.

I hope a lot of people lose their tenured jobs for this.  Can you imagine any private company being so inefficient?  I bet you can create a startup who can complete the census for under $100 million.  This is the worst example of inefficient government.

Source: AP via Engadget

End of Unlimited Bandwidth Internet in U.S.?

Comcast today announced a deal with BitTorrent saying that they will not limit BT specific traffic.

However, an additional detail can be found in the article, which may provide a hint of things to happen in the U.S. internet.

Rather, Comcast said it will work on reconfiguring its networks so that, by year’s end, it manages data in a “protocol agnostic” way. Comcast has confessed to “delaying” uploads to the BitTorrent protocol at peak congestion times, but the new process would apparently involve managing traffic based on how much bandwidth consumers use, rather than what sort of applications they’re running. [Cnet]

The key implication from this statement is that bandwidth will no longer be unlimited. This can have dramatic effects on the innovative environment in the U.S.