

Fuck the VCs - tortilla
http://www.taptaptap.com/blog/fuck-the-vcs/

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maxklein
Personally, I think it's just the start. It's my opinion that we are at the
very beginning of another game changing event (like the internet).

Computers are going to become tiny things like the iPhone, and you come home,
stick it in your docking station and your desktop pops up.

Apps will have to scale from very tiny screens to massive 30 inch monitors.
Things, them are going to be different real soon, like the gospel singers used
to sing.

Software will be deployed over the air, just like the iPhone app store.

That's why google has a phone, that's why yahoo is making YUI, that's why
google allows everyone use its charts API for free. They are all trying to
take control of the API for this new platform. The new world is not just
internet based, it's apps built to be completely internet aware and to work
with the internet all the time.

Software is changing. It's no longer about writing an FTP client and selling a
few thousand copies - when you think of an always on internet, easy
distribution, and location awareness, a whole new class of apps will emerge.

It's a big markets, and the business folk can see that.

~~~
nostrademons
I think you're right that we're on the cusp of another huge game-changing
event, but I think you're wrong about it being the iPhone, or any other cell-
phone-like device.

Does anyone remember 1992? There were basically two huge "next big things"
that were supposed to revolutionize everything. WebTV, and CD-ROM drives. Both
had _massive_ backing from the major players of the day - Microsoft, Apple,
the big TV networks, hardware manufacturers.

Instead, it was the WWW that took off, and over the next 10 years, the WWW
subsumed both of them. I don't think that was an accident of history. Huge
game-changing innovations rarely come from big-company platforms (though they
often come from hobbyists who were inspired by big-company research labs).
They just have too much entrenched baggage. Instead, they come from small
startups and hobby projects that have the flexibility to become what the
market is demanding. The web succeeded, in a large part, because Marc
Andreesen didn't listen to Tim Berners-Lee and added support for inline images
even though it was totally not the way anchors and resources were supposed to
work.

I've got two ideas for what that next big disruptive innovation might be. One,
as Mitch Kapor suggests, might be virtual worlds. The other is microblogging,
a la Twitter. Any other ideas?

~~~
maxklein
I don't see where one can go with microblogging. How does it change anything?
It's the end point - the blog is the end of the line. All you can do is change
the display format.

But merging cell phones and computer is the start of a new line. Virtual
Worlds are the start of a new line also.

Virtual Worlds are coming, but their time is still some years away. What will
really kick it off will be the headtracking and motion detection software that
are currently getting better and better with software. And combined with the
virtual 3d thing (head tracking where 3d is approximated) and constantly
cheaper big ass flat screen TVs, there is another big potential there.

The iPhone is not the game changer. It's the things that are right now being
inspired by the iPhone. It's the new devices that will come up that will copy
the concept but make it even cleaner, even better, even more powerful.

Are you trying to say CD-ROMs did not revolutionise everything? How much would
be possible today if we were still using tapes, or swapping 12 floppies to
load a 10MB game?

CDs did change computers, but they got old quick, that's all. But they still
stayed longer than the internet in its current form has been around.

~~~
nostrademons
Remember what the web was in 1992: a way to share textual scientific
documents. How does that change anything? All you can do is change the display
format. ;-)

And then people discovered you could embed images in these documents. And you
could sell stuff by listing the stuff you had for sale and having people send
you money. And you could hold auctions with them, once they figured out how to
let you update the page automatically. And you could upload pictures of your
dog and send them to friends.

And then folks realized that you could include a scripting language on both
the client and server, and let computers handle what website operators had
been doing. Update webpages through a form. Let people talk to each other on
forums without the webmaster getting involved. Automate those online auctions.
Display your email. Search for maps and driving directions. Look for the
multi-gig files that were previously available on CDs, and download them via
BitTorrent.

So, microblogging. Companies are already Twittering product announcements and
special promotions to customers. What if the customers could Twitter back with
suggestions? What if they could buy it immediately? What if you could Twitter
a picture or a song to your followers and they could listen immediately,
wherever they were (isn't Pownce doing that?)? What if someone did a bot that
monitors Twitter for mentions of your product, then ran some NLP on them and
sent you neatly categorized suggestions for improvements? What if someone
clustered Twitter users with some clique-detection algorithm and used that to
segment markets?

Hot damn, I may've found my next startup idea. Or maybe I should just apply
for a job at Twitter. ;-)

~~~
maxklein
I really don't see how this is useful. Maybe I've become one of those guys who
doesn't 'get it' anymore, but I think that twitter is not going to be as big
as you think. Yes, a form of mini communication will happen, but in the
current form, there will very quickly be too much information. We have finite
capacities for processing stuff, and twitter is a rabble of information, which
just gets wearying after a while.

To me, the people who are really into twitter all seem to be the same
demographic, and that's usually bad news for a technology. It's those same
people who used to like Usenet and the IRC that are now using twitter.

Twitter is something that intrudes on your life, and having it does not solve
any problems, it adds stuff to what you already have.

But I won't protest too much, because it's possible I'm wrong on this one.
I'll just wait and see. But frankly, I still don't see how I could somehow get
my mum excited about twitter, even if it had all those features you spoke
about.

~~~
william42
I think that twitter itself may not be that big but attaching twitterlike
'tags' to things may be a very useful feature. Being able to "home" your
comments on specific sections of a text seems useful.

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pg
It's a sign of this guy's inexperience that he treats VCs as if they were all
the same. In fact one of the most distinctive things about the VC world is how
much variation there is in it. Partners at the top firms are clever and honest
and expect to make money mostly from the fund's returns. Whereas the bottom
half are basically in the business of generating management fees.

~~~
condor
That is true, however I think it's fair to make the point that all Venture
Capital firms have the same structural incentive to treat companies (equity)
as products, to be traded in a marketplace, and consequently are primarily
focused on the net worth (capital gain) return from trading that equity versus
the ongoing value-added by the operating business (dividend). I think that's
where the 'taste-for-blood' comes from. That fundamental incentive affects how
institutional VCs view the founders of a company (less so as partners and more
so as employees in a sense). I think that's what this guy is reacting too,
rightly or wrongly.

~~~
pg
How many technology companies do you know that pay significant dividends? That
just tends not to be how tech companies operate. It's not an artifact of VC
investment.

~~~
condor
Thats true. I think newer (last 15 years) tech company's have been able to not
offer dividends and still attract investors (even low capex, software co's
that don't necessarily need to reinvest), but the types of investors (venture
investors) they attract are naturally then interested in capital gains, and
thats only achieved by trading that equity. I could be wrong, but traders tend
not to think past the point of their expected holding, and since their only
return is on sale of the equity, prefer for that to happen earlier rather than
later.

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hugh
The article itself is a bit of a rant/whine (rhine?) but I found the bit of
dialogue in the section "The VC mentality" interesting.

To some extent I think the VC might actually be right here. I think some
people get too caught up in the idea that there's a tiny minority of "great"
programmers who can perform miracles, and everyone else is a mindless drone
unworthy of coming anywhere near your code.

I'm not saying that all programmers are equal, but if this guy can't even find
_one_ programmer in the whole of Silicon Valley that he thinks is worthy of
working on his project (which appears to be an iPhone-based grocery list --
not exactly the most intellectually demanding project in the world) then he
might be looking for something that doesn't exist.

~~~
thaumaturgy
I don't think it's unreasonable to say, "We're having trouble finding one
great programmer". If a programmer is pretty good at what she does, then odds
are she's already got a secure, comfortable, well-paid job. The VC might have
suggested that extra money could attract a great programmer, but he didn't.

I think it comes down to Ambrosia versus Microsoft. The author would prefer to
produce software the way Ambrosia does. The VC prefers the Microsoft way.

~~~
hassy
> If a programmer is pretty good at what she does, then odds are she's already
> got a secure, comfortable, well-paid job.

Especially so if the programmer in question is a Mac/Cocoa programmer. There
are few of them around, and chances are they are either working at Apple or
doing their own thing.

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dmix
Bubbles impact more then just VCs and entrepreneurs. Right now, almost noone
is IPOing and exits are slim. Why does everyone compare bad VC investments to
the dot-com bubble? Do you really think there will be a flood of iPhone app
developers going public?

The only impact that will have on the economy is some investors will lose some
money, which happens all the time.

In Silicon Valley everyone seems to think that as long as their starting a
company, that VC is always an option. But its only appropriate for a certain
types of businesses (high growth, exited focused, etc). I'd put the blame as
much on the entrepreneurs who can't tell the difference and not the VCs who
look for trends to profit off of.

Besides, is it really that hard to stay "indie" developing iPhone apps? I
don't see where the need for capital comes in the first place.

~~~
hugh
_Besides, is it really that hard to stay "indie" developing iPhone apps? I
don't see where the need for capital comes in the first place._

Especially if you can't even find one person that you want to hire.

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pkaler
You don't really need VC funding to launch most iPhone applications.

The cost of development is so low compared to other types of development. I'm
the lone programmer at my startup at the moment. However, I just left a team
of 35 programmers trying to ship a PS3 game.

I could see maybe 4-8 programmers top on an iPhone application project. There
were 9 programmers on the last Sony PSP project I worked on. VCs don't want to
fund that type of development either.

They may fund an app that integrates somewhere in the cloud and also has a web
interface. That's a bet that is actually big enough for them to care.

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josefresco
Easy to say F __* the VCs when they're knocking down your door.

Me? I'd hear out the first caller without hesitation.

~~~
MicahWedemeyer
Yeah, if only to get some external validation that you're not crazy.

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henning
The other part of this, if there really is a bona fide iPhone app bubble, how
will Apple react, if at all? To them, it might seem like the Champs-Élysées is
getting turned into a giant strip mall. I wonder if they'd pull some kind of
sudden "night of the long knives" move.

~~~
aaronblohowiak
A bubble usually involves over-optimistic speculation. Are you suggesting that
there is an irrational exuberance in iPhone apps? I think there is a bit of a
land grab, but people are making real take-it-to-the-bank cash, not just
hitting nebulous "soft" performance marks. For of an app Boom than a bubble,
imho.

~~~
flipbrad
it's no good saying 'people' - the problem is which ones. Plenty of people
were driving aorund in nice cars during the last bubble, having 'taken to the
bank' investors' cash; but the whole setup was totally unsustainable and the
people putting in money weren't getting it out. Is it so different this time
around?

~~~
aaronblohowiak
The source of the money that I am referring to is iPhone users buying apps,
not VC money.

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fallentimes
I like the first comment - we deal with it every day:

"Agreed 100%. And oddly enough I’ve been told precisely this by two VCs!
Basically:

1\. “if you want to make a massive company, get VC money” 2\. “if you want to
make more money than 1, on similar odds, play the lotto” 3\. “if you want to
make money, don’t involve VCs” "

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tedr
Wow, this brings me back. Nothing makes VCs hotter than a nascent business
with traction in a hot sexy space. They'll cool fast when they see the world
isn't suddenly going to all get iPhones and leave everything else behind, but
they are on it like spider monkeys right now

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river_styx
YES!!

 _electric guitar riff_

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time_management
Haven't RTFA yet, but it seems like any respectable VC would recuse him- or
herself from any funding decision in which personal relationships might be
involved.

~~~
time_management
-1?!? Seafood soup!

