Sunday, February 19, 2006

Discovery of A-List Posts: Or Why A-lister vs Z-lister debate is a red herring

The conversation that started about gatekeepers has moved on to about A-listers vs Z-listers. Or how Z-listers can become A-listers. You can see the part of the conversation here on tech.memeorandum.

If you are trying to be an A-lister you aren't. Now matter how hard you try it just ain't going to work.

Besides the point isn't to be an A-lister but to write A-list posts. To do this you need an interesting topic, something worth saying (I agree posts get tired very, very quickly) and a readable style of writing. Note carefully that last point. Readable style of writing. I have lost count of the number of times I stopped reading a post after the first paragraph because of really bad writing (I'm looking at you Umair Haque of Bubblegeneration). I enjoy reading Gapingvoid because of Hugh MacLeod's writing style (not to mention the cartoons). It is really simple concept. I With the amount I read every day I don't have time to waste deciphering incomprehensible writing.

Back to the A-lister vs Z-lister debate. The real issue is allowing A-list blog posts rise to the surface from whatever blog they are posted on. Robert Scoble and Om Malik don't write A-list posts all the time. The blogsphere will improve if we make the shift away from thinking in terms of blogs to thinking in terms of posts.

More is needed to help good posts to rise to the surface. Technorati has just implemented their "Authority" slider. However, this still looks at the whole blog and not the individual posts. This is a step in the right direction but the slider could do with refinement to look at per post authority. The other major problem with Technorati's "Authority" measure is that it counts links. This fails to account for the "virtual bloggers" who simply read the post and may leave a comment but do not have their own blog.

There is never going to be a magic bullet for finding good posts. What is needed is a series of measures to rate and compare posts. Some of these measures will be social/community based. Others will be algorithmic like Google News. The more methods for quantifying quality the greater the likelihood of a good post finding its way to the surface where ever its location.

To kick start the debate I propose that two widgets be included in blogs. These widgets would allow readers to rate a particular post. One widget would allow the reader to rate the quality of writing and the other widget would let the reader rate the content i.e. is it interesting, funny, flamebait etc. Think of it as the Slashdot moderation system write large across the blogsphere. The same system can be used for comments as well.

The rating widgets fall into the community/social category of rating measures. What is now needed is a algorithmic measures. Bayesian filters fit nicely. Bayesian filters can be used to find good posts across the blogsphere in much the same manner as they detect and junk spam. The filter would compare each individual post against what it has learned are good posts. The filter can be continuously trained by simple yes/no button for readers and by tying the rating widgets.

Over time further measures can be added including rating the readability of the English and creating topic specific Bayesian filters (what is considered a good post of skateboarding may be quite different from what is considered a good post on 19th century Russian Literature).

No system will ever be perfect and the system will need to be continuously refined. A combination of social and algorithmic methods will be needed to discovery good posts. Neither social or algorithmic alone can do it. And if you are a Z-lister wanting to be an A-lister, writing consistently good posts is the fastest way to becoming an A-lister. Whinging about being a Z-lister is not.

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Saturday, February 11, 2006

Rocketboom and Attention

This week news broke of Rocketboom auctioning ad space. Jeff Jarvis has a post quoting Henry Copeland's view of the Rocketboom auction. It is easy to exaggerate the importance of this auction but I see this as being an interesting harbinger of things to come. It also speaks to a weakness of Google.

What is developing is a transparent market for the sale and purchase of attention; an Attention Market. Just like Fred Wilson wanted. The market poses a serious issue for Google maintaining the growth in revenue. It dent's Google's strategy of becoming an attention arbitrator. Google's current strategy seems to broaden the size of their attention pool through foray's into main stream media. I see this providing a short term to medium growth in revenue but this will rapidly become difficult to maintain as the Attention Market's momentum grows.

Google is not the only company threatened by the Attention Market. All of the Internet Ad Networks and traditional advertising arbitrators will be challenged and changed by the Attention Market. While the Attention Market threatens the established order it brings new opportunities for investment and companies.

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Monday, February 06, 2006

Disrupting the VC Industry Redux: Disrupting Equity Financing

In the ensuring discussion fuelled by Rick Segal's original post on disrupting the VC industry many important points where raised by both sides. In particular Jeff Nolan of Venture Chronicles gives cogent arguments about the value of VCs in building and developing companies. Not the least of which is overcoming the traditional web services "hole" during scaling. Something I have commented on before.

The simple fact is that VCs are not going away. No matter how hard some people might wish. VCs bring value to the table. However, the value that VCs bring does not fit every situation. VCs are currently used as a one-size-fits-all solution to problems. This is where the VC or, more accurately, the equity financing industry will be disrupted. Disruption will come from solutions that address particular problems or situations within the equity financing industry.

In my previous post on this subject I proposed a VC marketplace as one solution. I foresee this market covering the early stages of new company/idea development. From conception to a product with a few customers and some revenue. Put in web service terms, this would be from conception to the beta with a few customers and some revenue coming in. It is from this point that VCs add value. The marketplace, while it could still be used, is not necessarily the best solution for further equity financing. VCs can help smooth the ride as the company goes through major growth spurt. The aim of VCs should be to help the companies leap the "hole".

The VC markeplace doesn't replace VCs. The VC marketplace compliments VCs. The marketplace provides equity financing to companies to get them to the point of being ready for VC funding if they so desire.

Does the investment company proposed by Dave Winer and seconded by Doc Searls have a place. Many bloggers don't think so. They point to the previous failure of publicly traded VC funds. As proposed, I agree. It really isn't a particularly good idea nor is it disruptive (no matter how you cut it) as stated. For its proposed vision it However, the company does have a place within the equity financing industry. Just not the one dreamt of by Dave et al.

The fund could be useful for providing cash injections into companies that either don't want to undertake a round of VC funding (remembering Guy Kawasaki's refrain "To much money is just as bad as to little") or don't wont to involve VCs in the company for some reason (they see the VCs as the devil in disguise). The fund is another way of raising equity financing when VCs or the marketplace aren't a suitable solution.

The fund would only address companyies with cashflow that have an equity requirement that is too small to be worthwhile for VC funding (which seems to be as high as US$10m at the moment and likely to go higher). The fund would focus on purchsing preferred stock as opposed to common stock. Which translates (very roughly) as purchasing a slice of future profits as opposed to a slice of the company

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