So Bing may or may not be better than Google, whatever better means. What does better mean?
The trouble is that I love Google and I love the language and tone it uses. They have thought exceptionally hard about how it needs to sound. In the same way Apple thought exceptionally hard about every key on the iPhone. Bing looks like it has been tested to destruction by product marketers, segmenting and segmenting away.
But here are three really easy tricks to make Bing ‘beat’ Google:
1. Allow me access to my Google apps: I use GMail, Gcal and a whole lot of other G’s. Bing tries to force me to change tons of my usage paradigms by sticking a link to Hotmail and Microsoft Maps on its toolbar. The absurdity. It is a lot easier to get me to change search engines than get me to change every other part of my life. Don’t force me to swap an entire user experience when Hotmail doesn’t hold a candle to Gmail.I want to be able to click to my mail from my searchengine, and ideally from my search engine to my mail. (The latter might be harder–possible a Firefox extension or greasemonkey script).
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The Baltic Dry is as some people know is a vital index which tracks the prices being paid for dry-bulk cargo. It is a great indicator for the health of world trade.
However, trading BDI contracts was the realm of professional investors. For us mere mortal retailers, we found proxies, the most popularof which was Dryships (DRYS). Last year, as the BDI enjoyed a hideous rollercoaster as shipping rates hit upwards of $120k per day only to collapse in autumn to as low as, well nothing. DRYS has a strong historical relationship to the BDI and the stock bounced around like a yoyo, hitting as high as $114 and a low of $4 or so.
What has happened this year is that the historical relationship between DRYS and $BDI has broken down.
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The folk a Techcrunch, a blog, have done some nice digging to build a first draft model for valuing social networks based on user-numbers and advertising yields in different markets.
It is a clever model which attempts:
to rank various competing social networks. It bumps down networks like Orkut and Friendster who have tens of millions of users in markets with very little advertising spend, and bumps up networks with lots of users in higher value markets.
Now corporate valuations are notoriously tricky. The big bibles reinforce just how many caveats there are. And the art of getting a good price is what makes for a succesful investment banker
I like the effort to bring some clarity to the question, now I’d like to see the next version of the model to take into account several other factors.
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I put together a quick Bing vs Google review. I find Bing a bit ‘meh’ to be honest. Nothing in their that is radically better. And unfortunately, hard to see how Bing will get consumers to switch to using it for some of their searches while continuing to use Google for others.
I tried to embed the review but couldn’t. Find it here.
Also very suprised that Bing have chosen to ape but not clone/copy Google’s UI despite hard evidence that people just prefer Google’s look and feel even when the results are served up by MSN or Yahoo.
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Alan Patrick raised the per-weekly question of Twitter’s business model: how and when will it make money?
Now, as a quick aside on web20nomics, I am encouraged by Facebook’s ability to make money, heading towards $550m this year on 250m users, which isn’t a bad monetisation rate for a business without a business model (as it was described in 2007).
As monetisation rates go, it ain’t bad: $2-3 per user per year. On it’s current user base of 250m, if Facebook could triple their monetisation per user (which would put them below Yahoo), they would be a $1.6bn revenue company, which makes Yuri Milner’s call today a smart one.
But at least an order of magnitude off Google’s, which is between $40 and $80 per user per annum.
With Twitter heading north of 30m monthly users, monetisation rates as good as Facebook’s, Twitter would be making close to $10m per month, which ought to pay the electricity bills. The question is how?
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Hey the TrueKnowledge firefox plug in is really cool.
Essentially it allows Google to give direct answers to questions you ask.
I did a screencast here.
As we saw today, Twitter reach has zipped past the Wall St Jounral and New York Times. I put the growth rate in perspective, courtesy of Compete.com
In relative terms , Twitter has clearly outpaced Facebook and the neo-journalism of the Huffington Post.
Twitter makes Huff Po and Facebook look like laggards, but in traditional business terms increasing your customers by a factor of two or three in a year is hockey-stick stuff.
Incumbent’s digital products are merely extensions of their brands and their success is measured by the relative growth compared to stagnant or mature analogue products.
The one incumbent that seems to be an exception is FT.com which tripled its US reach last year due to the credit crunch–not something it can easily repeat this year.
Cooley’s latest private financings report shows some interesting trends:
So it is not surprising to see the Series A valuations come down, with less capital around investors will drive harsher terms from companies.
It helps inject some perspective into various debates around what exactly VC is from Fred Destin and Fred Wilson.
With a median holding period of around 5 years to exit (according to Thomson), these companies will be exiting in 2014 or so. The deals struck in Q1-Q3 look exceptional expensive, more so that ones in 2007 where the bulk of a series A may have been spent.
Of course those doing deals at the $3.75m can expect to do very much better than those roped in during Q4 2008. Why? Simple maths. If you pay £100 for something at sell it a year later for £150, you have a return of 50%. If you were able to negotiate down to £75 in the first instance and sell for £150 a year later your return is 100%. Having purchased at £75, if you achieved a sale at £112.50 you would have the same return as the first scenario.
In other words, initial purchase (or investment price) is a really huge driver of returns.
For an entrepreneur, the question is where are you better off. In 09Q1 you have sold off a third of your company for basically $1m. In 08Q1, you sold off a third for $3m. So looks like you are worse off?
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(Revised on 6th May to include models for VC funds without hurdles).
It’s worth understanding how LPs pay VCs in other to understand what kind of risks VCs are paid to take.
LPs (or VC investors) are typically pension funds, endowments and occasionally family offices who are investing over a long-time horizon in a variety of asset classes. Because of their time horizon (that is they are looking to build wealth over generations) they can get into longer term investments such as timber, farmland or VC.
These LPs can get stock market returns and bond returns through equity and bond holdings. So they turn to alternatives for two main things:
1. Diversification: don’t put all your eggs in one basket. VC is an interesting asset class in that it diversifies over time (relative to equity markets)
2. Juice: VC, smart guys with money investing in smart geeks, should surely create markets, disrupt industries, yadda, yadda, yadda. Read the rest of this entry »
The very kind folk at Thomson Reuters have provided me with some of the data that Fred Wilson was asking about in his two blog posts on the VC maths problem (I, II).
Starting with US data from 1994 to 2008:
A total of $69.5 bn was raised via 998 IPOs of VC backed firms (of all flavours) in the US. The total post offer value was $396 bn.
There were 3000 M&A transactions from 1994 to 2009 YTD of VC backed firms in the US. Of these, 1460 were disclosed. The sum of these deal values was $219bn, the average was $ 150m. On average each VC-backed firm had received $32m in financing and in-toto they had received $31m in venture backing.
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