The National Venture Capital Association released a four-point plan to revive the market for VC backed IPOs.
1. Tax incentives via low capital gains
2. SOX and other regulation reform
3. More boutique I-banks and accounting firms focused on VC backed companies
4. New liquidity paths through secondary exchanges
Thursday, April 30, 2009
Saturday, April 25, 2009
Google Profiles
Google announced this week the launch of Google Profiles, allowing people to create profiles of themselves that can be selected to be made available on Google searches for your name. The incentive for people to create such profiles is pretty clear. Google verifies these profiles, giving individuals the capacity to control what people glean about them when they "Google them".
The implications to the internet could be pretty far reaching:
The implications to the internet could be pretty far reaching:
- Through these profiles, Google learns more about individuals, giving them more context to leverage in their expanded advertising efforts with DoubleClick and beyond. It is similar to the type of context that social networking properties are collecting. However, unlike the social networking properties, Google has an established advertising network to expand on with this data.
- There could also be a disruption to Linkedin. With Facebook controlling most communications amongst members of a social graph, Linkedin's core consumer value has been scaled down to enabling people to study other people's backgrounds prior to meetings, introductions, etc. If the Google Profiles become people's primary professional profile, then Linkedin's consumer value will slowly fade into the background, and Google may in fact broaden their profiles to encompass a flavor of social or professional networking as well.
Thursday, April 2, 2009
online videos
I spent the winter really digging into the online video space with the gang here at NSVG.
Today, the online video market is roughly an $800M business. This is peanuts compared to TV which is closer to $70B. My conclusion from the forces taking shape is that the online video market is poised for explosive growth that will attract new ad dollars, in addition to ad dollars shifting away from TV to online video.
Before explaining the forces taking shape, let me begin with my definition for online video as opposed to TV. I think of online video as any form of video content that is delivered over the internet. I think of TV as broadcast/cable network channels.
Now to the forces:
1. Short-form content: My friends at TubeMogul tell me that based on their data, 75% of online video viewers drop off by the end of the second minute. The reason for this is twofold. First, there is a shortage of compelling content online today. Second, the attention span of online video viewers is in the minutes, not hours. There has been some limited success by groups creating short-form content that are compelling in nature and fit the short attention span, including EQAL (lonelygirl15, KateModern, etc) and Revision3 to name a few. My prediction is that we will see much more compelling content like EQAL's and Revision3's come out of small studios that will fuel the growth of online videos and attract advertisers who want something other than user generated content to put ads on. In a recent trip to LA, I was impressed with the movement of very talented creatives away from traditional studios towards independent production of online shorts.
2. Categorization and Channeling: Today, most of us find new online videos when our friends send us an email with a link, or when we search our Facebook newsfeeds and see videos our friends posted, or when we search video sharing sites like YouTube and Metacafe. The problem is that for the most part, we are pointing/clicking our way through content versus sitting back and being entertained as we are when we tune into channels on our TV. Companies like ffwd and 1Cast are doing some good work in categorizing content into channels that you can sit back and watch. I believe we will see more companies tackling this problem and we'll slowly turn online video viewing into something that you can sit back an enjoy versus point/click your way through. There are challenges though, like deciding on categorization techniques from the limited metadata that exists for online video. That said, it is where we need to go and we are seeing the forces take us there.
3. Advertising: Although part of the reason that online video ad spend is only at $800M today is in fact the lack of compelling content, another reason is the lack of appropriate ad units. While pre/mid/post rolls and overlays on video have had some success, the data suggests that consumers are not happy with them. Clearly there needs to be some innovation around new forms of video ad units that are appealing to both advertisers and consumers. I've seen some interesting seed stage companies recently that are doing very cool things like stitching ads into white spaces in a video or doing post video production product placement. The market is telling us that online video advertising is not working today, and the forces are moving us towards better solution.
4. Convergence: Perhaps the most exciting of the forces is that of convergence. I envision a day when we no longer pay Comcast or Dish a monthly subscription fee because we have all the content we want at our fingertips on the TV through the internet. Yahoo's TV widget platform is one indication of the big boys pushing us in this direction. If the Yahoo TV widgets take off (I think they will), you can envision all the content in the world being available through various widgets on the TV and people can view them for free with advertising or for a fee without advertising. In addition to Yahoo, Apple is making the same bet through their Apple TV service. However, the beauty with Yahoo's TV widget platform is that you don't need another box like you do with Apple TV. You simply connect your TV to the internet and you are off and running. We are still worlds away from this reality, but the forces are clearly moving us in a direction where one day all content will be delivered through the internet.
As these four forces materialize, you can bet that online video will grow from an $800M business to one that could very well surpasses where TV is today.
Today, the online video market is roughly an $800M business. This is peanuts compared to TV which is closer to $70B. My conclusion from the forces taking shape is that the online video market is poised for explosive growth that will attract new ad dollars, in addition to ad dollars shifting away from TV to online video.
Before explaining the forces taking shape, let me begin with my definition for online video as opposed to TV. I think of online video as any form of video content that is delivered over the internet. I think of TV as broadcast/cable network channels.
Now to the forces:
1. Short-form content: My friends at TubeMogul tell me that based on their data, 75% of online video viewers drop off by the end of the second minute. The reason for this is twofold. First, there is a shortage of compelling content online today. Second, the attention span of online video viewers is in the minutes, not hours. There has been some limited success by groups creating short-form content that are compelling in nature and fit the short attention span, including EQAL (lonelygirl15, KateModern, etc) and Revision3 to name a few. My prediction is that we will see much more compelling content like EQAL's and Revision3's come out of small studios that will fuel the growth of online videos and attract advertisers who want something other than user generated content to put ads on. In a recent trip to LA, I was impressed with the movement of very talented creatives away from traditional studios towards independent production of online shorts.
2. Categorization and Channeling: Today, most of us find new online videos when our friends send us an email with a link, or when we search our Facebook newsfeeds and see videos our friends posted, or when we search video sharing sites like YouTube and Metacafe. The problem is that for the most part, we are pointing/clicking our way through content versus sitting back and being entertained as we are when we tune into channels on our TV. Companies like ffwd and 1Cast are doing some good work in categorizing content into channels that you can sit back and watch. I believe we will see more companies tackling this problem and we'll slowly turn online video viewing into something that you can sit back an enjoy versus point/click your way through. There are challenges though, like deciding on categorization techniques from the limited metadata that exists for online video. That said, it is where we need to go and we are seeing the forces take us there.
3. Advertising: Although part of the reason that online video ad spend is only at $800M today is in fact the lack of compelling content, another reason is the lack of appropriate ad units. While pre/mid/post rolls and overlays on video have had some success, the data suggests that consumers are not happy with them. Clearly there needs to be some innovation around new forms of video ad units that are appealing to both advertisers and consumers. I've seen some interesting seed stage companies recently that are doing very cool things like stitching ads into white spaces in a video or doing post video production product placement. The market is telling us that online video advertising is not working today, and the forces are moving us towards better solution.
4. Convergence: Perhaps the most exciting of the forces is that of convergence. I envision a day when we no longer pay Comcast or Dish a monthly subscription fee because we have all the content we want at our fingertips on the TV through the internet. Yahoo's TV widget platform is one indication of the big boys pushing us in this direction. If the Yahoo TV widgets take off (I think they will), you can envision all the content in the world being available through various widgets on the TV and people can view them for free with advertising or for a fee without advertising. In addition to Yahoo, Apple is making the same bet through their Apple TV service. However, the beauty with Yahoo's TV widget platform is that you don't need another box like you do with Apple TV. You simply connect your TV to the internet and you are off and running. We are still worlds away from this reality, but the forces are clearly moving us in a direction where one day all content will be delivered through the internet.
As these four forces materialize, you can bet that online video will grow from an $800M business to one that could very well surpasses where TV is today.
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