innovation playground Idris Mootee

The Future of PC 2010 - When Is The Mouse Going Away?

People often ask about the new new thing…I wonder what will happen to the PC we use today in 2 years? When is the mouse going away (it is 40 years old)?  What does the next generation of keyboard looks like (current QWERSTY is more than 100 years old) ?

Will touch screen go mainstream? What about browser (there has been little innovation since the first browser)? What about “eye-tapping” technology which is laser-based and allows the eye to function simultaneously as if it were a display and a camera?

The current PC experience sucks as we know it although many of us are so used to it that we stopped complaining. Think about it, hard drives die without warning often at the worst time. Can we use a dozen of flash card instead?

Current PCs were designed for man (forget all those pink and red) and I can imagine how different they will be if they were designed for women. The first PC designed for female will probably become the most popular PC used by both male and female. Believe me.

Since landfills are filling up with abandoned toxic electronics, the next-gen PCs should be made out of recyclable material with a built-in small solar power screen.

Your future PC will not run on Vista as it will be discontinued in 09 and MSFT will declare that it is a complete failure. You will most likely be using Windows 2010.

Your future PC should have no cables.  All files synchronization will be done through wireless.

And if you PC catch a virus, the Center of Computer Disease Control (CCDC) will be alerted and a man in uniform will show up on your door in 10 minutes and snatch your PC and put it under quarantine for 10 days. They will be returned to you for a fee if proved cleaned.

Or in the future, PCs will be free. All you need to do is to sign up with a social networks and opt-in for some ads then you will get a free FaceBook PC?

Or by 2010 PC will cease to exist and computing will be embedded in all appliances and all you need is a terminal. Back to future, the network is your computer. The social network is your gateway to your connections.

Social Networks 2.0 - Data Portability and Gated Social Networks

I have so many responses from my last post, I wanted to explore that subject more next week so for those who sent me emails or posted here plese bear with me and I will get back to you on those discussions. For now, I want to share some thoughts on social networks. There's also rumor that Comcast's acquisition Plaxo will happen very soon, its Pulse social network service, with 1.5 million active monthly users, has been under the radar for a while. It's a smart move by Comcast, which can enhance the user experience across its 14 million high-speed Internet subscribers, 3 million voice customers, and 24.2 million cable subscribers. We are all wondering how social networking is likely to evolve once we get past the current hype cycle. It is always good to start from the motivations of these social networks.

I see five distinct types of motivation:

1/ I want to stay in touch with the cool people that I know and trust
2/ I want to meet new people for shared interest or expand business contacts
3/ I want to increase my online presence and publicize my persona
4/ I want to provide knowledge or share stories to help others
5/ I want to get some help

A recent pool shows that 87% respondents (Prospectiv surveyed nearly 3,000 users of social networking sites such as Facebook, MySpace, Friendster, Hi5 and others) feel that very few (58%) or none (29%) of the ads and offers they see on social networking sites match their specific interests and preferences. These results clarify that members of social networking sites are open to ads as long as they are properly targeted to their interests. Of those surveyed, 58% said that very few ads match consumers' interests and preferences, while 29% said that none of the ads match consumers' interests and preferences. Only13% said most ads match consumers' interests and preferences. As a result 54% of consumers never click on ads on social networks, while 39% occasionally will respond to ads.

Ad model-based social networks is not a problem, 85% of consumers said they are more likely to join a free social networking site supported by advertisements and offers targeted to their interests rather than a paid social networking site without ads. Social networks are more sensitive to ads. Unethical marketing practices on social media websites usually backfire.  The relevance and context is particularly sensitive and any non-targeted, spam marketing will create more damage to the site and its advertisers.  I know many industries including pharma are dying to figure out how to use SN to market their products. On the other hand, their lawyers are struggling with liability issues.

Ad spending on social-networking sites will reach $2.15 billion in 2010 (this year forecast at $14 bil), according to eMarketer. MySpace will continue to dominate, accounting for 60% of total U.S. online social-network ad spend this year but it might change. Worldwide, social-network ad spending is forecast to $2.8 billion, that’s a lot of money. Social networks must put adequate ROI measures in place if the flow of ad dollars is to continue, says Debra Williamson, eMarketer analyst and author of the report. An updated report estimates $40 mil for Facebook widget and application ad spending in 2008, up from $15 million last year. I believe the are under pressure to develop an adequate ROI metrics to accommodate how to measure “engagement” and not “eyeballs”. Currently Facebook and MySpace together account for 72% of social network ad dollars.

Facebook and MySpace just announced their plans to make your social networking data portable and Google has announced “Friend Connect,” a similar service that will officially this week. Friend Connect is a tool which enables any website owner to add some code to their site and get a number of social features. All that stuff you usually can’t be bothered to install plugins for: user registration, invites, members gallery, reviews, message posting, and - most importantly - third party OpenSocial apps.

What does that mean? In practice, this is an intrastate to create common connection which means that anyone will be able to log in, for example, with their OpenID on some blog, and converse with their Gtalk, Facbeook or Linkedin etc.

Remember the first local social network Dodgeball which got bought by Google and threw away? Then there was Twitter. It’s evolved so much more that “what are you doing now?” which I still don’t understand the value. Yahoo! launched its own play FireEagle in private beta which is starting the location-craze again — with plans to have multiple input/output methods looming across the web and devices. So another “where are you application”.

The desire to network is as old as humanity and online social networking sites is now part of our life. The question remains will these communities will eventually be gated and what will be the implications? However, the trust issue for companies remains very real. You cannot simply allow everybody to see everything. The question follow is around data portability, that is allowing users to share their list with other websites. Let’s say if I visit a site as a member of a particular group I will receive special group treatments. That is a very powerful concept. It is like every site will have the power to personalize based on the information that this person carries and marketers can negotiate with these groups for permissions to market to. The Data Portability Project is a grass-roots advocacy group pushing the idea for users to be able choose to share some of their data between the services and being able to do so with peace of mind, security and safety.

What about Facebook and Google sharing information with each other (not that this will happen soon as they are about to go to war) -- why would anyone want that to happen? Google has all your search data, but they don't know about your friends. And conversely, Facebook knows who are friends are but nothing about your searches. You can imagine the power of the two.

Let me know if you like this scenario. Pls share your thoughts.

Can We Fix Marketing? Most Best Practices Are In Fact Worst Practices.

On average I received 2 calls a night if I am lucky enough to be having dinner at home and not traveling, these calls are properly timed so they know I will be having candlelight dinner with my family and that’s exactly the time for interruption.  This direct-to-consumer telemarketing business should never be allowed, the worst thing is they call you and put you on hold while they finish up their other call.  (Business-to-Business is a whole different story as often they do have a value exchange and conduct in a very professional manner). They don’t know or care what I want or my interest and only interested in a "yes" answer after reading their script to me. Is this (direct) marketing?

Dear direct/tele marketers, are you really proud of what you do for a living? You build your career primarily by using late night direct TV commercials targeting the elderly and the vulnerable. Direct marketing is in trouble as they kill million of trees and bombard our mail boxes with garbage that no one reads let alone buy. These marketing firms belongs to the same category to used car dealerships, both are in the business of fishing for some vulnerable folks and sell them something they don’t want, need or will ever use.

You think there's nothing you can do with the telemarketers, in most cases they don't leave messages and will simply call you back, resulting in an endless cycle of you not knowing who's calling and having to call back to find out--something you're unlikely to do.  Here's Web 2.0 answer to this problem, solution, introducing Caller Complaints, a crowd-sourced index of the phone numbers of law breaking companies that have called folks on the do-not-call list. Users list these numbers, what was being pitched--and the frequency of the calls. If you find someone else has already listed the number and shared their negative experience, you can pile on and leave your experience, which votes it up.

The most popular (or in this case unpopular) companies rise to the top and are tracked on leaderboards. Users can also browse by area code and what type of call it was, from political phone spam to prank calls and debt collectors. The idea is that there will be enough resources to help you get to the bottom of who's calling to either leave a complaint with your carrier or simply blacklist the number from calling again. So far the site has amassed nearly 200,000 number searches from curious call recipients.

Here's some advice to marketers in general, please stop describing your product/company/service as "world-class" or "state-of-the-art." State-of-the-art lasts about 30 days today and what does world-class really mean? “ The "latest technology” means something I need to invest 50 hours to learn how to use it. “Free” means you will end up charging my credit card if I forget to cancel the services and that’s what you’ve factored in your marketing plan.

Stop calling me to subscribe to your magazine or newspaper. I have something new at home called the Internet (it has plenty of free content just in case you don’t know) and I can cut and save any content for future use. Besides, I am already subscribed to 18 publications from Harvard Business Review to Wired Magazine; I don’t need a general lifestyle magazine because I don’t have a general lifestyle. You must be able to see the problem as the economics of direct mail are failing rapidly and it costs too much to mail, and fewer response.

Having said all that, there are still many smart applications of direct marketing including the Blackberry campaign below. I am mostly referring to the bad practices of the industry.

Stop knocking on my front door while I am in a middle of an important battle with my Halo 3. Stop telling me I need to buy this energy-protection plan or replace my windows. Only Microsoft can tell when to replace my windows, not you. Police in some parts of Nothingham, UK are setting up four "no cold calling zones" in a bid to rid vulnerable residents of uninvited doorstep visitors. I really like this idea. Householders are being asked to ignore uninvited callers - and put stickers in their windows telling potential doorstep sellers they are not welcome. They can report suspicious behavior to a special trading standards hotline.

And for those electronic retailers, stop trying to sell me that warranty. The odds are small that I will remember that I have a warranty, know where I placed the receipts, or even bother to file the paperwork. I was buying a MacBook the other day from a retailer and he was trying so hard to sell me their extended warranty and tell me it is better than Apple care because they have better service. They don’t even service those products. Now even if I buy a CD or battery, they still try to sell me warranty. I guess they sell everything else at costs.

Advertising is not working even when it migrates to the virtual world. When Coldwell Banker hung out a shingle on the site as “the first national real estate company to sell homes within the community.” The real estate firm is in good company. H&R Block, Adidas, IBM, Dell, Reebok, American Apparel, Toyota are among the dozens of firms already there.  More than 70% of the site’s users say they are disappointed with the marketing that goes on in SL, according to a survey by Komjuniti, a Hamburg, Germany, research firm. This could be because companies are approaching it like a traditional marketing channel. Advertising is still advertising, it is losing its power. These brand sites on Second Life currently look like they’re being treated in pretty much the same way as traditional ads.

Many ad guys still believes that television is still the most important medium and will still e the most important medium for the next 20 years because: a) people have them; including people abroad and b) people know how to use them. Now that’s the kind of BS from the old school ad agencies.  The engagement power of television has been drastically reduced and they have now been reduced to digital wallpaper. The future of advertising is NOT in the advertising; it is in “Service Design”. Service Deign is like advertising in the mid 50s, no one knows enough about but sooner of later it be turned into an industry. It will be the backbone of what “Engagement” is all about. There will be no creative director in that world as marketing communications will not be built on one cute idea, it becomes “experiential”. User Experience Director replaces Creative Director.

Most customer experiences today are simply revolting, sometimes disgusting, particularly banks, airlines, telecom and many more. The idea now is (instead of) just focusing on a 30-second TV spot, to start a simple idea to engage, empower and energize customers. These Three Es is the future. It is NOT a creative director’s job to come up with an idea; it is the multi-disciplinary creative class that gets the job done.  Advertising agencies need to move from a factory model back to the idea model, put down the 50 years legacy and collective egos (creative awards ) and look to the future. You are in the ideas business. We live in the age of the idea. “Service Design” is the new discipline for the manifestation of the idea business, not product design alone and "Social Networks" are where circle of trust will be formed. That's where the game is.

On a closing note, here is great guerrilla promotion for the DVD release of the movie Death Proof is gory, attention-getting and totally appropriate for the movie it promotes.  Marketing meets "Happening Performance Art". Have a great weekend.

Consumer Gadgets Needs To Think Sustainability Seriously

In two weeks (May 19), Material ConneXion and Li Edelkoort partner to bring to life LEFT/BRAIN/RIGHT, an event on the greening of architecture and design.  The event will discuss the sustainable materials and technologies that are transforming design today and tomorrow. In Greening Perspectives 2010, trend forecaster Li Edelkoort will offer an emotional and human perspective on how green thinking is changing the way we perceive ourselves and the world around us.

The green movement has taken off significantly in virtually every industry but I still wonder the real impact to date. Think about hybrids, alternative energy, and green design and architecture. Consumer interest in greener goods has retailers scrambling to fill their shelves with sustainable products in almost every category although I question many of these so claimed green products. Even Wal-Mart's announced that in 08 their buyers will begin evaluating consumer electronics products with sustainability scorecard the $150 billion dollar consumer electronics industry is poised for rapid transformation. The electronic gadget industry should move quicker as less than 1% of these products have a sustainable design. Buying some carbon offsets and biodegradable forks hardly begins to address the environmental impacts of this industry, it is just not enough. We need to start from the drawing board.

Sadly most of these new electronic gizmos are loaded with toxins, have short life spans and are not designed for recycling. We need longer product lifetimes and modular components so we can upgrade instead of thro away. The opportunity horizon is wide open to leadership in green products that do more than incremental energy efficiency or recyclability,  Here's an example, designer Tom Kenworthy has come up with a Sustainable Flash Memory Card Holder that is made from recycled vending cups. A single holder requires seven plastic cups to construct, and best of all is, you will help reduce the amount of waste in our environment while holding the plethora of memory cards that are currently floating around the market. I guess it all depends on your creativity on how you want it to look like.

Here's a sustainable PC. A computer with smaller motherboard that means less toxin - Like most electronics the product contains elements which can be environmentally damaging, but since it’s 16% the size of a standard motherboard, there’s a lot less damage. Everything is made on one assembly line, reducing the amount of carbon emissions needed to produce this workstation.  This PC requires next to zero technical know-how. It is available with portable solar panel, low-power LCD, and 14 hour battery that can be deployed anywhere. Are you ready for this?

I am convinced that there are plenty of opportunities for the consumer electronics industry to go green and big opportunity exists for companies that position their products to meet the global shift towards sustainable products and socially responsible supply chain practices. Green is the new black, in fact it is more than the new black.

Is Social Innovation Ready For Prime Time? We Need More Business That Better The World.

Is Social Innovation such as Kiva ready for prime time? (Kiva offers peer-to-peer micro-loans, and Thamel.com facilitates in-kind remittances from the Nepalese Diaspora to family members back home) These innovations are primarily powered by the rise of social networks and these networks grow and transform into active, collaborative communities. In a couple of years, we should anticipate massive change through emergence of these networks. At some point, suddenly and surprisingly a new system emerges at a greater level of scale. Let’s not get too much into the theory.

These social ventures must also understand the fundamentals of market orientation and business economics. There needs to be a big enough market that will pay enough money to make the business financially viable and sustainable. No matter how well meaning this higher ground was, if it didn't make a good product or a good user experience that was competitively priced and easy to use, no one would buy/use it, and moreover, no one would notice your message. That is why they are called social ventures -- they need to be treated like any business ventures. Watch out for the next generation of Social Ventures, unlike the past, these are started by smart young MBAs (not the power hungry types) with a mission and a strong market focus, powered up exploding social connectivity and new capital that wants to see change.

There were a few health-related enterprises started the last two years. Sprinkles Global Healthcare Initiative from Canada manufactures sachets of micronutrients for home fortification of foods to improve the health of women and children. Claudia pointed out that micronutrient deficiency is a factor in over 2 million deaths per year- more than malaria- and affects over 750 mm children. MDF is estimated to reduce GDP by at least 2% in developing countries, and is the #2 global health priority after HIV/AIDS according to the WHO.

There’s the Whirlwind Wheelchair International, which is one of the original appropriate technology initiatives targeting health care needs in developing countries, started by SFSU design star Ralf Hotchkiss. Whirlwind is implementing a franchise model of locally owned workshops that produce robust high-performance wheelchairs that enable the disabled to participate in economic and social activities in developing countries. Their vision is to make it possible for every person in the developing world who needs a wheelchair to obtain one that will lead to maximum personal independence and integration into society. In order to fulfill this mission, WWI seeks to give wheelchair riders a central role in all of its projects and activitieYou’ll be amazed at what Whirlwind’s wheelchairs can do.

Don't you want to have a Kiva Mastercard? I definitely want to get one. That's the power of social innovation. Every enterprise should have more than one bottom line. There's always the Financial Bottom Line. The business operates like a for profit enterprise by selling goods or services to its customers and should make a decent return on capital investments. The Social Bottom Line is about achieving balances between its financial mission with a clearly defined social mission. There is a lot of opportunities at the bottom of the pyramid.

The same holds true for healthcare delivery strategies in the U.S. (which is messy today) as much as the developing world. More innovation effort is needed to look at viability of business strategies that engage the bottom of the pyramid and draw on user-inspired innovations to deliver tangible value to consumers.

Three Lenses To Look At The Emerging Discipline of Service Design

There were lots of talks around Software as a Service and it is actually becoming part of a major transformation of the software industry and yet many still don’t fully understand what it takes capture these opportunities. Service activities (both digital and non-digital) are essential for value creation not only in software-based businesses but also other industry from Telco to Financial Services and Business Services. With IP Telephony going mainstream and further convergence of data and voice, this is happening fast. Every bite of data has the the potential of becoming part of the delivery of a service.

Service Design is still an emerging discipline that lacks common methodology, tools and definitions. In the face of Web 2.0 empowered customers and a push for transparency; companies are facing a crisis in customer interaction and relationship management.  Service Design is part of part of front-office revolution as described by Rayport who authored the book “Best Face Forward”, Service Design is the core driver of any customer experiences.

The NY Times has an interview with a social psychologist Daniel Gilbert who talks about the difference between experiences and products (At Harvard, he is known as Professor Happiness)  According to Gilber, "Another thing we know from studies is that people tend to take more pleasure in experiences than in things. So if you have “x” amount of dollars to spend on a vacation or a good meal or movies, it will get you more happiness than a durable good or an object. One reason for this is that experiences tend to be shared with other people and objects usually aren’t." I think this it is such as un-American or un-Canadian notion but it may be changing.

Service design is an emerging field that includes different design disciplines (graphic, product, information, interaction, brand, customer service, interiorl) working together to create the tangible and intangible artifacts of service…sort of Hotel School meets Design School. I don’t think Service Design belongs to traditional service design as in retail and hospitality industries, it goes beyond that.  It is fair to say that “Service Design” is multi-disciplinary in nature. I don’t think it is like the service design as in retail or hospitality industries. I think it is more multi-disciplinary in nature. It is important to look at the boundaries of “Service Design” from the following lens:

The first lens is information design and visualization. Web 2.0 brings many interesting challenges to information design. Think about it, today many Web 2.0 services are based on participation and that usually comprises of content created by these conversations and these conversations create content. These content are part of service design and the community is in fact the service platform  not the technology.

The second lens is product design. Many of today’s products are either informational product or it is a product that serves as a node to a system. Industrial design uses a lot of artifacts and these artifacts start to develop context and consequences. How does these artifacts establish relationships among people within a virtual community? How do we use these artifacts to build on these conversations to create a service?

The third lens is business management. I am not sure where I am going on this one. Is good service design simply means good common sense and good business design? I first came across “service management” was during my Operations Management Courses taught by Kim Warren at London Business School which focused a lot on operational design. I also remember sitting in Jeffrey Rayport’s “Service Management” classes at Harvard Business School which he put a lot of focus in customer service design as part of marketing strategy. Both were drastically different from the “Service Design” we are talking here. Both put an emphasis on service redesign and closing the gap between the demand chain and the supply chain, examining the difference between a factory and a custom job shop. Should “Service Design” simply need to be part of business? Should business strategy itself becoming just another kind of multi-disciplinary design activity.

What Schools Of Design Are You From? What Is A Designer: Objects, Functions, Meanings?

I have not written about post on design for a few while. I do enjoy writing about design rather than business and strategy. May be I've written everything about that in my previous life.  I was drinking from this beautiful limited Evian bottles (limited edition designed by Christian Lacroix, click on the picture above to see the details) that I purchased from Whole Foods two weeks ago and it sparks a few thoughts on design. I also talked to some creative folks from OCAD at the Innovation Exchange and I think there’s a lot of exciting thing going on there. I plan to follow up with a visit in the next few weeks. Now back to design.

I recall reading a book on Design by Bryan Lawson a while ago, he is both an architect and a psychologist. Many of his ideas can apply to interaction design as well as other design discipline.  He acknowledges that design is “an everyday activity that we all do.” However, “professional designers also design for other people rather than just themselves,” and “are better educated and trained.” This juxtaposition serves me as I have a similar view on this.

Lawson believes that the models of design are too logical and not actually useful for practitioners. Lawson says, “Designing is far too complex to be describable by a simple diagram.” This idea is in part my motivation for my paper, having encountered quite a few models that illustrate the design process only to feel like they weren’t quite right, and certainly, never actually using them when it comes to the actual process. “We probably work best when we think least about our technique.”

I’ve seen hundreds of design processes that are anti-design in nature. They force a linear process-driven approach to design as if it is a production line (Six Sigma for Design? No thanks)  Process schools like a form-driven problem-solving approach. This school trace their linage back to the advanced program of the Kunstgewerbeschule in Basel (Switzerland).  This Swiss-style process schools thrived mainly as response to the slickness of the portfolio schools.  The portfolio school has a different approach and is more mercenary in my view and end-product driven. The problem-solving approach is more conceptual and the product rather than the process is king.  The two schools don’t get along well naturally. 

Doesn’t matter which school you are from, if you think that every problem in this world has a pure visual solution that exists outside the cultural context, you have a serious problem.  That’s often the biggest limitation of designers.  Designers’ job is to translate everything within a special user and cultural context.  Design is not process-driven and any methods of science are in fact unhelpful to the designers. There are intimate relationships between observing, reflections and inquiring and this is how design happens. “Good designers tend to be at ease with the lack of resolution of their ideas for most of the design process,” says Lawson. And for those who are not at ease, the design process is painful and the unproductive.

Massimo Vignelli (Martin Scorcese of Graphic Design, see his work below) earlier declared that "Helvetica in the morning, Bodoni at night" in response to a panelist asking what his favorite typeface is, but the most brilliant response was Vignelli's "In the States" when asked what was the worst use of Helvetica he had ever seen.
Here are good nuggets from Massimo Vignelli when he spoke at an AIGA event, the comments in bracket are mine:

“Without a grid I’m lost” (I use a grid not only for design but also for strategy mapping. I often swap tools from different disciplines and it works for me all the time)

“A chair is more important for your head than it is for your ass.” Discussing his love for a Rietvelt chair. (This one is interesting. Everybody should be designed for the head first)

“Design and fashion are big enemies” (Oh yes, good design should be anti-fashion, if it ends up being fashionable it should only be by accident)

“The culture of refinement is much bigger than the culture of change.” (Think about incremental innovation vs radical innovation)

“There is no room for irresponsible design.” (Design has a long history of addressing issues relating to social responsibility such as  ecodesign, inclusive design, design for disability, and eco-efficient innovation, design against crime and design for lower income etc.)

“The opposite of modern is contemporary. Contemporary is trendy” (The opposite of trendy would be -- fascination with old things --be called? Gentrophili. And that could be trendy too)

“We never figured out how to make politicians modern. They’re still old farts. Except Gore, we miss him.” (Gore is an exception. We need more politician like him)

I love the last one.  It is time to make politician modern. It is time to make government modern. It is time to make every Non-Profit Organization modern. It is time to make a B-School modern.
If you ask me what is a designer?  Here is my answer:

Design is about “translation”. Designers are “translators”. They translate needs, culture and meanings into products and services.  The design process is a “translation” process. Yoshiaki Koizumi (director of Nintendo's biggest Wii game yet, Super Mario Galaxy) sees his job requires him to "translate" the maestro's often-inscrutable insights into real-world gameplay.

Design is more than simply a form-giving activity—it is a strategic issue related to changing from existing to preferred states. Design is concerned with imagining how things can be different (for the better), and transforming strategic aspirations and desired futures into reality in a social responsible manner.

Venture Capital Meets YouTube - Vancorps Launched Its Beta Today

When people asked me the question whether US and Canada are losing out the innovation game as industries becoming less competitive, my response was ‘no’, thanks to our capital system efficiencies (to some extent) and the venture capital communities, I think we are as competitive as ever. What you see in the picture up here is a new company that launched itself today (is in beta mode), it is called Vencorps. The idea is to being the idea of crowd sourcing together with YouTube and American Idol.  People pitch that ideas on a YouTube type platform and everyone can register as an investor. Vencorps is a multi-million dollar venture capital fund that leverages the wisdom and participation of an elite crowd to build better startups. Their target audiences include angel Investor or people with good business ideas. I like the idea but not sure how much traction that can have. It is a great idea but a lot of executional elements have not been fully thought out.

These companies that the VCs are funding clearly are of the main engines driving innovation and entrepreneurship, especially in the US where the concept of venture capital was originated. The Venture Capital concept is one of the best things that ever happened to innovation.  VCs realize that they make money by identifying promising innovations early, investing risk capital to develop the business, and supporting the entrepreneur with his or her business till a point when they need t exit.

Corporate venturing within a large organization has not been working. Transplanting the VC model into the corporate environment is not an easy undertaking. The conflict usually lies in the conflicts with the parent company and unavoidable disruption to the parent’s core business model. Changing these policies and organizational structures to accommodate the specialized nature of venture financing can be a pain.

I have been meeting with a dozen of VCs today and it has been a somewhat productive day.  One thing came to my mind when I talked to these people is there’s a lot of myth out there about how difficult it is to negotiate with VCs but many are not necessarily true.  Differing interest and divergent expectations often complicate these negotiations. These challenges can be turned into opportunities if we use these differences to drive deeper mutual understanding.  Alignment between the VCs and the Entrepreneurs is a key. Often both parties have different views as well as tolerance of the risks involved; you need to be creative to shift the risks to the part that has a bigger appetite and also more risk seeking.

One useful advise for you is to always have a Plan B, it is your source of power for negotiation.  Whether it is a different source of financing or another VC firm, make sure you have a Plan B otherwise you are not giving yourself any options. If you have one term sheet, you have zero leverage in your negotiation. Yes, you will spend 3x the amount of time on the process, but it’s well worth it (if you can afford it). That is  only if you business is attractive enough to attract a few good VCs.

And remember you should always be prepared to pay up for high quality investors or incubators. There is a world of difference between good VCs and bad VCs (both the individual partners and the firms) that will ultimately have a lot to do with how successful your company can become.

Corporate Imagination" And "Corporate Strategy" Are Inseperable

The lack of imagination in corporate strategy development is hurting many organizations. Many companies think by adding new product extension is the easiest way to jump on the innovation bandwagon. There's simply a lack of tools, processes and framework to incorporate "corporate imagination" into "corporate strategy". There are tons of books written on how to do strategy planning but almost all of them fail to do that. I think every company needs to revisit their planning approach.

There's lots of myth about corporate strategic planning. The challenge with writing about what works in business strategy and what doesn't is that the evidence is basically anecdotal. Business writers are impressed from time to time with particular companies / CEOs that have succeeded (usually on financial measures or market cap size) and with the theories drawn from their success. Often they have to backward engineer these theories of success. And then five years later, another writer will write about the fall of that once great organization. We should not discount the need to learn the underlying habits of success--the "good habits" of great companies as illustrated by Jim Collins . For very good reasons, they singled out certain companies as models of success--companies that, for very different reasons, have since fallen on hard times. I am more interested what practical approach for companies to sustain their leadership under disruptive competition. Let me throw a few questions out and try to ask yourself if you believe in the following:

- High performance companies often recruit people outside their industry rather than looking within their own?

- VCs are better at investing than any typical corporation when it comes to innovative products/services?

- No nonsense, plain-vanilla boring straight-shooting CEOs perform better than flashy charismatic CEOs?

- Companies that reply on acquisitions of innovation do better than those who focuses on their own R&D ideas?

- Companies that stick to the knitting (ie their 'core business') reward shareholders better than those which actively expanding into the adjacencies?

- The level and quality of skunks work correlates directly to the long term performance of an organization?

History tells us that setting up autonomous "skunk works" or similar "idea labs" doesn't not improve an organization's innovation capability.  Think about those all those lab (including the high profile Xerox PARC) that failed to have many of their great ideas commercialized. I believe the challenge is not on the R&D front, it is the integration of ideas generation and activation. This is where we add most value to large organization... active integration of imagination with operations. Organizations struggle to manage imagination and in fact, three generations of MBAs were trained on command and control concepts.

Corporate imagination and creativity needs to be the core any corporate strategic planning exercise. Strategic planning should be about anticipating big disruptive challenges and spotting important trends. Often strategic planning exercises are turned into a days long power point karaoke or rigid, data-driven operations planning or financial forecasting.  To improve the quality of any strategic planning process, you need to begin with deliberately and thoughtfully identifying and discussing the strategic issues that will have the greatest impact on future business performance. The need to avoid the trap that they blind themselves to disruptive competition... and not becoming arrogant, complacent, and far too dependent on their traditional core competencies. The starting point should be around a cross-industry scan (comparable studies as we call it) and deep customer insights (ethnographic exploration). The idea to identify the nature and extend of the shift between your organization's assumption of customer needs and the emerging unarticulated customer needs. When we work with our clients, we document these findings and allow executives to use them in their planning process to drive meaningful discussion of any key strategic issues. This way we can ensure that management does not waste time and energy on less strategic topics during the planning sessions.

"Corporate Imagination" and "Corporate Strategy" are strange bedfellows, by bringing the two together an organization can truly build an innovation engine to survive and prosper the next disruptions. Neither discipline nor imagination alone, however, is as effective as both are together.

Incubation Often Means Smart Ways To Exploit Mistakes (Preferably Others) To Create Superior Return On Investments

People ask me about why we do incubation because everyone thinks it is so hard.  I don't think it is hard if one can master the art maintaining focus but retaining agility. Incubation requires more than just general start-up experience or financial advice.  The financial piece is actually less important at this stage. The more important tasks are nurturing of ideas, creating tangible version of the future business (prototyping) and storytelling. Storytelling, to be a bit more accurate, it's all about understanding how to use the elements of stories and storytelling to bring out the business concepts. There isn't a business in the world today--large or small, high or low tech, public or private--that doesn't need to use storytelling to bring the purpose of business to the stage.Those are three critical skills any start-up folks need to learn but most likely need help.

I am never obsessed with where the original idea comes from, that detachment helps me to look at things from an open mind and therefore I am best poised to take an idea to a successful conclusion.  I am equally excited making other people’s ideas (OPI) becoming real but I still like incubating at arm's length. I get tremendous amount of satisfaction seeing these people succeed...more than the financial gain.

On average are seeing one incubation prospect every week. The first question I have us “Do they have an insanely crazy, kick-ass disruptive business ideas and they want to change the world with?” If yes, I go the second question, “Do they work well under constraints?”  I’m a big believer that constraints inspire creativity and it is a true test of strategy. It forces you to bring out the creative side. Think Flickr, " I think that had a lot to do with why we were able to iterate and innovate so fast.” according to co-founder Caterina Fake.

Big incubation set-up didn’t do well historically simply because they were big, such as IdeaLab and Internet Capital Group that raised hundreds of millions but didn't return anything close to what they were supposed to.  The role as incubator is not to provide seed money; it is about providing resources, advice and infrastructure to allow the idea to become investable.  Sometimes money doesn’t help and it pushes the business to the wrong direction.

First thing is raise less and spend less. The less money you spend, the less money you need to properly incubate. Testing ideas as cheap as possible reduces overall investment. Don't invest a ton in infrastructure and let your incubator provides them.

The second thing is to play fast and build fast. Visualize your concepts quickly and test them out fast. Being slow means competitors can get into a space before you have time to breathe. Also, the more ideas you can generate and play with, the more chances you have of hitting on something worthwhile.

If something is failing, change and adapt fast and don’t money at failing projects. Agility is the beauty of start-up, you must know how to use it to your best advantage.

Another on common mistake float at the creative, idea stage for too long and don't have what it takes to stay with an idea over time and push it to the next level. Discovering people who are like this is very hard, so beware. So another advantage of working with us as incubator is we relentless push to make sure ideas evolve and plans get executed. 

Incubation is sexy and fun. Generate innovative, cool ideas give people a mission in life. Create new businesses that disrupt the big guys is highly satisfying. Think about finding the next Facebook or FlickR. It is unbridled innovation … exploiting the full value of business mistakes. Incubation (for me) is the business of exploiting mistakes (preferably others) to create superior return on investments.

There is another reason I like incubation, it is the uncertainty and success depends so much on that uncertainty. It is a balance between making things happen (fast) and letting things happen. Great things unfold for smart people who are devoted to change the world (I am putting a team of smartest people I can find and afford). There is another side which is about letting things unfold in its own sweet way. While one door closes another one opens, once you let go of what you believe was the best, new space is created for something even better to come. Because every ending ushers in a brand new beginning. Did I sound too zen?

Workplace Interruptions - Another Service Innovation

I took this picture of the men's room in a Persian restaurant. I find that amusing that they optimize every inch of space with ads. I have not seen a public washroom like this, I was told they serve different ads everyday. Funny.

I can name dozens of organizations or non-profit agencies which I have no idea what they do and what are their missions. Here's one that has a clear mission. The Bureau of Workplace Interruptions is a time-stealing agency who work with employees to interrupt the flow of their workday.  Yes, from interruption to innovation, you wonder what's the connection.  The purpose is to invigorate some of the time people spend at work in order to create new experiences and possibilities outside the flow of capital.

Let's say if you're an employee who needs a break from the your boring routines you can apply for an interruption at the bureau's website. Go fill out a form and subsequently, they will do their best to find the right interruption for you.  When planning the event, they'll take your occupation, work hours, and the means by which they can contact you into consideration. The interruption can take place via mail, email, telephone or, if you're lucky, a workplace visit by real people that you don't know.

If you worry that your boss finds out, the Bureau of Workplace Interruptions will strive to keep their actions invisible to your employer. They have a strict privacy policy and the service is free.

If you think this service is cool, how about this one?

If you have recently failed a project, here; an interesting idea. You can now consider joining the Failure Support Group.  You will get five minutes to present your failure (no power point needed) to present your failure.  Any innovative and artistic projects fail a lot, particularly those that are participatory, public and/or social. They fail for different reasons and cause myriad revelations. Nevertheless, the structures that we use to talk about these works and contexts where they are presented often don’t leave room for discussing the failures plainly and objectively.

The Failure Support Group is an evening survey of failed processes and failed projects They explore questions such as 1/ Is there, actually, a recipe for failure?  2/ Are certain methodologies more prone to failure than others? 3/ How? What is at stake in acknowledging failure – in one’s process, one’s community, or one’s career?

Most people associate failure with defeat, but it shouldn't. How do you view failure? Do you see it as something negative that you don't want to be associated with or do you see it as something positive? Most people in the world don't like failure. And the fear of failure is the main reason why more than 80% of people in the world are not prepared to change their circumstances. Why do people fear failure so much? The reason for this is because people don't understand the dynamics involved in success and failure. VCs are the people who understand failures and part of their job is to manage them.

Everything we do in life has either a right way of doing it and a wrong way of doing it. When we do it the right way we meet with success. Needless to say that when we do it the wrong way we are unsuccessful. Understanding this is important because it puts failure in its proper perspective and removes the fear around it. When someone who doesn't understand this dynamic meets with temporary failure he gives up thinking that he or she is not good enough or that he or she will never make it. But is this really what it is? The fear of failing is worst than the failure itself.

Does the fact that you didn't make it the first time mean that you are not good enough? Does it mean that you'll never make it? Not at all! All it means is You did not have all the right elements yet. As the late Mr. Leo Burnett once said "When you reach for the stars, you won't find yourself getting a handful of mud." In this case, you will get a Certificate of Failure.

The Failure Support Group holds their meetings at the Democracy Center just off Harvard Square (Cambridge, MA) See you there soon.

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Revisiting The Question: What's The Impact Of A Soft Economy To Digital Media?

Came across this poster last week. I stopped for a couple of minutes to see what' was that all about but I didn't have time tor read on. I still think the best ad medium is outdoor, if only I can use my cell phone to scan soI can learn more about this once I get home or they can push something to me. That's experiential marketing.

Some thinks that it is safe to assume that as the overall drop in advertising activities would include online ads, but that's not what the data is showing. As the economy softens, advertisers will look even more closely at how well their ad dollars are doing.  Increasingly, marketers are looking to ad networks-vertical, behavioral and otherwise-to buy more targeted advertising.  Before we get into ad networks, here's a piece of interesting data, the North American videogame industry sold $1.7 billion worth of hardware and software in the month of March (a report by NPD Group) This represents a 51% increase from the same period in 2007. If you are in the gaming industry, you'd never know that the U.S. economy was under distress. There are many bright spots in the digital word. Videogame, Adnetworks and Social Media are booming.

That could be a boon to the likes of AOL and Yahoo, which recently scooped up a series of ad networks and exchanges in their bid to become one-stop-shops for marketers. According to Imran Khan, an analyst at JPMorgan Chase that covers this space, said that ad networks "are growing much faster than the general graphical advertising industry." Khan estimates that the top 20 ad networks earned around $2 billion in 2007, which accounts for 14% of the display market.

Why are ad networks thriving? Cheap, targeted advertising. Networks charge much lower CPMs (as low as $4) than giant Web portals like Yahoo and MSN ($40 and up). It's no surprise, then, that ad growth on premium sites has slowed compared to the overall Web economy. Margaret Clerkin, the chief executive of Mindshare Interaction, said it's about efficiency. "While the home pages (of premium sites) are still very effective media buys, the price tags on them have become a little outrageous for many advertisers...there are other ways to amass that type of audience fairly quickly that are more efficient," she said. NY TImes has the full story. As I wrote about this last week, there are still plenty of opportunities to jump into this space, but the entry cost is high.

Outside the ad networks, there are a couple dozens of stealth start-ups that can shape the future. One is 9 months old company with a super team from Google. The company , currently in stealth mode, is called Mechanical Zoo and is working on a social search applications. The privately funded company has raised about $750,000 in convertible debt from angel investors, including ex-colleagues and friends. Two institutional investors have committed another $1.25 million to Mechanical Zoo, but the founders may raise a series A round of funding in lieu of that money. The name Mechanical Zoo is an homage to the mechanical workings of its application, as well as several animal-named products that the company plans to introduce over time.

The interesting thing is these folks left Google because according to them it can be tough inside the search giant to make new, big things happen, as well as to marshal enough talent away from the company's main search and advertising products to build new services.  Yahoo fell because of that reason. That's a universal truth even with no exception to Google.

The End of Advetising Agency (Both Traditional and Interactive) As We Know It?

IKEA has outfitted a train in Kobe (Japan) with sofas and curtains—probably with names like Oompa-loompa, Frida, and Bucarest. Unfortunately, this is only temporary, to mark the opening of a new shop in the city. No reason why we cannot have Starbucks train cars or Muji train cars. This is the future of advertising.

IBM has published a new industry study apocalyptically titled "The End of Advertising as We Know It".. It is based on a survey of more than 2,400 consumers spiced with feedback from eighty senior advertising executives. The study predicts that over the next 5 years some 30% of global ad revenues currently accruing to traditional media companies - amounting to billions of dollars - will migrate to online ad exchanges such as Google and Yahoo. This is overly simplistic verdict and an unlikely scenario.

Here are some predictions from the report:

- As the advertising value chain reconfigures, broadcasters, advertising agencies and media distributors in particular will need to make a number of 'no regret' moves.

- The new technology and rising popularity of user-generated and peer-delivered content, and new ad revenue-sharing models (e.g., YouTube, Crackle, Current TV), now enables amateurs and semiprofessionals to create lower-cost advertising content.

- Advertisers are demanding more individual-specific and involvement-based measurements, putting pressure on the traditional mass-market model. Two-thirds of the advertising experts IBM polled expect 20% of advertising revenue to shift from impression-based to impact-based formats within three years.

- New entrants are making ad space that once was proprietary available through open, efficient exchanges. As a result, more than half of the ad professionals polled expect that open platforms will, within the next five years, take 30% of the revenue currently flowing to proprietary incumbents such as broadcasters.

There is no question that the future of advertising will look radically different from the past. The push for control of attention, creativity, measurements and inventory will reshape the advertising value chain and shift the balance of power. Disruptive start-ups will bring more chaos to this already vulnerable business model which is more than 50 years old.  Let's face it...no body even look at banner ads, press releases are nearly useless, TV commercial are entertaining at most but don't engage viewers, direct mail is a i the business of killing trees...what's left?

I wrote a lot about this on this blog, spoke at international conferences and frequently exchange my views with top agency executives, they are most curious of what I think the different models of agency and what likely scenarios will emerge? Currently there is multiple capability gaps exist in agencies, they are lacking management consultant’s type of business rigor, then the deep insight of product designers and the digital know-now of interactive specialist. 

In this world of cross-capability mastery, what does the agency of the future look like?  Agencies also have tremendous egos and cultural issue to deal, too much emphasis on “the creative idea”, it is such a thing of the 70s.  The quest for scale has reduced many great firms to either a creative factory or procurement shop. There is no room for walls and egos in a digital world.  Future agency success won't be measured in unit’s displayed or gross impressions, but the level of customer engagement.

From the end of advertising agency as we know it to the future of advertising, this week in Montreal I met with Jean-Francois, ceo and co-founder of Sid Lee (picture of their cafeteria above serving lunch for 200 plus) A creative powerhouse founded in six years ago by two students that never worked in an agency. They didn't really reject the traditional agency model, just don't give a damn about it (or know enough about it). The agency has a close relationship with Cirque du Soleil and came to flame with their work with them. I was very impressed with them when he explained to me their dream to build a new form of creative organization: a Commercial Creativity group. He told me his business is about “creativity”. I told him Idea Couture’s business is about “innovation”.  That was the beginning of an interesting conversation.

He gave Scott and I a tour of their offices, there so much creative energy in the place. In the Sid Lee mantra, advertising should be seen as a tool, as opposed to a toolbox. Rather, what Sid Lee calls "commercial creativity" is the toolbox? And it can include a lot more than just advertising, which explains why Sid Lee is now involved in such things as retail architecture, experiential marketing and industrial design. The idea is to be able to develop rich brand experiences in stores.

I think this company is on a mission. There’s a lot in common between our firms, while their core is in “creativity and design” and our core is “strategy and creativity” manifested in innovation.  Our focus is more towards digital. There’s something about the French and Japanese and creativity, although they are very different. I’ve spent a lot of time in Tokyo and Paris for both business and play.  And some of my most creative times and business ideas come around my visits to these places. The French publish utterly different magazines and books from the kind I find anywhere else in the world, and there is something about their perspectives. For Japan, I love to fusion of modernism with the spiritually ancient that expressed in design ethos focus on transience and the constant dynamism of change. There are agencies (for the lack of a better word) like them in London, Amsterdam and Barcelona all with a mission to change the world of marketing communications.  London's Monther is a good example. See picture of their workspace below.

Here's an old presentation which I posted here four months ago. Now is a good time to revisit it. If you know a company who is also on a mission to change the ad world, please share with us. Let's hope it will all happen fast.  Advertising needs a revolution, not repackaging.

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Can A Media Buying Giant Reinvent Itself?

This is a picture of my living room, I realized I have not been in this room for more than 4 weeks. You can imagine what's life is like. When I am at home, I usually spend time in study and then the kitchen and the bed room. I have not been in many parts of the house for a long time. I need a tour this week.  My last post was three days ago, it is not common for me. I try to do at least 5 a week but it is getting difficult. I had only 4 hours sleep the last three days. Anyhow I feel good. May be because spring is here.

I was in Montreal most of this week, met some very exciting people and had some productive meetings..from the top creative minds to VCs and bankers. Scott showed me this place that makes bagel by hand.  This city has so much to offer. I love Monteal, it is one of my favorite city. I used to visit there every week but it's been a while I get to see the city's best side.

Today's headline from an Ad Age story caught my attention: WPP's MindShare has launched a wholesale restructuring of its business splitting the agency into four distinct units. The idea is to move the shop beyond planning and buying to McKinsey-style business consulting.  According to their CEO Scott Neslund MindShare's restructuring--six months in the making--involved a complete reexamination of "what we were doing with clients,. -

He listed three key client benefits of the new agency framework:

- a more streamlined process of working with agency services

- the weaving of digital resources throughout the entire organization

- stronger, more creative media work.

He believed the company has implemented the "largest sweeping changes in the industry," and that those changes "will energize the next generation of media and marketing specialists." Looks like this media giant is finally waking up to what's going around them. The company was formed as a scale play through the merger of the former media departments of JWT and O&M. MindShare quickly became the largest of the new breed of media-only agencies.  MindShare ranked No. 1 among media agencies in the U.S., with $11.3 billion in billings during 2006. We all know media buying is a commodity business.

Neslund explained that the MindShare restructuring is to strengthen its emphasis on creating branded content, particularly for the new media space but also for TV, out-of-home and radio. But it's not only about creating content. The move is also a clear delineation of just what services are on offer, and a way to eventually get paid for those different functions by establishing the value of each discipline (much as the controversial unbundling of media from creative was a way to get paid for both those disciplines). This puts them in direct competition with Time Warner, Meredith or Redwood custom publishing. So now the agency is competing with the media and want to be paid for higher value services.

Here are my thoughts. Content development and content delivery are very different from marketing services. Although over the years these content providers try to provide branded content for their clients by working with the ad agencies. Now they are likely to do so if the agency is attempting to eat their lunch. I also doubt if they can build the digital capabilities needed given the tight digital talent market. Even the interactive agencies are struggling to fill these gaps, what makes them think a media buying agency can do that?

Their plan is to build a McKinsey type business-planning group that serve in a management-consulting-like capacity, focusing on solving issues most relevant to the CEO, rather than simply developing a media communications plan. I am not sure media and content are the most relevant to the CEO. Nor I think they can attract (or afford) talent of those calibre.

They will create an invention group who's job is to create content that reaches consumers in a way that meshes with a marketer's business goals. The group, which is defined as media neutral, will also handle strategic planning and contact planning. My question is since they have a media buying unit (name Exchange) and media buying is their core revenue stream, not sure how media neutral they can be. I personally think agency should not be in the business of content creation. Branded content does mean custom magazines and websites, the power lies in the innovative integration of branded content into the marketing strategy. The true power is to combine branded content with social media content and apply them across the customer life cycle. The combination can deliver credible, objective editorial content that appeals directly to your customer interests and concerns while building your brand image. It is definitely one of the most effective tool to drive customer engagement.

The only interesting play here is being an arbitrageur. They will be getting into the business of both buying and selling media. They will buy chunks of TV inventory, make it addressable and resell it to marketers. MindShare will seek out similar opportunities where it actually owns media space it can sell to marketers. At the end of the day, they are still a media buying company but instead of media planning and placement services, they are now into wholesale and repackaging business.

Print publishers are not doing well. Many believe that most dollars lost to the Internet will never return to print when the economy improves. The last time the economy went into recession, in 2001, employment classified spending in newspapers fell by about one-third from the previous year to $5.7 billion. While the economy rebounded, employment classified-ad spending has never reached those levels again and dropped to $3.8 billion last year, according to data from the Newspaper Association of America.

Publishers are seeing growth in their online ad revenues, that's unlikely in the near term to make up for what they've lost in print. They will turn to marketing services based on their content to make up for the lost. Even New York Times Co., which has been ahead of the game online, with 11.1% of its total revenue coming from Internet business in the first quarter, didn't see big enough online increases to offset its revenue decline. Goldman's  Appert estimates that industrywide Internet ad revenue eventually will grow enough to generate overall increases, but that won't be 4 or 5 years away. Publisher needs to look for new format. Unfortunately many cannot see beyond the storm.

Online Ad Networks Needs Innovation - Not Just A Scale Play

Weather is great in Montreal this week. I always love this city, it has many unique things that you cannot find in any other city through out North America. I am staying at the St Paul Hotel which is one of the best boutique hotel in old Montreal.  Lots of meetings here and we have to work some important game plan for the next 6 months.

The business of online ad network came up when I was talking to a many at the airport. He was saying how much money is being spent to acquire these networks and almost everyone needs to have one. Ad network is the most competitive space and the stakes are high because there is big money there.  I think we have about 20 to 200 ad networks out there depending how you define them.

There has also been a lot of deal-making in the ad-network space and lots of money changing hands. More than $2 billion was spent last year to acquire 10 ad networks and exchanges, and venture-capital investment in ad networks reached nearly $300 million, according to media investment bank DeSilva and Phillips. If you include the $649 million that WPP spent for 24/7 Real Media, the $6 billion Microsoft paid for aQuantive, or Google's $3.1 billion purchase of DoubleClick.  You add them up, you are taking about a market valuation of over $7 billion of these networks.

Now Disney announces that it has struck agreements with 45 smaller, separate Web sites that allow it to distribute content on them and, more importantly, sell advertising on their behalf. By doing so, it becomes a player in ad networks. The idea of distributing ads online is a no brainer and it is simply scale driven. It sound like a niche but it is not, it is an industry. The continuous M&A and new players will confuse media buyers as well as advertisers. No doubt there will accelerated consolidation and we should not see more than 3 to 5 networks with 2 dominating 70% of the ad space. The top-20 ad networks that sell display advertising earned more than $2 billion in revenue in 2007, or about 14% of the total graphical-ad market. 

Other than the top 2,  others will have to find a niche in order to survive. Some ad networks will need to specialize in a certain topic area, like health or phama and other financial services etc., while others cut across multiple subject areas. Some ad networks charge advertisers only when a consumer clicks on an ad or makes a purchase. There are still many opportunities for innovation if we stop thinking it as a pure scale play.  If we start looking vertical ad networks focused on specific market segments that aggregate mid-tier publishers, this can keep CPMs and brand integrity on the high side, and allowing publishers to focus on improving content and growing traffic. As these types of networks grow and are able to sell a higher percentage of inventory, the economics will begin to work in publisher’s favor which it currently isn't, relegating the super networks to selling tens of millions of untargeted remnant ads on lower quality sites. They will then come to you and write you a big check for your niches.  When it comes to ad networks, tt is good to be niche.

Newest Ventures - From Social Networks Search To Social Ventures

First day of a crazy week ahead. We'll start the week with looking at some news on latest venture funding for the last two weeks. Mobango received $5.7m for their mobile social network
. I was seriously exploring this idea with Keith Liu three years back but it was a little early because we're looking at GPS network deployment.

Another social network recommendations start-up called Redux just raised $6.5 m in series A funding from DFJ and individual Alsop Louie. They had previously raide $1.65 million in seed funding from two individual investors. Redux has created a social network with recommendations based on their unique algorithm and is creating a social network that helps people navigate through people, events, and other social network features and it learns about you by analyzing your profile and asking you a few questions. The more you use the site the more it can learn about your interests and social behavior. The algorithm also creates a relevance score for people that it believes you would most likely want to get to know and meet. They do the same for events and literally suggesting to you which parties to go to.

This is one of my favorite. Sellaband received $5m from Prime Technology Ventures.  It basically allows you to buy shares in unsigned bands and become a band investor (kinda like timeshare). They let you invest in the artist of your choice and they consider those that invest "believers". Each artist sells 5,000 $10 units. Once the $50,000 is achieved the artist receives professional studio time. After the studio time all the 5,000 believers will receive a Digi-Pack C