Microsoft: Clueless or Actively Hostile to Search?

November 1st, 2007

I know that large enterprises have traditionally taken a lot longer to get clues, both generally, and specifically around search. To some extent, this is just a factor of organizational size: Voyager‘s awesomely successful enterprise search marketing company, SEMDirector, is helping enterprises learn to adapt to this brave new world, and creating a lot of value doing it.

Of all big enterprises, Microsoft is one that we’d expect to be relatively early on the search bandwagon. After all, they’ve largely reoriented the company around search and advertising.

But inexplicably, the very best assets that Microsoft has from a search-marketing content perspective — the gigs and gigs of support info and (heh) bug workarounds on their massive, persistent, ubiquitous installed base — are piss-poorly optimized for search!

Sometime, try searching for something like, oh, say:

exchange server pop mail marked as read  

…which you might do if, like me, you’re frustrated that MSFT’s latest version of Exchange server can’t seem to support POP3 access without flagging all the POP’ed messaged as read (thereby screwing up the flawed but de facto organizational method that Outlook has trained us all to use over the years). (Yes, it’s a real problem; no, I haven’t found a solution.)

Well, the first several hits are forums, blogs, and ISV’s offering solutions. Somewhere around 9th place comes a hit from Microsoft, though, and you’re thinking: “Great! these forum postings are people complaining, but the solution will just be right here in the handy Microsoft link! Boy, what smart guys they are!” So you click on Microsoft Office Outlook 2003 Solution Center

…and what you get back is a huge page full of what I can only describe as “useless crap”. Twenty or thirty topics, all loosely grouped around a product, but nothing apparently on my problem. A confusing mess of acronyms and key terms.

Sigh. OK, So then you pull out the backup. Use your browser’s in-page-search (cmd-f) to find “POP.” Surely, one of these thirty topics is about what I want, I just need to find it here. (Though, isn’t that what the search engine was supposed to have done? Whatever.)

Search: “POP.” A few instances, but nothing relevant. OK, Search: “marked as read.” One instance, but describes the opposite of my problem. How about “marked as unread.” Also irrelevant.

Now you sit back and scratch your head: Every single other link in Google, prior to the Microsoft link, was relevant (if not useful) to my particular problem and my carefully worded query. Now comes the link from the very author of my misery, the Leviathan, and NOT A SINGLE G.D. SENTENCE is relevant to my problem!!

And that’s when it hit me: Microsoft’s “support” pages are actually search engine spam.

(And Google has properly detected this: that’s why for Microsoft’s own product, and despite Microsoft’s huge “Google Juice,” its own support pages rank a pitiful 9th.)

The answer to what needs to be done is fairly simple. (Our friends at SEMDirector could walk you through it.) Push the search engine juice out to the edges of the graph (leaf nodes with real info, rather than these pseudo-indices which serve only to conflate keywords together that don’t belong on the same page); let real human end-users discuss topics, using words that come naturally to them (and hence to other help-seekers); engage external bloggers and forums both to push info out into the ecosystem and to get deep links back in to the leaf nodes.

(Back in 2004, I was seeing this kind of search-friendly behavior on HP’s server support forums, and it was AWESOME. But then, that was all about running Linux on a well-engineered, open platform.)

All of the above recommendations are anti-hierarchical, control-ceding, conversation-seeding moves. They require a mental move from hold on tightly to let go lightly. I’m talking about not just opening the kimono, but playing volleyball on the nude beach. Do you think that a company unable to do that with its support pages is going to be able to embrace a whole new and orthogonal, search-and-ads based strategy?

Customer Satisfaction Owners: Read Your "noreply" Messages!

October 19th, 2007

A quick thought: If you have responsibility for customer satisfaction at a company that relies heavily on the Web for customer experience, you should seriously consider making a practice of /reading the emails that come in to your “noreply” spambot addresses/. (Of course, you should /not have/ noreply addresses; it’s so f’ing insulting to your customer it’s beyond belief.) Essentially, if you want to see the misery of your least happy customers, the total flaming death-threat rants of your spurned customers, the pleading, pathetic missives penned into dodgy webmail interfaces and painstakingly drafted for maximum persuasive effect in solving the customers’ issues, and not least the Tourettean shitstorm of schizoid freakouts that result from when the former (bivalent term) customers have their first emails to “noreply” bounced and yet, beyond all logic and reason, reply again to curse the souls of the whoreson mongrel ancestors who brought a demon like you forth onto the Earth — then you must look into the heart of darkness, the festering cistern of the bit bucket to which you have relegated your hardest problems. Yeah, I got my email reply to a support ticket bounced from a “noreply” address today. Helpful stuff, too, had anyone been around to read it.

NBC F—ing Gets It; Why Don’t You Other Media Types Dig?

October 18th, 2007

Who here has seen The Office — American version? Yeah, I thought so: it a pretty darn worthwhile download. (Those of you who are puzzled at why I called it a “download” rather than a “TV show” had best get with the picture: “push” style TV is dead to an entire rising generation of attention-greedy, affluent knowledge workers. We consume our video via iTunes and BitTorrent, thank you very much.) Here’s the twist, though. If you google around for the character names, you’ll run across “blogs” set up for the characters by NBC. (In the past, you may have found such things done by rabid fans, as for the series Arrested Development, or outsourced to niche creative geniuses like my man Elan Lee, but now we’re seeing the oldest of old-line players get on board.) What’s so special about this? Well, think of it this way: those blogs are in-character and professionally written — but not just for the main characters! In fact, some of the funniest stuff that NBC has put up is for an ancillary character, downtrodden boomer office schlepp Creed. The blog is exploring and fleshing out an entire new space and giving depth to a minor character, with production value and infrastructure underpinning it. Which, if you think about it, is an extension of the ostensible value the network adds in the first place (plot, character, production, etc.), but instead of being constrained to 22 minutes a week of airtime, they are going deeper and wider. Previously (pre-Web world), you couldn’t justify paying a creative to create this deeper world around each character, because it wasn’t economical to put it in the show. But now, the show is kind of just a long video ad for the web property… The blog creative work plus the quick release to iTunes can only mean that someone at NBC really f—ing gets it! And kudos to him. Because most of the media industry deserves to die in shame and penury, but the product manager for The Office is a goddam hero of the revolution. Finally, I want to share with you this gem before some corporate assclown takes it down: more Creed Thoughts on all-you-can-eat-buffets contains the bachelor boomer’s thoughts on nutrition-in-bulk by means of buffet restaurants, including musings on fat waitress seduction and plate-diameter pricing models. But the real reason that that this is an ingenius and genuine bit of fan outreach is to be found in the comment section.  His commenters have been cheering him on with crude, even vulgar commentary, engaging with him as though he were a kind of dirty class clown sitting in back.  And NBC — either out of ignorance or winking complicity with the engaged fans — has left the crude comments there, unedited.  It’s a bit unfortunate that the example here is such a crude one, but folks, this is real social media, and it’s why the sucess of The Office‘s franchise is different not only in degree but in kind.  Whoever is moderating that blog is either way out-of-it, or with-it, and I suspect the latter.

wxPerl on Mac OS X must be run with special binary

October 4th, 2007

If you are having trouble with your “hello world” wxPerl script on Mac OS X, check your shebang (#!) line and make sure you’re running /usr/bin/wxPerl (or which ever wxPerl you have) rather than merely /usr/bin/perl — the normal perl will display the main window but won’t allow interaction between the window and the interface (e.g. you can see hello world but can’t click the button).

This posting seems to imply that Mac OS X 10.4 comes with a wxPerl installed; you can also get it via cpan / cpanp or from the wxPerl website if you don’t have it on your Mac.

Everything Old Is New Again: Innovation to Adoption Lag

September 12th, 2007

There are a lot of problems in software that aren’t solved well in a ubiquitous product (think PIMs, Personal Information Managers; they all suck royally despite everybody’s best efforts, and the OSAF Chandler project has taken years trying to redesign the very concept, with little to show for it to date). But there are precious few problems that haven’t been solved at all.

In fact, a ton of things that are being held up these days as “innovations” are rehashes of old concepts from the 90s, or the 80s, or sometimes even the 70s. Today this came into sharp focus when I saw this bit from a circa 1999 document on the Semantic Web by the Right Reverend Tim Berners-Lee. Here he asks, then answers, a question:

<blockquote> Surely all first-order or higher-order predicate caluculus based systems (such as KIF) have failed historically to have wide impact?

The same was true of hypertext systems between 1970 and 1990, ie before the Web. Indeed, the same objection was raised to the Web, and the same reasons apply for pressing on with the dream. </blockquote>

Then, while searching for some theory on append-only databases (such as would be used in a revision-control system), I came across this 1994 piece on “collaborative filtering.” That report in turn points to earlier work on “Information Tapestry” from the early 1990s.

So: 1970-1990, hypertext exists and is studied in CS departments. 1995, Netscape IPO. Early 1990s, collaborative filtering exists and is studied in research labs. 2006-2007, rise of Digg and Delicious.

I think there’s a very strong case to be made that VCs should stop looking for “innovation,” per se, and start looking for 10-20 year old CS masters’ theses that touch on an emerging market space…

The Magical Coefficient of Motorcycling

September 6th, 2007

There are a few things in Nature that seem like magical numbers. One is e. Another is the Golden Ratio. Another more applied version is 4 degrees C, the temperature at which water has its maximum density (thereby guaranteeing the action of thermal inversion, which prevents all of life from going extinct every few thousand years during an Ice Age).

There’s one for the world of motorcycling as well. But it’s more boring if I just tell you want it is, so here’s a bit of setup:

Think about flying down the freeway at 60 or 70 MPH. Sure, you are ATGATT (all the gear, all the time — no skin below the chin) and are helmeted, but doesn’t it seem crazy not to wear a seatbelt or something? (This sentiment dates me as being of the generation that grew up with mandatory seatbelt laws.) How the hell can you hold on to something going 70 MPH?

Well, it’s only sort of crazy. It turns out that holding on to (or rather, not falling off of) something going 70 MPH is a damn sight easier when you’re going 70 MPH along the same vector. What really matters is the acceleration involved. You at 0 MPH, bike at 70 MPH = bad news; you and bike both at 70 MPH = OK.

But, you may counter, how the heck can you get to 70 MPH? Isn’t that quite an acceleration, one that we usually encounter while strapped in with our backs against a DOT-approved seat?

Well, yes. But your acceleration is really bounded by one thing: the friction of your tires on the pavement. (You can have a stronger engine or tighter brakes, but they only are effective to the limit of your tires’ grip.) As it turns out, the natural properties of rubber make it so that you get about 1.1 g of traction on dry pavement. Torque your wheel faster, you spin out (or slow it more than that, you’l skid). Hence, as long as the bike isn’t cheating — starting or stopping using something besides the tires (like a rocket JATO or a brick wall) — you’re basically limited to applying about 1.0 g.

And guess what? Human bodies and minds happen to be really good at dealing with 1.0 g. In fact, you might say that the whole of bipedalism is just drill for how not to tumble against the pull of 1.0 g. So, from the day you first pulled yourself up as an infant, you were practicing the skill needed to hang onto the handlebars during a 1.0 g acceleration.

And that, my friends, is the magical coefficient of motorcycling: the traction of rubber on dry pavement. And that is why it’s maybe not so crazy to go 70 MPH without a seatbelt after all.

(Pace, engineers: I know that my explanation is oversimplified, but it’s roughly right.)

(And to the safety-concerned: your biggest concerns, of course, are exogenous to the question of traction: it’s when you do hit a brick wall, or when you start testing the friction of leather on pavement, that you really get hurt.)

Bubble Factors: Real Change, Easy Credit, and Self-Interested Lies

August 30th, 2007

Look at “Bubble 1.0” (as it’s known in the relatively young tech industry: the 1997-2000 tech-media-telecom bubble and the general IPO / equity bubble that went along with it).

1. A real change occurred — the uptake of Internet technology — and created some initial successes (think Netscape IPO). This got folks thinking about how to turn a profit, lighting aflame the animal spirits, and buoyed the mood of the markets.

2. Accommodative monetary policy made money cheap, and in combination with the buoyant mood and the animal spirits, led to compressed risk premia in the capital markets. Think insatiable demand for IPOs, and Fed rate-slashing due to LTCM in 1998.

3. Sensing opportunity (and driven to madness by their proximity to money with no ability to make it themselves), those in charge of telling the truth, like auditors, started fudging things in order to keep the good times rolling and to get a slice o’ Cheddar for themselves. Think Arthur Andersen and Enron.

Now, let’s take a look at Housing in 2002-2007.

1. A real change occurred. Think a palpable change in national mood and priorities post-bubble and post-9/11. In the realm of personal finance, we saw an aversion to “paper” assets and a move toward the real and tangible. To many people, this meant plowing what was left from equities into real estate, which had already been enjoying decent returns from the wealth effect of Bubble 1.0.

2. Accommodative credit. Think not only macro level, Fed funds rate stuff, but no-doc loans, NINJA (no income, no job or assets) loans, ARMs, option ARMs, interest-only loans, etc.

3. The truth-tellers started lying. Think the house appraisers here who were being incentivized to keep the party going at risk of losing business from the real estate agents, and the mortgage “officers” who were effectively the “buyer apraisers,” incentivized to keep the party going directly due to fee structures. Nobody in either group called foul on the prices or the creditworthiness in question.

This formula works pretty good, although it’s loose enough that its predictive power is probably fairly weak (better for validating a thesis than for scouting out a new bubble in progress). Any other ideas as to bubbles where we can look for these factors?

Textmate Cheat Sheet

August 14th, 2007
  Option+PgDn    Page down while moving cursor (caret)  Esc            Autocomplete  Command+/      Comment/Uncomment (Ruby, at least)  Ctrl+Command+V Paste without reindenting   

VCs and the Naughty Bits

August 9th, 2007

I spotted a piece by Paul Kedrosky today during a blog-feeds-catchup-session where Paul talks about a sort of “(minimum) two degree of separation” rule that VCs maintain between themselves and the sex industry. (Quotes above for my words, not his.) In other words: benefiting from infrastructure, transport, payment mechanisms — cool. Having fleshy bits linked to from the portfolio companies page — not cool.

This reminds me of an early experience I had at Voyager. We were looking at a company that was building an online search / social media app. They talked about people using it for various applications — consumer, enterprise, small business, blah blah blah. We were just about to the end of the pitch, when I asked pretty straightforwardly: “So, what’s the sex angle here? Is there an application in dating or porn?”

The room went silent.

I pushed on, oblivious to the mood that had just chilled like a shot of Jaeger down an ice luge. “You know, like VHS, or modems for BBSes, or early adoption of Web marketing tricks like affiliate programs and popups,” I articulated despite the intrusion of my foot now rapidly entering my oral cavity. “Is there a strategy for accelerating adoption around that content?”

The founders were visibly uncomfortable. Mercifully, my boss was not pissed, just bemused. “I … I guess people could use it for other things, too,” said one of the founders, finally. Handshakes all around, a quick note on our investment process, and we’ll get back to you after next week’s partner meeting, ciao for now.

Oops. Back at the office, this is addressed.

“Randall, in the venture business, we have certain things we don’t talk about, and certain things we don’t invest in, due to a number of reasons.”

At the time, I’m thinking: OK, VCs are pillars of the community, have to show up at the Opera, at the charity events, at the B-school reunions, and can’t be branded pornographer or such. I filed this away under the “shit not to talk about, Einstein” filter, along with ever admitting to listening to Journey, or denigrating tattoos while speaking to anyone whom you’ve never seen fully naked.

But now, Paul Kedrosky gives me a flashback and with a key piece of insight. It’s a follow the money moment: “… until the venture business is funded by groups other than pension funds, trusts, and endowments (ahem), the likelihood of mainstream VCs ever getting beyond flirtations [[with the sex business]] is vanishingly small.” Yep, follow the money. The paymasters here are the Prudent Men, the real stodgy guys, the Trustees and the Chairmen and the Stewards and the Overseers.

And frankly, this is probably a good thing. It’s a little like the Senate. You don’t want the country entirely run by a bunch of pasty old white dudes, most all millionaires, 60 years old and who won’t be fired for 12 years (on average), and who probably still think that Kudzu and the missile gap are our biggest national problems. But you don’t want a bunch of whippersnappers on the make driving all your big decisions without recourse to the accumulated wisdom of years past.

The real test will be if one of the trendsetter endowment funds like Harvard or Yale green lights a VC or PE investment that targets the sin sectors. If that ever happens, then the VC business will start to get a lot more (directly) involved in the naughty bits…

Liquidation Preferences: A Response to Leo Dirac

August 8th, 2007

In a recent blog entry, Leo Parker Dirac poses the question of the fairness of liquidation preferences in VC financings of startups. He’s going to be delivering a lightning talk based on it tonight at Ignite Seattle.

(To those of you who don’t know, liquidation preferences, or prefs, are usually a multiple of invested dollars that a VC gets out first, before anyone else is paid. This is because if you take $10 M from a VC for half your company, then shut down the company one second after depositing the VC’s check, he would only have a claim on half of it, thereby snookering him out of $5 M. To avoid this outcome, and due to our general greed, we VCs like to ask for at least a 1.0x preference, meaning that you have no incentive to shut down the company until you’ve grown it to something more than our investment dollars.)

His conclusion seems to be that liq prefs can be fair if transparently communicated to all parties. Of course, this implies that sometimes, details of prefs are not communicated clearly.

How can this be? I’ve seen many tens of term sheets, and never once have I seen one that uses invisible ink. Neither have I ever seen a term sheet that has a clause invalidating it if you show it to your lawyer. In short, there is never a case where an entrepreneur isn’t reasonably informed about prefs.

Let me construct an example. Say that you’re a first-time entrepreneur, and that you don’t have anyone on your exec team, nor on your board of directors, nor among your existing investors, who’s ever seen a term sheet before. (I was in that spot starting my first company back in 2000, by the way.) And, let’s say, you get hold of a term sheet that casually throws out there something like “holders of Series A shall be entitled to an amount per-share equal to two times the per-share price…” and you don’t know what it means.

Well, one thing I can absolutely promise you is that no VC is trying to sneak one by you for a shot at 2x his money. A VC investment just takes way too much heartache and worry and effort — not to mention opportunity-cost of not investing in the billion-dollar blockbuster every VC’s looking for — for a VC to fuck around with taking a chance at cheating you out of a couple million (remember, he has to give all but 20% of that profit to his investors, and split that 20% through some formula of his partnership, so even if he cheats you out of $5 M he’s not going to deposit more than a few hundred $k in the bank, and that’s at risk of losing his several hundred $k per year sinecure for a GP of a decent-sized fund).

Another thing I can promise you is that no VC ever wants you to sign anything without reading it and having your lawyer read it twice. Think about this one for just a second: I’m about to wire you enough money to buy twenty or thirty Porsches, based on the notion that you’re a brilliant businessman who’s going to make us both rich. Do I want to give thirty Porsches worth of cold, hard cash to the kind of guy who signs deals without reading the contract??? Seriously: I want you to be the slickest of salesmen, the toughest of negotiators, and the most diligent of dealmakers (not to mention a prodigious engineer, a revered leader, and a master marketer). VCs do not want to give money to sloppy suckers who can’t be bothered to read and understand a term sheet — including seeking savvy legal counsel when appropriate!

Now, having said all this, there are at least two cases where Leo’s thinking really does apply to the question of liq prefs. (It shows of Leo that his thinking on the matter of prefs is mostly abstract, that he does not mention either of these two cases.)

The first case is where you are dealing with a fake VC. A real VC is someone who spends full time managing a fund of committed capital from one or more arm’s length investors, which capital amounts to at least, say, $10 M per general partner and is entirely meant to be invested in growth companies for the purpose of financial returns primarily via capital appreciation. A fake VC is anyone else who calls himself a VC without pointing out the major differences with the above. And a fake VC has God-knows-what sort of motivation and may well want to swindle you out of a preference multiple.

Your uncle who owns a chain of bagel shops is not a VC. A hedge fund is not a VC. A dude who claims to represent a group of “anonymous Asian industrial families” is not a VC. Anyone who is keeping his day job is not a VC. Real estate guys are not VCs. Note that this doesn’t mean they are bad people (unless they pretend to be VCs, in which case they are fake VCs). It just means that the ground rules that you can understand all VCs to play by don’t apply.

If you’re not dealing with a real VC, read everything three times and have your lawyer read it six.

The second case is in follow-on rounds where the company is in a distressed situation. Everything Leo talks about (and everything I assume in the first part of this post) is about the moment before you take your first VC investment: do I take this capital, with its strings attached, for a shot at building my dream? The alternative there is to simply walk away, and go back to working at Microsoft. But once you’re hot and heavy with a company, once you’ve raised money, promised the moon and the stars to your friends and family, bamboozled the VCs into funding you, alienated all your social contacts and exacerbated your RSI, hired fantastic people and worked them to exhaustion and made them love you enough to drink the Kool-aid, extended commitments based on your word and your honor to customers and suppliers — only to find that revenues aren’t ramping up fast enough and you need cash — OK, now you are officially up against a wall. And precisely now is when you will be addled from overwork, and adrenalin-high, and blinded with the urgency of your need — and when the sharks will smell blood.

That is when you will get the predatory term sheet.

If Leo wants to do entrepreneurs (and VCs) a favor, he should take a hard look at what happens then: when you’ve got a company that still holds promise, but is in a distressed situation and needs capital for its very survival. Exploring those moral complexities is a lot more interesting than the sort of clean-room, game-theoretical chatter about whether one accepts term X on a first round of capital.