Guy Kawaski gave a great demonstration of and presentation on entrepreneurship in the Web 2.0 era at yesterday's PARC Forum. His new company, Truemors.com, is "a Web 2.0, User-Generated Content, Citizen Journalism, Long-Tail, Social Media Site" that cost him $12,107.09. The site enables anyone to post, comment on, or rate any breaking rumors or news. Two days after its launch, The Inquirer ("news, reviews, facts and friction") called it "the worst web site ever", which may have been partly responsible for a spike in attention - the site received 246,210 page views that day - leading Guy to wryly note “there's no such thing as bad PR as long as they get the link right” and "we probably got more hits than if we'd been labeled 'the best web site ever'" ... prompting him to ask any bloggers in the audience to label any posts about his talk as "the worst speech ever".
Guy had delivered an amazingly inspiring keynote emphasizing "The Art of the Start" (the book I most frequently recommend to prospective entrepreneurs) at the Northwest Entrepreneur Network's Entrepreneur University in November 2004, a few days after I had veered from the path corporate citizenship and started down the path of entrepreneurship. My notes from the event say he was "stressing the importance of making meaning (vs. making money), trying to change the world for the better; I also like his invitation to "be a mensch" (e.g., help people who cannot help you)." I don't know whether Guy will ever be able to help me, but given the huge boost I got from Guy's talk 3 years ago, I figured the least I could do would be to return the favor and give him a little Google Juice for "the worst speech ever" ... and perhaps driving a wee bit more traffic to his new site ... even though I don't believe it aligns well with his earlier stated maxim of changing the world for the better.
The inspiration for this site came from a CommunityNext panel on web founders who had defied the "venture capital model" that Guy (founder of Garage Technology Ventures) had moderated in February, and which included
- James Hong, co-founder of HotOrNot, a company / web site that was created to resolve an argument he had with a friend about how attractive a women they'd seen at a party was. He and his co-founder created the web site - which enables users to post photos (um, presumably of themselves) and/or vote on whether people depicted in [other?] photos are hot or not - over the next few days, and sent out emails to 40 friends ... and had 40,000 unique visitors by the end of the week. Photos on the site have now received over 12 billion votes,and the company has 4 employees and is earning (or yielding) $10 million / year in advertising revenue.
- Markus Frind (who Guy described as "one guy sitting around in his underwear in Vancouver"), founder and sole proprietor of PlentyOfFish ("100% free. Put away your credit card") - a free (i.e., advertising-supported) online dating web site - created the company / web site because he wanted to study .NET. The site draws 500 million page views per month and $10 million in annual advertising revenue.
- Drew Curtis, founder of Fark, a web site where he posts 25 interesting news-of-the-weird items per day, which garners 50 million page views per month and several million dollars annually in advertising (I wonder how much Chuck Shepherd makes).
Guy, a veteran evangelist, entrepreneur and VC - under the traditional model(s) - was inspired by these successful, though deviant, entrepreneurs. Now a 53-year-old father of 4, he would like to sit around in his underwear making millions - or even hundreds of thousands - of dollars per year from a web site. And so, in practicing what he preaches in The Art of the Start - entrepreneurship is more about doing than thinking - he decided to launch a web [2.0] site of his own.
Guy claims is goal is to continue a proud history of information democratization through technological advances, including the printing press, personal computing and desktop publishing: "I wanted to create a web site where anyone could post any information that thousands of people could read." So, he assembled a variety of resources - monetary and non-monetary - and founded Truemors. In his Powerpoint presentation, he offered some numbers on this process:
- 0 business plans (you don't need a business plan for a $12K investment)
- 0 number of pitches (you don't need investors - this is within the scale of manageable credit card debt)
- 7.5 weeks from registration to launch
- $4,500 in software development ("offshored" – to Electric Pulp, headquartered in South Dakota) vs. the $1M it would have required 3 years ago
- $4,824.13 in legal fees (incorporate new company, secure trademarks, investigate liability ... especially for libel) vs. $500 for "my uncle, the divorce lawyer" ... or $50K for Wilson Sonsini (his advice: don't skimp on good legal counsel, it makes future acquisition much easier)
- $399 for a logo (from LogoWorks) vs. the "butt ugly" London Olympics logo, which cost $400K
- $1,115.05 for domain registrations, including domains to “surround” truemors.com (Network Solutions) vs. $400 for GoDaddy, which he was boycotting due to a Superbowl commercial that he labeled as "sexist" ... which I found ironic, given his admiration of HotOrNot, and some of the use cases he offered or his own site. He bought 55 domains with various misspellings and top-level domain names (TLDs) - far less expensive than the $25K it cost to evict a cybersquatter in the future.
- 1.5 Full-Time Equivalents (FTEs) - he has one partner ... not sure which one is part-time
- 3 mentions in TechCrunch (first leak, second leak + screenshot, official launch)
- 261,214 page views on first day
- 14,052 unique visitors first day
- $0 marketing budget – Guy called in a lot of favors ("I spent 24 years [being a mensch] to make a $0 budget possible")
- 405 truemors posted on the first day
- 218 truemors deleted on the first day (junk, spam, or otherwise inappropriate) - according to Guy, half of the blogosphere complained there was nothing but crap on the site (which, by the way, does have a crap category (which Guy included in his later demonstration)), and the other half complained that Guy is a censor.
- 3 hours before site was hacked (he wasn’t offended, but rather was flattered "at least we were worth hacking")
- 36 hours before the Yahoo! Small Businesss hosting service recommended they move somewhere else
- $29.95 initial monthly fee for Yahoo! Small Business
- $150 was the new monthly fee when they moved to an ISP
- $3000 is the current monthly break-even point (they now include paid content for text - written by Truemorists - and photos - taken or found (on wikipedia, wikimania or iStockPhoto) by Truemorazzi)
- 2 days before Truemors was labeled the “the worst website ever” (by The Inquirer)
- 246,210 page views that day ("we probably got more page views than if we were labeled 'best website ever'")
Before demonstrating Truemors, Guy concluded his presentation with 4 observations:
- The blogosphere is full of angry people (essentially accusing Truemors of being "a stupid idea, poorly implemented"), leaving Guy with a newfound disrespect for the blogosphere, which he [in turn] accused of being composed mostly of 15 year-olds and 50 year-olds who live with their parents and have never French-kissed (hmmm, perhaps this could be a juicy truemor (for the record, none of those attributes apply to this blogger)).
- $12,000 goea a very long way these days
- You can work with a team that is thousands of miles away
- Life is good for entrepreneurs these days
Having been initially inspired by the panel of Web 2.0 entrepreneurs he moderated, he said that he would like to stop traveling and giving speeches, and ideally, someone in the audience at the PARC Forum would be recursively follow in his footsteps and be at the podium a year from now giving a speech starting out with "I saw Guy Kawasaki give a talk about making a million dollars sitting around in his underwear..."
Guy noted the the difficulty in predicting which startup companies will succeed - "I’m almost wiling to say that some of the stupidest ideas turned into the greatest companies" ... examples of which include Apple (whose initial customer base was homebrew computer clubs with 10 people), eBay (founded to sell used printers), Google (the 12th search engine), YouTube (a web site for people to post videos of putting Mentos in Coke bottles). In what seemed like an interesting mashup of Darwinism and Social Darwinism - perhaps Sociotechnical Darwinism (?) - he suggested that with Web 2.0, more people can try more stupid ideas for less money, and since you can never tell which stupid ideas will be successful, the world will become a better place.
During the Truemors demonstration, Guy gave a few "use cases" about people using Truemors to find conversation material prior to a date. Interestingly, given his purported objection to sexism, I found his use cases rather sexist: a PARC hardware engineer reading up on health truemors before a date with a woman he'd met on Match.com (or perhaps PlentyOfFish?), or a woman reading truemors on autos or sports before a date with a guy she'd met on an online dating site.
When asked "What’s to stop anyone else from doing this?", Guy replied "Nothing ... except that everyone in the blogosphere is saying this is stupid. Why would someone copy something stupid?" He then went on to observe tha there are very few things that are truly defensible. When a VC asks an entrepreneur "what makes this venture defensible?", "patents" is the wrong answer. If you're planning to spend time and money litigating patents, you're going to fail (although patents can be valuable for future acquisition prospects). The right answer is "Nothing. We're just going to implement better and faster".
When asked about the estimated value of all the favors he cashed in, Guy admitted it probably ran into the hundreds of thousands of dollars. But he also noted that "entrepreneurship is not about a level playing field, it’s about about tilting the field to you." He then went on to say a little more about karma and being a mensch, which reflected the foundations of menschood he'd earlier noted (in The Art of the Start):
- Helping lots of people, especially those who cannot help you (although I personally believe it's impossible to determine in advance who can and can't help you ... in fact, I actually believe that everyone has something of value to offer, even when it's not immediately obvious).
- Do what's right (not what's easy, expedient, money-saving or possible to get away with)
- Pay back society, for such gifts as
- family and friends
- spiritual fulfillment
- good health
- beautiful surroundings
- economic success
- a hat trick every once in a while
After 24 years of helping people, it looks to me like Guy is more interested now in making money vs. making meaning. Although the examples of "stupid ideas" that grew into successful businesses may have been questionable at the outset, many of them at least had grand visions. As I'd noted in one of many references to The Art of the Start - in an earlier post on social entrepreneurship as doing well by doing right - he [had once] espoused a socially responsible motivation to starting things:
[T]he best reason to start an organization is to make meaning – to create a product or service that makes the world a better place
- Increase the quality of life
- Right a terrible wrong
- Prevent the end of something good
... making meaning is the most powerful motivator there is ... [and] if you fail, at least you failed doing something worthwhile.
Guy did talk about failure, and what it would take to succeed: even if someone buys Truemors for $50K, he will doubled his investment on "the worst web site ever". His ultimate goal is to make at least $1M annually in advertising revenue, and spend more time at home. Providing for and spending more time with one's family are, of course, worthy goals, but I do not believe that labeling Truemors as a venture that will make the world a better place is defensible ... and I see it as incompatible with the second principle of being a mensch: "doing what's right (not what's easy, expedient, money-saving or possible to get away with)".
During the Truemors demo, Guy suggested that Truemors was intended as "NPR for the eyes" and that its redeeming value is that "If you read truemors every day, you would be a more interesting person". I'm reminded of the Chinese proverb "may you live in interesting times". We certainly do live (and venture forth) in interesting times, and I do believe that on a certain level, we're all interesting people (though this is not always immediately obvious to all observers / participants). I will be interested to see whether Truemors holds my interest ... or makes me a more interesting person ... or makes the world a better place.
[Update: there is a Google video if Guy's talk.]
[Update: Guy Kawasaki sold Truemors to NowPublic and is now chairman of the board at the parent company. Terms were not disclosed, so it is not clear whether he achieved his sales goal of $50K.]