Calacanis Archive

This post isn’t about all the mudslinging between Techcrunch/Mahalo and DEMO. It’s not about who wants to kill who, who wants cement boots for the other. It’s not about which conference is better for you to attend. It’s not about which conference is better for a startup to launch at. That discussion is not for now.

I am sure that both conferences are considered successes by the respective participating companies. Startup visibility is a great thing that so many of us work on daily. This post is about one issue we are now faced with: overload. As many of you know by now, Techcrunch 50 (my bet is 80 as a final count) is now going heads on with DEMO. Both conferences have one day "off" and then the other two days now overlap.

And you know what the mission to "kill" DEMO has done? It’s hurt the entrepreneurs that Jason was screaming and yelling about this morning on his chat with the fanboys. What about the DEMO entrepreneurs? They are now screwed as well. Why are 140(?) entrepreneurs screwed?

How will any of the 140 startups get visibility over the massive amounts of posts that will be put out over that 5 day span? From my perspective last year was tough enough as reporters were running from TC40 to DEMO and cranking out posts at an alarming rate. I’d suggest that CN’s coverage (and Webware’s) were the best from both events and it was already working close to 24 hrs a day with only one conference to cover at a time. Yet I will do it again this year and love every minute of it.

Can most blogs or even larger news organizations like CNET/NY Times afford to send multiple people to both conferences for coverage? Or will some startups just get limited coverage due to where they fall on the schedule of their respective conference? I am guessing if you are applying to TC50 you will want to be on the last day and for DEMO on the first day.

Let’s do some simple math:
140 startups
60 press at each event – totally a lowball estimate
each press person will cover 35% of the startups
=
2,940 posts over the 4 days — this doesn’t include interviews, general coverage, networking/party recaps, etc.

How will readers even get a chance to review all of the coverage and try out the apps? Alright, that covers the press. What about VC firms? Will they cover both for the entire event? What about general attendees? I guess to some extent both events are forcing everyone to choose.

In a chat with a startup today, he wondered if any startups will just stay home and launch on their schedule so they can get the full blogger/PR buzz. For example, launch your startup tomorrow and you have 3-4 others to fight with for visibility. Launch at DEMO/TC50 and you now fight with 140 companies for visibility. In a later chat the startup’s founder said the best time might just be the week before both events – since 140 startups will be holding back, you might just be able to get a bigger bang? I sure hope that’s not the case and that both events provide better (much better) visibility.

Update: Jeremy seems to agree with the startup I spoke with.

It looks like I will attend DEMO the first two days, then TC50 the second two days. Better take the laptop in for a tuneup before I head to the west coast.

So to Heather Harde, Michael Arrington, Jason Calacanis, Chris Shipley (and whoever she is working with), ya’all need to get this straight. Remember why you created these great events in the first place. It’s about helping entrepreneurs succeed. All of us have the same end goal.

Today I had the opportunity to sit down with Tyler Crowley and Jason Calacanis from Mahalo to review their updates which launch tomorrow. My article regarding the updates goes live at 2:30 Eastern on Wednesday, so be here! Below is one update that Jason provided regarding the Mahalo business model.

Much has been made about Jason’s presentation at the affiliate summit last month. So it’s interesting that the business model update is around affiliates and affiliate revenue. Jason explained that Mahalo has added affiliate links where they make sense. Currently they are working with Amazon and Commission Junction. Links are added by the Mahalo guides and greenhouse workers as they create the pages.

He provided a couple of examples:

• $15 CPA for Big Brother live streaming signups on their Big Brother page
• $2 CPA for signups to New York magazine on their Lindsay Lohan page

My guess is that within 2-3 months, 80-90% of pages on Mahalo will have at least one affiliate link. Jason mentioned that they are double-noting that the links are sponsored. I would suggest that the Mahalo audience doesn’t get the difference because the links look exactly the same as the non-affiliate links. Here is an example of the sponsored links section:

The majority of pages on Mahalo are "rich" for advertising. With that said, affiliate revenue could surpass Google AdSense revenue for Mahalo in the long-term. Check out our previous Mahalo coverage.

Over the past week, much has been written about what it takes to build and run a successful startup. It started with a post from Jason Calacanis where he suggested 17 tips to save money while running a startup. In the article, Jason suggested that you should fire anyone who is not a “workaholic” (update: Jason has written more about what he meant to say). The original post caused quite a stir: first TechCrunch responded to Jason’s post by suggesting that Calacanis fires people who have a life. 37 Signals weighed in with their take on work/life balance. Then Allen at Center Networks provided his own perspective.

I’ve spent some time chewing over this bru-ha-ha this week. Although the controversy revolved around work/life balance, I sensed there was something deeper that was at the root of all of this dicussion– specifically, what does it take to build a successful startup? The reality is that startups are like snowflakes. No two are the same. Products are different, teams are different, market conditions are different, competitors are different, challenges are different. So what does it take to be successful building a startup?

Much has been written about this too: Arrington says that hiring is the thing that matters most. Dave Winer says it’s mostly about building a hot product. Tony Wright weighs in with a post that probably rings the most true to me: it’s different in every case.

As I digested all of these great points of view, and reflected on my own experience with MyPunchbowl.com I wondered if there was one piece of startup advice that was universal– something that everyone could agree on. Something more important than saving money, or working hard, or building a product that people really wanted. Is there some piece of advice that could trump all of these very important things?

I think there is. And it’s a pretty simple concept that is much, much harder in practice than could possibly be described in a blog: DON’T GIVE UP.

Don’t give up: when you’re all alone at the beginning, trying to figure out if there is a market for your product

Don’t give up: when all you have is a Powerpoint presentation and a vision.

Don’t give up: when you struggle to explain what exactly it is you are working on (chances are you’re not even really sure yet yourself)

Don’t give up: when you can’t find people to take a risk with you, to join you at the infancy stage of your startup

Don’t give up: when every VC you meet with says that the “market is too small” or “the competitive space is too crowded” or “they don’t see how it can become a 100M company. (Read Mike Feinstein’s post)

Don’t give up: when product development is going slower than you would like, when big bad bugs slow you down, and when the user interface still isn’t quite right.

Don’t give up: when your early beta customers tell you the 50 other things the product needs before they would actually use it.

Don’t give up: when the press (or bloggers) won’t cover your product or write about your latest development

Don’t give up: when potential partners don’t return your phone calls and show a mediocre interest in actually closing a deal

Don’t give up: when individual angel investors get cold feet before they write the check

Don’t give up: when you can’t find GREAT people to hire to round out your team

Don’t give up: when they tell you it can’t be done or it’s already been done — when they tell you to pick another market.

Don’t give up: when the competition heats up

Don’t give up: when others can’t see the potential that you do

Don’t give up: when others around you do.

To all of those who wrote about what it takes to build a successful startup, I challenge you: is there another golden rule of startup success that trumps my Golden Rule?

Whether you save money, build a hot product, hire the right people or fire the workaholics, I believe that the only thing that matters is that you don’t give up. This is something that can’t be taught: it’s like the Gatorade commercials: do you have IT in you?

If you’re trying to build a startup– or maybe you’re struggling to get it off of the ground I hope you’ll re-read this post when you feel like giving up. Then pick yourself up, dust yourself off, and get back to it. Little by little everyday. Just don’t give up, and the rest will take care of itself.

As we build MyPunchbowl.com, I remind myself everyday not to give up. That’s the only thing that really matters.

This article was contributed by Matt Douglas, the CEO of MyPunchbowl, the party planning and online invitations site.

Earlier today, Mahalo CEO Jason Calacanis came out with 17 ways to save money running a business. He calls them "really good tips" – There are a couple of good ones on there like buying good chairs for employees but the majority of them show that working at Mahalo is like prison. In fact, I hear an electrified fence is going up in the coming weeks when they get the Series B funding. It’s also important to understand that entrepreneurs do not always make great leaders.

Duncan Riley at TechCrunch has his sarcastic take on the points which is well worth a read and Alain Sherter shows how Jason can easily run his company into the ground. There is a HUGE difference between the ceo/founders/stakeholders putting in time, and forcing the low-paid staff to be worked to death.

Update: Mahalo employee Sean Percival has a paragraph on how life is like for him at Mahalo.

What does Jason leave off his list? First, that all employees (including part time "guides") are basically forced into social media submission – thou shall vote, stumble, save every Mahalo content page. I call it his form of paid employee submissions – basically the same as affiliate marketing. And what I’ve learned is that to save money on paper products and water, they have only one toilet, men go on even hours, women on odd. If you need to go in-between, pee in a cup.

Why is Jason wrong in this case? Sure, having workers who bust their ass for a company is great. I did it for years and am doing it now working 14 hrs a day for CN (and for you). But it’s important to let employees come up for air sometimes. And that doesn’t mean team air, it means personal air. Jason brings in lunches, sounds great right? I’d be all for it once a week, but instead he forces employees to stay inside the prison office to eat. But not just eat – there are meetings while eating. So while stuffing your face quickly with a burrito or burger, you must discuss how to get the next Veronica Belmont video to go viral. Now, to turn this into something good, Jason could easily give his employees pre-paid cards for a few local joints to let them get out on the company dime. That’d be hot.

Employees do their best work when they have at least some amount of downtime. It doesn’t mean being off every other day, but it does mean being able to shut off the PC once in a while. In fact, I’ve seen employees actually work more effectively by having some normalcy in schedule.

What else does Jason suggest?

• Buying 2 monitors for employees – may as well get them mirrors so left eye goes to one, right eye to another
• Buying a fancy coffee pot – Jason says this saves employees time and money – sure the money part is great, the time part not so much – wouldn’t the 15 minutes of fresh air be a good thing?
• Don’t buy a phone system – I agree with this on a basic level – tho I don’t care for using employees phones for work – there just needs to be separation – what about a packet8 voip setup?
• Rent out your extra space – excellent suggestion, I’d love to rent some extra space somewhere in NYC
• Buy your workers computers for home – why not get them something for the car too – may as well install a pc in that single Mahalo bathroom
• Allow folks to work off-hours – again excellent, as long as the hours don’t run into each other
• Ask vendors for discounts – again, good suggestion, this is the place to really save large amounts of cash

In all of my years of management, the best thing I ever did was give my teams more room to breathe. I’d put my hours worked in my career against anyone and I can assure you that I’ve lost a lot of great chances with great people because of putting work first always. Jason should consider it as well if he wants his team to stay on. Short term his strategy works, but won’t in the long run. Burnout comes quick and with all of the current opportunities out there, people will leave when they are burned out. And when they leave, it will be at the worst time.

Jason Calacanis, CEO of Weblogs 2.0 service Mahalo, has apparently left the world of pissing off SEO folk and is now pissing off affiliate folk. This time he wonders if the search engines (including Google, Yahoo and Mahalo) should ban affiliate links from being indexed. First, how would anyone even know it’s an affiliate link? I don’t have a reaction here though if a gun was held to me, I would say that they should be banned or if they are indexed, it should be noted that it’s an affiliate link.

However, after reading Jason’s article about the potential banning of affiliate links it got me wondering about the way Jason links to Mahalo on his blog and the way he pushes his employees to also blog and spread the word of Mahalo.

On calacanis.com, nearly every single post has a link to Mahalo which is competely acceptable seeing as Calacanis is the CEO. But should these links have the nofollow attribute on them? Aren’t they paid links? Sure, there’s no direct payment but seeing as calacanis.com has a pagerank of 6, each time Jason links to a Mahalo page, he is passing the page some very heavy weight. In fact, it’s been reported that 76% of Mahalo’s traffic is coming from Google so naturally this type of linking is helping push Mahalo up the ranks in Google. In my opinion, he should nofollow every one of the Mahalo links.

In fact, employee links might actually be worse than affiliate links as they provide a direct benefit to the company whereas affiliate links only provide a true benefit when the user completes some action.

Furthermore, on the Greenhouse mailing list (that is the list for part-time Mahalo page creators), the executives from Mahalo constantly ask the list to push out the pages to their blogs and their social services. Should these links be labeled? Here is an example of the employee push on Mahalo:

everyone go ahead and share this with Mahalo Share!
http://www.mahalo.com/Grammy_Winners_2008

Mahalo is just one example, this happens across the Web with employees pushing products or services of the companies they are employed by. What do you think? Should employees of sites be able to “push” their sites and pass the juicy search credit or is this just as bad as any other paid link?

This will be my question for him at next week’s SES in NYC.

Jason Calacanis (aka "The Community CEO") posted an article on his personal blog earlier this week about advertising on Mahalo. Up until now it’s all been handled by Google AdSense. There are two topics that I will reply to below: ad placement and ad selection.

The fact that Google only lets you do some basic filtering pisses me off (though I do understand why it’s done this way). I spend many hours every week making sure that the ads shown on the sites I own are ones that aren’t past my guidelines. I’ve refused very well paying campaigns because they either were unethical or I felt that they just weren’t a good fit. And I applaud Jason for thinking about these questions as well – it’s a very important and sensitive subject.

As for ad selection, Mahalo is now testing Shopzilla ads where available on Mahalo search pages. These ads are CPA ads (cost per action) and require the person to actually make a purchase before Mahalo generates any revenue. The concern I have with these ads is for my Mom. If I suggest to Mom that she should use Mahalo, I would explain to her that humans are picking the content on the page and that it will be better for her than using Google. While the ads are noted in header format "Ads By Shopzilla" – I am concerned that Mom won’t know that it’s not something that a Mahalo staffer has selected for her. There are thousands of affiliate programs inside Google and through any of the affiliate programs that could provide ads that Mahalo staffers can approve over using a generic Shopzilla module.

Jason notes, "My thinking is that if you are super upfront about what’s an advertisement and what’s content folks will really focus on the ads *IF* they are in commerce mode. If users are not in commerce mode we don’t want to try and trick them/shif them…. let them stay in information mode." The issue Jason will learn (if he hasn’t already) is that mainstream Internet users don’t know the difference. They see all content as the same content. In all of my usability and focus groups with thousands of people (mostly women), the subject(s) would click whatever I wanted them to, whether it was ad, content, image, etc. Jason’s idea of making the ads appear as content will prove rich in clicks and potentially dollars, but will it tarnish the reputation Mahalo is going for? I’d say yes and that’s why I note my suggestion below.

As for ad placement and using the iPhone page in Jason’s blog post as the example, I’d suggest moving the ads outside the content area and moving them to the right. Then I could see something like, "Looking for an iPhone? Here are some retailers that carry it:" and same for the accessories. That way Mom can be assured that the content in the middle is "mahalo approved" and that the supplementary purchases are still available. And that also addresses Jason’s point about coming in commerce mode versus information mode.

The last concern is will Mahalo create pages in the order of which generate the most potential revenue. What I mean is that if Mahalo can find good paying advertisers that they can approve for a category/page, will they push these pages to the front for their guides over the more important, but lesser paying, content pages. I guess we will need to watch as they grow.

If Jason can find appropriate advertisers and partners for the categories that Mahalo creates pages in, it could be very beneficial financially for Mahalo.

Today we learned that Mahalo has added a social profile component to their system. Search Engine Land has a very lengthy overview of the features, but let me try to explain it in twitter-like style. You can add a profile with your social networks, and see your submitted links. And you can invite friends to Mahalo. That’s it.

Jason explains the new features as, "layering the social graph on top of search". Mike Arrington noted, "Today, they are adding user profiles and other social networking features to further incentivize users to submit quality content." I asked in the comments how this "incentivizes" anyone to leave more links – wouldn’t a forced login process cause less content to be submitted? The link I submitted to Mahalo is displayed on the page, about 4-5 full scrolls down. But it hasn’t been approved by Mahalo. What incentive does that give me to submit more links? I’d suggest moving those to the top to, at a minimum, say thanks for the submission. And would the average Internet user have a profile on Pownce or Twitter? I am not sold on what the benefit is to invite my friends to another profile generator. Can anyone help me understand some benefits to forwarding the profile creator to my friends?

Mike also notes that Mahalo traffic is up big which is great news for such a new startup. I’d just put an * there that shows the Alexa chart and who’s actually using the service. 60% of traffic appears to be employee traffic. Not taking anything away from the great growth curve displayed by comScore. (and yes, I know Alexa is the suck, but it shows a breakdown of where the traffic is coming from). Interesting note, "vanessa hudgens nude" is the most popular search term driver to Mahalo from Google reports Compete. I’d wonder what percentage of traffic comes from blogger mentions and Google vs. home-grown organic traffic.

I’ve written before about why the Community CEO doesn’t work and posted Jason’s response of why it does work. Today, it’s important to note that it’s not only community ceo, it’s also now unpaid community site growth with the belief that people will submit links to better the search engine to then help me back on future searches. I am not sure I’d take that bet but with their goal of hitting the mainstream, it may work.

Jason is a very smart marketer. I’ve said this several times before. We know this by the way he releases items in timing/depth on Mahalo and to whom he hangs with to drive traffic. I certainly can’t fault him for this.

In the video presentation below from LeWeb, Jason attacks Seth Godin for not policing Squidoo and Dave Sifty for the spam on Technorati. He then calls Ted Murphy an "idiot" and notes he is "not being so bright" with his PayPerPost product. Jason also notes in his discussion that we should use RSS subscribers as a metric for who’s an authority. I sure hope he is kidding on this last claim.

Here’s the video from his speech at LeWeb: