Redeye VC

Josh Kopelman

Managing Director of First Round Capital.

espite being coastally challenged (currently living in Philadelphia), Josh has been an active entrepreneur and investor in the Internet industry since its commercialization. In 1992, while he was a student at the Wharton School of the University of Pennsylvania, Josh co-founded Infonautics Corporation – an Internet information company. In 1996, Infonautics went public on the NASDAQ stock exchange.

Read more or visit First Round Capital

Monthly Archives for 2010

View the older monthly archives »

This year I mean it -- its a bubble!

Bubble_2We live our lives by routines.  In January, we all make resolutions for the new year.  In November, we give thanks for the bounty of the harvest at Thanksgiving.  And for those in the tech industry, in October we go to the Web 2.0 Conference and try to outdo each other with our declarations of "Bubble 2.0".

Today's NY Times story declares that "Silicon Valley’s math is getting fuzzy again."  This sounds somewhat similar to their story last year which concluded that: "Web 2.0...has in recent months become the focus of dot-com-style hype in Silicon Valley..."

As people leave the conference this evening to write their obligatory "we're in a bubble" story, I thought it would be helpful to provide them with examples from the last few years, so they can find new ways to express the same thoughts...


2004

"To be sure, conference organizers seemed aware of the possibility of a looming hype machine. One panel early Wednesday featured stock analysts mulling the thesis: Is it a bubble yet?" - CNet News.com

"The web is entering another bubble of optimism..." - Read/Write Web

"No greater shroud hangs over Web 2.0 then the fear that we'll repeat the financial mistakes of the past..." - IT Conversations

"The Web 2.0 conference was an online lovefest, where an array of speakers repeated that the Internet is still in its infancy. A panel of financial analysts and venture capitalists questioned whether the industry is going through another bubble.." - SF Chronicle

 

2005

“The industry is still tingling from the loud and sweaty Bubble 2.0 — whoops, excuse me, Web 2.0 — conference here late last week.” - USA Today

“No Web 2.0 Bubble? Hmmm.... even the backers of the recent Web 2.0 conference warned that things were getting frothy” - Business Week

"I heard many people say it felt very bubblelike. in fact, every party or event seemed like a lead in to this topic." - Mark Pincus

“What was a budding movement three years ago, at the dawn of the revival in technology, internet, and silicon valley, has become a full blown mania.” - Fred Wilson

"At the Web 2.0 conference, I'm sensing the buzz of a bubble" - Read/Write Web


2006

"Are we in a bubble? Absolutely" - Read/Write Web

"Web 2.0 was the same dance all over again: this tech bubble, boomy, exuberant thing that happens when money hangs like a bumper crop in an orchard.  At the conference, I swear there was a ka-ching sound in every techie's step." - USA Today

"For industry players, many of whom lived through the dot-com crash, the surging wave of new Web companies and the corresponding media buzz can mean only one thing: an investment bubble where too much money is chasing too few good ideas." - CNet News.com

"(Did someone say bubble? Not at this conference, please!)" - SFgate.com

"It isn’t dot-com bubble level, I’m told, but darn close." - Forbes

 

Even a broken clock is right two times a day.  By proclaiming a bubble every year, everyone can say they "called it." 

The Implicit Web

I’ve recently come to the conclusion that Web 2.0 no longer has any unique meaning.  It now means “any Internet-based company that has launched after 2004”. It is as useless a descriptor as “dot com” was.

Jason Calacanis today posted his attempt to define Web 3.0. Like Fred, I sure hope we can find a better name for it than 3.0. I also think that Jason’s proposed definition is incomplete. I believe that a big part of “what comes next” will center around the Implicit Web.  Since the Wikipedia entry on Implicit Web is pretty obtuse/complex, here’s what I mean by implicit web:


As people spend more time online and perform more of their activities online, they create a lot of data about themselves online. Netflix knows what movies I watch and like. Apple knows what music I purchase and listen to. Amazon knows what books I purchase and like. Evite knows what events/parties I’m going to. Tivo knows what TV shows I like. Opentable knows where I like to eat. Fandango knows what movies I go to. Ticketmaster knows what shows I’ve seen.


However, until now that data has existed in silos. There has been no easy way for me (as a user) to access and benefit from that data.  I think the Implicit Web will give users the ability to control the data in these silos and decide who and how it gets shared with.


Let’s take a simple example. If a user joins Facebook
today and wants to complete their personal profile, they get presented with several blank boxes (see right) to fill out. However, via the Implicit Web, as user should be able to tell Facebook to:

  • Fbprofilecheck Apple (or Rhapsody or iLike) for their Favorite Music
  • check Tivo (or Comcast) for their favorite TV shows
  • check Netflix (or Flixster) for their favorite Movies, and to
  • check Half.com (or Amazon) for their favorite Books.

Why should users be forced to re-create data that already exists? Talk about a waste of time.

I think there is a huge opportunity here. In fact, it reminds me of an opportunity I saw in 2000. In 2000, Sony launched their Playstation 2 – and they were quickly sold out. Over 50,000 Playstation 2’s were listed on eBay in the first week. That means that 50,000 sellers had to go to eBay and spend 15+ minutes creating the exact same listing. Every seller had to type-in the same description and upload the same picture. That’s over 12,500 hours wasted re-creating something that already existed elsewhere.  And that helped shape the vision of Half.com.

First Round Capital is actively looking to invest in companies that help make the Implicit Web a reality – either by breaking down the silos or by taking advantage of the data in a new way.

One final story. I remember hearing a story about a research study on dating (I haven’t been able to find the exact study – if anyone knows it, please tell me). Researchers basically arranged two types of blind dates. The first group of blind dates was a traditional dinner – where two people spent two hours talking and getting to know each other. The second group of blind dates was a little different. For this group, they took one person and let them spend five minutes alone in the other person's home or apartment. They could see their fridge, their clothes, their books, their music, how messy/neat the house was, etc.

And they found that the person who spent five minutes collecting implicit data got a far better (and more accurate) picture of their date then the person who spent two hours collecting explicit data by conversing.

I wonder if the same results will hold online…

Silence

So, I know I've been a bit quiet on the blogging front lately.  A combination of a crazy schedule, overflooded inbox and an injury have taken their toll.  I have been making my "list of things to blog about when I have time" -- and I hope to have some time next week, so stay tuned.  In the meanwhile, a few small updates on the last month:


  • Apiconference_2Portfolio company, Mashery, closed their next round of funding from Formative Ventures and Accelerator Group.  Mashery is also currently sponsoring Dealmaker Media's one-day conference, "The Business of APIs".  If your company is doing anything new on the web today, you are probably looking at APIs and Web Services -- and this conference seems like a unique opportunity to learn from several companies who have already launched API distribution programs.

  • Brett Hurt and the Bazaarvoice team also recently announced their most recent round of funding, led by Battery Ventures.  Watching these guys execute has been amazing -- their client list reads like a "who's who" of ecommerce.

  • We also recently led a seed-stage investment in Satisfaction Unlimited.  Satisfaction provides a set of tools that allow companies to crowdsource their support amongst their customers.  They are part online discussion, part FAQ, and part social network. Anyone can ask a question, submit an idea or problem, or just talk.   Love a company?  Hate a company?  Get some Satisfaction here...

  • One of our (west-coast) portfolio companies, is actively (urgently) seeking an IT/Operations person (either full-time or contractor).  They are looking for someone with expertise in (1) running a 99.99% uptime high traffic consumer site, (2) colocation management and bandwidth provisioning, and (3) Linux, Apache, Tomcat, Java and MySQL.  If you know of anyone, please let me know...

  • I broke my shoulder a few weeks ago.  In order to spare myself the "Groundhog's Day" experience of repeating the same conversation 20+ times a day, I decided to put the footage of the injury on Youtube...