Internet, Startups

Of Mercenaries and Missionaries

Right at the end of my time at college I discovered the Mac. I remember being astounded at just how much better it was than anything else I had tried to use. I was struck by the care taken with the whole user experience. I had a sense of connection via the object with the designers. I started to learn more about the company, how it had been founded, its values and its structure. The more I learnt about this cheeky almost rebellious company the more it appealed to me, as it unapologetically pointed to an alternative in a complacent and creatively bankrupt industry. Apple stood for something and had a reason for being that wasn’t just about making money.

Jony Ive, talking about why he joined Apple

If you had to pick a company in Silicon Valley (and maybe the US) with the strongest culture, Apple would have to be at the top. Really, who is better? The loyalty of their top executives is astonishing. Jony Ive, 20 years (he joined in 1992). Eddy Cue, 23 years. Phil Schiller, 17 years at Apple all together, 15 of them in his latest run. Scott Forstall, 15 years. Tim Cook, 14 years. Bob Mansfield, 13 years.

For each of them I suspect Apple is their life’s work. Ive’s quote is telling; it succinctly sums up why people come to Apple and why they stay. I have friends who work at Apple and almost all of have said something similar to me over the years. By all accounts, it’s not an easy place to work. It is full of stress. But people go, and stay, because they feel like they’re part of a larger mission and cause. It’s why this video was so incredibly important when Steve Jobs returned in 1997.

But Apple, alas, is not the norm. A more mercenary culture is pretty pervasive in Silicon Valley, and indeed in the tech world. I saw it throughout the late 1990s, and you see it very much in evidence today. People latching on to a rising startup for a year, two, three or four; looking for riches through that IPO or the acquisition. Then ditching out and on to the next thing.It’s accepted practice among the career-minded and ambitious. But it can have a devastating effect on the startups those folks join; when times get tough, or even a little uncomfortable, the mercenaries are always the first to flee.

If I were an active investor, this would be one of the key ares where I’d focus. Is the company full of mercenaries? Or missionaries?

And as someone hiring people at a startup, it’s one of the first things I try to understand. Are you just another mercenary? Or do you want to help us change the world, through thick and (a lot of) thin?

Digital Media, Startups

“Life is an intelligent thing”

I read a lot, usually fiction. But (unusually for me) I’ve lately been reading a lot of the current, popular books about the technology world. In the Plex, by Steven Levy about Google. The Facebook Effect by David Kirkpatrick.

And now “Inside Steve’s Brain.”

This passage – about Jobs’ doubts about returning to Apple in 1996 – has stayed with me the past few days:

He sometimes wondered if he was doing the right thing… He knew that returning to Apple would put pressure on Pixar, his family and his reputation. ‘I wouldn’t be honest if some days I didn’t question whether I made the right decision in getting involved. But I believe that life is an intelligent thing — that things aren’t random.’

Apple, Digital Media, Startups

The Lost Magnificent Ambersons Footage: An Allegory

“It isn’t the consumers’ job to know what they want.”    – Steve Jobs, when asked if consumer research was done for the iPad (NYTimes)

The tale of The Magnificent Ambersons is well known among hard core movie fans. It was the first movie directed by Orson Welles after his ground-breaking Citizen Kane, and Welles and others thought it was an even better picture than Kane. But Welles went off to Brazil to make another movie just as Magnificent Ambersons was going into final edits, and left the film in the hands of the studio (RKO) and his associates. Who proceeded to test a version of the film in front of a group of teenagers in Pomona, California who had come to see a wartime musical, The Fleet’s In.

Predictably, the kids savaged the film, and in Welles’ absence RKO and some of Welles’ colleagues proceeded to butcher the picture, cutting it down from a run time of 132 minutes to 88 minutes.  No copies of the original version of The Magnificent Ambersons are known to have survived. (Imagine for a second 44 minutes being hacked from Citizen Kane, Casablanca, Lawrence of Arabia, or Schindler’s List). This whole saga is recounted in more depth, and wonderfully, here.

The tragedy of the Magnificent Ambersons illustrates perfectly what happens when you’re making something that is designed to engage one’s emotions and you leave the really important decisions to a focus group, or A/B testing, or some similar data-driven process.  For when you’re trying to make something that produces joy, or that is “fun,” or that is playful, some art and some craft and a point a view is required. Things that are built to engage one’s emotions — movies, music, art, even devices like the iPad — can’t be systematically produced, or manufactured, or tested.

I’ve felt this strongly as we’ve made Showyou (a new app we launch in about 12 hours) the past few months. We wanted to make something that was, first and foremost, fun to use. That made you smile with delight. That was beautiful to look at.  We had (and continue to have) a point of view about how we ought to do that. We tested it with about 50 people over the past month, got wonderful feedback from them, and iterated intensively to make the app more usable as a result.

But some feedback — while rational, defensible, perfectly justifiable — we ignored. Intentionally. Because acting on it would have involved taking out or substantially altering the very elements that, in our view, make Showyou fun to use.

It may be that tomorrow we’ll be proven wrong. And indeed, there’s definitely the risk of leaving too much in — or failing to recognize when you’ve just got a bad idea to start with (Ishtar?!).

But as I’ve gotten older, and worked on more products, I’ve come very much to the view that you have to have a point of view. And be willing to stick to it. You might be wrong. Or you might make something great. With Showyou, we are excited about what we’ve built, and eager to make it better still.

For in our world, unlike the movies, you’re never done and you always keep working towards perfection.

Internet, Media Business, Startups

The Digital Revolution: Lessons from the 19th Century

Last summer I spent a fair bit of time reading up on the history of the newspaper business. Biographies of Hearst, Pulitzer and E. W. Scripps, along with a few more academic books on how these newspapers actually became big businesses.

The most suprising thing I learned?  That without the twin forces of urbanization and industrialization, there would have been no modern newspaper business, no modern advertising business, and no modern media business.

Those two tectonic shifts in the 19th century created new neeeds; those new needs created a huge array of new markets that flourished well into the 20th century. The newly created needs most relevant to the newspaper business produced by urbanization and industrialization were:

Need for ready-to-wear clothing
Up until the mid-19th century, most people in the West made their own clothes. Buying clothes was beyond the reach of all but the very rich. But with urbanization and industrialization, it suddenly became possible to buy clothes. And, in large urban areas, getting the right clothes (even though mass produced!) became a marker of your status and position in life. Department stores, an invention of the 19th century city, built huge new markets catering to this new need.

Need for Packaged Goods
Most people in the West also grew and produced their own food up until the middle of the 19th century. But as the West became increasingly urbanized and industrialized, that just wasn’t possible. People working at factories or other jobs in cities needed to be able to buy packaged foods and sundries, giving rise to businesses like P&G, Kellogg, and Colgate.

Need for Entertainment
Finally, those living in cities were no longer bound to a full day of work tending to the land or to their animals. The middle and upper classes, and even the poor, suddenly found they had time for leisure, made more abundant still by electricity which extended the day.

Newspapers flourished in late 19th century as they built huge audiences among urbanites catering primarily to this need for entertainment.  The great papers of the late 19th century offered a steady diet of crime trials, sex scandals (tame by our standards today), and increasingly sports news. Publishers like Hearst and Pulitzer added muckraking journalism that entertained and agitated for change.

With millions of readers every day, newspapers offered packaged goods companies (P&G) and sellers of clothing (department stores) the very best way to grow their businesses. Buying an ad in an urban newspaper with a big circulation was the most effective way to market to city dwellers who needed to buy clothes, or packaged goods.  And this gave rise to an entirely new market — for media, and for the creation and making and selling of advertising. That had never really existed, in any meaningful way or at scale, until the late 19th century. And it would not have occurred without the forces of urbanization and industrialization.

It’s obvious to most anyone now that the huge tectonic forces at work in this generation are the combination of computing and digitization (or, digitalization as the English would say).  These new forces have fostered new ways of making existing markets more efficient — you can now buy nearly anything online, for example.

But they’ve also given birth to new needs, desires fresh and new and that perhaps we didn’t know (or still don’t know) we had including these two:

The need for self expression and self-representation
For many on the Internet, it’s no longer sufficient just to go online; you need to be online.  As we spend increasing amounts of time on the Internet, or engaged in a digital life, many people want to have a presence there and assert there personhood there. This began with early online communities like The Well and other BBS, but has gotten a fuller expression with blogs, sites like Digg and Stumbleupon, and media publishing platforms like YouTube and flickr and even Vodpod. Myspace and Facebook (and to a much lesser extent, Twitter) were the first mainstream incarnations of this need.

The need for immediateness
We now live in a world where we expect — and crave — access to anything from almost anywhere at anytime. Google has been the most obvious outlet for this new need, and a whole new market — search-related advertising — was borne from it. But one could also list Amazon, Netflix, Craigslist, e-mail, IM, and real-time services like Facebook and Twitter as tapping into our new need for immediateness.

Other, more recent services and products can be explained as illustrations of these two new needs. I would argue that services driven by game mechanics — Foursquare and Farmville for example — are primarily driven off the need for representation of self. “Leveling up” and earning badges helps to define who we are online, helps to foster our sense of digital personhood.

The iPhone, Blackberry, and other smart phones show the need for immediateness made manifest in the mobile world.  The iPad, if it succeeds, will do so because it satisfies our need for immediateness in some more profound way than laptops and smart phones do (and this is why I’m skeptical about it); and not because it’s a “consumption” device.

Just as markets for clothing, packaged goods, and entertainment begat the entirely new market of media and advertising in the 19th century, it’s interesting to contemplate what new markets might get created from our newly created needs for self-expression and immediateness. Virtual currency, curiously, can perhaps be understood best through this prism; we want Farmville dollars to facilitate our self-expression; we buy virtual currency to satisfy our desire for immediateness.

But what else? What might come next? What other markets might be born as the result of all this?

Internet, Startups

Power of Passed Links

Fred Wilson, a VC and blogger and investor in Twitter, talks about the power of Twitter to drive traffic.

more about “Powere of Passed Links“, posted with vodpod

He says that among their portfolio companies, traffic from Twitter and Facebook is now about 20% the amount of traffic driven by Google; that it is growing about 3-40% per month; and that if that growth rate continues, Facebook and Twitter will drive more traffic to their portfolio companies (excluding Twitter, obviously) than Google within a year or two.

As I wrote two months ago, I get that the potential for traffic growth is very attractive. The question for me remains is there some fundamental benefit that will allow this to happen, or are we just seeing a bubble inflate right now:

So why the hype? Traffic. People — bloggers especially, those in Silicon Valley or the tech industry even more particularly — have realized that Twittering can send traffic.  This is why Jason Calacanis offered $250,000 for one of the 20 recommended user slots on Twitter.  It’s why so many top twitterers include links in their tweets, usually to their own properties. And why so many in the SEO/SEM business have flocked to use Twitter.

So it’s all good, right? Twitter is the new Google, a new fountain of traffic for web properties? That depends on how you look at it, and whether you think Twitter provides some essential, fundamental value. If you question whether it provides much value other than the potential to drive you traffic, the Florida real estate cum ponzi scheme analogy goes like this: people are flocking to Twitter mostly because they believe it has the potential to drive traffic, and as long as people flock in that perception is fulfilled.

The problems start occuring when the growth slows down, or stops.

And this movie, we’ve seen it before. Digg and Facebook got the same (ok, not quite the same) levels of hype in their days of ascendancy, for the same reasons. People thought they could be tamed, harnessed, used as traffic hoses. As growth (or the perception of growth) in traffic from those services decreased, so to did the hype attendant on them decrease, at least among the digerati. But unlike Twitter, one could argue Facebook, and to a lesser extent Digg, provided some more meaningful, underlying value to their end users.

I still think that the jury is out.

Startups, Uncategorized, Video for Video? Yes, We Have That

I like Fred Wilson’s blog. Read it regularly. Also follow him on Twitter.

On Friday, Fred posted an interview with Robert Scoble where he asked for a “ for video.”  Real-time maven that I am, I would have seen Fred’s note, it would have caught my attention, and I would have tweeted him right away. For I know of such a service!

But, very happily for me, I was very off the grid for three days here:

Picture 7

Now I’m back, refreshed, and should update the record. for video? Already done.  Called Vodpod. Been around for over 2 years. And indeed already pretty popular! You can see my video bookmarks on the right. Heck, you can even watch them there!


  • Provides a handy browser bookmarklet (or extension if you prefer) so you can bookmark a video from any site that offers Flash video + an embed code (9500+ sites and counting)
  • Makes it easy to share the videos you bookmark in an infinite number of ways through our widgets, RSS feeds, API, hosted video sites, applications for Facebook and Twitter and FriendFeed, and more
  • Normalizes the video playback across thousands of different Flash player types, with consistent sizing and handling of auto-play (as best we can, anyway)
  • Makes lovely thumbnails for the videos you collect
  • Provides handy Flickr-like organizer, so you can order your collection as it grows

And more. The team gets an A for building an awesome service; I get a more critical mark when it comes to evangelizing the product among the technorati.

So @Fred — check it out! It’ll even work on your Boxee:-)

Blogging, Startups

Matt of WordPress: Blogs Dead? No.

Found this writeup of a conversation between Andrew Keen and Matt Mullenweg via Matt’s blog (so I assume he endorses this quote):

“Blogs will become aggregation points,” the shamefully youthful, soft-spoken Mullenweg explained, as he mapped out the future of blogging for me between bites of Dutch smoked salmon. “They will become our personal hub. Places where we store all our personal media content such as our flickr photos and Twitter posts.”

That’s a vision we buy into at Vodpod.

When we launched Vodpod 28 months ago, we started by offering cool, simple widgets that let you put your favorite videos in an interactive gallery on your blog.  We’ve expanded the array of tools for bloggers since then; some bloggers have built entire sites using our API.

We’re big believers in both blogs, and bloggers.  If they were stocks, we’d be long. That hasn’t changed, our belief hasn’t wavered these past two years, despite the hype give to other platforms.

We have some very interesting things up our sleeves for the blogging community. Stay tuned.

Internet, Startups

Why We Tweet: A Theory

In my last post here, I suggested that Twitter-cum-phenomenon was starting to feel like the Florida real estate market circa 2005 (hype growth of the service far outstripping the substantive value it provides). Given that Oprah focused her show on Twitter yesterday, I thought I should follow up that last post by trying to unpack the riddle of Twitter’s appeal.

Dave Winer wrote this on earlier in the week:

I read Farhad Manjoo’s piece in Slate about Twitter. It’s the best of a class of commentary that says that Twitter is something you can skip if you aren’t interested in periodic 140-character reports on mundane people’s lives. As I read the piece it made sense, so I was left wondering why I was and still am attracted to Twitter and use it, daily.

I set up my first Twitter account (one of 5-6) back in September 2006. It had just launched, but geeks here in San Francisco were talking and blogging about it. I have been an on, then off, then on-again Twitterer, and have asked the same question regularly: “Why am I here? What am I really getting out of this?”


The Twitter team’s web craft (by that, I mean the art of building a seductive and usable service) was what initially attracted me. It has always been a joy to use and is impressively made, in a million very subtle ways.  Understanding what they’ve done well I think helps us to understand the appeal the service has had, even when so many of us have so often said: “I don’t get it.”

Here are the things I’ve particularly admired as a fellow web crafter:

1. Asynchronous Following

At the time Twitter launched, the canonical social media approach was “friending” — a reciprocal relationship. Myspace, Flickr, Facebook, and dozens of other imitative social networks required (and still require, in many cases) this form of relationship. The requirement of reciprocity can feel restrictive, confining, claustrophobic and artificial all at once. Twitter picked the lock on this — first, with a hybridized approach of “friending” and “following” (like subscribing to a blog feed, but in a way that feels much more personal), and then abandoned “friending” altogether.

Asynchronous following allowed Twitter to become a publishing platform, but with the ease and intimacy of a communications service. Celebrities and others could use Twitter to broadcast to their fans and followers, with hardly any effort at all.  Ashton Kutcher can have over a million followers because there is no reciprocity — he doesn’t have to follow them back. And it has allowed those 1 million + Twitterers who follow Kutcher get to indulge in one of the web’s guilty pleasures — lurking and stalking, with a crafty and weird combination of both anonymity (“I’m one of a million, Ashton can’t tell I read that Tweet”) and intimacy (“I’m listed as one of Ashton’s followers!”).

2.  Ease-of-use and the 140-Character Limit

Novelists often talk about the tyranny of a blank piece of paper. That same terror probably keeps blogging from becoming a more popular. Writing is damned hard, it takes time and effort, you have to be committed. Twitter, by sticking hard to the 140-character limit in order to inter-operate with SMS, instantly solved that problem (I don’t think that was a lucky accident; after all Ev and Biz built blogger and saw first-hand the hurdles in front of bloggers).

Suddenly you could publish publicly on the web with less effort than it takes to write an e-mail. The short-form limitation took the pressure off, and leveled the playing field. Yeats, were he on Twitter, wouldn’t necessarily Tweet better than you or I.

3. The Feeling That You’re Not Alone

Last — and for me, by far, most crucially and impressively — were the simple ways the Twitter team visually articulated the notion of “following” on Twitter.  The co-mingling of Tweets you write with those from people you follow was an absolute stroke of genius. It gives the appearance — an illusion, perhaps — that someone is out there paying attention.

It’s instructive to think about this in comparison to blogging. I am typing this post from my very trusty and capable dashboard. To my left and my right are every command and tool I might need as a publisher. But when I hit the publish button, I’ve not a clue that anyone will read this. It goes out to the ether, to a server, and then sits inert in the form of a web page that may or may not ever be seen.

Contrast that to Twitter. Whether I’m writing a Tweet from a client like Tweetdeck or Twhirl, or, not a publishing tool in sight. But I’m surrounded by people. Tweets from people I follow. As soon as I hit enter, my tweet is right there in the stream. I know, intuitively, that people will probably read my Tweet; after all, staring me in the face are short messages from the people I follow. Maybe a few of my 300-odd followers will read what I’ve had to say.

I hadn’t thought about the contrast with the actual act and process of blogging until this past week. And, in the end, this contrast solves the riddle for me.

This UI, and the publishing mechanics of Twitter, are not technical innovations; they are psychological ones.  They give you the visceral feeling that someone out there is listening, that someone is paying attention to you.  Inventions from the community — like the use of “@” for replies, and retweets, have simply reinforced all that.

You don’t get that from blogging –  the notion of an audience feels more abstract; your readers more distant; the perception that you are being heard more attenuated.


In the end, we’re left with a paradox or two. The act of Twittering  sustains — people Tweet because it’s easy, and it gives them the appearance someone is out there, listening. But the substantive value of these Tweets for readers is at best debatable.

The act of blogging feels isolated, silo’d, lonely even — at least compared to Twitter. But the substantive results from blogging can be impressive, useful, even life-changing for the reader.

UPDATE: Virginia Heffernan has an interesting take on Twitter in tomorrow’s NY Times magazine.

Internet, Startups

On Florida Real Estate, Ponzi Schemes and Twitter

Back in early February (2009), there was a very worthy piece by George Packer in the New Yorker, “The Ponzi State” (it’s behind a registration wall, I’m sad to report). The gist of Packer’s piece was that economic growth in Florida required a constant influx of new people.  With very few underlying industries or major businesses, many in the state made their living selling houses or building them.  As long as there was a constant influx of new people with money in their pockets to buy those houses, everyone was happy. House prices went up, more people moved to Florida to buy houses thinking prices would continue to go up, many of them got jobs selling or building more new houses, and so on.

Then everything came crashing down in 2007. Without that constant influx of new people, turns out there was no “there, there.”

That article has been rumbling around the back of my head as I’ve watched the hyper-explosion of Twitter the past couple of months. I’ve been wondering: is Twitter’s growth driven by some underlying fundamental benefit it provides? Or, is it like Florida — dependent on a constant influx of new people to the service? And if the latter, what happens when the growth peters out? Is all this growth and hype just inflating a big “Twitter Bubble?”

I think the answer is yes. And I realize that writing this is complete and utter heresy in the current moment. Hear me out.

I admire Twitter as web craft. It is very, very nicely made. But in general, how much value does a series of 140-character messages really provide? Go look at the feeds for any of the top 100 or 200 Twitterers. How much value is really there? Look hard at your feed for a day — how essential was it to get those Tweets in real-time, really?

At the very, very best, I think you have to conclude the jury is out.  At the very worst, it’s a big, stinking, very perishable pile of inanity — mostly crap, with a very short shelf-life.

So why the hype? Traffic. People — bloggers especially, those in Silicon Valley or the tech industry even more particularly — have realized that Twittering can send traffic.  This is why Jason Calacanis offered $250,000 for one of the 20 recommended user slots on Twitter.  It’s why so many top twitterers include links in their tweets, usually to their own properties. And why so many in the SEO/SEM business have flocked to use Twitter.

So it’s all good, right? Twitter is the new Google, a new fountain of traffic for web properties? That depends on how you look at it, and whether you think Twitter provides some essential, fundamental value. If you question whether it provides much value other than the potential to drive you traffic, the Florida real estate cum ponzi scheme analogy goes like this: people are flocking to Twitter mostly because they believe it has the potential to drive traffic, and as long as people flock in that perception is fulfilled.

The problems start occuring when the growth slows down, or stops.

And this movie, we’ve seen it before. Digg and Facebook got the same (ok, not quite the same) levels of hype in their days of ascendancy, for the same reasons. People thought they could be tamed, harnessed, used as traffic hoses. As growth (or the perception of growth) in traffic from those services decreased, so to did the hype attendant on them decrease, at least among the digerati. But unlike Twitter, one could argue Facebook, and to a lesser extent Digg, provided some more meaningful, underlying value to their end users.

In short, I think it’s arguable there is a Twitter bubble now, just as there was Florida real estate bubble in the early 2000s. It’s being propped up by perception of future, unending growth. A lot of people joining because they believe in the dream — that they can gain a lot of followers, and turn those followers into dependable “viewers” or “buyers” or “believers” or whatever.  And instead of real estate agents, we have “social media consultants,” SEO folks, web designers, entrepreneurs, politicians, and celebrities pitching themselves, or their links. In short, it’s a few million people furiously on the make.

That’s not to say Twitter is worthless, that it has no value. The value is exactly what you’d expect a steady diet of 140-character messages would provide.

Rather, just like Florida real estate at the height of the bubble (and Facebook two years ago), the value is a lot less than we currently perceive. It’s not the next Google. Heck, it’s not even the next YouTube (a company, it turns out, that was underhyped!).

And that the crash might be a hard one.

Internet, Startups

Time to Say Goodbye to the Serial Entrepreneur

One of the most over-rated terms in the Silicon Valley lexicon is “Serial Entrepreneur.”

For the uninitiated just visiting Epigonic, the term refers to those entrepreneurs who form, then flip, startup after startup. They are worshipped, especially, by Silicon Valley denizens; seen as safe hands who can produce a steady stream of singles, doubles, and the occasional triple.

But they don’t, generally speaking, create lasting, durable companies. Hewlett, Packard, Moore, Groves, Gates, Jobs, Ellison, Brin and Page — these were not serial entrepreneurs (yes, Jobs did found Next and helped create Pixar, but only because he was forced out of his beloved Apple for a decade).

And if we’re to get out of this crisis, we need more entrepreneurs like that. Ones who can create jobs, at lasting and durable companies. Most startups that get flipped might enrich its founders and investors, but otherwise add little to society.  Name me the start up launched by a serial entrepreneur that still has value, relevance, and strength?

I can only think of one — PayPal. Jury is still out on Skype. I think YouTube will still likely be very, very large and important and relevant in 5-10 years, perhaps it will get added to the list.

Let’s be honest, most startup acquisitions end up being utter failures for everyone but the founders and the investors. The founders, newly enriched, quickly lose their focus and zeal, and the once innovative startup just becomes another cog in the bureaucratic machine. Employees at the acquirer are often resentful of these newly enriched founders, and go out of their way not to cooperate in making the acquisition a success. The supposed catalytic effects to be brought by the startup often fail to appear, having typically been oversold by the startup to the acquiring company.

Sound familiar? I could think of a hundred other examples.

Fetishizing of serial entrepreneurs in the Valley has occurred in part because it’s been impossible for nine years now to make any money from tech startups in the public markets (Google, Salesforce, and a few others excepted). The only reliable way to make money has been to fund, flip, repeat.

To illustrate just how ingrained this mentality is, let me tell a personal story. Two years ago,  7-8 months in to starting Vodpod (and only 3-4 months after the service launched), we got a very nice, very good, very real acquisition offer. I polled a wide array of folks for advice, and almost to a person I heard this: “Sell, take the money, stay at the acquirer for a year or two, and then start over.”

That mentality has to change. With the economic crisis, it probably will be forced change — the fund, flip, repeat model is no longer operative.

But if it’s impossible to have an IPO in the current public markets, or to sell your startup to an acquirer, what are the options?  We need to find a way for mid-size companies to go public again. Reid Hoffman suggested three ways in which the government could help fuel startups the other day; I’d add a fourth  –  enact securities laws and regulatory reforms that would enable a new public market for mid-tier companies. Specifically, something like the AIM in London, targeted at companies with market caps between, say, $100M and $1B, with reporting and legal requirements appropriately tailored to the size of the company.

That might allow more entrepreneurs to focus on building durable, long-term companies, while still satisfying the needs of investors and employees for some liqiduity in the short- to mid-term. Growing companies with $30-50M per year in revenues and some profits could have a path to go public, without the current and very onerous requirements designed for Enron-like multi-billion dollar conglomerates. Some of those companies might thrive, and move on to the big boards. Some might wither. Either way, seems like a better prospect than selling out and withering away. Or doing this so much more inefficiently through an opaque and entirely unregulated secondary market.

If we had this type of market, perhaps that would have been the path taken by Flickr and they might remain a viable, independent, innovative company. If we build such a system, it could be the path taken by current thriving startups like Automattic (WordPress), Digg, or Twitter.