Mark Pincus Blog

Firefox = Foxy Cash Cow

i've been hearing rumors that firefox (from mozilla.org) is making over $30m annually off of its deal for the google search box. just saw they passed 64m downloads too. that would mean they're making $0.50 annually for every download, but actually if you lose 50% of the downloads to apathy, bugs and ignorance (hmm...the ABI dilution effect), that would imply more like $1.00 per user which is pretty amazing. it's kind of fitting that one of the few startups in silicon valley to immediately go cash positive is a non-profit; and continues to support my hypothesis that all startups are non-profits except google:)

What's your dream job?

i received a lot of great comments on my question of 'where's the leverage?'. this smart kid blogger in my neighborhood, ben casnocha, comments that you should be in it for the love of the game and not the fat paycheck and that the daily grind is part of the price.  while ben's passion is admirable (at such a young age. i think he's in high school) it doesnt ring true.  does richard branson have to make these tradeoffs? no. he has an awesome job where he can wake up every week and devine a new product to put his virgin stamp on; and he's doesnt have to sell his ideas to anyone but the public.

maybe the right question should be 'what's your dream job?'.  i believe that for most entrepreneurs the dream job would be one where we get to come up with new ideas, have another team execute on them but maintain ultimate control over direction - ok being ceo of virgin wins hands down and probably for most entrepreneurs. 

Views from the front lines...

so fred, brad and allen have been blogging lately about the VC world from allen's 10 commandments to fred's vc cliches and brad's diary from the front. i thought some of us entrepreneurs should chime in with what it's like trying to come up with the next great idea (then get funding, market traction, revenue, profits and keep a sliver of equity). 

[this would be a cool thread if other entrepreneurs would add and tag it as 'entrepreneurs'. (and if i could figure out how to do that.)]

i'll kick this off with..."Where's the leverage?"

so the big dilemma facing most seasoned entrepreneurs today is about leverage. the vc's and other investors get plenty by making multiple bets within large funds. they can be reasonably confident that over their fund's life they can deliver good returns and make good and sometimes obscene money. entrepreneurs have to make totally concentrated bets and wait several years to see if they pay off at all. this gets hard when the rest of your business school classmates seem to make as much in one year managing their hedge fund as you hope to as your final payout if it ever comes.

so where's the leverage? well, you can try to start multiple companies but that is frought with landmines like the fact that over time companies will readjust equity to compensate current employees and investors so you can count that your equity will be highly diluted when you leave.  also, you will inevitably dilute your attention to the winner by spreading it across a lot of losers.

you can try to raise a fund and start an incubator (and party like it's 1999:). while this may be great for the investors who get to buy into your companies at founders prices, it is very hard to put a lot of capital to work and now you've reduced your payout to a carry across a relatively small number of bets (as compared to a vc fund).

you can join a vc fund. this seems to be the most popular route for successful entrepreneurs (most recently bill joy going to kp). for some people, this represents a kind of nice, easy retirement. they probably dont last in that business which gets more competitive as it gets more crowded. my problem with that (other than nobody inviting me to join:( is that i'd get frustrated with such a passive role (though some are notoriously not that passive:).

for me, it seems to be an inescapable loop of saying i'm going to do something else until i find i'm overtaken by some idea that i cant bear to see others go do only to wake up again to a 9 to 9 job with team meetings and board calls wondering how i ever wound up in the same ground hog day existence and dreaming of the next escape and the path to something better.

Is there a Uniform Community Value Curve?

i've been thinking for a while that some feisty social networking phd (read dahah boyd) should go out and research the community value curve. that is the exponential growth in value for communities with higher penetration. the idea is that at low levels of penetration, say under 5%, there is close to zero value to any community, but that at say 10% penetration it might be 10-20 points (on a 100 index) in value and at 30% penetration it might climb to 60 points and at 50% it might climb to 80 points. i'm wondering if there is a uniform law of community value that might hold true across all types of online community. this would be interesting as it might lead to a whole new analysis of customer or community acquisition. for example, if we knew where the inflection point existed we might find that we could afford to pay 2-5x the marketing cost for the first say 20% of a community, knowing that beyond this, our cost of acquisition might go to zero and the inherent value and stickiness might go up so high as to greatly extend the useful average life of any registered community member. based on this formula companies might rationalize much greater upfront investments to go after much larger communities like say whole cities.

if anyone knows of similar research let me know.

Sassa Leaving Friendster

i got a few reporter calls yesterday on scott sassa leaving friendster. the general theme was 'doesnt this show that social networking didnt make it?'.  my response - no, overall the service category continues to grow faster than blogging. the big winners like the facebook have been small startups and not big players (yahoo or msn).  also, we've seen that this is about community and real communities will deliver more meaningful value than virtual. i look forward to seeing how many foot-in-mouth quotes i made on this one:)

This Man is a Spammer

some of you may have followed my ongoing fight to stop the worst scorge of spammers, the guys who syphen our cards from every conference we attend and then sell us into email slavery.  i want you all to meet michael luckman who says i gave him my card at a networking event and he figured i'd like to start receiving his emails on 'great sales tips' every day until i opted out.  now i'm sure michael is no worse than the rest of these guys but i believe we all have to work together to stop them in their tracks. we need to tell the luckmans of the world that it's not ok to market their businesses this way. we need to tell the conferences we attend that it's not ok to let the luckmans attend if they violate the spirit and open access intended by these events.  now i got into an ugly flame war with this guy after he failed to honor my first requests to take me off his list. so i wont reprint it hear. i did call him a dickhead and he seemed to think that was conduct unbecoming a 'ceo of a progressive san francisco company'. i will say that i find it a bit ironic that he is asking me to extend to him higher civil respect than he has shown the hundreds of poor, unsuspecting people who have unknowlingly given him their cards.

i am including michael's email address for anyone who would like to inquire about his spam procedures who would like to add his name to any lists they think he might like to receive as well mbluckman@achievexcorp.com. 

Rupert Gets on Board

jeff jarvis brought to my attention a speach by rupert murdoch that sounds truly incredible on many levels. first, it's cool to hear him basically concur with the argument i made last summer at brainstorm to sir martin sorrel (ceo of wpp , world's largest ad agency) that advertisers had two choices - host the conversation or get out of the way. in this case, he's talking about the role and opportunity for publishers. but the overall point is the same. the ants are taking over and big media cant fight it and survive....

The speech-astonishing not so much for what it said as for who said it-may go down in history as the day that the stodgy newspaper business officially woke up to the new realities of the internet age. Talking at times more like a pony-tailed, new-age technophile than a septuagenarian old-media god-like figure, Mr Murdoch said that news "providers" such as his own organisation had better get web-savvy, stop lecturing their audiences, "become places for conversation" and "destinations" where "bloggers" and "podcasters" congregate to "engage our reporters and editors in more extended discussions." He also criticised editors and reporters who often "think their readers are stupid".

Zinga Pulls Through

zinga came through surgery with a smile. she lost half her bladder so she'll no longer hold it like a camel. looks like she used another of her multiple dog lives. thanks to everyone for your positive energy and well wishes.

Zinga has Cancer

my dog, zinga, has cancer. she's in the hospital today fighting hard with major bladder surgery. i know it sounds hokey, but she is truly the strongest being i've ever known and remains my greatest inspiration. now, she's had cancer and beaten it before but this time it's come back way more aggressive and in more places.  i hope you all will send her some positive energy. she can use it.

Love the New Wynn Hotel in Vegas

i just stayed at the new wynn hotel with my dad (we do a weekend every year together and we get more boring every time:) and i highly recommend it. it's nicer than balaggio and doesnt have that mall of the americas feeling. 19 restaurants many with outdoor terrace dining. huge, awesome pool area with a ton of cabanas. they were even nice enough to let me win money to pay for my first visit.