so I’ll come back to the second segment
of the show in this segment we’re going
to shift gears and talk about finance
investing VC and fundraising there’s an
article in P hub recently that talked
about Sherwood partners a Palo Alto fund
that basically goes out there not a fun
sorry affirm that basically goes out
there and as known as the Undertaker in
the community and it basically just
shuts down distressed companies or not
even distressed companies companies that
just you know are not going to be the
big billion-dollar IPO so they get taken
out it’s fascinating co-founder Marty
pigeon ssin has been doing this now for
well over a decade largest year was two
thousand you know they’d basically
they’re making a killing and especially
when there was a downturn so he is
quoted as saying that they’re closing
down quote social networks video
distribution and clean tech companies I
don’t think either of us are experts to
chime in on clean tech but I want your
opinion on social networks let’s start
broadly it’s 2011 does it make sense to
launch like a vertical social network or
has facebook just on the market well I
don’t think Facebook owns the market but
one thing we have to keep in mind is
that social networking is something
that’s no longer new and uncertain
people know what they’re doing with it
and they know how to build a business
off of it and that brings me in my
second point is that there’s pretty much
too kind of business models for social
networks and I’m really generalizing
here the first one is to actually
generate revenue directly kind of like
what Facebook’s doing with all its
different advertising options and the
other one is to pretty much sell off to
a company like Facebook because they
want your technology if you’re trying to
just be a Facebook clone or if you’re
trying to generate revenue directly I
suspect that you’re going to be under a
lot more pressure and that you might be
forced to close down if you have a very
niche piece of technology that might
appeal to either Google or Facebook or
someone else then you’re more likely to
survive provided you don’t run out of
venture capital in the meantime of
course it’ll be harder to raise more
venture capital if you do run out and
then you’ll be on the line but to go
back to video how do you how do you
think this might be affecting video
because video companies whether their
distribution or content oriented they’re
they’re kind of about the same age of
social networks yeah i mean i’ve seen
this story unfold in 2008-2009 when
every company sort of laid off thirty
percent and asked
staff to you know reduce their wages by
ten percent remember the good times rest
in peace by sequoia presentation which I
think was just to scare both their CEOs
but also the competition at other VC
firms okay so I think whether you’re in
content whether you’re in distribution
whether you’re in content management the
old eps whether your content delivery
advertising analytics i think you
basically now are find yourself with a
fork in the road i think if your cost
structure is like reasonable then you
can probably stay business as usual and
even accelerate the gas pedal the
problem is again there’s a lot of
companies and i’ll go meet companies
like every time that I’m you know in the
neighborhood and I just look around I’m
like man there’s like 30 more people
here and I think some of that growth is
sustainable and and and realistic
there’s demand there I think some of it
is just driven by the market giddiness
right and venture capital and all that
so I think if your cost structure is
again out of whack the yes you should
probably start to not batten down the
hatches but just be a bit more careful
but I think if your cost structure is
pretty reasonable then it’s probably a
good time to get aggressive and go and
get market share because other companies
are going to have to inadvertently scale
down especially if they are VC back
because VCS are like you know they say
this about investment bankers to and
VC’s in particular and and just bankers
when you say you know you need a loan
it’s like they’ll give you an umbrella
when it’s sunny but then the second it’s
raining there like getting back that
umbrella right so I think that you’re
definitely going to see us not so much
of a shakedown the way we saw in 2008
that was just fear in the marketplace
but I think you are going to see some
kind of slow down and some companies
being forced to to just basically unwind
or emergent to others we’re going to
wrap up the second segment we’re going
to be back and then we’re going to do
lightning round an email of the week
where a viewer basically calls BS on me
we’ll be back
of the show in this segment we’re going
to shift gears and talk about finance
investing VC and fundraising there’s an
article in P hub recently that talked
about Sherwood partners a Palo Alto fund
that basically goes out there not a fun
sorry affirm that basically goes out
there and as known as the Undertaker in
the community and it basically just
shuts down distressed companies or not
even distressed companies companies that
just you know are not going to be the
big billion-dollar IPO so they get taken
out it’s fascinating co-founder Marty
pigeon ssin has been doing this now for
well over a decade largest year was two
thousand you know they’d basically
they’re making a killing and especially
when there was a downturn so he is
quoted as saying that they’re closing
down quote social networks video
distribution and clean tech companies I
don’t think either of us are experts to
chime in on clean tech but I want your
opinion on social networks let’s start
broadly it’s 2011 does it make sense to
launch like a vertical social network or
has facebook just on the market well I
don’t think Facebook owns the market but
one thing we have to keep in mind is
that social networking is something
that’s no longer new and uncertain
people know what they’re doing with it
and they know how to build a business
off of it and that brings me in my
second point is that there’s pretty much
too kind of business models for social
networks and I’m really generalizing
here the first one is to actually
generate revenue directly kind of like
what Facebook’s doing with all its
different advertising options and the
other one is to pretty much sell off to
a company like Facebook because they
want your technology if you’re trying to
just be a Facebook clone or if you’re
trying to generate revenue directly I
suspect that you’re going to be under a
lot more pressure and that you might be
forced to close down if you have a very
niche piece of technology that might
appeal to either Google or Facebook or
someone else then you’re more likely to
survive provided you don’t run out of
venture capital in the meantime of
course it’ll be harder to raise more
venture capital if you do run out and
then you’ll be on the line but to go
back to video how do you how do you
think this might be affecting video
because video companies whether their
distribution or content oriented they’re
they’re kind of about the same age of
social networks yeah i mean i’ve seen
this story unfold in 2008-2009 when
every company sort of laid off thirty
percent and asked
staff to you know reduce their wages by
ten percent remember the good times rest
in peace by sequoia presentation which I
think was just to scare both their CEOs
but also the competition at other VC
firms okay so I think whether you’re in
content whether you’re in distribution
whether you’re in content management the
old eps whether your content delivery
advertising analytics i think you
basically now are find yourself with a
fork in the road i think if your cost
structure is like reasonable then you
can probably stay business as usual and
even accelerate the gas pedal the
problem is again there’s a lot of
companies and i’ll go meet companies
like every time that I’m you know in the
neighborhood and I just look around I’m
like man there’s like 30 more people
here and I think some of that growth is
sustainable and and and realistic
there’s demand there I think some of it
is just driven by the market giddiness
right and venture capital and all that
so I think if your cost structure is
again out of whack the yes you should
probably start to not batten down the
hatches but just be a bit more careful
but I think if your cost structure is
pretty reasonable then it’s probably a
good time to get aggressive and go and
get market share because other companies
are going to have to inadvertently scale
down especially if they are VC back
because VCS are like you know they say
this about investment bankers to and
VC’s in particular and and just bankers
when you say you know you need a loan
it’s like they’ll give you an umbrella
when it’s sunny but then the second it’s
raining there like getting back that
umbrella right so I think that you’re
definitely going to see us not so much
of a shakedown the way we saw in 2008
that was just fear in the marketplace
but I think you are going to see some
kind of slow down and some companies
being forced to to just basically unwind
or emergent to others we’re going to
wrap up the second segment we’re going
to be back and then we’re going to do
lightning round an email of the week
where a viewer basically calls BS on me
we’ll be back
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