Reading time: 1 – 2 minutes

Happy Thanksgiving everyone! I for one am looking forward to a relaxing day of eating, eating and more eating (why hasn’t someone created a web app for that yet?). I thought I would pass along a couple posts I caught today that I think are worth your time during the holiday. Here it goes!

Todd Vernon on Scaling Your Web App

Todd wrote a great post on scaling your web app today. Most of the points he makes are common sense and yet so many startups don’t do any of the things he talks about. If you run a startup and your product is a web app then you should give Todd’s post a read and make sure you are doing everything he says. Don’t be a green bean. While they are good vegetables you shouldn’t aspire to be one.

Don Loeb & KommonKraft’s New Media DoucheBags Video

I am so happy Don posted this video as I had yet to see it. Check this one out while you’re in you tryptophyan stuper because then it will be even funnier. Also, as Don points out, this could be a fun video to show when someone at the dinner table asks you what you do for a living.

Reading time: 4 – 6 minutes

TECH cocktail Chicago 6 went well this past Thursday and, I have to say, it was nice to be back in Chicago. Things are happening in that city. Watch out Silicon Valley! One of my favorite stories of the night was how a couple days prior to the event some long time friends finally received funding for their business.

Mike and Matt, the founders of Chicago based GrubHub, received $1.1mm in funding led by Origin Ventures to continue expanding their burgeoning empire. What made the story hit even closer to home was that there were significant ties from GrubHub and Origin Ventures to TECH cocktail.

GrubHub actually demoed at the second TECH cocktail event at the Gramercy in the Lincoln Park neighborhood of Chicago and Origin Ventures has been a long time sponsor of TECH cocktail. I am going to go with the story that both parties first met at TECH cocktail but I have yet to corroborate that.

As if that story wasn’t enough we had another great evening with over 500 people in attendance and some great sponsors and demoers. Since they foot the giant bill I think thanking the sponsors is now in order.

Thank you to the TECH cocktail Chicago 6 sponsors which included Centro, Carepages, Athena, Optimus Solutions, SingleHop, ChicagoMicro, myAOL, Interactive Mediums, Saper Law, Fiodan Corp., SitterCity, NUDirection Consulting, MK Capital, Origin Ventures, SeatQuest, Accounting Services Provider: Frost, Ruttenberg & Rothblatt, P.C. and Preferred Legal Services Provider: Hinshaw & Culbertson.

Now, on to the demoers:

42 Friends, LLC – Facebook app creations like “Growing Gifts“, “Goals” and more
Cappex – a safe and effective tool for finding the right college for you
Dawdle – buy and sell new and used video games, systems and accessories
VMDirect – video email system
PropertizeMe.com – online property management system
SeatQuest – online ticket search engine that virtually shows you your seats
Songza – online music search engine and player created by Humanized
ViewPoints.com – personalized online review system
Waves.TV – create a Web TV channel and broadcast online in a matter of seconds

There are definitely some great companies in that list. Check them out when you have a chance.

Lastly, make sure to check out the photos from TECH cocktail 6 and add TECH cocktail as a contact on Flickr. A big thanks to Rachelle Bowden for being the official TECH cocktail 6 photographer. If you had your picture taken in front of our sweet backdrop go check out Rachelle’s site to find it and make sure to thank her for making you look so good.

Since it is so close to Thanksgiving I feel it is only apropriate to end with some notes on what I am thankful for.

Things are happening in Chicago and, even though Frank and I are living outside the city now, I am still very grateful to be a part of it all. Chicago is where I cut my teeth in technology so it will always be a special place to me (who knows – I may be back…) and staying involved in what is happening there is very important to me.

I am also lucky enough to have a lot of great friends in Chicago tech who are some of the best and brightest entrepreneurial and tech minds around.

Lastly, I am thankful for the all the love and support TECH cocktail has received from the community. Without all of you the event doesn’t happen.

Chicago is a great place to build a company and it is only getting better. Keep up the great work everyone!

Reading time: 2 – 3 minutes

There was a lot of great discussion today about VC so I thought a quick wrap-up was in order. Normally I’d write a full post but the three posts I will briefly touch on below did such a good job I will simply suggest you read them. Here it goes:

The New Rules of Tech VC – Alex Iskold on Read/Write Web

Alex put together a post on RWW today that looks at VC both past an present. He takes readers through the old model, why it worked and why it is changing. He then looks at the current state of VC and to the future of what things may come down the road. Here’s a snippet from the post about the future of tech VC:

Now, putting it all together, leads us to conclude that large venture money is going to migrate away from technology. Specifically, this is what is likely to happen:

• We will see more smaller size funds and they will be successful
• Large firms are going to focus on series B deals and will have to pay premium for the same equity
• Big firms will focus less on tech, shifting to alternative energy, healthcare, etc.

It’s a great article even for those who know a lot about the VC world.

The Fiction of 20% – Fred Wilson on A VC

Fred takes readers through why VCs saying that they have to own 20%, 25%, etc. of a company to make a venture return is simply hogwash. Good stuff from one of the more innovative VCs around.

The Changing Landscape of Early-Stage Investing – Fraser Kelton on Disruptive Thoughts

Fraser has a nice high level wrap-up of innovation in the early stage VC space and adds some of his insight which is always valuable. I am glad Fraser is moving to NYC in January for Adaptive Blue. We’ll be able to finally take our virtual conversations about early stage VC and entrepreneurship offline.

Reading time: 6 – 10 minutes

Generativity – or the ability for all people, some with no qualifications at all, to use and share a technology – is the both the best and worst thing about the PC and internet combination. This open access allows for unparalleled participation and innovation but it also means the system is vulnerable. Let’s open up by taking a look at the good side of generativity.

Disruptive innovation is crucial. Without it human progress stalls. For disruptive innovation to happen the innovators need to be able to reach users with their new products. With PCs and the internet the user is easy to reach since the user controls what programs they will run and what products they will use. This leaves the door open for crucial new technologies and applications of technologies to permeate.

Generativity also allows smaller firms to emerge and grow. Without generativity there would be no start-ups since large firms, who would own proprietary systems in a world without a generative internet and generative hardware, would effectively be able to block out smaller entrants into their markets. Without those smaller entrants – a.k.a. the disruptive innovators – progress is stalled.

In a June 2007 Harvard Business Review article (I am telling you, you need to read HBR – very, very good stuff) entitled “Saving the Internet” written by Jonathan Zittrain uses some great examples to describe the disruptive innovation made possible by a generative system.

For example, Zittrain looks at online auctions and posits that the market would have been ripe for the picking for someone like Christie’s or Southeby’s but eBay beat them to the punch. There are also a host of other applications (web based e-mail, personal web pages, IM software, etc.) that may have never been born if the internet and the PC were not generative.

Of course that is what is so exciting about technology, and in particular, the internet. A level playing field (systems wise) has been created where a few guys in a garage with an idea can disrupt large corporations who, by nature, are typically unwelcoming of new ideas created by outsiders or even their customer.

While it is great that the system is open and users can try new things at their leisure the issue remains that there any many computer and internet users who do not know enough about PCs and the internet to know they are doing something wrong or harmful. Essentially users are in control of what code they ultimately run which leaves them vulnerable to unknowingly running bad and harmful code.

Due to this unfortunate byproduct of open and generative systems we have experienced a large influx of what Zittrain refers to as “appliances” – or devices and systems that are not generative. Some examples of appliances are TiVo, hand held devices, etc.

Users enjoy the fact that these devices are convenient and will limit the damage the user can inflict. That said, it seems that users are not valuing the ability for them to modify and add new functionality to these devices like they can with their PCs. As Zittrain mentions, this turn toward appliances is a slippery slope. Once the PC goes out in favor of devices the ability for new software, like skype, to emerge is far less likely.

Zittrain also mentions that:

A shift to smarter appliances, ones that can be updated by – and only by – their makers, is fundamentally changing the ways in which we experience our technologies. They become contingent: Even if you pay up front for them, such appliances are rented instead of owned, subject to revision by the maker at any moment.

Unfortunately this is also true of APIs. While they are an agent of generativity their generativity is at the sole discretion of the company that created them. It makes complete sense that a company who created something and put APIs in place to allow for generativity would want to control the APIs use in some way. However, the company that built the API is not the only thing standing in the way of the APIs generativity. Back to Zittrain (he uses the Google Maps API as an example):

But this puts within the control of Google, and anyone who can regulate Google, all downstream uses of Google Maps – and maps in general, to the extent that Google Maps’ excellence means other mapping services will fail or never be built.

Zittrain goes on to make another interesting point this time around Web 2.0 and generativity:

… what some have applauded as Web 2.0 – a new frontier of peer-to-peer networks and and collective, collaborative content production – is an architecture that can be tightly controlled and maintained by a central source, which may choose to operate in a generative way but is able to curtail those capabilities at any time.

Of course this situation has been covered before. The MySpace and Photobucket example comes to mind where MySpace temporarily disabled the ability for Photobucket widgets to run on their platform. Facebook is another great example.

Facebook is a closed system which recently opened up by allowing people to create applications that live inside Facebook. However, those applications have to be built in Facebook’s framework and Facebook could potentially limit the applications they accept at any time including turning off applications like MySpace did to Photobucket. I hope Facebook will remain open but we’ll have to wait and see how it plays out.

Back to the question at hand: should we sacrifice generativity for safety and security?

I would argue based on all of the information above that we absolutely should not. What we should do is look for create ways to create security without compromising generativity. Zittrain lists four things in his article that we can do to keep the web and PCs generative while working to better secure them from threats.

Netizenship: Allow small groups of people to moderate (i.e. Wikipedia). It’s like neighborhood watch for the web.

More help from ISPs: The end points – ISPs – can become safety valves.

Network neutrality for APIs: The network should of course remain neutral so disruptive innovation can happen but the companies who offer APIs should also allow the APIs to remain neutral in that anyone who wants to can build on top of them (of course their are cost implications to the company offering the API that would need to be considered).

Virtual Machines: Technology that allows mission critical apps to be cordoned off from other apps essentially creating two separate machines in one is on the horizon. This will allow for a test bed to be created on a PC and that test bed, if infected, would not be able to harm the other crucial apps on the PC.

I’d like to jump into a little more detail on the last item – virtual machines. I just read yesterday in the latest edition of MITs Technology Review about an even more interesting idea around virtual machines. Ivan Krstic, one of the 2007 Technology Review Top Innovators under 35 (he’s only 21! – I feel like such a slacker), developed a system for the OLPC project called Bitfrost. Here’s TR’s explanation of the system:

Instead of blocking specific viruses, the system sequesters every program on the computer in a separate virtual operating system, preventing any program from damaging the computer, stealing files, or spying on the user. Viruses are left isolated and impotent, unable to execute their code. “This defeats the entire purpose of writing a virus,” says Krstic.

Fascinating stuff. The system is not quite ready for consumers yet but Krstic is working on helping programmers write “wrappers” for their programs that will allow them to communicate with the Bitfrost system. That is the first step toward getting something like Bitfrost out to the general public.

I’ll close with a quote from Zittrain’s HBR article that I think is quite fitting:

… for the generative Internet to save itself, it must generate its own solutions.

Fortunately it looks like we’re well on our way to doing just that.

Side note: Zittrain’s book on the generative Internet will be released this fall by Yale University Press and Penguin UK.

Reading time: 3 – 5 minutes

Frank and I hosted the 5th TECH cocktail in Chicago last night (6th overall) which marked the one year anniversary of TECH cocktail. It’s really hard to believe that it has already been a year since TC1. That said, I thought I would start out with a little infographic I put together that sums up TECH cocktail’s first year (thanks to Jason Shellen for the inspiration). A picture says 1,000 words right? Plus, the graphic should keep my reminiscent rambling to a minimum.

Chicago has definitely come together as a technology community over the last year and I think we’ll be able to do even more in the year to come. In fact, TECH cocktail and Chicago have also become trend setters. Other people in other great cities that lack tech events are coming to us and asking us to bring TECH cocktail to them. I see this as a very positive thing since all the technology communities in the U.S. will start becoming closer.

TC5 was the best event we have done to date and it is all because of the great people we have here in Chicago. We drew between 500 and 600 people and a lot of those people have already sent in notes telling us about some of the great people they met and how TC5 will help them going forward with their businesses.

Of course it also takes lots o’ cash to put on an event like TC5 (trust me, I wrote the check) so I’d like to thank our sponsors since we literally couldn’t do it without them. A huge thanks to SingleHop, LinkedIn, Digital Bootcamp, Saper Law Office, Chicagoland Entrepreneurial Center, MK Capital, Origin Ventures, Chicago Micro, Fave Media and LiquidTalk.

Please check these guys out and help make their sponsorship contributions worth it. I know these guys primarily sponsor to help the community and aren’t as worried about their ROI but they have some great products and services and they are local so we should all be supporting them.

Next up I want to thank all of the demoers at TC5. Thanks to myAOL, PollEverywhere, My Open Bar, Braintree Financial, Humanized and Fave Media. We set out to create a platform for start-ups and others to showcase what they do so we’re glad so many great companies are taking advantage of it.

Last, but certainly not least, I want to thank Laura, Paulette and the John Barleycorn’s staff for keeping things running smoothly throughout the night and of course a big thanks to all the TCers out there. You guy make the event what it is and we’re forever grateful for your support.

I’ll leave you with this link to the TC5 pictures and make sure to tag yours techcocktail5 when you put them on flickr. Looking forward to seeing you all at TC6 in a few months!

Reading time: 2 – 4 minutes

I was scrolling through the old feed reader the other day (I was a way, way behind on that) and I caught Andrew Parker’s post on the death of the page view. Looks like Neilsen has decided to do away with pageviews in favor of a “time spent” metric. Andrew brings up an interesting point about both of these metrics and what they inherently value which I believe is worth quoting in full here:

But, why would Nielsen replace page views with the “time spent” metric? When everyone focused on page views, it rewarded companies like Myspace for requiring clicking through 10 pages just to update your profile. Now, if time spent becomes the new default metric, then sites like Myspace will be rewarded for their slow, cumbersome interfaces that needlessly waste your time. Whereas, a site like Google would be punished for having a speedy, easy interface that prioritizes getting you where you want to go, not keeping you on Google’s site.

He makes a good point. We need to start figuring out how to measure good traffic instead of just traffic. Advertisers are getting smarter and smarter each day and they are going to demand better from us in the metrics space. I am also sure that advertisers will quickly figure out the major inherent flaw in the “time spent” metric that Andrew points out. That is leaving pages open in general or leaving pages open across multiple tabs in a browser when you aren’t looking at them (which both he and I do each and every day).

Andrew then talks a bit about what we built at FeedBurner (by we I mean our awesome engineering team) and some of the flaws there. He’s spot on since we are really focusing on the feed and our current site analytics are not super useful for people who don’t use a blog platform to publish (but they are very useful for blog publishers). However, I do think the feed will begin to power more and more things for publishers and that is where things get interesting in the way of analytics (see my post “Publish Once” for more).

If feeds are powering widgets, e-mail delivery of content, feed readers, syndication, etc. then we are in a great position to fully measure the audience and its’ engagement and tie things back to the site analytics. We’re a ways out from this of course but it is coming and it should get us closer to the holy grail of audience engagement.

In the meantime, Andrew suggests looking into qualitative methods of measuring the web. That’s an interesting concept and it could add a lot of value to advertisers if qualitative metrics were developed and used in conjunction with quantitative metrics. I am not sure what the qualitative side of things would look like but I’ll keep thinking about that notion.

Reading time: 2 – 3 minutes

I am really excited to share a video of the new myAOL that my friend and TECH cocktail co-founder Frank Gruber put together. Frank is the Product Manager for myAOL (that’s why he moved to the D.C. area) and has been working day and night with his team on myAOL for a while now.

That said, I have read some of the criticisms of the product in the Tech Crunch comments (i.e. the product is not innovative, AOL is a year behind everyone, etc.) but I think the thing we all forget sometimes is that we are on the cutting edge of technology and not everyone is.

AOL is helping to bring the technology and ideas we’ve all proven out over the past few years to the masses. They help ideas and technology cross the chasm and that’s important.

For example, some people still don’t subscribe to feeds. I know… it’s crazy but it’s true. I think this product will definitely help more people understand feeds (among other things) and I think that is a very good thing.

myAOL should launch later this summer. Make sure to subscribe to the myAOL blog to stay up to date with Frank and team’s progress.