Thumb Blogging...

I haven't tried this before but I've been seeing more and more bloggers posting via their BlackBerry's. I definitely don't enjoy this mini keyboard for drafting long form copy but if it helps me post more frequently/consistently then I can certainly make due.

My new phone, BlackBerry Bold (thanks baby!), is also a lot easier to type on than the older model BlackBerry I had been using. They've done some amazing things with this keyboard: better "bounce" when you press a key, ergonomic keys, etc. I've definitely been enjoying the experience all around.

The phone's camera is also pretty tight, I'm not sure what the specs are off the top of my head (I'm typing this while on the train) but it was good enough to inspire me to (finally) setup a TwitPic account. I see so many random, bizarre or funny things in a typical New York day, I'm pretty psyched about having a way to capture and record them now.

Almost at my stop on this train...let's see if this "test post" actually goes through now.


Sent via BlackBerry from T-Mobile

Happy Birthday TickerHound!

I can hardly believe it's been a whole year!  But WOW, what a year it has been.

12 months ago to the day, George Zhao and I pulled back the curtain and brought TickerHound.com to life...

...and within 15 minutes the site crashed.

Needless to say we've come a long way since then.  

Instead of the single cheap-o box we were running on when we launched, the site is now 100% hosted "in the cloud" on Amazon's EC2/S3 platform.

Thousands of investors have asked thousands of questions and submitted thousands of answers to the site.  Our members are the best in the world - and I can say that because I've personally met and had drinks (alcoholic and non) with dozens of them this year.

We've forged partnerships with a handful of financial media companies such as Investor Place Media, Agora Financial Publishing, Business Financial Publishing, Tycoon Publishing and the list goes on.

And the best part is, we're just getting started!

We made our 3rd hire only 2 short months ago  --  welcome aboard Lou!

We have our largest partnership to date launching in a few weeks -- you won't want to miss this one -- which is why we've been absent from most of the NY Tech events for the last 2 months.

So it goes without saying that we're VERY excited about TickerHound's prospects for 2009. 

But this won't be an easy year.  Then again, when is it ever easy running a start-up?  :)

Our country is entering one of the most challenging economic times we've ever faced.  The crisis before us started in the financial markets, so for a financial-tech company like TickerHound the impact of these tumultuous times becomes apparent very quickly.

We're witnessing a fundamental shift in the financial services industry and I'm excited to be a part of it, but at the same token it's certainly added a level of complexity to our business that we hadn't aticipated when we first launched.  However, the important thing to remember is that in times like these we're presented with once in a lifetime opportunities to really make in impact on our market.  Some of today's greatest companies were forged in the fires of the last downturn.

I firmly believe that now, more than ever, individual investors need to become better educated investors.  Relying on stock brokers and money managers (and even $50 billion-dollar-stealing hedge fund managers) has to become a thing of the past.

With tools out there like Covestor, StockTwits and Wikinvest, an individual investor can level the playing field and manage their money as they see fit.  They have unprecedented access to data, stock ideas and educational material that was once trapped behind high-priced pay walls.

Times they are a changin' and I'm proud and honored to be playing a small part in it.

Here's to another 12 months of sleepless nights, tumultuous markets and some of the most exciting times of my life!

Happy Birthday TickerHound!

Steve Forbes & Eric Schmidt Look Like the Head Vampire!

Here's a picture of Eric Schmidt (CEO of Google):


Now here's a picture of Steve Forbes:


And now here's the Head Vampire from the 80's classic, The Lost Boys:


Any questions? I think not.

Feature Sequencing

One of the biggest mistakes I've seen companies make over the years is improper sequencing of feature sets.

For instance, if the users themselves are the hubs of a social network, then why would you launch a social networking application before giving people a reason to come to the site in the first place? That's like saying, "Hey, come to my nightclub tonight...nobody's here, you won't meet any women/men, but it'll be popular one day so just drop by and keep coming back until we get hot!"

FAIL!

I prefer to think through feature roll outs in a very methodical way -- I don't take any credit for this either, it's been done many times by many successful entrepreneurs over the years. I just happen to enjoy copying what successful people have done in the hopes of one day becoming successful as well.

In fact, I once attended a talk given by Joshua Schachter of Del.icio.us fame and he pretty much said the exact same thing I'm about to share with you...building the right features at the right time is critical to the success of a product.

In my mind this can be boiled down to a three step framework and if applied properly, could mean faster roll outs, higher quality products, greater user satisfaction and more opportunities for revenue generation.

Here's the framework in a nutshell:

Utility - First create a product that's useful for a single user. For instance, Del.icio.us was valuable long before you were able to see other user's bookmarks. In its first iteration Del.icio.us simply allowed members to store their Favorites/Bookmarks remotely, thus allowing them to retrieve these pages from any computer they happened to be on. Later on they exposed the social content discovery components that turned the service into the viral success it has become today.

Network - After you've made a product that's useful for a single person, there's a good chance that MANY individual people will find it useful. When you attract a large audience of individual users then all you have to do is pull back the curtains and allow them to start interacting with one another. It's obviously more difficult than that, but you get my drift.

Ideally you'd want it so every piece of data one of these users contributes to your site somehow adds value back to the whole network. For instance, on Del.icio.us, each time a user bookmarks a URL it adds to that URL's popularity across the system which provides all kinds of useful information for new users, visitors and members who already have that URL bookmarked. It also allows like minded people to find one another and use these new connections as a way to discover new content (e.g. if another member has a handful of the same bookmarks as me then there's a good chance I'll want to see what else he has in his favorites).

And then this leads to (hopefully) the final step in the feature sequencing framework: Revenue.

Generating revenue has become an all elusive component of this framework. I think there are a number of reasons for this but first and foremost it's because most people save this step for last while it should probably be right up there with the problem you're trying to solve.

While this may be the final step in this particular framework, it should be one of the first things a businessman thinks about. Granted, you can have a wildly successful product (and ultimately, a wildly successful business) by simply building something people love, locking them in through the network effect and allowing the revenue model to reveal itself as time goes on, but in my experience you'll dramatically increase your chances of monetary success if you think this through from the beginning and iterate on it just like you would the software.

Ultimately you'll want your utility, network and revenue models to dovetail nicely into one another - e.g. Google and contextual advertising - so it'll pay to think through this framework in a holistic manner.

What This is NOT

This is not a bullet proof way of thinking through your product development plans. It doesn't even begin to address the many nuances of conceptualizing, building and launching a product. It doesn't address user needs, market size, etc.

Simply, think of this as a "back of a napkin" way of testing your product roadmap. Conceptualize your utility, then figure out how that contributes value back to a network and then think about how to monetize that.

I know it may sound simple and probably pretty obvious, but I can't tell you how many times I've been sitting in on product development meetings and someone is pounding the table demanding that every feature plus the kitchen sink be included in "Product Version 1.0".

By testing your product roadmap against a time-tested framework like this one, you'll stand a much better shot at getting a successful product out the door in a shorter period of time, period.

Legacy and the Web

I know I haven't updated this blog in forever, but with good reason. We've been working our asses off at TickerHound -- I wish I could share the big secret with you now but you'll just have to wait a bit longer.

In any case, I was finally inspired to write a new post as I was on the train this morning.

I had my headphones on and two of my favorite songs played back to back:

Big Pun's: You Aint a Killer
The Notorious B.I.G's: Warning

Aside from the fact that they both have "Big" in their names (and rightfully so), the other thing these two talented artists have in common is that they've both passed away -- too young, might I add.

But here I am -- along with thousands of other hip-hop fans -- listening to these young men weave rhymes that are over 10 years old and still thinking to myself, "Damn, these guys are good". I'll be 90 years old one day (god willing) and I'll still be thinking, "Damn, these guys are good".

And that right there is the LEGACY these two men have left to this world. Their ability to take concepts, events and emotions from their lives and craft beautiful rhythmic sentences out of them.

The same applies to many creative people:

• Visual artists
• Film makers
• Actors and Actresses

These people, 100 or 200 years after they're gone, will have left a legacy here on earth that all future generations will be able to appreciate.

But what about us?

The rough and tumble entrepreneurs who are creating, crafting and weaving beautiful web experiences and products each and every day.

Sure, we make an impact now but what about 100 years from now?

Will our works of art (read: "our web sites") even be around then? What happens if we have to close up shop and shut down our sites?

All that creative energy just fades into oblivion.

And I know what most people would say: "that's business". And while I agree to an extent I have to imagine that the web is more than just business. The very nature of it makes it so that content can persist.

Our designers and developers put just as much creative energy into building a site as a Director would into making a film -- where's their legacy?

Sure, the "Portfolio" section of a designer's personal page or an item on an entrepreneur's resume/bio gives a viewer a brief glimpse into a product that no longer exists...but don't we deserve more than that?

Shouldn't someone be able to EXPERIENCE the sites and products we've built as we originally intended? Shouldn't they be able to ask a question on TickerHound, or vote for a story on Digg or find a great wine on Snooth?

I think sites like The Way Back Machine do a decent job at preserving a site's content, but not so much the experience.

I also think sites like Blogger, Wordpress, Flickr and YouTube have also greatly helped keep legacies alive - albeit in a static form.

But I think we need a new type of web archive -- one that allows a site's experience to persist throughout time. I want my grand kids to be able to go to TickerHound (even if it no longer exists as a business) and experience something I created when I was in my 20's.

What would a "legacy" service like this even look like? How would it function? Is it even possible?

I don't know.

All I know is if there were a way to make it so a young man, 25 years from now, could use TickerHound, Digg or Snooth (whether or not the businesses were still "alive") and say, "Damn, these guys are good", then I'd be one happy entrepreneur.

Chinese Word of the Day

The US economy is going to shit and China is buying up most of our debt.

We're slowing down, they're still accelerating.

Bottom line: China is the going to be the largest economy in the world within the next generation or two, period.

Being that we operate web-based businesses that have a global reach, I think it's reasonable to assume we'll either have Chinese:

• Customers
• Investors
• or Business Partners

at some point in our careers.

I grew up in Flushing, Queens here in New York:


That's where I first picked up Chinese (Cantonese and Mandarin). Then I went on to Major in East Asian Studies in college where I studied Chinese for 3 years solid (spoken and written) and spent several months in China.

While I'm far from an expert, I can definitely get by.

So in the spirit of global business and global communities, I decided to start teaching Chinese one word at a time to all those who are interested.

I'll be doing this via my twitter account: @WayneMulligan

So if you'd like to pick up a new language, I'll be posting a new Chinese Word of the Day each and every day. I'll write the word out in Chinese characters, give the romanization/phonetic spelling and provide a little context.

I'm going to try and make most of the words market/business oriented but if anyone has requests or suggestions just @reply me or DM me on Twitter.

Enjoy!

Twitter Power

So I rattled off this quick Tweet this morning as I was venting over a slow net connection here at the office:

"#Sunshine Suites: These internets is running sloooow today"

And then I get this e-mail from our management company a couple of hours later:

"Hey Wayne,

Saw your post on twitter, let me know the details...

What seat are you sitting in and which floor?
How are you testing?
You are using ethernet?

- Jake"

That's some smart customer service right there!

The Current Financial Mess - Simplified!

The whirlwind of news surrounding the current financial mess we’re in has my head spinning.

First it’s foreclosures, then it’s Fannie and Freddie and then it’s Merril Lynch and AIG - when will it stop?

But more importantly than that, this rapid destruction of the American financial system has many people wondering how it got started to begin with?

That’s why I decided to write this week’s article in response to this question on TickerHound:

How did this financial mess get started in the first place?

So let’s go through it step-by-step, from the beginning until this weekend when the Government announced a $700 billion bailout of the financial services industry. It’s our tax dollars that will be financing this bailout so I think it’s important that we all understand how and why it happened.I. It all started in the housing and mortgage market:

Basically, lenders were loaning money to whoever wanted to buy a home. Credit score, income and assets became irrelevant terms as brokers and local lenders rushed to issue new mortgages.

It seemed like a relatively “low risk” strategy at the time to many banks. Reason being, they figured that even if people stopped paying their mortgages, the housing market was doing so well that folks could just sell the house for a profit and pay back the remainder of the mortgage.

And that’s really where the trouble started.

II. Then the Investment Banks Got Involved:

Mortgage Backed Securities (MBS) are nothing new on Wall Street. They’re sort of like bonds, meaning there’s a “principle amount” (the amount being loaned) and interest coupons (or payments) that would be paid monthly on the loan. However, MBS’s aren’t single loans.

Instead, these loans were really thousands of individual mortgages all pooled together to create a single, tradable security.

This is another reason why many lenders were happy to keep giving out mortgages to folks (even if they didn’t qualify). Local lenders knew that they’d be able to package up all those mortgages and just sell them right to the big investment banks and not have to worry.

The banks then turned around and would trade these Mortgage Backed Securities like they would a stock or a bond - trying to pocket profits in between each trade.

III. Bubbles

The basic assumption in this whole mess was that housing prices would continue to rise each year.

In fact, that assumption turned out to be pretty accurate. According to the S&P Case-Schiller Index, home prices nearly doubled across the country from 2001 - 2006.

That’s because it was so easy to get a mortgage, everybody wanted to buy a home. Thus spurring demand and in turn driving up prices further. It sort of became a self fulfilling prophecy, which in turn became a full-fledged housing bubble.

And just like any good bubble, it eventually had to pop!

IV. The “After-Pop”

So after the housing market finally started to tumble, the financial services industry went into a year-long death spiral. Here’s the basic sequence of events:

1. People couldn’t afford their mortgages anymore.
2. They couldn’t sell their homes for more than they paid due to falling prices
3. So they defaulted on their loans - this happened to millions of people!
4. The big investment banks which now owned all the mortgages suddenly realized that these “assets” were virtually becoming worthless in a very short period of time.
5. So the banks had to take massive write-downs on these loans. The way this works is the banks were considering these baskets of mortgages as assets on their balance sheets. Once the assets went from being worth $100 to $1, the banks basically lost 99% of their value.
6. When that happened it made it very difficult for the banks to get loans themselves (imagine applying for a loan when all you have is a pack of bubble gum and the clothes on your back - it’s not likely to happen).
7. When the banks couldn’t get their own loans they were either going to be forced into bankruptcy (Lehman Brothers) or had to be swallowed up by healthier firms (Bear Stearns, Merrill Lynch, etc.)

V. How the Government Got Involved

Ever since Bear Stearns went under the government has played a fairly prominent role in this whole mess.

But it wasn’t until we almost saw the implosion of Fannie Mae and Freddie Mac that the government really made its presence felt.

Fannie Mae and Freddie Mac are sort of like “buyers of last resort” in the mortgage market. They were established to maintain liquidity in these markets in the event of the large banks being unable to trade their Mortgage Backed Securities.

So in the end, Freddie and Fannie were sitting on trillions of dollars in bad home loans.

And while these companies were private organizations they were however government sponsored organizations. So if the government had let either one of these companies fail then it might’ve made it very difficult for the United States to keep selling debt to big foreign buyers, like China. Remember, it’s our ability to sell our debt to other countries that has been funding our country’s operations (e.g. wars, etc.) for the last several years.

VI. How AIG and Insurance Fit In

AIG came into the picture when it began selling “insurance” to the big banks.

This technically wasn’t insurance, but that was mainly due to clever wording on the part of AIG management. Because for all intents and purposes, they were basically insuring the mortgages held by the banks - this type of insurance was called a “Credit Default Swap”, or a CDS.

Basically, the banks would pay AIG a monthly fee and in turn AIG would promise to make the bank whole on any mortgages that defaulted (sure sounds like insurance to me).

At the time I’m sure this sounded like a good idea because everybody assumed housing prices would continue to rise.

Well we all know how that turned out and that’s why in the end AIG was left holding the bag for billions of dollars in bad loans.

VII. The Bailout

So that brings us to where we are today: On the eve of the largest government bailout of the private sector in the history of this country.

The implications for these actions are vast and complex.

On the one hand, the government has to do this; the alternatives are too disastrous to even comprehend. On the other hand, what type of message does this send to the banks going forward? That it’s ok to engage in risky, reckless behavior and they’ll always get bailed out in the end?

I think I’ll save the rest of my commentary for another post.

I hope this gives you a clear picture of why and how we got into our current predicament.

If you have any other questions on this topic feel free to go to TickerHound for the answers!

The China Adventures...Finally!

I know, I know, I promised to post these 2 months ago but I've got a good excuse.

TickerHound's been going surprisingly well this summer and it's been monopolizing the vast majority of my time. So now my blog AND my girlfriend hate me and my entrepreneurial spirit :(

j/k

In any case, here are my pics from June's trip to China...we had an AMAZING time!

Beijing is much cleaner than it was 3 years ago, but it also lost some of its "edge". There were no more gypsy cab drivers at the airport trying to drag me into their overpriced cabs, no more fake DVD's being sold on the streets of Beijing and my white T-shirts didn't turn brown from the rain anymore.

I guess some would call this progress, but for me, I missed my Beijing funk.

Don't get me wrong, there were still some funky sights to be seen, but China definitely got its act together for the Olympics.

Shanghai was great too, but then again, it always has been. I think on my next trip to China I'm staying out of the cities and heading into the countryside. It's high time I see what the vast majority of the country lives like, not just the wealthier (comparatively speaking) city folk.

So without further ado, heeeeeeere's China!

This was my friend Winston's wedding. His wife's mother was one of the higher ups at China's CCTV. Therefore, there were more people manning cranes, cameras and fog machines than there were guests!

Great wedding though! Congrats again Winston!

Who's ready to drink??


My boy Mao lives here.


I don't know why but I thought these outdoor, branded food/drink kiosks were so cool.

A spot of tea?

And now for the food!


I'll post more pics soon enough...this just made me reeeeeally hungry!

Hagel's So Far Ahead of the Curve...

"Stories offer potential to communicate some elements of tacit knowledge. They help to provide enough of a sense of context to reconstruct and extend parts of the tacit. Stories, properly told to communicate the richness of context, do not reduce to snippets."

From a recent John Hagel article that talks about where the internet might be headed.

For a long time I've been thinking about the concept of narratives and how they can be somehow structured and distributed to not only provide a new means of self expression but also to transfer knowledge. It's clear that it's on the mind's of other folks in this space and I can't wait to see some of the start-ups that begin to explore it.

We have a ton of narrative out here in the blogosphere -- who will dig through it to extract and present it all in a meaningful way?

A Quote I'm Pondering...

From Brad Burnham at Union Square Ventures:

All of this means that you will see subtle changes in the way we invest our new fund. We will be even more selective about the early stage Web services we back, looking for compelling differentiation, a discrete market focus, and clear evidence of sustainable user growth. You will also see us invest selectively in later stage opportunities that we believe are poised to grow as more users become more dependent on the Web to manage their daily lives.

I concur...

It's About Education, NOT Information

For investors, a proper education and investing framework should always trump access to "immediate information".

I know that automated information aggregation, synthesis and analysis is all the rage on Wall Street these days. Banks, traders and hedge funds are all jockeying to get the news first, fastest and interpreted in the most efficient manner.

But with the announcement that financial "intelligence" firm, Monitor110 will be shut down, it gives me reassurance that TickerHound's on education as opposed to information was the right path.

Case in Point:

This is currently the top headline on Yahoo! Finance (the largest financial portal on the web in terms of traffic):

Stocks trade higher on upbeat earnings results - Stocks are opening higher after stronger-than-expected quarterly results from names like Coca-Cola Co., JPMorgan Chase & Co. and United Technologies Corp. gave investors some reassurance about the health of the economy.

Ok, now if I were a regular Joe, I'd look at that headline and think, "Oh wow, looks like JP Morgan is pulling through and doing well despite all the turmoil in the financial markets."

But that wasn't the case at all.

In fact, the company's year-over-year profits were off by 53%!

And the comments from the company's CEO, Jamie Dimon, weren't particularly optimistic either:

"the economic environment to continue to be weak -- and to likely get weaker -- and for the capital markets to remain under stress." He added that "since substantial risks still remain on our balance sheet, these factors will likely affect our business for the remainder of the year or longer."

I don't know about you, but that doesn't sound very encouraging to me.

But the stock still rallied - all because analysts expected JP to do even worse than they did!

Trying to trade stocks based on the assumption that "maybe this company won't do as bad as everyone thinks", is a sucker's game. The media creates headlines like this to get people to read their articles and watch their TV shows...fuck that!

Investors need to tune out and rely on their own experience and their own education to make money in this market.

Mr. Dimon pretty much said, "things aint gonna get better for a while now, so don't expect much from us." The CEO of a company says that and what I really hear is, "Hey, don't buy our stock right now, you can buy it later this year for much cheaper."

Education, not information my friend...play this bear market, don't let it play you!

And I'm Back!

For those who don't know, I haven't been "State side" for the last few weeks.

I've been in China hanging out with Yao Ming and his crew preparing for the Olympics.

Ok, maybe it wasn't Yao Ming, but I was definitely hanging out hard in the Middle Kingdom with some old friends. I have plenty of pictures on the way, so sit tight.

All in all it was a great trip. I managed to eat food from over 10 different provinces, drink alcohol from over 15 countries and gain 10 lbs. in the process!

I even managed to get some work done. You can now see TickerHound prominently featured on OptionsZone.com's Question of the Day.

This is our 2nd widget partnership with many more on the way throughout the summer.

I hope everyone's having a great 4th of July weekend and I'll be back Monday with my first set of pics!

Paul Graham Missed the Mark on This One

Let me start by saying that Paul Graham is the man...the guy is doing a lot for the start-up community in this country and I truly enjoy reading his essays.

Furthermore, I give all the respect in the world to anyone willing to candidly discuss their thoughts, ideas, etc. in public view. They open themselves up for criticism, ridicule, etc. - so I don't want this blog post to be taken in the wrong way...

I'm NOT "Graham bashing" here, but something has to be said about his most recent post on "Cities".

In his latest essay Graham essentially talks about the "messaging of cities" -- in his opinion, the same way a brand or company projects a message to the public, so do cities. It's his contention that these cities project the following messages:

• Silicon Valley: Power is important
• Boston/Cambridge: Knowledge/ideas are important
• New York: Money is important

This is probably one of the first times I've ever read anything from Graham and thought to myself, "Holy fuck, how did this guy reach such generalized conclusions that show such a clear lack of depth in thought!?"

I mean, seriously...money does NOT matter in Silicon Valley!? Are you freaking kidding me? I guess Sand Hill Road is known for its charities and its many not-for-profit initiatives. And entrepreneurs only go there to take in the scenery.

And I love this one:

This suggests an answer to a question people in New York have wondered about since the Bubble: whether New York could grow into a startup hub to rival Silicon Valley. One reason that's unlikely is that someone starting a startup in New York would feel like a second class citizen. [3] There's already something else people in New York admire more.

The "something else" Graham refers to here is, of course, money. Hmm...I wonder why New York has been a hot bed for artists, musicians, actors, actresses, writers and various other occupations that are done more out of passion than for compensation for decades now?

While I do agree that it's probably easier to find more people who are interested in participating in (financing, partnering, working for) start-ups on the West Coast, I certainly don't think the "New York only cares about money" message is valid and it's borderline ignorant. Tech start-ups are far from the only industries out there that require boot strapping, ingenuity and creativity.

Arguably, one of the most influential (on ANY level) movements over the last 20 years was born and bred in the streets of New York: Hip-Hop music!

In fact, another guy I really admire, Gary Vaynerchuk, has even compared the web industry to Hip-Hop, circa 1985. And to tell you the truth, I couldn't agree more!

Granted, certain cities maintain a certain culture, but trying to pick a specific message for a city as large, deep and diverse as New York is like trying to say Moby Dick was just about a guy who went fishing.

Paul, not sure where or for how long you lived in New York but next time you come through, we need to hang out so I can show you around a bit. Might teach you a thing or two about a thing or two ;)

Offline - Where the Real Cheesecake Is

So we have FriendFeed, Twitter, Facebook, MySpace, Digg, Google and all sorts of other cool, fun and sometimes useful tools.

FriendFeed lets me know whenever one of my friends uploaded a new Flickr photo, Twitter keeps me up to date on whenever a handful of people I know are taking a dump, Facebook makes me a better friend (haven't forgotten to e-mail someone for their birthday in 2 years) and the list goes on. These tools are pretty damn amazing - I love them all. But while they've made a meaningful impact on my online life -- which is taking up the vast majority of my day lately, but that's another sad story -- they haven't done nearly as much for my off-line life.

I guess what I'm trying to say is that while these applications have changed the way I use the web, they have NOT changed the way I live my life. Facebook was coming close, in fact, while I was in College and the network was still closed, it was an integral part of my life...invaluable even.

And THAT is what I'm really looking for. I'm looking for a service that becomes indispensable to my REAL social life. Something that changes the way I live my off-line life!

Because that's what this is really all about - search engines, social networks, social news, etc....these aren't tools that are supposed to keep us locked into our chairs all day and our eyes fixed on a monitor. They're supposed to help us derive meaningful value for the other parts of our life: work, school, social, etc.

At the moment the only site that's truly integrating with my real life in a meaningful way is Meetup.com - mad props to Scott - I've met more people, learned more things and have gotten more value out of signing up for that site, than ALL of the other sites combined. And the kicker is, I don't even go on the site that often!

I see a link for a Meetup somewhere else, usually in a tweet or an email, and then I hit up Meetup for 2 seconds to RSVP for the event, and that's it! Brilliant!

So that's what I'm looking for - more "Meetup-like" sites. That's what I'm challenging the start-up community to put together.

Sites that change REAL LIVES and in doing so, will change the world.

Why Google Opening up AdSense is Important

For some reason the Microsoft-Yahoo! news got a lot more coverage on Monday than an announcement that came out of the Google camp…an announcement that I’d argue is much more significant to all three companies than Microsoft “possibly” buying Yahoo!’s search business.

Google is announced that it would be opening up its content network (AdSense) to display ads from 3rd party advertisers and networks.

That means other advertisers can now tap into Google’s publisher network and start serving up display ads. The advertisers have to be certified by Google, of course, but this is a fantastic move for Google even with a limited number of certified ad networks.

Here’s why:

1. The move diminishes the possible effects of a combined Microsoft-Yahoo! display ad business. Any type of closed ad network Micro-hoo would’ve created has just become much less valuable.
2. By Google giving its publishers more ways to make money the company stands a better chance of being the primary ad platform used by millions of web publishers (why go to the ad networks if the ad networks are already coming to them?). This is makes me think of Warren Buffett’s ideal investment: “a toll booth in a one bridge town”.
3. I haven’t seen any details about monetization yet but this could also be a monster revenue driver for Google, especially when you look at it in the context of the Double Click deal.

In any case, it’s a major move for Google and I think the implications are going to be huge for Google and especially for Microsoft and Yahoo!.

Got my visa for China!

Wow, I can't even begin to describe what kind of f*%kin' production it was to get this thing!

The first time I went to China all I had to do was show up at the consulate with my visa application and a passport - 4 days later, POOF my Visa appeared. But this time they're making people jump through hoops (almost literally) to get a Visa.

I show up on my first day and it's obviously more packed than usual due to the Olympics. So I waited for 4 and a half hours only to be told I need the following:

1. Copies of my plane tickets
2. Copies of my hotel confirmation so I can prove I have lodging when I'm there
3. Bank statement showing I have enough money to spend in China
4. A letter from my employer (or a business license if self-employed) stating I'm allowed to take vacation

I couldn't believe it!

My bank statement!?

A letter/business license!?

These people were out of their minds.

But, I did what I was told, came back later in the week and waited another few hours before handing in my "permission slips".

I guess all's well that ends well...my flights, hotel and visa are all in order and on June 19th I'm heading back to China!

I wonder if I can reach out to some Beijing tech bloggers before I land...

Where Does Facebook Go From Here?

I was lucky enough to have been in college when Facebook first launched. Luckier still, I was at one of the first few universities Facebook opened up to, Columbia.

I watched as the site evolved from a place to either:

A) Hook-up
B) Find out who else was in your anthro class

to a world class social utility that has not only helped redefine social networking, but also the web as a whole. It's one of the most well designed products I've ever seen...the company seemed so focused on solving real problems for real people. And that's certainly what propelled them from niche social network to one of the largest web sites in the world.

But where do they go from here?

What's the goal of the company now?

They've certainly changed the way we use the web, but have they changed the way we live our lives? Once upon a time I would've made the argument that, "Yes they have!". But I don't find that to be the case anymore.

When I was using it as an on-campus utility to engage classmates, attend a random meet-up over at Lerner Hall, or to find out where the next party was, I thought, "Wow, now this is a useful tool for my day-to-day life." But not so much anymore.

Now I get friend requests from people I've never met, I get updates when my friends comment on photos of people I don't know. I hear about parties I would never care to go to all because I added a stupid app to my account.

I feel like Facebook is becoming Starbucks. Too big for its own good. A man without a country. A cause that lost its way somewhere.

I know Umair isn't very fond of Facebook and makes a number of compelling arguments with respect to strategy and competition. But I think the reasons for Facebook's uninspiring performance as of late could be put much more simply - they've lost their reason for being.

And that begs the question, how does ANY company, once they get to be a certain size, maintain the core values, mission and vision they originally started with?

Is it a fallacy to even think that this is possible?

Which BIG, ultra-successful companies have stayed true to their users and to their original mission and values without being corrupted by their scale and size?

Google?

Disney?

I don't know the answer, but I'd love to hear some opinions.

On another note - and probably a separate blog post - which companies ARE changing how we live our lives?

Meetup.com?

FILL IN THE BLANK??

Wrestling with Midgets...oops, I mean Widgets...

I'm a big believer in the web trending towards disaggregation.

I have this vision of the web as a gigantic supermarket with all of these different items on the shelf. And we, as consumers, get to stroll up and down the aisles picking and choosing what we want our dinner plate to look like.

But, picture life before supermarkets - before America operated as a surplus economy. We ate what we killed or what we were given. Same goes with how we used to consume content...

In the mid-late 90's it was all about the "portal" and the aggregation of as much content as possible. We would go to the portal that had the most content (e.g. Yahoo!) because chances are we'd find something we liked there.

Then we slowly evolved towards the aggregation, indexing and searching of content via sites like Google, Digg, etc.

But now we're at the point where people are savvy and willing enough to take charge of their experience on the web and decide what their "dinner plate" will look like. And if the web is the super market, then the widgets are the groceries.

For those that don't know, a widget is basically a small software utility that resides within another web site...think of it like having a site within a site. Some widgets play music, others allow visitors to communicate with one another, etc.

For entrepreneurs of today, widgets will play an increasingly important role in how we build our respective businesses. The game has changed from, "How do we get the community to come to us?" into, "How can we go to where the communities already are?".

The most popular application of widgets has obviously been on sites like Facebook and MySpace where widget developers have been able to build monstrous followings in very short periods of time - I've seen some Facebook widgets explode from 0 to 5 million registered users in a few short weeks. That's unprecedented in the "destination" web, but when you go to where the audiences already are, you really begin to leverage the physics of the "widgetized web".

So how does this apply to me and TickerHound?

Well, since we have such a belief in the web becoming more decentralized, we want to capitalize on that trend and position ourselves to take advantage of it. So we're building a suite of widgets for TickerHound that other financial publishers, content providers and communities can use to enhance their sites and make their lives easier.

We've already kicked off development on a couple of the widgets but now that we're approaching the more complex stuff, we've been wrestling with some tough questions.

I'll be sharing some of those issues here and on the TickerHound blog in the coming weeks. I hope to get some great feedback from all of you!

Microsoft's Best Move Yet

A TickerHound member asked:

“If Microsoft can't get Yahoo! then what's next for the company?”

Normally I might’ve shrugged my shoulders, suggested another acquisition candidate and considered the conversation over. Microsoft (Nasdaq: MSFT), while still a very successful company, hasn’t yet shown me that they really “get” the web.

That is until Tuesday night!

Let me explain…

Now when I first heard that Ray Ozzie was joining Microsoft I was thrilled, to say the least. Ray Ozzie has been innovating in the tech space for decades and has really been one of the few consistent hitters when it comes to emerging technologies.

But after watching (quite frankly) a series of disappointing product launches come out of Microsoft for the last few years, I began to lose faith in Oz.

Had he lost his touch?

Did being stuck in the confines of Microsoft rob him of his mojo?

Well he must’ve taken some notes from Austin Powers, because as of the other night, the “Great and Powerful Oz” has finally gotten his mojo back!

Lately, much of my focus has revolved around web-based services. For example, a couple of weeks ago I wrote about Google’s new web application platform (Why Microsoft Should be Shaking in Its Boots): App Engine.

This is was a HUGE move for Google and one that I think will serve the company very well in the future.

At the end of the article I asked if this was “check or check mate?” for Microsoft. Well, I think Microsoft just answered my question…and it is most certainly NOT the end of the line for the boys in Redmond.

On Tuesday evening Microsoft announced its most ambitious plan since the launch of Windows 95 – Microsoft’s upcoming “Live Mesh” service.

Similar to Google’s application platform, Microsoft hopes developers will make use of its toolset in order to develop robust web-enabled applications. But Microsoft is taking the vision a bit further. Instead of giving people a backbone to host their web-centric software on, Microsoft is providing a fully integrated platform that connects web applications directly to a user’s device(s).

Ozzie’s vision is to have a service in place where Microsoft’s products – and anyone else who wants to develop applications for the platform – can be synchronized across all devices (phones, PDA’s, game consoles, etc.)

How About an Example?

Ok, let’s say you have your trusty camera phone out at a ball game and decide to snap a quick photo of your favorite New York Yankee, Derek Jeter. Instead of just saving the photo to your phone, Microsoft’s Live Mesh will instantly beam it to your PC back home and your online photo album (along with any other connected device).

Then when you get home, you decide you want to edit the photo a bit because it’s a tad blurry (i.e. you can’t see the ball flying over the Red Sox outfielder’s head clearly). So you touch the photo up on your PC and instantly, the photos on your PC, your phone and your online photo album are all updated at the same time with no other action on your part.

And that’s just a silly example with photos…

Now imagine what that means when it comes to calendars, contracts and other business documents?

The array of services and solutions that can be built on top of a holistic platform like this are endless.

Microsoft’s also launching community features into Live Mesh, which in my opinion, makes it dramatically more powerful than anything else taking shape on the web right now.

Imagine you’re working on a team with several other people and you’re trying to edit a Power Point presentation or a Word document.

The Old Way:

• You make a change to the file


• You email it to everyone and wait for feedback


• Then you realize that somebody else changed a part of the file that doesn’t quite match yours and now you have to work their changes in on top of your own

The New Way:

• Everybody makes changes in real time, regardless of what type of device they’re using


• Everybody’s copy is synchronized


• There’s a record (visible to everyone in the group) of every change that was made so it’s easy to rollback and clean things up

Think about the productivity gains here! Think about the types of services that can be built on top of this platform. Think about the amount of commerce that this will drive – and not just for Microsoft, but for every web, desktop and mobile application developer out there!

Plenty of people would argue that this isn’t a direct competitor to Google’s platform, but I think if we examine the implications of a universal application platform, that bridges the device-to-internet gap in a seamless way, we’ll see that this is definitely Microsoft’s best move yet!

So even if Google’s platform is the foundation that the cities of the web are built upon, then Microsoft’s Live Mesh will be the roads that bind them together.

E-mail needs to get Socialized

There have been several blog posts over the last few months about how hard it is to keep track of, read and reply to all the e-mail that we get bombarded with. I don't personally have a big problem with that but folks like Fred Wilson and Mike Arrington, who have to field 1,000+ emails a day, are certainly going to find it hard to maintain a decent response rate.

So in reply to a post Fred made today on the topic, here's what I think needs to be built:

There's a big opportunity here if someone could do it "right"...not to jump on the "social graph" bandwagon, but what if we could use our social graphs to help prioritize email. For instance, if someone created an email client (better yet, an add-in for existing clients) that would give you a way to sort mail based on how "connected" you are to a person. Could be a point based system and it would use criteria like:

1. Email history (e.g. have you corresponded with this person before, how long ago, how many times, etc.)

2. Connect to your Facebook or LinkedIn profile and assign points by how well connected the person is to you (degrees of separation + number of mutual connections)

3. See how engaged the person has been with your digital presence (have they commented on your blog posts - could pull the data from disqus - or your flickr photos, or sent you a tweet on twitter, etc.)

I'm sure there are some other relevant data points here but the main idea is that getting through 1000 emails a day is always going to be tough no matter what. But there are some emails that really can wait and there are some emails that deserve a quicker read and reply. How we organize those emails is what will ultimately determine which ones will get read and replied to quicker.

Anybody have any thoughts on this or know of an add-in that does it already? Might actually be fun to go out and just build it if it doesn't exist.

Any ideas?

Is There a Monster in Your Portfolio?

Yesterday on TickerHound.com, a member asked: “What do you think about Monster.com?“.

I haven’t thought about this company for a long time. But once I started to really take stock of our current economic climate and Monster’s business model, I began to see why I needed to tell all my friends to double check their portfolios and make sure they weren’t holding onto any shares of this one.

Monster Worldwide (Nasdaq: MNST) is one of the world’s largest online job databases. The company is one of the few successful holdouts of the dot-com era and performed rather well after the market began to make a comeback in 2003.

The stock went from a low of $8.57 per share in March of 2003 to a high of $57.40 in April of 2006 - that’s a 569% return in under 3 years. Not bad, not bad at all.

But to keep all this in perspective, the stock was at $91 a share in March of 2000. So over the course of 6 years, the stock was actually down about 37%. Reason being: the recession of 2001 and the subsequent multi-year bear market that followed.

Monster, being so tightly correlated to the job market, got hit so hard because as unemployment went up and companies stopped hiring, their site provided very little value to employers and employees alike.

So now, we’re at the beginning of 2008, it’s pretty obvious we’re heading into a recession (no one knows how bad this could get) and I feel like I’ve seen this movie before.

Many people would tend to agree - Monster’s already down about 30% since the beginning of 2008.

Some may call that oversold, I call it “the tip of the iceberg“.

If we were simply talking about an equities market “correction”, then I’d say we’ll be coming out of the downturn by the 3rd quarter. But we’re talking about a crisis in the credit markets here - we haven’t had to deal with this since the 70’s and when you stack inflation on top of it we’re looking at a “perfect storm” scenario.

So this isn’t even a matter of performing deep financial analysis or picking apart the chart to identify a pattern. Let’s use some common sense (an underused asset in many investors’ tool boxes) here and see if we can figure out what’s going to happen to Monster…I think asking ourselves a few questions will be a good way to proceed:

• Do you think companies are going to be hiring aggressively or laying people off?
• Do you think they’re going to want to pay to list their jobs or will they simply use word of mouth to attract the relatively small number of employees they might hire?
• Is it a good sign or a bad sign when 3 - 4 top executives leave the company over the last 3 months?

I feel like I’m watching a rerun of 2001 here and Monster’s on its way to $10 per share!

Now, I’ve never been one to go short a stock…it’s just not something I’m comfortable doing.

But you should definitely have a look at your portfolio, because if you have “a Monster” lurking in there, it’d be a smart move to rid of it and get rid of it quick!

I Got a Google App Engine Account!

Sorry, I might be running a company right now, but I'm still a geek at heart.

Scoble had the Qik cam going during this evening's Google Campfire event where they announce Google App Engine - a direct competitor to Amazon's AWS (S3, EC2 and SimpleDB) offerings. Unlike Amazon, however, with Google App Engine you don't have to worry about instantiating machines, adding new ones, clustering, etc. You just create an app, upload, tweak a bit and Google takes care of the rest. Scaling, clustering, backup, etc.

For a small company without a SysAdmin, this solution is going to be extremely important!

Right now they only support Python and since TickerHound was developed using PHP we won't be able to use the service right away. But we're creating some other mini-applications at the moment that this will be perfect for.

Good news though - according to Google, "Python is simply the FIRST language we'll support, it won't be the ONLY language." So as soon as this thing supports PHP, TickerHound is going to be moving.

The one negative I see right off the bat is that it's still a proprietary platform - it doesn't seem like it'll be easy to move to another service (if one ever wanted to). That doesn't give me the old "warm n' fuzzy", but if this platform is as good as it sounds, I doubt I'd want to move anyway.

Built in analytics, trouble shooting, version control, roll backs, monitoring, etc. - Google App Engine seems pretty tight to me! Psyched to have an account and I'll be posting updates and links to our apps as we build them.

Google to Buy Expedia? No Way!

Re-blog from TickerHound Blog:

I saw this question come up on TickerHound the other day and just had to write a post on it.

A member asked, “Expedia’s been up this week on Google acquisition rumors - what do you think?” read more>>

Ok, now I might have to eat my hat on this one but my gut (and plain business logic) makes me think otherwise. Anybody who is saying different, I won’t mention them by name, is probably doing so out of ignorance, desire for attention or a bit of both.

One has to understand that Google isn’t some “dot com” growth engine that’s looking to build at any cost. This company is extremely disciplined when it comes to its finances and it shows in the bottom line – but more on that in a moment.

The point I’m trying to make is that Google is not going to swallow up a company simply to add eyeballs, revenue or whatever else to the Google pie. They’ll only acquire a company when it compliments their core business of search and search advertising.

For example, YouTube.com – Google acquired the company for $1.6 billion last year and hasn’t looked back since. YouTube serves up roughly hal the videos on the web right now and I really believe Google has the wallet, connections, etc. to deal with the copyright issues the service faces. The other thing to recognize is that YouTube wasn’t just some online video site. The service fit within Google’s model of content aggregation, indexing and search – and then monetizing that through advertising.

YouTube doesn’t create content, they aggregate it, index it and make it available to the public…strangely similar to Google’s search engine. The same applies to many of the acquisitions, albeit smaller, that Google has made over the years…

• Writely.com which formed the foundation of Google’s Office applications: users publish documents and Google hosts and indexes them.
• Blogger.com: Bloggers post tons of content which Google indexes and monetizes with advertisements.
• And the list goes on…

Now if Google acquired Expedia they would be entering an entirely new business: E-Commerce.

This might make you say, “Well, why does that matter, money is money, right?”.

WRONG!

Money is always money, but the question is, what does it COST to get that money? In other words, what’s your Return on Capital?

Right now Google has an average Return on Equity of 21%.

Expedia: 5%

Why on earth would Google take on a business that would make its margins worse off?

Answer: They wouldn’t!

Like I said, this is just my opinion and if Google comes out next week and announces that they’ve taken over Expedia, I’ll issue a public apology on TickerHound.com. But, as I said before, my gut and business logic are telling me otherwise.

The one travel company I could realistically see Google taking over would be Kayak.com – it’s a privately held travel SEARCH company. They index and search over 140 travel sites in an effort to find you the cheapest airfares, hotels, etc.

While I “think” this would be a match made in heaven, Kayak is a privately held company and I have no idea what their financials look like. But from a synergistic perspective, Google-Kayak makes a lot more sense than the Expedia story.

I Love Saturday Mornings

Routine:

• 9:00 AM - Wake up (that's right, I like to wake up early on Saturday's, see item 3 for why)
• 9:30 AM - Head to my new favorite west side bagel shop, Brooklyn Bagels (go figure). I highly recommend the Oat and Raisin mini bagel...coming from a former bagel boy, you need to take this recommendation seriously!
• 10:00 AM - The cartoons begin, starting with none other than Teenage Mutant Ninja Turtles!! Sorry, but I can't stop watching Saturday morning cartoons, I imagine I'll be doing this until I'm 90.

After some cartoons I usually end up working for a few hours before we figure out a good spot to head to for lunch. I'm thinking Flushing today...nothing like Taiwanese food from flushing!

3 Problems with the Financial Services Industry

Here are the main problems with the financial services industry as I see it:

1. Broker/Client Interests are NEVER Aligned

You may be asking, “Well if I make more money doesn’t my broker make more money? And isn’t that good for the both of us?”

Theoretically, yes. However, as long as an adviser is paid based on the number of trades you make or the amount of money you keep in your account then he or she is NEVER motivated to do well for you.

They are not paid based on how well your stocks perform – whether or not your account goes up or down they still get paid a commission every single time you buy and sell a stock.

That’s like having a car mechanic who gets paid for the number of times he fixes your car – he’ll just make sure it stays broken for as long as possible and will continue to steal your money!

2. It’s Never About Making You Wealthy

The other thing to realize is that the people who work on Wall Street don’t want you to become insanely wealthy. If that happened then there’s a chance you’d leave them.

There’s a chance you’d stop playing the game.

So why would they try to make you wealthy? Answer: they won’t!

Instead they feed you products like Mutual Funds and Index Funds so you’ll just mimic the market and do average! Not good, not bad, just average.

3. They Always Keep Control

And one of the biggest scams that Wall Street has going for them is that they convince the investing public that investing on their own is dangerous. They convince everybody that in order to do well you need an army of analysts and bankers to tell you which stocks are good and which stocks are bad. Then, and only then, can you profit in the market!

If that were the case then why do most Mutual Funds have a tough time beating the market? And on the flipside of that argument, why does the most successful investor in the history of the world have an office of only 8 people?

Bottom line: There’s no good reason why you can’t do just as well investing on your own if you equip yourself with the right information!

Blurring The Line

As you can see there’s a serious problem in this business – there’s always a clear line in the sand: “you” and “them”. It’s never “us”.

We need to change that and we need to change it fast. We need to come up with a way where you and those you take advice from are sitting on the same side of the table.

The only way that gets done is if we change the nature of the client-advisor relationship – it can no longer be a “one way relationship”, it has to become a relationship of reciprocation, a “two way relationship”. Let me explain what I mean…

As of right now what happens when you buy a stock?

Your broker calls you (or vice versa) and rattles off a couple of stocks – you pick the one that sounds best and you buy it. That’s a one directional relationship – your advisor pushes information toward you.

Now, think about it this way – what if you could sit down at the same table as your advisor and have him teach you his process for digging through stocks?

Well, we know that would never happen due to the reasons we talked about before – if they gave away the “secret sauce” then you wouldn’t need them anymore. If they showed you how to invest, then you could go off and do it on your own.

Well, for most established companies in this industry that logic makes a lot of sense – it wouldn’t be in their best interests to make you a great investor. It would be in their interests to make you dependent upon them.

That's why I'm so excited about what we're doing at TickerHound - we have a distinct advantage here and that’s why our perspective on the situation is dramatically different from most. Our business isn’t predicated upon keeping you (and other individual investors) under our control.

We want to set the information free and allow you to live up to your fullest investing potential!

There are other companies in this space doing the same thing - Covestor.com, CakeFinancial.com, Wikinvest.com - all great companies and all looking to do the same thing: level the playing field so the individual investors out there have a shot at taking their financial futures into their own hands and making better financial decisions today!

Why Buffett Would Never Buy Google

Yesterday on TickerHound.com, a member asked, “Would Buffett really buy Google?”

The question was based on a Fool.com article (click here to read it) that quoted this year’s Berkshire Annual Shareholder Letter where Buffett writes, “It's far better to have an ever-increasing stream of earnings with virtually no major capital requirements. Ask Microsoft or Google.”

I could see why this led some to wonder – and the Fool.com even wrote an article about it – if Buffett could potentially invest in Google. This made me laugh if for no other reason than Buffett mentions Microsoft in the same sentence…a company he knows intimately (considering Bill Gates sits on Berkshire’s board) but has yet to ever invest in.

But let’s leave that part out of the equation for a moment, let’s just look at the “Google angle” and try to answer the question: Would Buffett really buy Google?

For consistency’s sake, I’m going to analyze this in the exact same way the Fool.com article did:

Is The Business Simple and Understandable?

Definitely!

Google is an ad broker – plain and simple.

We can talk about their technology all we want – and believe me, that’s what makes their ability to broker ad dollars so effective – but at the end of the day, the way the company makes 99% of its money is by putting publishers and advertisers together.

That’s a pretty plain vanilla business to me (regardless of all the sophisticated search technology they have on the backend).

Do They Have Favorable Long Term Economics?

I’m going to skip this for a moment and come back to it at the end. You’ll see why below.

Is Management Candid and Competent?

I’d have to give the affirmative answer on this one as well.

The founders, Larry Page and Sergey Brin, both have the better part of their net worth’s tied up in Google stock. That means management’s interests and the share holders’ interests are certainly aligned – something Buffett always looks for in a company he’s buying.

And in terms of candor and competence – their execution speaks for itself and if you’ve read Google’s annual reports and even their S-1 filing, you’d know that they’re candid and up-front about how they manage their business.

So this item gets checked off the list as well.

Is The Price Right?

Here’s where we run into problems…

Buffett’s brilliance isn’t based on the fact that he knows how to value an asset…I know a lot of folks who can value an asset.

My father knew exactly what we should pay for our home when I was a kid.

I could tell you right off the bat how much I’d pay for new car.

In fact, Finance 101 teaches people basic asset valuation models – more specifically, Discounted Cash Flow analysis.

The ability to value an asset isn’t difficult…you just plug some numbers into the equation and you get your value.

The difficult part is making sure the NUMBERS themselves are the right numbers.

So now you’re probably asking, “How do we know if the numbers we’re using are correct?”

Well, you’ll never be able to tell if the numbers are EXACTLY correct – you’ll have to use your best judgment (and even then you’re probably going to be off, and that’s why in Ben Graham’s infinite wisdom he taught Buffett – and thousands of other value investors – to apply a “margin of safety” approach to business valuation…but that’s another story).

But here’s the caveat (and this goes back to the “Does the business have favorable long term economics?” question)…according to the Fool.com article, because the internet has favorable long term economic characteristics, and Google is by far and away the leader of the internet pack at the moment, they assume that Google will therefore have favorable long term economic characteristics as well.

But that just isn’t so…the tech sector is predicated upon the process of creative destruction. Companies must find new and innovative ways of doing things or they’re destined to become obsolete. I mean, how many times have we seen this happen in the last 10 years?

To argue that Google will ALWAYS maintain a competitive advantage in a space that changes by the hour is foolish (no pun intended).

That’s why Buffett only invests in mature companies that compete in mature industries. It makes the tough part of business valuation (using the right numbers) much, much easier.

So to answer the original question as simply as possible, would Buffett ever buy Google?

In my opinion...Not anytime soon!

Click here to leave your answer to this question.

Integrating user feedback...

Today we launched our new and improved TickerHound design!

Well, the design isn't very "new", it's just been updated a bit based on all the feedback we received from the TickerHound community over the last 10 weeks.

From the get go we told ourselves that we wanted to build a site that our users absolutely LOVED to visit. Our goal was to create the iPod of financial education sites - and no, I don't mean it would play music when you visited, I mean that we wanted the user experience to be so damned compelling and so pleasurable that every visitor felt like the site was built just for them.

So in order to do that we knew we'd have to be in constant communication with our members. We knew we'd have to actively solicit feedback from and actively LISTEN to what they were telling us.

Now, when requesting feedback, it's very easy to take the stuff you want to hear and throw out the rest. I believe it's what psychologists call the "confirmation bias" - you tend to only pay attention to the data that supports your predetermined hypotheses. Being that this predisposition is hardwired into our brains, we knew we had to be OVERLY conscious of it and integrate it into our decision making process on a regular basis.

So as we worked with our design team over at nclud, LLC. (great guys, super talented, I highly recommend them) we would constantly revisit older feedback surveys. We would reexamine data we originally tossed out and we'd revisit features we decided not to add - some of them stayed in the trash can, others ended up on the site.

The point being - while you can't take every single suggestion from every single member, you are doomed to failure if you don't actively examine and reexamine what your users are telling you. Those who fail to ACTIVELY LISTEN will die!

Ok fine, I'm being a little over dramatic here but the point is still the same - listen to your members and they will help you succeed.

The other thing we had to remember was that sometimes our members will tell us more through their actions than their words. For instance, when I saw that we were getting a higher percentage of user activity per day on older questions (questions not on the first page of the questions list), I knew we had to add more numbers to our pagination scheme (it used to be 3, now it's 9).

We also relied HEAVILY on our Google Analytics data - yes, we're cheap, we use Google Analytics. Here's a perfect example:

One of the goals with the redesign was to increase the amount of time visitors spent on the site. It's not particularly low or anything but it'd be great to get it higher (obviously). So I examined the pages that have gotten the highest exit rates over the last 8 weeks. Then I used Google Analytics to track the visitors' paths through the site until they hit the high-exit pages.

It turns out that the pages they exited on tended to only be the 2nd Question page they visited (these are the pages that contain the full question and the associated answers - if any). And they would tend to exit more often than not if it was a question page that didn't have an answer yet (seems intuitive but it just didn't occur to us until we examined the data).

So now we reworked the code for displaying the "Related Questions" in the right-column of the Question pages. Now, the top 2 "Related Questions" will be questions that have at least 1 answer.

While we don't have a lot of data yet, it's clear from early tests that our strategy is paying off in terms of "page views per visit" which I feel will ultimately translate into more time spent on the site.

We'll be adding more features throughout March and we've also made it a company mission to add 2 new features (that have been requested by our users of course) each and every month.

We might not be the sharpest tools in the shed, but we want to be the best LISTENERS on Wall Street!

Muncipal Bonds...

Should we be buying General Obligation muni bonds en masse, right now?

The failure rates on GO bonds, historically speaking, are so small that it's highly unlikely that an investor with a diversified muni-bond portfolio would experience a catastrophic loss of capital. On top of that, Warren Buffett just created an insurance company for the sole purpose of insuring these bonds. Typically companies like Ambac would insure muni bonds, but they've got themselves into a fine mess now.

So for Buffett, this is a lay up. He gets to insure low risk bonds that he'll probably never have to pay off and in turn will collect a nice revenue stream from the insurance premiums in the interim...so if the Oracle is in it, I've got this gut feeling that I should be too.

I really can't see any state governments letting any large municipalities default on their debt, especially given the current economic climate.

I don't think I'd go near any revenue bonds right now, but anything backed by the full faith and credit of a city I lived in would be just fine by me.

Stock Chart Widgets...

Had a great talk with Paddy Mullen tonight. Paddy is the founder and developer of ChartWidget.com - a dynamic JavaScript stock charting system that is still in development, but is already an amazing product. Think Google's stock charts, minus the flash requirement.

If anybody is looking to add some sleek charts to their site with a tight UI, I highly recommend checking out ChartWidget.com and dropping Paddy an email.

Stock charts are definitely something we'll want to integrate into TickerHound in the very near future - and in all likelihood, we'll be using a solution from Paddy.

BarCampMoneyNYC

While there are college courses already being dedicated to developing social networking and Facebook apps, there's very little in the way of structured data or information on how social media is affecting the online financial services industry.

So here is the deal...everybody and anybody who is involved in Financial-Tech (e.g. software engineers, entrepreneurs, UI designers, investors, rubber-neckers, etc.) is cordially invited to the first BarCamp associated with the convergence of finance and technology...BarCampMoneyNYC!

Unlike the recent O'Reilly Money:Tech conference, this little conference of ours will be based on the BarCamp format. All attendees will also be presenters...yes, that means you either have to present or participate in the presentation. But don't be "scurred"...we're all here to learn, teach and help one another navigate these unchartered waters.

TickerHound and a number of other NY based financial-tech start-ups and industry veterans will be in attendance. I'll post more details as we get closer to the event, but just so you can mark your calendars now, here's the 411:

BarCampMoneyNYC Event Details:

Date: April 12, 2008
Time: 9am - 5pm
Venue: Wilson Sonsini Goodrich and Rosati, 1301 Avenue of the Americas (between 52nd & 53rd street), 40th Floor.

What is BarCamp?

BarCamp is an international network of user generated conferences — open, participatory workshop-events, whose content is provided by participants — often focusing on early-stage web applications, and related open source technologies, social protocols, and open data formats. For more information, visit http://en.wikipedia.org/wiki/BarCamp and barcamp.org

About BarCampMoneyNYC

BarCampMoneyNYC 2008 is an ad-hoc gathering for the people who work in, cover or seek to revolutionize the finance industry to share and learn in an open environment. It is an intense event with discussions, demos, and interaction from all attendees. It costs nothing to attend, but there is a price: all attendees must lead a discussion, give a demo, a session, or help with one. For more information visit, http://barcamp.org/BarCampMoneyNYC

BarCampMoneyNYC Sponsorship Information

BarCampMoneyNYC is a free event to attend. In order to keep the event free, organizers rely on sponsorship from businesses. Sponsorship donations will be used for food, t-shirts and miscellaneous expenses incurred during the hosting of the event. Sponsors of $500 or more will have their logo added to our t-shirt. All sponsorships will receive signage at the event, and collateral at registration desk. For additional information contact BarCampMoneyNYC organizers.

We already have an impressive roster of attendees, so if you'd like to come, participate and meet some of the movers n' shakers in this industry in New York.

Google Ads - The Real Story

So the talk of the tape last week was obviously Google (Nasdaq: GOOG). The Mountain View search giant has been on a downward spiral since the end of last year and showed no signs of letting up now.

In fact, the stock is down over 33% in 2 months alone – that’s over $70 billion dollars in shareholder value completely wiped out in a matter of weeks.

Last week was no exception – after a negative report came out from web traffic reporting company, comScore, Google’s stock slid from $505 on Monday down to $471 by the close on Friday. That’s a decrease of over $10 billion in market value in a single week based on a single report.

I can’t begin to tell you how many news articles and blog posts I read that had the, “See we knew Google’s success couldn’t last forever”, feel to them. The basis for this insightful, albeit untimely conclusion: the comScore report. On a side note: I bet the vast majority of the analyst and editors behind those articles were probably the same people who predicted Google would go to $800 per share only 3 months earlier.

In any case, the real issue here is the comScore report.

Was it accurate?

Did the media draw meaningful conclusions from it?

Were the conclusions accurate?

Nobody seemed to bother asking those questions – well, if they did, those weren’t the folks getting all the publicity last week. The only articles making the front page or the “most popular” lists were those calling for Google’s head on a platter, so to speak. So let’s fast forward to the end of the week when comScore published a post on its blog that pretty much read, “Oops, we might’ve given you the wrong impression”.

My favorite excerpt with respect to the report:

“The information triggered a flurry of reactions in the media and the financial community that centered on two concerns: 1) a potentially weak first quarter outlook for Google, and 2) an indication that a soft U.S. economy is beginning to drag down the online advertising market.

While we do not claim that these concerns are unwarranted, we believe a careful analysis of our search data does not lend them direct support.”

If you’d like to read the entire blog post, click here.


The basic gist of the blog post was that while total click-throughs may have been down, it was due to a conscious effort on Google’s part to eliminate ineffective ads. Meaning, there was less opportunity for clicks because Google was proactively displaying less ads, thus increasing the dollar return on the ads that were displayed.

Bear Sterns’ analysts aside, I think most folks realized that this report was overblown – at the end of the day, 3rd party data doesn’t mean everything…money does. And according to many Google clients, some of whom I know personally, Google is still their primary advertising solution and they’re seeing more and more money from the company each month.


Check out this report from Alley Insider which talks about one of the larger ad buyers on Google and why they’ll continue to use Google as one of their primary marketing tools:

Ad Buyer: No Slowdown In Search Or Google

All in all it was a rough week for the company and the stock may not be out of the woods yet, but there’s a valuable lesson to be learned here: It pays to do your own homework!

That’s why I was so happy to see a few TickerHound.com members ask questions on this exact topic…one of the recent questions: “What will happen to Google now? Is the selloff going to continue, or has it bottomed out?”

Click here to weigh in on the situation.

While I couldn’t tell you when Google’s stock will be on the rise again, I can say for sure that this company isn’t going to be another “dot bomb” sob story. I’m definitely a long term bull on this stock.

Is Hershey the Value Play of the Year?

A great question appeared on TickerHound the other day that really caught my eye. One of our members asked:

“Is Hershey going to be the biggest value play of the year?

This has to be something Buffett would be licking his chops over - and not just because the chocolate is good - Hershey looks like Coke did back in the 80's. Getting hit by competition and internal problems but still has this ridiculous amount of brand equity and consumer reach.

My only question is, when do we buy?”

Click here to read some of the answers or submit one of your own.

Being that I’m a chocolate fanatic and an avid Buffett follower, the question immediately had my attention – I was even tempted to post a quick answer to it, but I decided to dig a little deeper and do my homework on this one.

Full disclosure: I do NOT own any shares in Hershey or any other company I discuss in this article.

So the story behind Hershey’s recent decline is this:

Back in January of 2007, Hershey’s CEO at the time, Richard Lenny, met with his counterpart from Cadbury, Todd Stitzer. Stitzer was proposing a merger between the two consumer food & beverage giants that would create a global candy making powerhouse.

Cadbury was willing to give up its beverage business (a huge point of contention between the two companies in the previous merger discussions they’ve had) as well as incorporate in Delaware, maintain a US stock listing and keep the headquarters in Hershey, PA.

Somehow, after that meeting, Mr. Lenny got into a major dispute over the merger with Hershey’s largest shareholder – The Hershey Trust Co.

The Hershey Trust was formed by the company’s founder, Milton Hershey, as a school for orphans which he eventually transferred all of his assets to, including his stake in Hershey’s chocolate. The trust currently owns almost 30% of Hershey’s stock, controls 79% of the voting shares and can remove 5/6 of the company’s board if it saw fit to do so…in fact, that’s exactly what they did do, as well as force Mr. Lenny out along with a number of other top ranking executives.

They say it had to do with Mr. Lenny’s withholding information about the proposed merger and Hershey’s growing financial problems. This is all disputed by a number of parties on both sides of the fence, so I won’t go into it here.

Now, the stock is down 31% in the last 12 months – the stock hasn’t been this low since 2000 – 2001.

For me, when a brand name like Hershey’s is getting beaten up in the market, it smells like an opportunity to make some money. So here are the pro’s and con’s for Hershey as I see it.

Positives:

• Largest candy maker in the US
• One of the strongest consumer brands in the country
• Aggressively moving into global markets
• In the process of integrating a massive overhaul of its supply chain in order to improve efficiency and reduce costs
• Stock has been hit hard and is at historically low prices

Negatives:

• 80% of its sales come from the US
• Brand reach doesn’t extend outside of the country
• International probe from US, Canadian and European regulators into whether Hershey (and several other candy makers) engaged in a concerted price fixing scheme
• Revenue and profits fell short in 2007
• Recent management and board shakeups have left the company in untested hands
• Still going to see roughly $200 million in operating charges next year in relation to its supply chain overhaul

Potential Outcomes

So the negatives seem to be outweighing the positives…for the moment, at least. The chart is in a solid downward trend and while it might’ve found support where it is now, I can’t see it moving dramatically to the upside anytime soon, especially with all the other uncertainties surrounding the company.

The new management and board have me concerned as well. Reason being, the folks who control Hershey’s Trust are all local Hershey, PA elites – not veterans from the candy business. It doesn’t give me that “warm and fuzzy feeling” knowing that the largest shareholder is making such dramatic changes based on one bad year and for feeling like they’ve been kept out of the loop.

So to answer the original question – the time to buy is not right now. I’d wait until this stock builds a base and starts trending upward. However, if you’re already a Hershey shareholder, I wouldn’t be too alarmed at the moment. We’re still talking about the largest candy maker in the US with one of the oldest and most powerful consumer brands in the country.

If the company doesn’t recover on its own, here are some other potential outcomes that will help shareholders see some serious upside in the stock:

• Merger with Cadbury: The Hershey Trust isn’t opposed to a merger with Cadbury – in fact, as they were planning to shakeup the company they held additional talks with Cadbury in New York late last year. While the two companies didn’t come to an agreement, I don’t see why the conversation couldn’t be picked up again, especially if Hershey’s stock continues to languish.

• Merger with Wrigley’s: A few years back Mr. Lenny architected a merger with Wrigley’s – the gum maker – again, Hershey’s Trust nixed the merger at the last minute. But again, if the stock continues to languish we could see some of these conversations pick up again.

At the end of the day I think it’s fairly clear to all parties that Hershey needs to diversify its business away from the US market. They need a partner overseas, especially in Europe, and Cadbury would be a fantastic fit in my opinion.

So while I wouldn’t be a big buyer just yet, my guns will be locked and loaded because at some point in the not-so-distant future, Hershey’s stock will become a part of my portfolio.

Click here to read some of the answers or submit one of your own.