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| The Next Trend in Organizations? Y Combinator-like Funds Posted: 08 Oct 2008 01:50 PM CDT
Techstars in Denver, LaunchBox Digital here in Washington, D.C., Dreamit Ventures in Philadelphia, and many others around the country have attempted to duplicate Y Combinator’s strategy with mixed success. Media companies are paying close attention to this model and considering that each startup doesn’t receive more than $10,000 to $30,000, it’s a cheap investment for most large media organizations. Given that most media companies are suffering in the current environment, they are willing to try just about anything to spark innovation that can positively impact the company. One executive at a large media company in New York that I met with on Monday suggested that they are considering opening up their library of content to developers and will start writing checks to get “hackers” to build interesting applications. Whether or not this model works has yet to be proven but for such a small investment it’s well worth the risk for most of these companies. Even some governments have taken to the model including Maryland which has its own small business incubator sponsored by the state government. At Internet Week New York last year, a number of organizations announced NYC Seed which was a $2 million fund for startups in the New York City area. The trend continues and over the next 12 months my guess is we will see many more of these types of funds spring up around the country both from within organizations, governments, as well as organized by groups of individuals. One person after the other that I speak with is in some way related to the launch of one of these funds somewhere in the country. Do you know of any other companies launching these types of funds? What do you think of the model? |
| Can Anybody Compete With Facebook & MySpace on Mobile? Posted: 08 Oct 2008 11:16 AM CDT As an internet entrepreneur one of the most significant fears you can have is that Google will begin offering a competing product or service for free. Both small and large companies fear the day Google will launch a competing free product. Just ask Microsoft’s Steve Ballmer his thoughts on Google Docs, I’m sure he won’t be enthusiastic about it. If you are an executive at a mobile social network compny, any new service rolled out by Facebook and MySpace would most likely have the same effect. There is a large group of competing social networks that have built sizable audiences including Mocospace, MyGamma, Peperonity, Itsmy, and a few others. The biggest challenge facing those networks? I would suggest Facebook and MySpace are the largest challenges. According to a study released yesterday, out of all users of mobile social networks “nearly 70% have visited MySpace and another 67% had visited Facebook. No other social networking site reached 15% adoption mobile adoption.” This is substantial and it appears that Facebook and MySpace are simply blowing by the competition in a short period of time. According to the research, the most popular activities on mobile devices is checking messages and comments followed by posting status updates. This also goes to show how Facebook and MySpace are rapidly substituting many of the features provided by Twitter, a company which has yet to find a sufficient business model. One of the core takeaways from the study is that mobile social networks, and not email, are becoming the central hub for communication for those connecting on mobile devices. This has huge implications for the future of social networks as it suggests that the social networks are becoming a more integral component of users’ every day communication. I for one receive business communications via Facebook on a regular basis. While the average users may not have hit that point, the trend is in that direction. The only remaining question is not whether users will continue to adopt social networks on their mobile devices, but what social networks they will use over the next 12 to 24 months. I would suggest that we will continue to see a shift that significantly favors Facebook and MySpace. Given that the data in this study is from the second quarter, new data will most likely suggest a continuation of this shift. Do you think competing mobile social networks have a chance? If so, where are the largest opportunities? |
| Google Gets in to Advertising on Social Networks Posted: 08 Oct 2008 09:36 AM CDT Last night Google announced that they had launched Google AdSense for games. One of the largest gaming companies benefiting from the new advertising platform is Playfish. Google actually included a demo of AdSense for Games directly integrated into Playfish’s Word Challenge game. This is a big step for Google and one that competing advertisers should pay close attention to. Why? According to sources within Google, games are not the only applications that Google is advertising on within social networks. Google is testing out their AdSense platform for other social applications. Take a look at some of the most popular applications on Facebook and you’ll quickly realize that Google is testing banner advertising on some of the largest applications. This could mean trouble for some of the existing advertising networks on Facebook that focus primarily on banner advertising. Currently eligible partners “must have a minimum of 500,000 game plays and have 80% of their traffic from the U.S. or the U.K.” Google is currently filling advertising inventory for Zynga, Playfish, Armor Games, Konami, and a number of other large gaming networks. Currently Sprint, Sony Pictures, and esurance are the primary advertisers testing out the Google AdSense for games platform but we know of other advertisers, including the Travel Channel, who are testing out other forms of advertising on the social platforms. Look for Google to continue to expand their presence on social platforms over the coming months.
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When Y Combinator was started a few years back, I doubt they knew how successful they would be. The company has invested in numerous companies that have obtained future rounds of funding or have been acquired. If you follow the web technology space there’s a good chance that you’ve heard of most of their companies. Over the past year numerous Y Combinator copycats have sprung up around the country.| You are subscribed to email updates from The Social Times To stop receiving these emails, you may unsubscribe now. | Email Delivery powered by FeedBurner |
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