Florida Venture Blog by Dan Rua

No-BS Venture Thoughts for No-BS Entrepreneurs.

A running perspective on Florida's growing tech and venture community, with an occasional detour to the Southeast/national scene, venture capital FAQs and maybe a gadget or two....

By Dan Rua, Managing Partner of Inflexion Partners -- "Florida's Venture Fund".

Friday, February 29, 2008

Where is Jason Calacanis's Disclosure, to People AND Machines?

It's a good thing February 29th doesn't come around that often. It's a day Jason Calacanis may want to sweep under a rug.

After yet another episode of Jason jumping up and down for the world to notice him and his company (this time with some affiliate marketer rants and techmeme coverage), a Feb 29 post by Allen Stern over at Center Networks focused on Jason's conflicted, undisclosed PageRank-passing link practices and his promotion of such practices to the rest of his employees. Jason's practices were particularly ironic given he just highlighted the FTC quote: "We wanted to make clear . . . if you're being paid, you should disclose that."

You can read Allen's direct affiliate, employee, paid link comparisons. My post just provides a bit more detail to Allen's dead-on observation. My post isn't about affiliate links. My post isn't about buzz marketing. My post isn't about Mahalo's business model (human scraping is worthy of a whole other post). It's simply about applying Google's standard for machine-readable disclosure to Jason's PageRank-passing links. In fact, it's even more narrow than all of Jason's violations (Andy Beard covers some others) -- I'll just focus on his deliberate PageRank juicing of Mahalo already alluded to by Allen. No rocket science here.

Google's standard:
1) Google's position on disclosure, via Matt Cutts, is that adequate disclosure on the web must be understood by people AND understood by machines. [next 3 images are directly from Cutts presentation]
2) Google has suggested a few ways to meet their standard of machine-readable disclosure; the most straightforward being the use of rel="nofollow".
3) Google has exacted severe penalties against sites failing to provide machine-readable disclosure.
Jason's PageRank-passing:
4) Jason Calacanis gets paid direct cash compensation from Mahalo, and significant equity compensation from Mahalo as a shareholder. [next 3 images are directly from calacanis.com posts]
5) More Mahalo pages in Google SERPs equals more money in Jason's pocket and equity -- orders of magnitude more than the typical affiliate or sponsored blogger that Jason has railed against in the past.
6) To get more Mahalo pages in Google SERPs, and higher in Google SERPs, Jason repeatedly creates PageRank-passing links to Mahalo, with SEO keywords stuffed into anchor text. One or more links are a daily occurrence, with many linkfarm-in-a-post posts.
7) None of Jason's PageRank-passing links provide machine-readable disclosure as required by Google (or human-readable for that matter) -- even though using nofollow would still retain any traffic/branding goals of linking.
The result:
8) Jason's undisclosed PageRank-passing links are working. Pages that no one has found interesting enough to link, reach Google #1 SERPs because of Jason's single PR6 keyword-stuffed link. See this Google SERP and this backlink check as just one example of many.
9) Neither the linker (Calacanis.com, PR6) nor his sponsor (Mahalo.com, PR6), have received any penalties as a result of these clear Google Guideline violations. There are times when I've heard Google say they focus on the most egregious examples, but I can't think of a blogger with more compensation at stake, doing more blatant, conflicted PageRank-passing without machine-readable disclosure.

Google, what are Allen and I missing?

Labels: , , , , , , , , ,

Wednesday, February 27, 2008

Where's Dan Now? #3

Well, just like WDN #1, you folks solved WDN #2 faster than I expected. Given the long time gap between those, I thought I'd toss you another one I snapped this morning. Where is this Papa John's commercial being shot? I gave plenty away in the picture so I need the exact address.

UPDATE, 02-29-08: Congrats to Brian who nailed it (I shoulda blurred the Cantina). Thanks for playing along!

As usual, I've created a pushpin on my WDN map AND I was able to solve embed this time. Enjoy!

View Larger Map

Labels: , ,

Tuesday, February 26, 2008

GOOG Will Die an Open Death

I've been digging into open search, playing around with Hadoop, Nutch, Wikia Search and other efforts. I don't think it's close to supplanting GOOG, but it will eventually. It will start with better results and/or better display of results -- particularly to niche/long-tail needs. The key will be when someone applies a sustainable revenue model to Open Search in a manner that allows distribution channels to get off the GOOG candy.

The fight hasn't been about search quality for some time. It's been about buying distribution. However, there have only been a few players with search quality high enough to test distribution models. When Open Search allows anyone to match search quality/display, then creative monetization models will emerge -- unlocking distribution in the process.

Yahoo's recent "An Open Approach to Search" post was nice to see, but it's just the tip of the iceberg...

Related images: yahoo, google, hadoop, nutch, wikia search, open search

Labels: , , , , , , ,

Where's Dan Now? #2


As I shared in my first Where's Dan Now? post, I'm on the road a lot. Today's pic is very different than last time. Can you be the first to name this location within 1 block (e.g. address, google map etc) via comment?

Enjoy!

UPDATE, 02-27-08: Congrats to Kris for guessing my Tampa, FL location -- looking out from the downtown Bank of America. I've added this WDN #2 to my GOOG map. Am I missing something or does GOOG still not have YouTube-ease cut/paste for embedding MyMaps? It looks like they require you to get a Maps key and write your own embed code. I must be missing something...

Labels: ,

Stage6 Killed so DivX Could Thrive?

Well, no sooner did I tout the growth and value of HD streaming site Stage6.com and they decide to close up shop. It could be my rationalization, but it sounds like they were a victim of their own success. According to some sources the combination of traffic, copyright policing and board greed (nixing a spin-out funding deal), led to a decision to shut Stage6.com down. I'm guessing deal negotiations also broke down when new investors wanted reps & warranties about copyright liability.

On the surface, shutting such a property down doesn't make much sense...someone is probably too busy with the DivX-inside business model to mold the right Stage6 deal (including all the copyright complexity). But, sometimes such focus makes perfect sense...[UPDATE: especially if the core team is gone]

Jordan, I'm still interested in talking if you are...I'm guessing you've got something interesting in the worx...

UPDATE: TechCrunch provides a blow-by-blow on the Stage6 drama. As an early investor in DivX along with Frank Creer and others, I sure hope it wasn't as bad as it sounds. There is still a lot of value in that property...

Labels: , , , ,

Saturday, February 23, 2008

Bobby G: Adventure Capitalist...er Business and Asset Consolidator

I've seen people make money in a lot of ways in this world. The MOJO show Bobby G: Adventure Capitalist reminded me of that fact. I thought I was going to see a show about venture capital, but that's not quite what was on the screen. Upon further research, the show website shares that Bobby's company is a Business and Asset Consolidator.
Now I don't know Florida-based Bobby Genovese (although I think Barbados is the legal home of his business), but I have to hand it to the guy. Somehow he convinced MOJO to run a venture capital reality show about him and his company, BG Capital; with the following portfolio:
  1. The Neptune Society: a pre-funded cremation service
  2. Clearly Canadian: OTC stock, enhanced water company
  3. Neptune Memorial Reef: a manmade reef off the coast of Key Biscayne, with the following benefits/uses:
    • A memorial garden for the cremated remains of our dearly departed.
    • The world's largest and most enchanting man-made reef.
    • An environmental and ecological masterpiece.
    • A world-class destination for divers and explorers.
    • A place for commemorating mankind's accomplishments.
He seems like a pretty personable guy and he definitely knows how to live the high life. If you haven't seen his show, give it a look. It's no Rockstartup, but it will get your head out of Web 2.0 and remind you that there are diverse people and businesses making money out there...

UPDATE: I checked Bobby's company site (rather than the TV series site) and found some additional portfolio companies. For example, he's backed the Vancouver International Polo Team. It sounds like he's quite the polo player:
"Even more remarkable is the talent of Genovese himself. Although an accomplished equestrian, he wasn't introduced to the sport until 1995 when he took his first lesson. Much to the surprise and delight of both teacher and student, Genovese proved to be a natural."

Related images: bobby genovese

Labels: , , , , , , ,

Friday, February 22, 2008

RankSpank Makes Me Laugh...What's Your RealRank?

As a VC you get to live vicariously through your portfolio companies. Sometimes that is exhilarating, other times it is frustrating, and quite often it's just plain funny. This morning, I'm laughing.

Given some of GOOGopoly's moves in late 2007, more and more bloggers and advertisers are realizing that PageRank has no direct correlation to traffic and pageviews. A link-savvy PR5 site can have ~100 visitors and plenty of PR0 sites have thousands of visitors. Alexa tries to improve on this with sampling estimates for traffic, but it's common knowledge that sampling errors and gaming drive a wedge between Alexa stats and reality.

Being in the social media marketing business, IZEA saw this as a problem and an opportunity. The result was RealRank, an open ranking system based upon real visitors, pageviews and active links (e.g. links that actually refer people rather than hidden on footers etc.). IZEARanks.com was launched with RealRank tools and reporting. So, how do you let the world know when you've got a better mousetrap? Well, one way is the town crier of our time: funny videos.



Kudos to Veronique, Ashley, Travis, Scott, and even champagne bubbles Ted, for a very professional music video. Keep them coming and keep having fun...

Labels: , , , , , ,

Tuesday, February 19, 2008

WeMedia, BarCamp and FoWA: Big Month in Miami

Miami's social media scene continues to grow. Next week is one of the bigger weeks in awhile, with three great conferences.

Feb 26-28: WeMedia
Location: The conference is conducted at the University of Miami, located in Coral Gables, south of Miami International Airport and southwest of downtown Miami. US 1, or Dixie Highway, bisects Coral Gables and is a good pathway to the University.
Schedule

Feb 28: BarCamp Miami
Location: Carnival Center, 1300 Biscayne Blvd, Miami, FL 33132
Schedule

Feb 29-Mar 1: Future of Web Apps
Location: Carnival Centre, 1300 Biscayne Boulevard Miami, Florida 33132 USA
Schedule
Confirmed speakers include: Kevin Rose, Kathy Sierra, Cal Henderson, Erick Schonfeld, Kevin Marks, Matt Mullenweg, Blaine Cook, Leah Culver, Emily Boyd, Kevin Hale, Dan Rubin, Gary Vaynerchuk, Joseph Smarr, and the ScrapBlog crew


Related images: miami, wemedia, barcamp, fowa, kevin rose, kathy sierra, cal henderson, erick schonfeld, kevin marks, matt mullenweg, blaine cook, leah culver, emily boyd, kevin hale, dan rubin, gary vaynerchuk, joseph smarr, scrapblog

Labels: , , , , , , , ,

Monday, February 18, 2008

Nice Idea, but How Will You Get Visitors?

I had another conversation today with an entrepreneur who had an interesting online destination site idea, but few answers for attracting visitors. In general, I'm not nearly as excited about destination/media properties as I am about horizontal online services. However, a well executed destination site can still make an interesting business.

The only problem is that the same pitches are happening today that happen in the late '90s -- focused on the big target/niche market and the interesting site functionality; with little discussion of how people will find out about the site and why they will visit. Responding to such questions with a reiteration of site function isn't sufficient, at least not for institutional capital.

A few of the tactical approaches for getting traffic to a destination are:
1) organic search
2) sponsored search
3) viral adoption
4) referral tools
5) affiliate marketing
6) display advertising
7) distribution relationships.
But, it's not enough to just reference this list or a subset. Entrepreneurs need to explain how their niche or target audience is uniquely accessible through one or more of these methods. I'd also recommend doing some small tests with one or more of these so you can speak from real data/ROI. It doesn't matter if you have the neatest idea with the best supplier relationships -- you need visitors or you die.