BuzzMachine

Tom Evslin contributes to the discussion about advisory capital with a suggestion — give ACs equity, not options — and a question: How will startups meet the right ACs? Should there be AC firms? Good question.

I think that VC shops would be wise to set up — and arrange compensation for! — networks of advisory capitalists, who could aid the startups with advice and expertise and the VC firms with deal flow and with help managing a far greater number of far smaller investments. These relationships should not be exclusive, otherwise you won’t get the maximum deal flow and introductions and the best deals for you. As with the rest of life online today, you should think networks: The more and better connections you make, the better.

Now the problem for the VCs remains: Startups need less money and thus it’s hard to invest enough for your real clients — your investors — without stretching your real resources — your time and attention. That’s why ACs are needed: to help you reach and invest in more companies by finding them and advising them. As I said the other day, the relative value of expertise and experience grows in relation to money, so the smart VCs will compensate for the reduced need for money with increased use of targeted expertise.

Should there be AC firms? Maybe. But I think not: The value is in flexible networks, in knowing people who know people who know stuff. I fear a firm would just act like an old consultance: Hire us and buy our bullshit and take your chances. Advisory capital is about personal relationships. VCs bring other people’s money. ACs bring their own knowledge.

So I think the thing to do is to old the first ACcon: a Demo without cash, in which startups meet experts with experience and they get to know each other and test each other and see whether they want to date. It’s not much different from other networking events, like Web 2.0 and Nick Denton’s old First Tuesday, except that money isn’t the draw and the currency, smarts are.

Glenn Reynolds argues in the Journal that bloggers change minds, and change their own minds, on issues like the UAE ports tempest.

As I write this, it’s not clear where the rest of the debate is headed, but there are already some useful lessons for the White House. First, blogs make an excellent early warning system. The White House, unaccountably, seems to have been blindsided by the furor over this deal, though most people’s gut reaction was negative. As with the many bloggers like me who changed their minds, gut reactions can be overcome by evidence — but the White House should have taken advantage of this early warning to have its arguments in order. It didn’t.

I don’t know why I would ever sign up to have GQ magazine send me mobile spam. What of value could they possibly say in an SMS: “Remmber your collar stays today”?

A disciplinary committee in the UK just suspended London Mayor Ken Livingstone for a month and fined him £80,000 for likening a reporter, who’s Jewish, with a concentration-camp guard. The local papers are shocked at the precedent of an electorate’s will being overruled by an unelected tribunal. I am also shocked that the cause is speech. Says The Guardian’s Mark Lawson:

It’s worth remembering that when Bill Clinton was threatened with removal from office by the members of the House and Senate - over allegations of serious sexual and legal error - considerable concern was expressed about whether even elected representatives had the right to overturn the will of the people as expressed in an election.

The Times editorial:

That such a sentence should be passed on him not by London’s electors, but anonymous officials after a costly tribunal into his behaviour is, though, ludicrous.

The Telegraph’s leader:

In a democracy, people should be free to vote for whom they wish, and politicians to act as they please within the law.

: And tonight on Bill Maher’s show, Irshad Manji ties the discussion of Holocaust denier David Irving to this: Another man said more stupid things and is jailed.

: One more: Telegraph columnist Simon Heffer ties together the tales of Irving and a media steambath over Prince Charles’ leaked critical diary of a China visit.

For two Englishmen, this has been a week when freedom of speech has come at a high price….

Let us start with Herr Irving…. [T]he notion that he has been locked up for taking such an irresponsible, stupid and offensive view of history is appalling. The best way to guard against anti-Semitism is to let people such as Irving have their say. I doubt that a single anti-Semite has been created by reading any of Irving’s works. Indeed, it is far more likely that his every utterance has reinforced hatred of Nazism and Nazi doctrines, which is why he is more useful to humanity outside jail than in it.

What he and the Prince of Wales have in common is that the unlovely band of hysterics in pursuit of them prevent any such objective view of their behaviour.

The defense of speech usually comes to speech we do not like and that is fine for such speech does not hurt us. And isn’t that the lesson we should be demonstrating to all the cartoon rioters and murderers?

I will say it again:
The cold of the chill is more dangerous than the heat of the hate. I believe that a free marketplace of speech will succeed where a closed and controlled public square will fail.

Steve Baker talks to adman Rishad Tobaccowala of Denuo (Publicis):

He maintains that Google is out to become the eBay of advertising, but with one crucial difference: “eBay makes the market but doesn’t take sales,” he says. “Google is the seller and the market. Eventually, someone has to wake up and say, ‘This is [BS]‘.”

And we have to wake up and create the open marketplace that will compete with Google’s coming monopoly. We have only ourselves to blame.

I’ve been thinking about the suit against Craigslist and why so many forms of regulation just won’t work in a new world of control at the edges. The Times reported:

If the lawsuit, filed by the Chicago Lawyers’ Committee for Civil Rights Under Law, succeeds, Craigslist will be forced to follow the same rules newspapers do in their classified advertising listings, screening each ad to make sure no antidiscrimination laws are violated. That means ads like the ones the lawyers’ group said it spotted on Craigslist in a six-month investigation would be banned.

But here’s the problem: When we had a small number of centralized repositories of ads — gatekeepers — it was easy to impose this kind of regulation. It is possible, though expensive and ineffective and inefficient, to do so with online gatekeepers.

But it is impossible to clamp down on such speech the distributed world, where I can post an ad on my blog and it can be found via Edgeio or Oodle or Google. Then who are you going to sue? The search engines for finding it? The enablers for providing the functionality to me? Or me for exercising free, albeit inappropriate, speech? The control is at the edges and it’s much harder to regulate the edges.

(Full dislosure: Craig Newmark is a personal investor in the news startup I’m working on.)

Jon Friedman writes a too-kind profile of little ol’ me at Marketwatch. (BTW, the chunk he quotes in the middle is from the world editors’ conference site, not me, just to be clear.)

So Google starts a page creator. Haven’t we been there, done that?

I might be more interested if they had:
* Tied this with Blogger to create freeform blogs.
* Tied this with Google Base to let people create structured data.
* Tied this with RSS to create feeds.
* Tied this with Google Video and podcasts to create homes for many media.
* Tied this with Google Mobile to enable me to create any of the above for my phone, or yours.
* Tied this with Google Groups to allow creation of collaborative content.
And so on, and so on….

The power of Google is not in creating a bunch of separate things but in making connections. But not unlike other big media companies, they now seem to be finding it difficult to spell synergy. [via Squared and Scripting]

Fred Wilson does his Roone Arledge imitation as he doth protest too much about Stowe Boyd’s advisory capital post and my agreement with Stowe.

Unless you have capital at risk or some other form of “skin in the game” like sweat equity, you cannot and will not feel the thrill of victory and agony of defeat that binds the VCs and entrepreneurs in startups. Capitalism works for a reason. Greed and fear are powerful forces. I have worked with many “independent directors” over the years. And they are often incredibly good directors who add value in all sorts of ways. But they don’t feel it in their gut the way the entrepreneur does. VCs, particularly the best ones, do feel it in their gut. And so they are there for the entrepreneur when they need it most, joined at the hip with the risk/reward belt.

Cue video of a VC on skis hurtling down a mountain.

I think the point of Stowe’s post is that equity gives advisors the sense of material involvement in a startup that is better than consultation, and that by making such arrangements, one can get advice, connections, and expertise from people who are, in many cases, at least as qualified as the people who happen to have money.

Or here’s another way to put it: Money is a commodity, nobody’s is better than anybody else’s. But knowledge and connections are uniquely valuable. And in an time when startups need less money, then the relative value of knowledge increases.

Note that this is precisely the example that Publicis’ new Denuo is following. Now in their case, Publicis is a giant company that could, indeed, also invest capital. But so far as I know, Stowe Boyd isn’t filthy rich (yet). And yet his advice would be very valuable to many startups and they should find the way to get it without requiring him to invest.

The larger story here is that venture capital is not escaping the explosion of business models that is also hitting media, advertising, retail, and many other industries. So VCs, too, need to explore new models. Perhaps they need to find ways to involve — and compensate — networks of advisors to bring that knowledge to startups and to spread their own work and risk in finding and helping and managing relations with companies, so they can get involved with more companies at a smaller scale than they can afford to today. If you can no longer bring $5 million to 10 companies but can’t afford to manage 50 $1 million investments — because it stretches your real assets, which are attention and time — then maybe the way to scale is via Stowe’s model.

[Full disclosure: Fred is a friend now; we share advice; and I have and would gladly pitch any company I'm working on to him.]

It is doubly offensive that the FCC is choosing now — a time when free speech is under attack by cartoon-crazed mobs and Chinese dictators to renew its assault on free speech. Now, more than ever, America should be creating an example of free speech, not focusing on “shit” while others are losing their lives and their freedom over speech.

Reports have it that the FCC will add “shit” to its list of profane words, which so far includes just “fuck” and all its adjectival and adverbial forms. And Nicole Richie joins Bono as the first officially profane Americans. I can think of others, but that’s the FCC’s skewed view. The FCC also upheld its fine against Janet Jackson’s breast. I hope that CBS has the balls to continue fighting that fine — as Fox is fighting the Married by America fine — to bring this matter to the Supreme Court.

Reading the agenda of the World Newspaper Congress in the Kremlin — the Kremlin! — in June, I sense foreboding. Some of the sessions:

Should newspapers welcome citizen journalists? … But what are the consequences for quality newspaper journalism? By inviting their public to participate, are newspapers harming their primary function or is citizen journalism a useful means of maintaining relationships with the “free generation?” …

One of the most pressing dilemmas newspapers face today is how to integrate audio, video and interactivity into their news production. Should print journalists be trained on multiple platforms? Or should newspapers join forces with other media companies to provide multimedia news? …

Web portals and news agencies: new threats to newspapers? New media mean new competition for newspapers. News aggregators lead readers to other sources and Internet companies produce original content. News agencies directly access the public though their websites, skipping the newspaper middleman. …

Lessons from the Mohammed cartoon clash… Six panelists will discuss if there are limits for press freedom and how media responsibility can work in a globalized world. …

Media credibility: should newspapers rewrite editorial guidelines?…

Not a club of happy campers, I’d say. That’s all from the forum, which seems focused on the newsroom. The congress — which seems focused on the business side — concentrates, more wisely, on innovation. I like the title of this talk by Carolyn McCall, chief exec of Guardian Newspapers (where — full disclosure — I write and will consult): “How Guardian Newspapers Limited changed everything except our values in just 12 months.” And I’d say some new values are fair game, too. And I’d say the editors should be concentrating on innovation as well.

Softbank invests $11 million in OhmyNews to go global.

OhmyNews and Softbank shared an understanding that OhmyNews will have to strengthen its Korean main operation to effectively realize the globalization of citizen participatory journalism. To this end, Softbank will invest US$5.2million to OhmyNews. OhmyNews will spend the invested funds on the expansion of OhmyTV, an Internet television arm of OhmyNews, to advance citizen participation in the video journalism and the development of OhmyNews’ English language edition, pushing citizen participatory journalism to the next level. Softbank will own 12.95 percent of OhmyNews’ outstanding shares as a result of this investment.

Softbank and OhmyNews will jointly launch OhmyNews International Co. Ltd. in early March and use this business arm to globalize citizen participatory journalism. Using the company as a global stepping stone, Softbank and OhmyNews agreed to work together in spreading citizen participatory journalism worldwide, which was pioneered by OhmyNews based on the concept that “every citizen is a reporter.” …

As its first international news venture, OhmyNews International will establish ‘OhmyNews Japan’ before August 2006 in Japan. ‘OhmyNews Japan’ will provide Japanese citizens with a multimedia platform of citizen participation, hence introducing a completely different kind of news media to Japan’s media market that will live up to the spirit of Web 2.0.

Until now, OhmyNews has been largely a Korean phenomenon and many have wished and wondered about expanding it to other countries but so far, this has not happened. The question has been whether Ohmy is uniquely suited to the Korean media, political, cultural, and technological landscape or whether it will work elsewhere. I’m moderating a panel with EunTaek Hong, editor-in-chief of Ohmy, at the Online Publishers Association next week and I’ll be eager to hear more. [via Craig]