Tim Oren is a Managing Director at Pacifica Fund, a venture capital firm, and a regular blogger at Due Diligence. That combination alone makes him an interesting guy, but I've particularly enjoyed his thoughtful writing and no-BS attitude. ("Addicted to Buzz?" on the tech industry's use and abuse of buzzwords is an outstanding example.) Many thanks to Tim for taking the time to address three questions on VC blogging, startup blogging, and John Markoff's "What the Dormouse Said"...
1) You're one of a handful of venture capitalists who's also an active blogger. (Others I'm aware of include Andrew Anker, David Hornik and Kevin Laws at VentureBlog, Allen Morgan, Jason Caplain, Jeff Nolan, Ed Sim, Martin Tobias and Fred Wilson. I stress the word "active." A number of folks apparently tested the waters and didn't go any further.) Most people who blog, myself included, are looking to break out of our local networks and connect with the world at large--but as a VC, I'd imagine you have the opposite problem and often need to find ways to keep the world (and its endless business plans) at bay. Why did you start blogging, and why have you continued?
Due Diligence started as a private notepad for research I was doing on markets, technologies, and ventures - hence the name. My partners also had access, and I found that a little annotation and analysis mixed in with the raw notes made for shorter explanations at meetings. Eventually, my partner Mochio Umeda - who blogs in Japanese - suggested I open it up to the public, in part because of our own interest in what's now called "citizens' media". Maybe it's the venture capitalist's equivalent of the anthropologist observer-participant: If you want to understand a nascent market, you need to play. I've been writing for the electronic medium off and on since the mid-80s (early CompuServe), so already had a 'voice' of sorts and decided to give it a try.
The sustaining motives are different, and several. If you're a writer, just imagine how it would feel if 90% of your research and analysis output got spiked. That's what venture capital is often like. The majority of the market, technology and venture research never pans out directly - it's a cost you undertake to avoid bogus investments. But it can often make interesting reading for others, if cleaned up to disguise the original project. These themes can also take on their own momentum, e.g., the occasional series on new media vs. old media industries on which Kevin Laws and I have collaborated, and which has spread onto VentureBlog as well.
When I write about venture capital itself, it's often out of frustration. I am not systematic. When I get hit several times with the same misunderstanding, bogus analysis, or prejudice from those pitching, or from outside the business, I may try to extract the common theme and write an explanatory or analysis post. With luck, some of these may be useful in an educational sense, but at least they're a way to simultaneously work off the frustration and force myself to articulate it clearly.
The voice is my own. I don't represent myself as a spokesperson for the VC business at large. I believe the essence of this medium is intensely personal. You get a sample of outdoors related posts, Silicon Valley reminiscences, and sometimes politics mixed into the analysis if you're reading DD. That's part of me, and if I feel like journaling it, so be it. Venture and the Valley itself are just networks of people, so it's appropriate that readers know something about who I am.
2) The existence of the blogosphere and its ability to facilitate public, discoverable conversations across organizational barriers would seem to pose both a challenge and an opportunity to entrepreneurs. OTOH, they're going to be able to tap into a much broader network than before to validate and evolve their ideas. OTOH, it's going to be harder to maintain control over those ideas. I've heard it said many times that people in the technology industry place too high a value on secrecy, and that NDAs are usually more of a hindrance than a help, so perhaps it would be a welcome development if blogs can open up the industry's culture a little. How do you think blogging will affect the world of startups and entrepreneurship?
I'd call blogs a large net positive. Ventures are built out of trust as much as ideas. To the extent that personal trust networks get extended further, more diversely, using this medium as a means of introduction, you're going to get better, smarter teams and business ideas. I'm not a fan of formalized 'reputation systems', but it's certainly true you get a feel for someone's personality through their writings. For instance, I've never met Fred Wilson face to face, but I've got a pretty good idea what kind of deals he might like, of his views on important market uncertainties.
The NDA argument is too facile for me. There are times when implementation speed is of the essence, and who cares what leaks, so you get there first. There are times when you need to spend patient effort doing a deep dig into a technology area, and taking that time and protecting the investment are important. Telling one from the other, and balancing between them, is a matter of business judgment that some technologists develop with experience. Hearing the difference dismissed just tells me I'm dealing with a naif.
3) Finally, you recently posted on John Markoff's "What the Dormouse Said," a history of Silicon Valley, and you noted that,
"Regardless of the seminal role of the ideas outlined, it must be acknowledged that not a single one of the projects described in 'Dormouse' achieved a commercial success. They were works by cognoscenti, for cognoscenti. Like it or not, scale adoption is the means by which personal computing technology impacts culture and economy. Markoff at times seems to adopt the view heard from these pioneers that their work was misunderstood, or ignored, often in the rush to commercialization...These problems were of the pioneers' own making. The most poignant portions of 'Dormouse' describe the organizational problems lurking behind the creativity. In fact, none of these organizations and systems managed to scale beyond the size of a modest startup, or survive a single generational turnover of computing technology."
A mythology has grown up around some of these early technologists, portraying them as high-minded victims, and your post certainly helps to clear away some of that magical thinking. But even if these pioneering efforts were undermined by their own failings, they still evoke an almost tragic sense of what-might-have-been. What failed early venture (referenced in "Dormouse" or not) strikes you as the greatest missed opportunity?
Any retrospective might-have-been analysis has to look at market readiness and fit as well as technology vision. Engelbart's 1968 Augment demo is still the Mother of All Demos after all these years, partly because of Doug's vision, and partly because he had a great team who went to incredible lengths to create a high bandwidth remote experience. It took the better part of two decades before that experience began to be widely feasible. The infrastructure was ready, but by then expectations had changed - the PC was the point of reference for the broad market.
The incredible stream of ideas that flowed out of Alan Kay's PARC team was the result of an intense design focus on creating a transparent tool for kids, itself the result of Alan's deep belief that analysis and specification of behaviors should be a formative part of the education, stemming from his Piagetian training. Those design ideas have been remarkably successful. The core vision has been less so. Projects like Squeak and Croquet show that while the infrastructure is now here, there seems to be little pull for these projects. Computing as such is being buried inside of platforms, rather than exposed as an educational experience.
So I measure the 'might-have-been' in terms of what visions the infrastructure could actually support at the time of development, and whether time showed that there was a fundamental demand for the vision. I would still have to award the booby prize to Xerox, specifically for failing to capitalize on the combination of the direct manipulation interface, networking and laser printing that Apple eventually turned into desktop publishing. All of the pieces existed in one place, Alto showed what a determined cost reduction effort could accomplish, and the implications were immediate for Xerox' core market. Yet they blew it, completely muffed the tech transfer. Perhaps the single biggest missed opportunity to create value in the history of the Valley, if you judge by the companies that arose on that spot.
The one I was closest to, and that still stings, was HyperCard. A real Rorschach blot of a product. Jack of all trades, master of none. There were at least three separate products inside of the one, trying to get out, judging by what users did with it. Apple could have listened to that feedback, and created a lot of value. Instead management decided it was 'competing with the developers' and pretty much abandoned its evolution. I'm not so sure that (as Jerry Michalski told me over dinner earlier this week) 'HyperCard could have been the Web', but I'm certain that a lot was left on the table.
Bonus Personal Question: Judging by some of your posts, you're an active hiker. What's your favorite hike here in the Bay Area?
I'll give you three that I try to do every year:
Serpentine Loop in Edgewood Preserve
Ancient Oaks Trail in Russian Ridge Open Space Preserve
Hotel Trail in Joseph Grant Park
These are places to linger, not to work on your aerobic capacity. All are best in spring and early summer. It's no accident my blogging output drops during those seasons.
Note: I added the links above to Tim's comments.
tim oren due diligence pacifica fund venture capital vc blogging john markoff
