Uncrunched

Twas just a week ago that the NY Times argued that Craigslist was virtually bulletproof. Not because it’s anything special, but because they cultivate a false image of doing good while simultaneously bullying competitors with their lawyers:

So why hasn’t anyone managed to unseat Craigslist, a site that has barely changed in close to two decades?

It has dug an effective moat by cultivating an exaggerated image of “doing good” that keeps its customers loyal, while behind the scenes, it bullies any rivals that come near and it stifles innovation.

So everyone understood how naive that was. Even the NY Times: Craigslist is undefeatable no longer they say now.

They retreat all the way on why Craigslist is successful. Nothing mentioned about legal bullying or accusations of exaggerating their image of doing good. Here’s what they say now:

Craigslist appeals to people all around the country, and world, because of its simplicity and accessibility

So, ok. That’s not what the other NY Times guy said. But let’s move on.

So Craigslist is now somewhat appealing to users, and may have some attraction beyond legal bullying and image propaganda.

But it’s not gonna last. Because in a meandering argument the NY Times says that social stuff, and mobile stuff, and/or a “distributed network” of such stuff, may “soon…be giving Craigslist a run for its money.”

Ok.

So first off they talk about Highlight as a threat to Craigslist. Highlight is a wonderful mobile social network and we’re investors. But it’s not what’s going to bring down Craigslist.

The writer, and I’m not kidding, saw someone trying to sell something on Highlight, and decided it’s a threat. “A few days ago an incoming alert caught my eye,” she says.

And that was that. Because oh my gosh, for the first time ever there’s something competing with Craigslist. Nevermind doing a web search, to the presses!

Facebook has tried. Microsoft has tried. Ebay has tried (when’s the last time you rushed on over to Kijiji?). Dozens of startups have tried.

They’ve all failed. Or are in the process of trying to figure out a way to survive in a Craigslist world.

It’s not that Craigslist can’t be beaten. But they’ve put up a pretty good barrier to entry – a simple service that charges way less than they could for what they offer. All the demand is there, and no one wants to bother listing stuff on services that have no eyeballs.

Craigslist can eventually be disrupted, and perhaps it will. But almost certainly not by any of the services listed in the NY Times article.

But what I’m most annoyed with: I don’t understand why the NY Times wants so badly for Craigslist to be beaten.

Do they really have no sense of history or the other attempts that have been made to take market share from Craigslist? Do they really think that for the first time ever someone’s trying to take them down?

It’s sloppy, naive reporting built on a foundation of questionable motive, and I don’t like it. At some point shame needs to overcome arrogance and condescension. I thought we hit that point last week, but obviously not.

An annoying part of life is the collection of recurring credit card charges over time. Things like gym memberships, or the kind of stuff companies like Intelius trick people into accidentally buying.

You can’t get these charges to stop. You talk to the companies. You threaten the companies. They drag their feet and never close the account.

But hey, there’s always the wipe out option. You call your credit card and ask for a new card. No one can make charges to the old number any more. I did this a couple of months ago to clear out about $400 per month in recurring charges that had accumulated over many years (this was my main TechCrunch credit card, so there was lots of random stuff).

That wipe out option was one of life’s small pleasures. A way to stick it to those companies that just won’t stop charging your credit card.

Apparently that’s all over now, and has been for some time due to changes in government regulations. Merchants can push charges through on the new card. There’s nothing you can do about it, and I have three merchants charging me a total of $113.95 that won’t go away.

Chase, the bank behind this credit card, says they have no choice but to keep charging me. I don’t know if that’s true or not. But it’s awful for the customer. And in this case it resulted in a lost customer.

Today I cancelled that credit card. My only other option was to go through the lengthy paperwork process of disputing all of these charges, and there’s no way I was going to do that.

First off, I’m friendly with Nick Bilton at the NY TImes. I like him personally. I think he’s a gifted writer and I’ve written good things about him in the past.

But I’ve also criticized him more than once and I’m going to do it again now. Not to generalize, but a lot of people who come to Silicon Valley from the east coast have an odd way of looking at success, more jealousy driven than anything else. I thought Bilton broke that stereotype, but the more I read of his stuff the more I wonder.

There was the Path take down earlier this year, which I thought was extremely unfair. And the recent party article that was more about poking fun at him than any real criticism.

Today his target is Craigslist.

It’s not that he’s criticizing Craigslist. I think there’s lots to gripe about there. But the impression I get from the article is that he decided on his conclusion – that Craigslist is a bully and wins only through legal action – and then built his facts around that conclusion. Because his arguments just don’t work.

From the article:

This isn’t the first time Craigslist has claimed such violations. The Internet is littered with carcasses that once built on top of the listings site. Their pixelated tombstones are inscribed with one-liners that Craigslist killed access without any notice, or they were sent a cease-and-desist letter by Perkins Coie, a top-notch corporate law firm that frequently represents Craigslist.

and

Most of the sites that Craigslist killed began as hobby projects, making little to no money — just programmers trying to make a product they loved, better.

and the money shot:

As intellectual property lawyers will tell you, Mr. Kidd is not off base: facts, like those in classified listings, cannot be copyrighted.

So why hasn’t anyone managed to unseat Craigslist, a site that has barely changed in close to two decades?

It has dug an effective moat by cultivating an exaggerated image of “doing good” that keeps its customers loyal, while behind the scenes, it bullies any rivals that come near and it stifles innovation.

His argument is basically:

1. Craigslist is stuck in the 90’s and sucks.
2. They are therefore ripe for disruption.
3. They avoid disruption by bullying rivals and stifling innovation

So none of that makes sense.

Nick is a design guy and it makes sense that Craigslist would horrify him – “it feels stuck in the 1990s, where links are electric blue and everything is underlined.”

But sometimes design doesn’t matter, even though that thought scares the hell out of designers. Craigslist works because it’s free and everyone uses it. The network effect has kicked in and there’s very little that can stop that. It took the Internet to defeat Windows. Ebay, another listings site stuck in the 90’s, has also yet to be disrupted.

None of that has to do with legal bullying. Entrepreneurs are free to compete with eBay and Craigslist, and often try. But the only way they have any shot at all is to build on top of Craigslist data to try to jumpstart usage. No one’s ever going to go to a listing site that has no listings. And if no one’s there, no one is going to list stuff.

Does Craigslist have some moral obligation to help competitors disrupt it by handing them their data? Nope. And despite Nick’s legal opinion, they can absolutely protect that data in the courts.

Should they? I don’t think so personally. When I was at TechCrunch we took the opposite approach with CrunchBase, for example. Anyone can take that data via the API with very few restrictions. We were right in thinking that as long as the data was free people would feel good about keeping CrunchBase as the central repository for that data. In my opinion it’s a more valuable asset than even TechCrunch today.

But this just proves my point. Craigslist wins whether they take legal action or not, because of the network effect. Nick’s hypothesis that Craigslist is just bullying people with lawyers to keep on top holds no water.

And if anything Craigslist undersells how much good it does. It’s a mostly free service that helps people connect endlessly around the world. To find jobs, buy things, and meet others. They extract very little value from their own network – unlike, say, Ebay, which does the opposite. Craigslist is an unqualified good thing. To say they exaggerate their image of doing good is incorrect and extremely unfair.

As a final point, Craigslist has eaten the NY Times’ classified listings lunch over the years. That’s a conflict of interest that needs to be disclosed in this kind of take down article.

Not everything that’s working in Silicon Valley has some nefarious evil plot behind it, Nick. Take off the New York City goggles for a moment, you might be amazed at what you see without that taint.

NBC’s official Olympic website describes Australia as located in central Europe:

Located in central Europe, bordered to the north by Germany and the Czech Republic, to the west by Switzerland and Liechtenstein, to the south by Italy and Slovenia, and to the east by Hungary and Slovakia. Is primarily mountainous with the Alps and foothills covering the western and southern provinces.

And people have been pointing it out for at least a day, and NBC is sticking to its story.

Which is awesome.

I really like how detailed they are with the description. Their interns may not know the difference between Australia and Austria, but they sure are thorough.

via Stephen Lau and Daniel Raffel.

Human waste shuts down BART escalators

When work crews pulled open a broken BART escalator at San Francisco’s Civic Center Station last month, they found so much human excrement in its works they had to call a hazardous-materials team.

While the sheer volume of human waste was surprising, its presence was not. Once the stations close, the bottom of BART station stairwells in downtown San Francisco are often a prime location for homeless people to camp for the night or find a private place to relieve themselves.

via @DanielRaffel

I’m obviously not getting invited to the right parties, because the Silicon Valley I know and love bears no resemblance to the “obscene” picture painted by the NY Times’ Nick Bilton in his article earlier today.

The money here is obscene. The newly minted rich are obsessed with outperforming their rivals. One industry party I attended had a jungle theme. This included a real, 600-pound tiger in a cage and a monkey that would pose for Instagram photos. A prominent Googler’s Christmas party in Palo Alto had mounds of snow in the yard to round out the festive spirit. It was 70 degrees outside. Sean Parker, a founder of Airtime, threw a lavish, $1 million party that included models he hired to roam the room and a performance by Snoop Dogg.

There is an obscene amount of money here. But it’s the only place in the world where most rich people don’t really flaunt it.

I know a billionaire that drove an old Honda until recently, for example. Another that lived in a small apartment so he didn’t have to bother with the hassle of a home.

None of the people I hang out with talk about their private jets or wear “handcrafted jeans” (whatever that is).

And unlike New York, LA or Washington DC, the conversations here are rarely about money. They’re usually about ideas.

No doubt, there are countless people who consider themselves part of the startup scene who do little else than hop from one trendy party to the next.

But these parties, and these people, are not the ones doing anything interesting. As a blogger I learned long ago to shun those events. The real stuff happens at the events that don’t have caged tigers. Or NY Times reporters.

Because this isn’t a Hangover movie.

Perhaps that article speaks more of Nick Bilton’s social life than the Silicon Valley he’s trying to describe. Or maybe he’s watching too many Bravo shows.

Because, young Nick, the stupid shit people do in Silicon Valley these days is preciously innocent compared to the late 90s. That was a time that even the serious people started to lose the plot.

There’s a pattern with reporters and bloggers that come to Silicon Valley and experience it all for the first time.

They write stories about how all the startups now are building useless stuff and wax nostalgic for the recent past when people had bigger dreams and ambitions.

And then they talk about the excess at all the parties.

My advice is this. Stop going to parties. Then use all that free time to start spending time with the serious people, doing serious things. They aren’t at those ridiculous parties. So, why are you?

PS – One thing Nick got right though, are the endless pitches. Like Nick I was also pitched in a bathroom at a urinal. That’s not something you soon forget.

I was driving back from Lake Tahoe this afternoon in my rental car. Which meant a lot time to scan through radio stations to kill time. Somewhere before Sacramento I hit 810 AM, where they were talking about Marissa Mayer’s pregnancy, so I listened for a while.

The host was Tim Montemayor. He was taking a lot of calls from what sounded like older women. A lot of the comments were along the lines of “I’m sure she’s wonderful but it’s not fair because people who invested in that company are going to lose their life savings” and “she’s not fit to be a parent.”

In other words, these weren’t our country’s best and brightest citizens. The host was riling them up and HE seemed quite convinced that Marissa would probably simultaneously ruin Yahoo and neglect her child.

“I feel bad for this generation, too much is expected from women,” said one caller.

There was also, and I’m not kidding, some discussion of how hormones will affect her ability to cope with the stress of being a CEO.

Where’s the outrage? Where are the women in tech screaming for people to stop talking about a woman’s pregnancy as if it were somehow anyone’s business, or whether a pregnant woman/young mother is capable of leading a company?

For some reason Mayer doesn’t seem to generate that kind of passionate defense response from the self selected leaders of the women in tech movement.

I’ve talked before about how important role models are for more women to reach positions of power and influence in tech.

This whole situation is just a nicely wrapped gift to the whole community, something to truly inspire more women to get into tech and entrepreneurship.

But from what I’m seeing there’s a lot more tearing her down (including from women) than celebrating the whole situation.

Why is that?

The tech press must be all hopped up over the first few episodes of The Newsroom. Defenders of truth and protectors of the masses and all that.

Because they’re out opining on this and that with more than the usual amount of condescension and self righteousness this week.

Marissa Mayer is a “tyrant” with a penchant for humiliating colleagues, says Business Insider.

“Spot on” says another journalist who’s totally miffed she didn’t scoop the original story, and taking heat from readers in her own comment section.

And then doing it again when she was unable to scoop the pregnancy story, either (and commenters calling her on it).

There’s two of the towering laws of journalism in all their glory. Balance, meaning let’s find people who’ll say something negative about someone to balance things out (and winners always have haters). And Objectivity, meaning a pissed off journalist can rant at will because of course they’re not biased. Even if they are.

And then I read another article about how Kevin Rose is essentially a spoiled quitter, and how that doomed his startups and frustrated those around him.

“Just read a negative article criticizing me as an entrepreneur from someone that has never started a company,” responded Rose.

And Rose is quite right. Because not only was this story another example of cruising the losers for a juicy sound bite, but it was also written by someone who’s never been in the trenches at a startup. Who has no idea what he’s talking about.

Every once in a while I pull out the Man In The Arena quote because it reminds us of what’s really going on.

It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.

People are out there trying to create things out of absolutely nothing. Which is hard. And messy.

And the press, needed desperately to defend the people, drum up all this bullshit based on some anonymous source who’s had their feelings hurt along the way, or had to work too hard, or whatever.

Too often the press is just a big pack of deadweight loss insecure scavengers running around yelling “look at me!”

People can’t help but read this stuff because it’s so scandalous. But what really bugs me is that so many of these journalists act this way while telling themselves, desperately, that they’re doing good. Important things. Fourth estate stuff.

You want an angle on a story? I can find someone to give me that angle if I want to. But what’s far more interesting is the truth.

Omelettes are being made, people. Stop focusing on the broken eggs.

Because if you find yourself having a hissy fit because someone else got to break a story about someone being pregnant, and then tainting your stories based on that fit, you should really be put in a time out.

Update: I just announced on TechCrunch that I’ll be interviewing Marissa on stage at TechCrunch Disrupt in a few weeks. I can guarantee that we’ll be talking about meatier subjects than her pregnancy PR choices and how many people in her past thought she was mean to them.

Marissa Mayer becoming Yahoo’s new CEO isn’t just another story about another exec playing musical chairs and switching jobs.

There will be debates about whether or not Mayer is enough to save the troubled iconic company. And debates about the wisdom of her decision.

But what the press has missed so far is that this is a paradigm shift for Yahoo.

Mayer is completely out of Yahoo’s league. So far out that I’m surprised they even had the courage to approach her (although it’s possible she approached them).

But they obviously found that courage, and Mayer has taken the job.

Impossible, I would have said a week ago.

But it happened. And overnight Yahoo’s reputation will change.

At first it will just be in Silicon Valley. But as of now people won’t be ashamed to say they work at Yahoo any more. And for the last several years, they have certainly been ashamed.

More key employees will stick around. The company will be able to hire better people. People will be proud to work at the company again.

Morale will shift immediately, there will be lots more positive thinking.

Why? It’s just the way humans think. If something is perceived to be a loser then it becomes a loser. People bail, either physically or mentally. A defensive attitude takes over. Talented outsiders avoid it like the plague.

Example: Just a couple of years ago Yelp refused to be acquired by Yahoo for some $200 million more than Google was offering.

Now, though, the bloom is back on the rose at Yahoo.

It doesn’t mean the company will find a way to win. But like I said, the whole Yahoo paradigm has shifted.

I’ve interviewed Mayer many times over the years at TechCrunch and Le Web events and I’ve been able to see the way she thinks during those interviews and in other interactions.

What happens next is she’ll want to win. And generally she does win. I’d expect a bold new product strategy and an acquisition plan to help build the foundation of that strategy.

Fixing Yahoo will be difficult, particularly since the company seemed to have grown comfortable with its decline and no longer had any fight left in them.

I expect Mayer will be fixing all that sooner rather than later.

It’s a good day for Yahoo.

Last month I wrote about some guy that people pay thousands of dollars per month to get access to his “network.” He had reached out to me because he (incorrectly) thought I worked at Newsweek and wanted to connect one of his clients. Obviously this guy isn’t someone you want to be paying to introduce you to people.

Someone I know recently sent me a Facebook message about this very topic. I didn’t respond to the first message (I don’t check FB messages religiously) and he sent a follow up:

This guy isn’t the same buffoon that messaged me about Newsweek. He’s a young entrepreneur trying to figure out if he can make money on the side connecting people to investors.

The answer is no.

Not directly anyway. There are still people out there trying to act as finders for investors, asking for a percentage of the amount raised or some other fee. These aren’t the kinds of people that we or any other investors we know want to interact with, and we ignore them.

There are so many legitimate ways an entrepreneur can get attention from investors. It all starts with knowing at least one person already in the ecosystem, and all of us take cold calls and emails all the time. Show up in Silicon Valley and you’ll make friends quickly, sans a fee. And there are so many channels for first time entrepreneurs to get in front of the right people – Y Combinator and the other incubators, AngelList, etc. If you’re the real deal, someone will bite with just a little bit of persistence.

Showing up in Silicon Valley with a paid networker is like going to a holiday party with a prostitute. People are going to figure it out, and the people you want to be hanging out with are going to shun you. Because you’re with a hooker.

That doesn’t mean you can’t leverage your network, though. That’s the main point of networking. Bringing quality deals to an investor is valuable, and in some cases you can probably talk your way into advisor shares in the startup (people don’t see this as prostitution, for whatever reason). And a young startup just getting attention in Silicon Valley may want to hire you as a consultant outright, either now or later, to help with general marketing and PR.

And of course if you happen to be really, really good at finding and picking quality startups, your track record can get you a job at a VC or angel fund. Or you may even be able to get investors in your own fund directly.

Good luck out there.