I stayed up on Sunday night to watch the Academy Awards. I wanted to see which actors would win. Up until very recently black actors weren’t even nominated. We talked about this a lot when I was growing up in the Bronx whenever the Oscars rolled around. It was a show for white people, we thought. Most of us knew that the only black actors to win Academy Awards in the 20th century were Hattie McDaniel in 1939 (the actress who played the maid “Mammie” in Gone With the Wind), Sidney Poitier (1963), Louis Gossett, Jr. (1982), Denzel Washington (1989), Whoopi Goldberg (1990) and Cuba Gooding, Jr. (1996). Of these actors, the only black actor to win in a leading role was Sidney Poitier. In 2001, Denzel Washington became the second black lead actor to win, and Halle Barry became the first black actress to win as best lead actress. Jamie Foxx also won as best lead actor in 2004 for Ray.

How things have changed in my generation! To paraphase Ellen DeGeneres (who did an awesome job as host, by the way): What would Hollywood be without blacks, Jews and gays? This year black actors were nominated — and were favorites in — 3 of the 4 catgories. In the end, Jennifer Hudson won as best supporting actress and Forest Whitaker won as best lead actor (the third black actor to win in a leading role in 6 years, after a period of 38 years between the first and second wins for lead black actors!). Eddie Murphy, the third favorite, lost and left the awards early. Seems that he’s not so popular in Hollywood as he is notoriously difficult to work with. It’s difficult to win in a vote of your peers if you’re not so well-liked.

I left the US in 2000, because I was tired of racial politics, tired of seeing everything through a racial prism and tired of always being seen through that same prism. I wanted to experience “blackness” in other contexts, or maybe not to experience it at all. I wanted a break. In the US, you are black first, and that is usually regarded by others as a bad–or at least, stigmatized–status. It’s tiring representing an entire race 24/7, particularly in the mostly white settings in which I tended to find myself. So I pulled a Tina Turner, packed up my bags and decided to change my primary identity from “black” to “American”. People might not like Americans, but they have at least a grudging respect for us. The dislike is often based on our status as the only superpower. I don’t mind so much if people associate me with power (that’s the goal of every American, isn’t it?). But I do mind people feeling superior to me. At a very early age, one of my favorite aunts taught me a phrase that as a young, Black person you can never forget: “Good as any, better than many and inferior to none.”

Being in Europe is different. In the US, you are always representing a race, but that creates a certain power in numbers that leads to social change and political power. Colin Powell’s status as a “racial representative” has an effect in Hollywood, in the business community, in everything, because his very presence and success redefines the public conception of blackness. This is what we see in the case of the Academy Awards. The increased presence and socio-political power of the Black community gets reflected in cultural events like the Academy Awards. The Latin community will be next, and in fact, this year made important advances as well with films such as Pan’s Labryinth and Babel.

In Europe, there is no such thing as black consciousness, black power or black politics. So no one apparently cares if blacks are represented in politics, arts, on television or in any other cultural space. In Spain, for example, the only consciousness that I see relates to regional and linguistic differences (Catalans vs. Basques vs. Madrileños, etc.). You can’t imagine the city when Barça beats Madrid, or if Barça loses. But I don’t see anything like black pride, or Arab/Muslim pride, or Latin-American pride. There’s not even so much gay pride! There’s no pride at all!

The US might be racist, but we accept racial minorities as our own. Maybe as disfavoured cousins, or maybe even unwanted stepchildren, but still part of the family. And this means that talented members of racial minorities have opportunities to reach the very summit of cultural power (the Oscars, the Grammies) or political power (Condeleeza Rice, Barak Obama, Colin Powell, etc). I view my life as a living example of this access to opportunity. But this doesn’t appear even close to being possible in Europe, and I doubt that I would have had the same opportunities growing up here.

This is, in part, why the New York Times is reporting today that Dreamgirls will be an interesting test case of international acceptance. The title of the article tells a sad story: “Film With Black Stars Seek to Break International Barriers”. The US market made Dreamgirls critically and commerically successful (the film passed the ever-important $100.000.000 mark), but there is doubt that the film can do well internationally. Apparently, US marketers believe that the international community is “the new South” (referring to the once-slaveholding region of the US). As one marketer noted: ““The international marketplace is still fairly racist.”

One might argue that it’s just that Europeans live racism in a different way and so don’t relate to US racial tales. But then again, such limitations of imagination generally don’t stop movies starring actors like George Clooney or Brad Pitt from succeeding, even if the themes involved are distinctly American. I liked Bend it Like Beckham and “Pride and Prejudice” is one of my favorite books even though their characters do not reflect my daily life. Suspension of belief / universal tales.

It’s an interesting dilemma, an example of the typical “individual vs. society” conversations that are had in political science and philosophy classes: on a personal level, I feel free from racial politics and thus more content personally. But on a political level, this freedom might be damaging in that it risks tacitly accepting the continuing marginalization of communities to which I belong.

For all of you who still aren’t aware of what Dreamgirls is in any of its incarnations (the original Supremes, the Broadway show or the current movie), please see the performance below from the recent Academy Awards and let me know what you think.

The New York Times reported yesterday that Microsoft will buy a health vertical search engine called Medstory. The “intelligent” search engine looks for health information using a database of information aggregated from medical journals, government documents and the Internet in general.

The terms of the sale were not disclosed.

As Peter Neupert, vice president for health strategy at Microsoft, notes: “Clearly,” Mr. Neupert said, “search is a critical part of that better end-to-end experience for consumers.”

Microsoft’s eventual goal is to link personal information like age, sex, family history, etc. to search so that search results are tailored individually and can identify treatments, drug interactions and interesting articles in medical journal.

“Health search could be way more relevant,” says Neupert. “You don’t need to see thousands of results. What you want to know is, what does this mean to me personally?”

This is the same basic question that ALL vertical search engines attempt to address. And as Richard MacManus points out, the acquisition of Medstory is part of a larger web trend: the continued rise of vertical search. Interestingly, he argues that Microsoft’s main interest in Medstory could be that Microsoft wants to enter and dominate the vertical search engine niche for health before Google has a chance to get its foot in.

I’ve just read The New York Times’s very positive, almost gushing review of Blinkx. At first, I thought it must be some sort of paid advertisement, but I have unwavering faith in The New York Times’s journalistic standards. The journalist, Jason Pontin, seemed in-love with the product, and he’s not exactly unfamiliar with the technology space–he’s the editor-in-chief and publisher of MIT’s Technology Review.

In any case, the excitement being generated by Blinkx makes sense, given how obsessed with video everyone is after the sale of YouTube to Google. The consensus seems to be that Blinkx’s technology is not perfect, but that it’s better than the competition. As Pontin explains: “[S]earch engines — like Google — that were developed during the first, text-based era of the Web do a poor job of searching through this rising sea of video.” If these guys can really create a decent search engine for videos (something that no one else currently does), they’ll make a lot of money for themselves and for their investors.

I briefly tested out the site, and the first thing that you notice is that it looks really cool. I like the video wall.

The website claims that they already have 7 million hours of searchable video content. I did a search for videos with the singer “Jennifer Holliday” and got 15 results, including Podcasts and previews of some videos. Not all of the results were relevant. Many related to Dreamgirls or to the song “And I’m Telling You I’m Not Going” without any obvious reference to Jennifer Holliday (other than the fact that she’s the one that originally made both the show and the song famous).

The New York Times notes that Blinkx has received $12.5 million from angel investors. Those must be some big angels. It seems that they’re now making the rounds talking to VCs. Fred Destin of Atlas Venture, for example, has a brief review of Blinkx and notes that the founders had apparently gone to Atlas Venture to present their product, though he didn’t have the chance to meet with them. In Spain, Atlas was involved with eDreams until its recent sale to TA Associates.

Check it out! This might be a star in the making.

I’ve been reflecting over the last few days about the pros and cons of trying to be an entrepreneur in Europe relative to the United States. I’ve talked about cultural and legal structures, but so far there’s one element that I’ve still not discussed directly: education. A large part of the responsibility for creating future entrepreneurs rests in the colleges and universities that form young adults.

Luckily for me, The Wall Street Journal has just published a front-page article on John Hennessy, Stanford’s president, entitled: “The Golden Touch of Stanford’s President: How John Hennessy’s Silicon Valley connections reap millions for the university — and himself”. The article is interesting in that it presents another clear case of interest alignment and demonstrates how the convergence of business and educational interests can generate an exciting entrepreneurial environment that fosters billion-dollar, market-leading, high-tech companies like Google and Yahoo.

Among the interesting facts about Hennessy in the Journal article:

• Over the past 5 years, Hennessy has received fees, stocks and stock-option profits from outside interests totalling $43 million. His yearly salary at Stanford is $616,000.
• Hennessy made $1 million in one month — November 2006. The money came from his outside interests, not from his job as Stanford President.
• Hennessy sits on Google’s board. So does the President of Princeton University.
• Google granted Hennessy 65,000 options to buy Google stock at $20 apiece before its IPO (Google today trades at about $470 per share–that is, about 23.5 times more.)
• Throughout his career at Stanford, Hennessy has sometimes left academia to create start-ups that were later sold for prices in excess of $100,000,000.
• Hennessy has invested in top-tier venture capital funds such as Kleiner Perkins Caufield & Byers, Sequoia Capital (the VCs behind Google and YouTube) and Foundation Capital.
• Hennessy sits on Stanford’s endowment board, which chooses venture funds in which to invest Stanford’s $14 billion. Hennessy is a private investor in some of the venture funds in which Stanford invests.
• A personal recommendation from Hennessy can almost guarantee VC funding of student projects and Hennessy has helped put his graduate students in touch with lawyers/VCs that lead to multi-million-dollar financing rounds, often by funds in which Hennessy is an investor.

A few interesting facts about Stanford in the Journal article:

• Stanford’s endowment of $14 billion is the third largest in the US behind Harvard ($25 billion) and my alma mater, Yale ($18 billion).
• Stanford’s former provost, Frederick Terman, was responsible for introducing William Hewlett to David Packard in the 1930s. Terman joined Hewlett-Packard’s board and was a well-paid consultant for a high-tech investment fund.
• Silicon Valley companies donate a lot of money to Stanford:
  • Netscape co-founder Jim Clark (who, coincidentally, is the father-in-law of YouTube co-founder Chad Hurley) donated $90 million to Stanford in 1999. He was also an engineering professor at Stanford during the early 1980s.
  • Yahoo co-founder Jerry Yang is Hennessy’s former student. Yang is now a Stanford trustee and helped lead Stanford to a successful $1 billion fund-raising campaign. Yang recently announced that he will donate $75 million to Stanford.
  • Approximately half (16/33) of Stanford’s trustees are venture capitalists, private-equity investors, money managers, or current/former high-tech executives/directors.
  • Over the last 6 years, Stanford has received $3.45 billion in gifts.
• Stanford often licenses technology to former students:
  • Google licenses its Internet search technology from Stanford, where founders Larry Page and Sergey Brin started the company and were Ph.D students. As payment for the license, Stanford received shares in Google’s IPO that it has since sold for $336 million. Stanford continues to receive a “modest” annual licensing fee from Google. The terms of the initial agreement have not been disclosed.

My two main conclusions:

• It must be exciting to learn in such an environment, with professors that have
  • technical expertise
  • real-world experience launching successful start-ups that get sold for more than $100.000.000, and
  • significant influence with powerful representatives of the tech and/or investor community.

• I am a die-hard Yalie, but after reading this article and seeing the doors that Stanford can open for a young entrepreneur, I’m starting to think that maybe Stanford wouldn’t have been such a bad choice.

Yesterday I was complaining about some of the structural limitations that might prevent successful European start-ups in an international marketplace. But it seems that there are a few disruptive VCs that are trying to make the whole process easier, or at least more transparent. I don’t think it necessarily guarantees that you will get funding, but it does reflect the fact that some forward-thinking European VCs are actively trying to identify interesting projects in a way that supports and encourages young entrepreneurs in Europe.

Why is this happening now? This reminds me a bit of a debate that we had in my political science classes at Yale about how to foster structural change. In that case, we were talking about how to combat racism, and the question was whether desegregation in the US could be legally mandated or whether it was smarter to give business leaders an economic incentive to change their behavior and then such changed behavior would then trickle down to the consumer. We generally came to the conclusion that government has its role in fomenting social change, but that the alignment of economic interests was what really created meaningful social change. It’s great if the government alters the overall structural limitations, but then you need some early adopters to implement the desired change. Altruism and morality might lead to interesting theoretical discussions, but money talks.

In this case, the early adopters with the aligned interests are successful entrepreneurs who want to foster entrepreneurship in Europe while making some money for themselves (or for their companies) by creating global companies from European start-ups.

For example, Saul Klein of Index Ventures has created the OpenCoffee Club. Once a week, from 9-12, he’ll be at a local Starbucks in London, and anyone who wants to stop by can chat with him or anyone else that shows up. The idea is to make VCs accessible and transparent, and to create a space where entrepreneurs can meet potential investors while having access to free wifi. Saul has invited other investors/entrepreneurs to start local OpenCoffee Clubs in their own countries/regions. He also invites readers of his blog to send him any questions that they might have on funding, and he’ll either answer them or look for the answers. We should applaud his efforts, because, to date, my limited experience with VCs has been uninspiring and controversial at best . . . .

Saul has also posted on his blog an insightful presentation prepared by Ben Holmes, his colleague at Index Ventures, that answers the following issues:

• How do VCs work?
• When to Raise VC Finance
• Strategies for VC Fundraising
• How to Choose the Right Partner

Somehow I’m skeptical that this would happen in Spain, largely because the environment still does not foster local entrepreneurs or investors. London, however, has a much more vibrant and established business community, to the point that some people argue that it’s the new financial capital of the world.

In such an environment, maybe London has a chance to become the European Silicon Valley . . . .

Update: As I was surfing the web after writing this post, I came across an interesting counterpoint on BBC’s website. Kulveer Taggar, a recent Oxford grad (he was the President of Oxford Entrepreneurs) and CEO of www.boso.com, explains why he left London to go to Silicon Valley in pursuit of fulfilling his Internet dreams. Let’s just say he paints a pretty harsh picture of looking for financing in the UK. The debate continues . . .

The New York Times has an interesting article today about how a lot of European entrepreneurs are learning their trade in Silicon Valley before moving back to their home countries to try to create local start-ups. Interestingly, the article notes that in many cases, European entrepreneurs convince some of their US colleagues to return with them to improve their chances of creating successful start-up ventures.

There is data in the article that is cause for some optimism:

• European start-ups attracted $970 million in 2006, the highest level in a decade since the Internet boom ended in 2000.
• Overall venture capital fund-raising in Europe is more than twice the levels of 2002.

But there is also some cause for concern:

• In the US, failure is valued; in Europe, failure is professional suicide. Some US professors, for example, teach by looking at “constructive failures”. And we Americans are taught at any early age that “if at first you don’t succeed, try, try again.” The key insight is that you probably learn more from your failures than you do from your successes. You must analyse each mistake, try not to repeat it and never give up. This is the essence of the scientific method / trial and error, which is the best way to gain useful perspective and valuable experience for future success.
• Bureaucracy and rigid labour (and tax) laws inhibit the entrepreneurial process. Start-ups need to move fast and work hard, two concepts that are not always appreciated in European labour environments. Cash flow is key for any start-up, and as one observer has noted, Spanish tax, employment and bankruptcy laws, for example, seem to note little difference between a small start-up like Goa Internet Services (my company) and multinationals like IBM.

In the end, there are really only two options: i) change the structural constraints that inhibit entrepeneurs from succeeding; or ii) accept that the majority of European start-ups will never be competitive at an international level. The civil servant will continue to be king. I don’t really see a middle road. It’s funny to me, for example, that the French entrepreneur interviewed by the New York Times notes that his lawyers were angry with him for asking his employees to work late or on weekends given France’s 35-hour limit. In Silicon Valley, this would be a non-issue; it’s simply something that goes with working for a start-up. (In this sense, I suppose that stock options help to create a sense of employee investment in the project. Stock options are common in the US, particularly in start-ups. They don’t appear to be so common in Europe.)

How can Europeans compete in the global marketplace if they are not willing — or legally able — to make the same sacrifices as their US competitors who dominate the international marketplace? Is it logical to assume that US companies will adapt to European customs? Or is it more logical to assume that the European start-ups will need to adapt to “international” standards in order to compete at an international level? And what are European governments going to do to help along that process, other than invest in PR campaigns (including unattainable or dreadfully slow subsidies programs) and complain constantly about the need to create more and better European entrepreneurs?

Please don’t misunderstand me. I don’t think that the US obsession with work and materialism is healthy from a personal perspective (even though Western Europe — the centre of many luxury companies — is not free from materialistic tendencies). And I’m not trying to say that extraordinary and determined entrepreneurs cannot succeed in Europe. (Here I am thinking about two friends of mine in particular, Jesus Encinar and Juan Julia.) But it does mean that they will be more the exception than the rule, and that all of this talk about creating a European Silicon Valley will remain simply that–empty words–until important structural and cultural changes are implemented.

It’s a simple matter of survival of the fittest. Adapt or die (or in this case, be destined to failure and/or mediocrity). It’s that simple.

I recently saw the movie Dreamgirls, since I’m a huge Beyonce fan. What some people don’t know is that Dreamgirls is a loose translation of the story of the Supremes, the most successful African-American singing group of the 1960s and one of the most famous all-girl bands of all time. The band was founded by Florence Ballard, widely seen as the group’s most powerful and best singer. Ballard ended up dead at age 32 largely due to chronic depression and alcoholism. She just couldn’t get over the fact that she essentially lost control of her dream for factors that had nothing to do with her or her talent, namely that Diana Ross was slimmer and looked more biracial and thus more appealing to a predominately white audience in the US in the 1950s / 1960s (remember that the legal segregation of blacks and whites ended in the US only in 1954 ).

In some sense, Dreamgirls is an all-American story of Rags to Riches. But why is it that the founder and most talented member of the group ended up dead and bankrupt while the less talented back-up singer became an international star with millions of dollars in her bank account? As I watched the movie, it made me reflect a lot on my current project, migoa.com, a vertical search engine focused on homes, jobs and cars that we will launch soon. Finding financing for an ambitious start-up is not easy in general, but even less so in Spain, and there have been many times when I have related very much to Florence Ballard’s frustration over the fact that her dream was in danger of being taken from her. It’s easy to become frustrated when you realise that:

• A lot of times, the key ingredient to success is not talent, it’s luck. Or put another way, being in the right place at the right time. The most important skill in this regard is being able to identify the opportunity and try to take advantage of it, but even then you might still end up failing for reasons that have nothing to do with you or your individual talent:
• It’s really painful to watch as your dream is taken away from you or at least severely compromised, particularly when others might profit more than you do from your original ideas, dedication and passion. A lot of entrepreneurs end up being forced to leave their own companies when outside investors / VCs decide to bring in better, more professional management. In many cases, it might be the right business decision, but it still sucks if you are the entrepreneur that founded the company.
• Life isn’t always fair, and complaining about this truism is pointless. You just have to get over it and keep moving forward.

As a matter of fact, the most celebrated part of the movie “Dreamgirls” comes when the Florence Ballard character gets kicked out of her own band, and she sings one of the best and most powerful songs ever written: “And I Am Telling You That I’m Not Going”. (I’ve attached a copy of the original Broadway version of the song sung by the legendary Jennifer Holliday in 1982.) The point of the song is that she’s telling the other members of her band–and a former lover that profited from her initial leadership–that no matter what, she’s not going anywhere. She sings: “I’m staying, and you’re gonna love me!” That has become my motto in life! The song is really about perseverance, single-minded obsession, determination, borderline insanity and above all else passion. Despite the tragic elements of the story, these are the traits that I most identify with as to me they define the essence of a true entrepreneur–the mix of passion and determination with a hint of insanity and almost evangelical faith.

So as people talk about “dead pools” of web 2.0 companies, or about the fact that the majority of start-ups fail, I just keep telling myself that “I’m Not Going”. Life is tough sometimes and it’s often not fair, but that’s just too bad. Adapt or die, but you’ve got to continue dreaming, having faith and working really hard, of course.