Last week Sophie and I went to Paris for the Le Web event. Whereas ETRE probably has the best networking and is over-the-top elegant, and DEMO Germany is a must for anyone wanting to enter the German market, Le Web is easily the coolest tech event that I’ve ever attended (Essential Web is probably second).

By cool, I mean that it felt like I was at a cool, exclusive party — kind of like when my friends and I snuck into Puff Daddy’s VIP Party when the MTV Awards came to Barcelona. But that’s another story . . .

At ETRE, the guests are important but not really focused on being cool. It’s more like being invited to a world summit where you can actually meet and interact with world leaders. At DEMO, you have all of the German VCs available to you. At Le Web, the speakers and other guests are cool, public figures but probably not the main attraction. Some of them gave 20-minute extracts of what should really be much larger discussions. In fact, in a world where almost everyone has a blog and has posted his or her best presentations on YouTube, you usually don’t learn anything new at large conferences geared to general-interest audiences full of non-entrepreneurs. If you want to participate in longer, more substantive conversations with entire micro-communities of commentators, analysts and entrepreneurs, go read your favorite entrepreneur or VC’s blog or become one of her “friends” on Facebook or search for her presentations on YouTube. There are a lot of options that are cheaper than paying the hefty entrance fees and travel expenses to go to a conference.

But if you do go to a conference, it’s nice to feel welcomed, as if you are a VIP guest. And that’s what Le Web excels at. It’s clear that they spent lots of time designed to make the event feel special and singular — making it comfortable and elegant, as opposed to just functional and boring.

A few highlights:

• The networking lounge was full of modern art work and live artists drawing while entrepreneurs networked on comfortable couches and/or watched the main conference on large plasma TVs.
• There was the Michelin-star type lunch, with chefs preparing foie, shrimp, fondues, raclettes and other great meals, and other waiters serving wine, cocktails or whatever beverage might capture your attention.
• Each guest was introduced with electronica / house music, which certainly woke me up at 9AM in the morning
• Loïc Le Meur graciously introduced himself to each guest at the party, smiling broadly and being a good host, even when Phillipe Starck spoke about 1 hour more than his allotted time.
• Kevin Rose had a very intimate and personal conversation with a Business Week journalist, who asked him about Digg’s groupies.
• Most of the presentators cursed and spoke in a lot more “vulgar” terms. It was surprising on the one hand, but it lent to the atmosphere that the audience was being allowed to hear open and honest conversations between influential Internet opinon-makers. No bullshitting. Just the real deal with lots of cursing.
• Most of the attendees were dressed stylishly and intelligently, as if we were all part of an exclusive Rive Gauche soiree.
• And, of course, there was the fact that so many people went. Bloggers. VCs. Tech analysts. Entrepreneurs. It seems that we all go to the same conferences, but people seemed a lot happier and cheerful at this one. Various blogs had speculated that there’d be 2000 people attending (clever, aggressive marketing). At the event, however, Loïc mentioned that 800 people would attend, and it seemed to me that there were fewer than that. A good showing, but fewer than 1000 people in the same room at the same time. And a lot of the tickets seem like they were comped — i.e., free for friends of friends of Loïc and certain bloggers.

That being said, it was definitely a very cool event. The coolest, most elegant tech event around by far.

A Wall Street Journal reporter interviews Dan Nye of LinkedIn (CEO of LinkedIn since Feb. 2007) to find out:

• How they differentiate themselves from Facebook and MySpace;
• Whether they have an inferiority complex since they “only” have 18 million users; and
• How they’ve grown over the last year (now over 200 employees).

It’s an interesting example of product differentiation and amping up a start-up.

Le Web 3 is now over. It was an awesome conference, about which I’ll write later.

The one comment that you get a lot at these conferences, however, is: “Wow! There certainly seems to be a lot going on in Barcelona these days.” I hung out a bit with Nicole Simon, formerly of Blognation Germany, and she told me that she thought it’d be cool to do a conference in Barcelona, given that Germans and French bloggers want to know more about what’s going on in the Spanish tech scene (and I suppose, in Spain more generally).

Well, now that should be a lot easier. Javier of Loogic has just launched Loogic in English. Loogic is kind of like Spain’s TechCrunch. I try to read it every day to see what’s going on in the Spanish tech scence. Javier is also a really nice guy and often willing to give you useful product feedback. His advice definitely helped make nuroa into a better product.

And Loogic is one of the most read Spanish tech blogs, so if you have a product that you’d like to launch, there’s no better place to do it.

Congrats, Javier! I think this is a great iniative and sign that the Spanish tech scene is going global!

I was surprised to read Michael Arrington’s TechCrunch post on Friday that Edgeio was going to be shut down. On the one hand, it’s kind of scary, my being in the vertical search space and all.

There’s always that moment of initial fear when you read something like that. Maybe nuroa really isn’t going to work? WTF have I gotten myself into? And HTF did they burn through $5 million in less than a year without being able to generate any revenue or relevant traffic or enter into any significant strategic alliances? This is perhaps the biggest question in most people’s minds. (It still amazes me that a start-up that launched in Feb. 2006 could receive a cheque for $ 5 million from a VC only 7 months later! I’m assuming the valuation at that point must have been somewhere between $15 and $20 million?)

But upon closer analysis, it’s clear that Edgeio’s problems had less to do with being a vertical search engine and more to do with being more of a concept than a business. To me, Edgeio’s failure reflects the danger of creating a tech-geek project with very little appeal or applicability in the real world.

Following are the four main lessons that I think can be learned from Edgeio’s demise.

Not All Vertical Search Engines Are Created Equal: Whereas the majority of vertical search engines crawl classifieds portals like Idealista and ImmobilienScout 24, or have a direct relationship with real estate agencies like Sasi or Engel & Völkers, Edgeio’s model was to operate — as the name suggests — on the “edge”. Cutting through the PR jargon, this means that they only looked for classifieds listings on blogs or other RSS-enabled sources — this explains Michael Arrington’s involvement and value-added to the project. TechCrunch was the ideal platform from which to launch a blog-focused vertical search engine. As TechCrunch explained when Edgeio launched: “The Edgeio ethos is that content belongs on the edges, and that is where the name originates from (Edge input/output). Content on the edges means the content on the millions of blogs and other sites out there which Edgeio does a good job of aggregating and organizing.” So whereas property search engines like nuroa aim to disrupt the traditional classifieds space by crawling mainstream classifieds sites, Edgeio chose instead to bet that sellers would be willing to create blogs on which they listed their properties or other classifieds, and Edgeio would then aggregate those blogged classified listings. The basic problem is that a business focused only on classifieds in blogs is not currently very scalable, as the majority of people still use more traditional offline and online options (e.g., classifieds portals and newspapers) to advertise classifieds goods.

Classifieds Are Local: Given that their main market is the blogosphere, Edgeio was never focused on any one geographical market. If you take a look at their website (which is very well-designed by the way), the tagline is “search the world’s listings”. Their value proposition was that they granted you access to over 100 million listings in 1,484,953 cities and 166 countries What does this mean in practice? If I’m looking for an apartment in Barcelona, why would I care that there are lots of listings in 1,484,952 other cities? Also, I don’t really see why local advertisers would choose to advertise on an “international” website, particularly if this international website isn’t one of the leaders in its local classifieds space. In other words, if I am Expofinques and I want to strengthen my market position in Madrid where I’m not as strong as I am in Barcelona, why would I advertise on Edgeio as opposed to the other sites that are more focused on Madrid? And if I’m a property buyer in Barcelona why would I be more interested in searching “the world’s listings” than in searching “the most complete set of listings in Barcelona”? Start-ups have to focus on a market, or a product, or on something in particular. Being focused on “the world’s listings” is largely meaningless, other than as a concept.

Keep Your Burn Rate Down Until You Have Some Indice of Possible Success: Edgeio’s hype always had more to do with the connection to Michael Arrington and TechCrunch than anything else. Whereas companies like Trulia, Simply Hired and Indeed have generated significant traffic, marquee-name investors (Sequioa, News Corp. and The New York Times) and are growing nicely (e.g., Trulia’s U.S. traffic is up 130 percent in 2007, to 1.2 million unique visitors per month, according to Comscore), Oodle’s vanguardist and diffuse approach never seemed to catch on. Nonetheless, it seems that they were determined to buy their success and hoped to convince investors to continue investing in them, even though they had no material revenues, traffic or partnerships. Michael Arrington is pretty direct in explaining why Edgeio had to close down: “The company burned through [$5 million] according to plan, meaning they ran out this month. The product roadmap was fulfilled, meaning development lags didn’t hurt the company. But the revenues didn’t come in and user/partner milestones weren’t met. And that meant no one else was going to put more money into the company.” In the comments section, he’s even more reflective and frank: “In general I’ll say this - it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself.”

This is just further proof of what Fred Wilson of Union Square Ventures noted in a recent post entitled “Why Early Stage Venture Investments Fail“: “[I]t’s pretty clear to me that most venture backed investments don’t fail because the business plan was flawed. In my experience at least 2/3 of all business plans we back are flawed. Most venture backed investments fail because the venture capital is used to scale the business before the correct business plan is discovered. That scale/burn rate becomes the cancer that kills the business.”

It’s Easier to Criticize than to Do It Yourself: I can’t help but note a certain irony in noting that one of tech’s most noted and sometimes more hyper-critical bloggers — he created the Dead Pool with a certain glee — is the co-founder of the most prominent vertical search engine to enter the Dead Pool, despite all of the natural advantages that he has given his access to financing and marketing. Most of us would give our left arm to appear prominently in TechCrunch, but Edgeio is proof that expensive marketing can’t make up for an ill-conceived product.

And it also shows that like the old saying goes: “Opinions are like assholes. Everyone has one.” It’s a lot easier to criticize others than to create a successful product yourself.

The best we can do is hope to learn from Edgeio’s mistakes so as not to end up like they did.

In keeping with my lessons learned from Loïc Le Meur, I’m now going to promote nuroa a bit and ask for your help.

We are trying to get 1 month’s free publicity on a new website for start-ups. As a start-up with limited resources, you can’t imagine how important that word is — “free!”

All you need to do is go to this link — http://www.europeanstartups.com/company-index-european-startups — and click on the “vote” button next to our name “Nuroa.” It should take less than 5 seconds of your time, but you can’t imagine how important it would be for us.

Please remember that you can vote once per day.

Sorry in advance for this shameless plug!

Here’s another viral video making the rounds. I first became aware of it when Kara Swisher posted about it, noting that it had made Robert Scoble spew Diet Coke out of his nose. Then Iñaki mentioned it when Oriol and I had lunch with him and Dani on Wednesday (btw, really nice guys. I’d invited them via Facebook to meet up with us. They quickly said yes and then even paid for our lunch! We chatted for about 2 hours about nothing and everything. A good time was had by all, and we will pay for the next meal! We’ll probably even invite them to our next party, though they’ve made us promise to keep the video cameras off . . . .) And then today, I noticed that various VC blogs were posting the video.

So I could no longer resist the peer pressure.

I think the video’s mildly humorous and relevant only to tech geeks (have I become one of those?). But in the end, I’m a bit of a lemming (i.e., easily influenced). If influential people say it’s important, I guess it must be important. And if the makers of the video recommend that I put it in a blog (and important bloggers have done so), then I guess I should do it too.

Maybe that’s what Dan meant about content not being the key factor?

I promise to try to be more original going forward . . . . I’m not in high school anymore . . . If the cool kids jumped off a bridge, I wouldn’t jump. Would I? . . . .

Next week, Sophie and I will be heading to Paris for Le Web3 and a couple of business meetings. I will be taking my trusty video camera, with the hopes of posting some of the highlights. According to the folks at Le Web3, 1300 people from 40 countries will show up. I can’t wait to see what the party will be like!

Anyway, Loïc Le Meur, France’s best known blogger, video-blogging entrepreneur and organizer of Le Web 3 is now on a major marketing campaign to promote Le Web 3 (and his new project seesmic.com, which is still in alpha). I get daily video updates from him on Facebook about what’s going on at Seesmic, all of the major tech blogs are offering free tickets or discounted tickets to Le Web 3 to spur attendance, and major newspapers like the Financial Times are writing articles about Loïc and Le Web 3.

Watching his commitment to self-promotion is cool, because I’ve gotten some interesting lessons about what we can do to promote nuroa.

Highlights from the FT article:

• Seesmic.com, a video-blogging platform, is Loïc’s fifth start-up, and he moved from Paris to San Francisco, because he thinks that Silicon Valley is the only real destination for entrepreneurs that want to launch global Internet brands. It’s a bit ironic that the person responsible for organising one of Europe’s biggest Internet events firmly believes that the US is the only place to be if you really want to be relevant in the Internet space. But Loïc justifies it by saying that Europe’s 22 languages and geography complicates deal-making, while San Francisco is at the epicentre of deals. In his words: “The way you do partnerships here, everyone’s a block away or 20 minutes away in Palo Alto. If I need to set up a partnership with [micro-blogging service] Twitter, I call them, we have coffee, and two hours later the deal is done. If I were in France, there’s a nine-hour time difference and it’s like you don’t matter.” If even marquee-level European entrepreneurs with direct access to world leaders feel irrelevant if they are not in Silicon Valley, what does that mean for the rest of us?

• On a more optimistic note, Loïc provides his top 10 tips for entrepreneurs. I’ll re-post them here and comment on them in more detail in the future. In general, I’d just say that they are very insightful, but as with most things, much of it is easier said than done.
  1. Don’t wait for a revolutionary idea. It will never happen. Just focus on a simple, exciting, empty space and execute as fast as possible
  2. Share your idea. The more you share, the more you get advice and the more you learn. Meet and talk to your competitors.
  3. Build a community. Use blogging and social software to make sure people hear about you.
  4. Listen to your community. Answer questions and build your product with their feedback.
  5. Gather a great team. Select those with very different skills from you. Look for people who are better than you.
  6. Be the first to recognise a problem. Everyone makes mistakes. Address the issue in public, learn about and correct it.
  7. Don’t spend time on market research. Launch test versions as early as possible. Keep improving the product in the open.
  8. Don’t obsess over spreadsheet business plans. They are not going to turn out as you predict, in any case.
  9. Don’t plan a big marketing effort. It’s much more important and powerful that your community loves the product.
  10. Don’t focus on getting rich. Focus on your users. Money is a consequence of success, not a goal.

A few weeks back, there was athunderstorm at TechCrunch regarding an article about how to make videos more viral. The guest post was written by Dan Ackerman Greenberg, a 22-year old Stanford graduate student and CEO of a company that helps make videos viral. His stated goal was to give the reader an insight into how to make videos more popular — he likens it to SEO for videos, arguing that companies need to understand video virality optimisation strategies as part of their online marketing campaigns.

It seems like he knows what he’s doing. His company has helped six videos to achieve:

• 6 million views on YouTube
• ~30,000 ratings
• ~10,000 favorites
• ~10,000 comments
• 200+ blog posts linking back to the videos
• All six videos made it into the top 5 Most Viewed of the Day, and the two that went truly viral (1.5 million views each) were #1 and #2 Most Viewed of the Week.

Among his key insights is that content isn’t king (this is what makes his job seem a little slimy). In his words, although great content is cool, it’s not essential to making a video really viral. There’s a process to making a video viral, and that process is often a lot more important than the content itself.

This seems somewhat unmeritocratic and counter to the point of community-based voting systems. You want the see the best content, as voted by an objective set of your peers, not as manipulated by clever viral marketing experts.

The post got 515 comments, a second post in which Dan responded to the attacks that people like him corrupt the purity of video sites like YouTube by manipulating users into viewing mediocre content (I guess the general reaction was that it’s like those SEO people who try to trick Google and eventually get punished for corrupting the results.), and an interview with CNN.

Michael Arrington posted a somewhat dramatic comment noting that “frankly I’m disgusted by this”.

But as they say in politics, “all press is good press”. Controversy is an effective marketing tool. This kid is now on the map, and I’m sure that lots of companies will be calling him. Random people like me are blogging about him and thinking about how much we need someone like him for our companies, even if there is something slightly unsavoury about “artificially” making your video popular.

But isn’t that the definition of a marketing campaign? Artificially making something popular? Isn’t all marketing/advertising on some level invasive/misleading/untruthful/manipulative? Maybe that’s what Mark Zuckerberg is learning given the backlash against Beacon . . . .

When I first heard about SEO, I thought it was “shady”, because it tried to manipulate Google’s results for corporate gain. And I guess I have the same feeling about Dan’s company.

But now I realise that start-ups like mine live or die by SEO. Manipulating Google (within their self-imposed limits) is the name of the game. And the same will probably be increasingly true about videos.

That’s marketing, folks!

So with that in mind, I’ve posted two videos:

• Dan’s interview on CNN explaining his vision of SEO for videos; and
• a video that various French friends have been sending me about a musical group that performed on the subway in Paris. Their video already has more than 1 million hits on YouTube! It’s obviously a viral marketing campaign to promote an upcoming album, as was the performance on the train. It’s a cool little video that cost absolutely nothing to make, but who knows. Maybe Dan’s company helped them make it popular on YouTube . . . .

Naturally 7 (live on the Paris subway)

Dan Greenberg on CNN, SEO for videos

Harvard’s alumni magazine, 02138, is generating a lot of attention for an article about Facebook’s creation and the various lawsuits initiated by other Harvard alumni against Mark Zuckerberg. The magazine got a lot of juicy tidbits from protected legal documents that a court clerk accidentally turned over to the article’s author. Facebook quickly put some of its millions to good use and filed legal motions trying to convince a judge to order the magazine to remove references to the protected legal documents, but they’ve apparently lost the motions and the information is still on 02138’s website.

In general, Zuckerberg seems like an aggressive guy with questionable ethics, but I’d aready posted about that. In addition, with all of the negative press surrounding Beacon (Facebook’s overly aggressive advertising system), Zuckerberg is realizing that the media often builds you up only to then tear you down.

In some sense, I feel sorry for Zuckerberg (or as sorry as you can feel for a 24-year-old self-made billionaire). He’s trying to finish puberty while navigating his way in a high-stakes, fast-paced, cut-throat business culture with international media outlets and tech analysts scrutinizing his every move. As one commentator humorously notes: “Maybe 13 year-olds shouldn’t be CEOs.”

But what’s cool about the 02138 article is that they’ve posted online some of the tawdry tibits that Zuckerberg definitely didn’t want anyone to see — they’ve included PDFs of Zuckerberg’s college application, his online journal, his testimony before the Harvard disciplinary committee, his depositions, etc. (Kara Swisher of the Wall Street Journal notes the irony that Zuckerberg wants to have his private life protected, even as he tries to monetize all of the private details of Facebook’s users via Beacon.). Interesting reading . . .

A few highlights:

• Zuckerberg once handed out business cards that read: “I’m CEO … bitch.”
• He has noted that he prefers Asian women.
• During March 2006 negotiations with Yahoo executives, Zuckerberg refused to meet over a weekend because his girlfriend was in town. “When I’m hanging out with her, I tend not to be that engaged [in work],” he said. (This might not seem like such a big deal in Europe, but it’d be absolutely unheard of in the United States, particularly when an Internet giant like Yahoo is meeting with you because they want to buy your start-up for $1 billion.)
• Zuckerberg owns 20 percent of Facebook, which means that on paper he’s worth $3 billion.
• Zuckerberg learned to code in sixth grade (at about 12 years old), when he got first desktop PC and the book C++ for Dummies.
• As a senior in high school, Zuckerberg and friend Adam D’Angelo designed a music plug-in called Synapse that played songs in patterns based on the user’s listening habits. D’Angelo is now Facebook’s chief technology officer. When tech website Slashdot linked to the plug-in, WinAmp, Microsoft, AOL, and others sought to buy Synapse, but the two friends decided not to sell it at first. Soon it was too late and the big companies were no longer interested. (Let’s hope for his sake that history doesn’t repeat itself!)
• Zuckerberg is really confident in his coding ability, but less so in his design ability. So when he starts a project, he starts first with the design. In his words: “I know I can code well, but I’m not so confident about the design and I know how important that is to the final product, so I always like to get the design out of the way first … I start with a simple design and build pages on top of that.”
• Zuckerberg is well known for programming long hours without eating and with little sleep. He claims that he coded the original Facebook site in just over a week, during Harvard’s exam period.
• As a sophomore at Harvard, where he was a computer science major, Zuckerberg got into trouble when he created a website called “facemash” — a kind of Hot or Not service that put photos of two Harvard students side-by-side and asked users to choose who was hotter. To get the photos, Zuckerberg had hacked into Harvard’s servers and copied pictures from student directories, informally known as facebooks. He admits in his journal that it was a crappy thing to do: “[O]ne thing is certain, and it’s that I’m a jerk for making this site. Oh well. Someone had to do it eventually … ” Harvard’s disciplinary committee (known as the Ad Board) placed Zuckerberg on probation for “improper social behavior.” It was that notoriety that caused the guys at ConnectU (the site that allegedly “inspired” Facebook) to ask him to do the programming for their proposed social networking site.
• Though his parents are affluent (he’s the son of a dentist and a psychiatrist), when Zuckerberg went to Silicon Valley in the summer of 2004 without an internship to seek funding and work on Facebook, his parents paid only for his mobile phone bills and health insurance. He decided to drop out of Harvard at the end of the summer to stay in Silicon Valley (at that point, the company had 250.000 users), funding the company with the rest of the money that his parents had saved up for his college education.
• In Silicon Valley, networking paid a huge initial role in Zuckerberg’s ability to get financing for Facebook. During the summer of 2004, he became friends with Sean Parker, one of the founders of Napster. Parker advised Zuckerberg on how to set up a company and introduced him to VCs. In return, Zuckerberg made him company president. Zuckerberg later forced Parker to step down after he was arrested for cocaine possession. But having Parker on-board helped bring in millions of dollars of venture capital.
• Zuckerberg is also involved in another lawsuit involving Eduardo Saverin, one of the original founders (he owned 30%) who says he was forced out when Zuckerberg incorporated Facebook, diluted Saverin’s stake and became sole director.
• At Harvard, Zuckerberg claimed that money was the least important thing to him when he did a project: “I don’t really like putting a price-tag on the stuff I do,” he told Harvard’s daily newspaper, the Harvard Crimson. “That’s just, like, not the point.”

This guy’s certainly experienced a lot for someone who’s only 24 years old!

I came across this video while surfing the “Spain” page on Facebook. It’s hilarious and shows how transgressive culture is, particularly in the age of the Internet. White kids in the South dancing like black and Latino inner-city kids in Los Angeles, all being watched via Internet by various nationalities in Spain.

The kids in this video are “krumping/crunking“, which is a style of hip-hop dance popularised in Los Angeles, based on music from Southern rappers in the United States.

Dave LaChapelle’s documentary Rize focuses on this kind of music/dance. (Ironically, I frist saw the documentary on Canal+ in Barcelona.)

Whatever.

This video is hilarious and endearing at the same time!

(By the way, for those of you not as old as I am, the reference to “White Men Can’t Jump” is from the 1992 movie of the same name. It scares me to think that that Carlos was 3 when this movie was made, and I was his age!)