…Buckminster Fuller coined the term ephemeralization to describe the…tendency of...machinery to be replaced by…software.

In 1938 Buckminster Fuller coined the term ephemeralization to describe the increasing tendency of physical machinery to be replaced by what we would now call software. The reason tablets are going to take over the world is not (just) that Steve Jobs and Co are industrial design wizards, but because they have this force behind them. The iPhone and the iPad have effectively drilled a hole that will allow ephemeralization to flow into a lot of new areas. No one who has studied the history of technology would want to underestimate the power of that force.

Dave Winer ☛ "entrepreneurs who were showing up were less the bright-eyed engineers …, and more…carpetbagging MBAs"

When I started my second company, in 1988, also in Silicon Valley -- the industry was approaching a level of maturity that, in tech, warns of a looming implosion. I was too young and inexperienced to know this, but the signs were everywhere. A few years before if you had a good idea, you could ship a product, promote it, build a user base, and find liquidity. Now the dominant companies had grown so big they were starting to choke the ecosystem. And the entrepreneurs who were showing up were less the bright-eyed engineers with big ideas, and more of the carpetbagging MBAs with pyramid schemes. Gotta say the VCs typically went for the MBAs. The era of the engineer, if it wasn't over, was certainly waningPermalink to this paragraph

Eric Woodward and tr.im - A small study in Entrepreneuring...

Last week tr.im shutdown and hit the twitterverse from just below the surface of the Social Networking1 space like a Jellyfish sting.  This is not the first internet startup to shutdown.  There are many large and small that shutdown or are acquired and eventually whither and die of neglect.   Eric Woodward's tr.im was a popular url shortening service and one that I used on a fairly regular basis.  It had some nice features, but the "url shortening" space has become crowded with competitors of late.  Twitter, a thousand pound gorilla in the social networking space anointed one (bit.ly) the url shortener for Twitter and Eric saw this as the checkered flag in the race.

As interesting as the underlying issues are regarding url shorteners, I became much more interested in the Entrepreneurial aspects of the story after I stumbled across the Tech Zing podcast about tr.im in my Twitterstream.  Tech Zing is hosted by Justin Vincent & Jason Roberts and I've never heard of any of them before the tr.im event.  Ever the willing spectator for war stories and train wrecks I decided to give it a listen.   What I heard was a level headed serial entrepreneur2 discuss the realities of a startup.  It took me back to my days in start-ups.  No I am not an entrepreneur myself, just one of those breed that is recruited by entrepreneurs to realize their goals.  I lived through a few startups during the internet boom bust cycle (Viant, 12 Entrepreneuring & Linx LLC) and I can identify with Eric and the choices that all real entrepreneurs must make.  Those choices my include shutting down a business and cutting your loses.

Listen to techZing! 13 for Eric's story. [Note: Some of the questions from Justin and Jason are naive and cringe inducing but hang in there and listen to the entire podcast for Eric's pearls of experience.]

Some interesting points of discussion:

  5:50 - "Developing a small piece of software and selling it for a nominal amount of money is just not interesting to me..."
            Classic 2.0 business model... scale first layer in services later.
  9:00 - Trouble with outsourcing
13:20 - Rock Star developer vs. good teams
17:20 - I didn't start out to build tr.im....
22:00 - Loosing control of the process...
23:50 - Becoming the poster child for "Link Rot", "But it's not really in my DNA to hand my competitor my product for free"
24:20 - bit.ly as the insider and the nature and reality of competition
33:00 - Surprised by the reaction
43:20 - Everybody know the internet only has 3 business models
53:00 - Eric's background

1. "Social Networking",  "Microblogging"... Whatever you call the space that Twitter, Facebook, Friendfeed, et al are in.
2. Eric founded an early ISP in Canada, founding CTO of mail.com, founding CTO of myinternet.com, founded a domain portfolio company and currently founder of Nambu.

via @techcruch "There’s a large uproar right now following Tr.im’s demise on whether or not anyone should actually be using URL-shorteners just in case something like this happens."

There’s a large uproar right now following Tr.im’s demise on whether or not anyone should actually be using URL-shorteners just in case something like this happens. [...snip...] But an archive of these links that is maintained outside any one service could help put people’s minds at ease.

Yes, I was a tr.im user. It was a great service and now they're holding my links hostage because they could not figure out how to monetize the service. Hopefully a company like bit.ly will step up and pony up enough ransom to free them. Aaahhh perhaps that is the URL shortener industry's new monetization approach. Get competitors to buy you out if your shutdown threatens credibility of the entire sector...

Facebook Acquires FriendFeed (only 12 Employees!)

FriendFeed is based in Mountain View, Calif. and has 12 employees.

The most interesting point, for me, is that FriendFeed has only 12 employees! I know I shouldn't be supprised in this new age of small startups that stay small, but the site just oozed polish, features and performance. I expected them to at least break 40 employees. Kudo's to those guys and I hope they got some good cash in the deal.

Ramen Profitable - [Loving the noodle reference...]

"Ramen profitability is the other extreme: a startup that becomes profitable after 2 months, even though its revenues are only $3000 a month, because the only employees are a couple 25 year old founders who can live on practically nothing. Revenues of $3000 a month do not mean the company has succeeded. But it does share something with the one that's profitable in the traditional way: they don't need to raise money to survive."

Paul Graham is always a good read.... Check out the full blog post.

You've Gotta Hand it to Larry!

Ellison Moves Quickly to Push Aside IBM, Plunges Into Competitive Server Market - WSJ.com:

"One person familiar with the situation said IBM's final offer over the weekend was closer to the latter figure, making Oracle's $9.50 offer a financially better alternative in the view of Sun's board and more likely to close. Oracle has to pay Sun a $260 million breakup fee if it terminates the transaction.

Another person said
IBM was pressing Sun's board to revoke change-of-control provisions that would give a large number of Sun executives two years of salary in the event of a sale. Yet another person familiar with the matter said Oracle didn't hesitate to accept those provisions, characterizing them as 'a rounding error' to the software giant."

True, But I Am Old

I am an alumni of the first Internet Boom/Bust cycle, more specifically of Viant Corp which was originally founded with the name "Silicon Valley Internet Partners" or SVIP.    I joined SVIP from Merrill Lynch, and the shift was dramatic...   SVIP and eventually Viant was an organization of extremely bright, energetic, optimistic, creative and interesting people.  People who, to this day,  remain in touch.   There is a Viant Yahoo group where a few of us communicate and many of us lurk.   Recently there was a thread around the current events in the market and the general feeling that...

Things will get worse before they get better... The "spend more than you earn" party is over. It's going to be a massive hang-over.

A fellow former CXO responded in his characteristically upbeat , poetic and humorous style.  I enjoyed it so much that I've included it below....

True, but I am old.
In junior high school, Comet Kohoutek was predicted by some to wipe out the entire Earth. True, this was mostly predicted by people in California and,true again, most Americans were stoned out of their gourd during that time period...so that prediction doesn't really count.
But when I was in high school we all learned the metric system because "the rest of the world uses it and by 1980 America will too!". Well, that didn't happen.
A little later, Time magazine ran a cover story on "The Second Ice Age" which was fast approaching upon us and would have Americans moving to Mexico in droves so they wouldn't freeze to death! (Seriously, look it up, it was the late 70's.) Now we are warming globally, it seems, and Ohio will soon have beachfront property.
Let's see, what else? Communism was on the doorstep of taking over the world and we would all be calling each other comrade by the turn of the century. A wall came down instead.
Here's my favorite: Y2K. Remember that one, folks? People were preparing for the end of the world (again) and I think the only thing that happened was that one toaster in Australia malfunctioned or something.
I'm not saying that this isn't a real crisis or that there won't be real pain and suffering as a result of this. There probably will be.
I'm just skeptical.
Optimists vastly outperform pessimists.
I know that's true because a consulting company proved it to me with a 3X3 matrix and a very thick presentation binder that made a loud "thud" when they dropped it on my desk next to their Y2K report.

Thank for sharing Bill!

Business Enabled Integration...

A few years ago I worked at an incubator called 12 Entrepreneuring. It was during the heady but waning days of the internet boom. 12 was in the midst of incubating Grand Central Networks, an integration network company. I was asked to help temporarily with the conceptual design and architecture on the project, which was based in the San Francisco office, until the New York office (my eventual homebase) was up and running.

My background was in systems integration at the enterprise level. I felt that the value of the network would be to provide a rich set of pre-integrated business partners and industry aware components. My point was to align with the business and not be purely technology focused. Founder Halsey Minor pushed to keep the service simple. His catch phrase was "a better FTP". Alas, Grand Central Networks has gone the way of many a startup.

Alignment with business is where the industry is finally heading... In an effort to differentiate themselves in the inevitable arms race like spiral of the integration market, webMethods has sought and received SWIFT Certification. Banks looking to upgrade their SWIFT integration technology now have a reason to seriously consider webMethods. iWay Software, as the adapter company has been at the forefront of supporting industry protocols such as SWIFT, FIX, HIPAA, etc. and is pushing into insurance with ACORD. Yes, vendors will continue to add bells and whistles to their products but I expect them to become more tightly aligned with various industries and their standards. A tool that is already aware of your industry's standard processes and vocabulary is incredibly valuable.