As a member of the American Alpine Club I look forward each year to the arrival of my copy of Accidents in North American Mountaineering.  This is a book that the club publishes annually that documents climbing and mountaineering accidents that are reported each year in the United States and Canada.  The idea, of course, is to educate the climbing community on things that can go wrong in the backcountry in an attempt to make everyone safer (as if the threat of dying were not enough, we also have to worry about being written up in Accidents. . . ).   A typical entry might be titled: Fall on Snow – Unable to Self-Arrest, Faulty Use of Crampons and would then go on to describe how someone fell on a snowfield (in this case not far from Boulder, CO), dropped his ice-axe and wound up breaking his legs when he inappropriately tried to stop himself with his crampons (ouch!).  Other titles this year were: Stranded, Exposure-Hypothermia, Inadequate Clothing/Equipment, Climbing Alone, Weather, Exceeding Abilities (apparently this guy got it all wrong); or my personal favorite: Stranded, Exceeding Abilities, Incompatible Partners – Poor Communication (I like that having crappy partners is an official designation of the AAC).

As I thumbed through Accidents this year it occurred to me that it would be great to have a venture capital version of this book.  Entries could be titled things like: Poor Sales Execution, Faulty Use of Partners, Inability to Raise Additional Financing. Or for a company from 1999: Inexperienced Management Team, Poor Market Timing, Superbowl Ad. Or perhaps: Product Shortfalls, Slow Customer Traction – Inability to Cut Costs Quickly, Inattentive Investors.  I assume that most VCs think a lot about companies that didn’t work out and why – this would be a way to memorialize that effort and to share it across the community.  I’m actually ½ serious here – let me know what you think.

Louisiana are pretty remarkable. Gunmen targeting medical convoys. Widespread looting. Here’s some aerial photography that shows the water covering neighborhoods.  Here’s a link to a photo series from the WashingtonPost (if this link doesn’t work for you there’s a link from the post home page).  Its unbelievable to see what’s going on and disheartening to watch some of the behavior that is emerging in what has become somewhat of a lawless area (I’m not talking about people stealing groceries to live on – I’m talking about the people looting from jewelry stores and the like).  Reports of the devastation in

In one of my philosophy classes in college we read Hobbes and Rousseau back to back and had to write a paper on who had the correct view on society (Hobbes’ premise that society and laws were needed to keep human nature, which was inherently bad, in check or Rousseau who argued that humans were born good and that it was society that corrupted us).  I’m not sure which of these views is supported by what we’re witnessing, but either way it’s a sad commentary on the state of our society (to say nothing of how unprepared government agencies seemed to be to deal with a disaster that was days in the making).

Ugh.

I wrote a post a month ago about the US personal savings rate falling to zero in June – its 2^nd lowest level since the great Depression.  It’s worth reading the comments to that post, which pointed out the following: 1) people are stupid; 2) don’t get too hot and bothered about just one data point; 3) the savings rate was actually slightly positive – at 0.02% – not actually zero; 4) there’s hidden savings in the US in the form of R&D, education spending and gains in home equity values that, while not exactly putting money into a bank account, is the equivalent of ‘investing for the future’; and 5) higher savings rates don’t necessarily translate into economies growing more quickly (using Europe as an example, although Japan would be another prime data point for this argument). All very good points and well taken (particularly the point on ‘hidden savings’ – I hadn’t thought about that before). However while low savings rates clearly have short term benefits to the economy (in the form of more money going into the economy itself – on a macro level this is a key driver in Keynesian economics) they are probably not sustainable in the long term (certainly not at or near zero).  Also, given the current administrations insistence on expensive outlays of capital and preference for tax cuts which are causing us to run quite a deficit, combined with our large current account imbalance, we’re reliant on someone’s savings to fund our economy (and if American’s aren’t saving, then we’re 100% reliant on other nations to fund our debt). Perhaps some economist readers might jump in here with their thoughts.

With all this as backdrop, it’s worth noting that today the July figures were released that showed that the July savings rate actually fell to below zero (to -0.06%) – its lowest level since monthly records began being kept in 1959 (see the full report here; note that quarterly savings rates during the depression were negative – monthly data were not kept at that time). Inflation is blamed for much of this shortfall (although that can only be the case when spending levels and income are already closely matched), but it’s a worrying trend.  Of course, in his comment to my last post on this subject Jack warns to wait for 3 months of data before getting too agitated, so perhaps we should wait and see if this trend reverses itself. . .

A recent Nielson/NetRatings poll (story here) showed a huge gap between the have’s and the have-not’s. Specifically they asked respondents about their usage of RSS and found that 66% either hadn’t heard of RSS or didn’t know what it was used for and that only 11% of web log readers used RSS to monitor blogs (less than 6% of users overall use RSS according to a Pew Research study from January). There are definitely some implications for those (increasing number) of us who are investing in and trying to grow RSS related businesses (and we’re clearly still in the early stage of the adoption curve for RSS enabled technologies – see Bill Burnham’s great post on the subject here)

That is not what I want to talk about here, however. What I want to talk about is something much more basic about how we are looking at the emerging industry that is building around RSS. I want to talk about “42”Those of you who grew up in the 70’s an 80’s (or who saw the recent movie) might recognize 42 as the much anticipated answer to the ultimate question in Douglass Adams’ classic Hitchhikers Guide to the Galaxy. Not exactly what the universe was expecting and most of the 4 part Hitchhiker’s trilogy then chronicles the search for THE ULTIMATE QUESTION. The point being that sometimes the answer we get is because we didn’t understand the question.

I worry about this with RSS. RSS is a technology – not an industry, not a service, not an application. It’s a (somewhat) standardized format for shipping around XML content. Not particularly interesting by itself – it becomes much more interesting when you lawyer something on top of it (access to your favorite blog or podcast; information about your upcoming trip to Aruba; updates on the top accounts you are working on in your SFA or CRM system, etc.).  Techno-geeks understand what you mean when you say things like “what’s your RSS strategy” and “how are you implementing RSS” – just like they understand that SMTP underpins e-mail or that SOAP is what facilitates communication for apps using web services. Everyone uses e-mail – very few people know what SMTP is. Most people make use of .NET or web services enabled applications – I’d guess that most have never heard of SOAP outside of the bathroom.  Both are important technologies, but for the most part behind the scenes.  We need to raise the level of conversation (and action) around RSS.  We can turn “RSS” from a description of an enabling technology into the common name for accessing information through feeds in a central repository (in the same way that successful companies turn their names into verbs), but we need to focus on what RSS does (and building stuff on top of the technology), not just on the technology itself. I’m not at all surprised when I read stats like the one above – we’re still in the early stages of building an industry around a new technology; still early in the hype curve; still figuring out the potential.

As the saying goes: “It’s not the technology . .  it’s what you do with it that counts.”

HHere’s today’s shocker – VC’s don’t have all the answers.  Those of you  who are not VC’s have known this all along, but for people on the inside it’s a slow process of realization (I think I’m on about step 8).

Seriously, though, as much as its amusing to poke fun at VCs (and our increasing propsnsity to blog), I do really like to see new non-VC folks throw their hats in the ring to talk about the world of operating growing businesses.  Because of my background, I’m especially fond of reading what people in the corporate development world have to say (which is in part why I encouraged Daniel to write a guest post for my M&A series).

Josh King is doing just that and I’d like to officially welcome him to the blogosphere. And with a blog named “corporate tool” we know he’ll bring some humility to his writing <g>.  Welcome Josh!

I’ve had a few frustrating things going on this week and my attitude around them forced me to remember an old adage that I used to use when I was guiding back-country hiking trips (when inevitably we’d get rained on or someone would have forgotten something and people would get upset).

It’s either fun or funny. Choose.
Depending on my mood my response can range from laughter to “fuck you – it’s neither and I don’t want to play this game” (talking to myself, of course). Of course most times it really is either fun or funny (or feels better when put in one of those categories) and when forced to choose it typically puts me in a better mood.

I love playing around with Google Translate – mostly to look at web sites or read blogs that are written in other languages.  I’m also a big cycling fan and after this year’s Tour I decided to write to the German cyclist Jan Ullrich – one of my favorite riders and the third place finisher in this year’s contest.  I wrote my note in English but also translated it into German using Google. I had forgotten about this note until a few days ago when I actually received a note back from Jan (I’m actually pretty sure it was really from him – it certainly made my day!).  I translated it back to English also using Google, but decided that it was too important to leave to chance, so I forwarded it to a German friend of mine in Frankfurt for a second opinion.  Turns out Google did a pretty nice job translating his response, but was apparently too literal in translating my original note.  I found it pretty amusing and thought I would repeat it here – a good lesson in lexical vs. conceptual meaning.

My original note was meant to say:

Jan- You are a wonderful bicycle rider.  I’ve enjoyed watching you in this year’s tour (as every year).  You are a great champion.  Know that you have many american fans! (translated with Google translate – sorry if the translation is rough).

Your faithful fan,

Turns out I actually wrote:

Jan, you are a wonderful bicycle co-rider. I enjoyed being careful for you during this years Tour (as in previous years).  You are a big champion.  Did you know that you have many American ceiling-fans!

(translated with Google translate you – sad, if translate is coarse)

Your reliable ceiling-fan!

Apparently I’m Jan’s only talking ceiling fan <g>

(In case you were wondering, Jan’s response to me was: Thank you very much for your support!  You are helping me a lot! Sorry I am only replying to your letter now.  Best Regards, Jan)

Back from vacation and quite refreshed . . .

One of the things we did in Maine was visit the LL Bean outlet (ok . . . we’re tourists . . .). Going there provided an example of making your threats real – in this case a positive one. LL Bean is open 24 hours a day, 7 days a week, 52 weeks a year.  No exceptions. They are so serious about this that they actually don’t have locks on the doors to their store. Pretty powerful example of putting a stake in the ground about something they believe strongly in.

The US personal savings rate fell to zero in June – its lowest level since the latest spending binge started (post 9/11) and the 2^nd lowest since the Great Depression. You can read the full government report here (be sure to check out some of the tables – very interesting information).  Yes, the economy grew at a healthy annualized rate and clearly the Fed is still worried about inflationary pressure (we still have 50-100 basis points left to move in the fed funds rate) . But still – personal savings rate of 0%? We already lag behind the rest of the world in our ability not to spend pretty much all of what we earn (see here for a chart of US savings rates by quarter for the past 5 years) , and this trend shows no sign of improving.

I don’t get why these sorts of data don’t get more press.  It seems that yesterday’s announcement received little, if any, attention at all.  But our inability to save is a serious problem. Combined with deficit spending and our trade imbalance we’re increasingly reliant on outside capital to finance our collective lifestyle.  Ultimately these trends are not sustainable.

I don’t get why so few people seem to care . . .

I’m leaving for a week’s vacation tomorrow (see my vacation curve post – I’m past the inflection point again) and I’m not planning on checking my e-mail regularly.  To keep down on e-mail clutter, my secretary is going to monitor my mail and delete or move things out of my inbox that are not important or that don’t have immediacy.  To make sure the right stuff stays and goes, I’m making a list of things that I would like her to keep and things that she can move or throw out.  This process has highlighted for me how many things I get delivered to my inbox that should be sent via RSS – all the updates, tech dailies, vc weeklies, investment banking research reports, etc.  My list of things to discard is shockingly long.  All of this is really unnecessary – everything in that group should really be delivered via RSS (I already subscribe to a long list of update or keyword search type feeds through RSS, but the ones on this list are not available in that format yet), which would allow me to be in better control (the Outlook filtering functions aren’t very reliable) and not have to bug someone else with my e-mail clutter.

Next vacation I hope not to have to do any of this. . . .