Archive for the ‘Business planning’ Category

My User Manual

October 12, 2013

A little over a year ago I started a new job, and a big component of my role was to help the company bring a lot of scale to their marketing, and bring a higher tempo and user focus to the company’s product development. This meant taking three groups of already high performing teams, and leading them into territories unfamiliar to them, while also helping them develop skills and capabilities new to many.

This is the kind of job that comes around in your career rarely. Tremendous, tremendous fun, and the best part is it’s only just beginning. We’re growing like crazy, and are about to enter that phase of the market where we have the right offering at the right time, and are about to see some pretty breathtaking expansion.

transparency

And I found myself explaining how I work, how I manage, and many of my core values as a manager, but also as a person. A lot.

So much of creating the opportunity for the rapid experimentation, fast failure, “iterate to excellence” team performance is based on how you work as a team, not what you work on as a team.

I mentioned this to my wife in a text message while on a train headed to work, and she pointed me to an interview with a CEO about his “user manual” – a one page document that lays out how anyone in the company can easily understand how to work with him. I LOVED it. A combination of approaches, philosophy, and personal values.

By the time I got off the train I had a complete draft of my User Manual. Check it out, I’m on v2.1

By the time I’d plugged in at the office I published it to  everyone on my teams via Chatter, as well as my counterparts on the exec team and a bunch of others I work with frequently.

Folks on my team appreciated the transparency, and it’s made it so much easier to engage with other teams and get to a place of trust and performance that much more quickly.

But the best part was for me. Any time you have to be intentional about something, and write it down, you learn something about yourself.

Advertisements

The Unfamiliar State of Funding a Startup

March 8, 2012

I work with a lot of startup companies, and am currently involved with three that share the same characteristics: pre-product, pre-revenue, and at the very beginning of fundraising. And I’m having the same conversation with all three. It goes like this:

  1. The cost of getting a company to scale and even to profitability has dropped dramatically in the past ten years.
  2. The nature of venture capital has shifted from an early stage focus to late stage or even growth equity investing.
  3. Angels and experienced high net worth folks have stepped in to fill the role VCs served for early stage investing.
  4. A viable fundraising strategy can default to a path that doesn’t assume VCs participate at all, or perhaps only towards the end.

Let me expand on each of these points.

COST OF GETTING TO SCALE – THE RISE OF THE MACHINES

There are a lot of factors at work here, to the benefit of entrepreneurs. The rise in cloud computing means that fixed infrastructure expense has largely been eliminated from the business plan, and this will only get better (Amazon just announced it’s 19th price decrease in six years). Virtual teams + Google Docs drive OPEX down even further unburdening you from lease costs.

The shift to “inbound marketing” – social media, blogs, SEO, viral – can drive large volumes of traffic at significantly lower costs (60% less or more) than traditional “outbound methods – and at higher conversion and retention rates. It takes a lot less of your marketing budget to reach and acquire users. With the shift to freemium and subscription business models you can also let your most active users decide for themselves to pay for your services through in-app messaging and offers – significantly reducing the cost of sales.

I call this the “Rise of the Machines” because metrics and machine-driven resources/methods do much of the heavy lifting at a fraction of the cost of human-intensive alternatives. Josh Kopleman surveyed his portfolio and found “…that companies today are 3 times more likely to get to $250K in revenue during an eighteen month period than they were six years ago. ”

VENTURE CAPITAL IS DEAD – LONG LIVE VENTURE CAPITAL

The money that VCs invest comes from “institutional investors” – pension funds, endowments, insurance companies – and these institutions allocate their investments across a wide range of “asset classes” to manage and diversify risk. They tend to make these allocations based on ten year return performance averages, and beginning in 2009 (as my partners and I found out with unfortunate timing) the ten year return for the VC asset class went negative.

That’s for tough the VC industry overall, but if you look at the top 20-25 firms, the ten year return is quite good. So what institutions did was stop putting money in general into the VC asset class, and only put money into the big, established firms. This caused fund sizes to swell (Accel’s most recent fund was $1.35B+ comprised of $475M “early stage” + $875M “growth equity” funds), which incents those firms to put larger and larger investments to work in each deal (to justify their partners’ time).

So at a macro level, investment into VC funds dried up for all but the top firms (reducing the total number of VC funds) and poured into the top firms, shifting their focus to larger investments in later stage firms.

ANGELS BECOME ANGELS ALMOST LITERALLY

At the same time early stage VCs moved out of the market, a wave of experienced tech executives who had made fortunes building internet companies became very active investors. They brought more than deep pockets, they brought valuable insight and experience and even better – intensive, engaged roles with the companies they funded.

And along the way, incubators emerged as mini-factories where angels could become involved with lots of companies and let the law of large numbers help them there. Overall, angels are investing 40% more than they were even a year ago – now over $700K per round, and there are concerns there’s a bubble happening with incubators. But the headlines are, angels have stepped into early stage investing at a scale and role traditionally reserved for VCs.

STARTUP FUNDRAISING HAS NEVER BEEN BETTER, AND WORSE

What this means for startups is you can get your business to scale with ten times less money that you needed 10-15 years ago. $3M – $5M. If you plan well and are well connected you can do this with individual investors who add a ton of value and will roll up their sleeves to help out. The real benefit is you can also find individuals who share the same expectations you have for the outcome of the business. A 5X return on $3M may be the right outcome for the business and for investors who define success as a financial return coupled with a durable business that solves a problem they care about.

It also means you can liberate yourself from having to map your business and outcome to the trajectory that many of the larger VC firms need their investments to align with – they need billion dollar exits to generate the billion dollar returns they committed to their institutional investors.

Don’t get me wrong here. VCs are an important and valuable catalyst to the technology sector and the economy – and many are out there doing what they’ve always done to identify the next great disruptive business. And for your business, a VC can be the exact right fit either at the beginning or once you’ve gotten to scale.

It’s just that now VCs are playing a different role than they have in the past, and for startups this means it’s a brand new, unfamiliar, day out there.

Back online

February 29, 2012

Well, that was a long hiatus. But for a lot of good reasons I needed the time away from this and feel ready and enthusiastic about resuming the exploration of technology and startups and how failure critically enables their success.

Next post to follow, and will be on the theme of how user acquisition costs and leverage have dramatically reduced the financing required to get a company to break-even (and to a seven figure user base), and how that’s reshaping not just early stage businesses, but mature enterprises.

Stay tuned, and thanks for your patience these past months.

Pete

You miss 100% of the shots you don’t take

December 15, 2009

Something I have just loved about being in the venture capital business is the people I’ve met, running businesses I did not fund.  And of those there are a few I found so relevant to my own interests, and with founders who had such passion and integrity, that I continued to meet with them well after saying “no.”  Trying to be a productive sounding board, making introductions, passing along knowledge or experience where it seemed helpful.

It’s always been such a pleasure to get the updates from these CEOs, they arrive when you least expect them and it’s exciting to see how things are developing, where the connection is no longer the possibility of financing, but a genuine interest in the business and a relationship with the CEO/team.

Dustin Hubbard of Paperspine is one of these.  His company offered a subscription service for books.  Physical books.  He  had the idea for his company after finishing a book, and having no room for it in his already jammed bedside table.  So, he planned and planned, left his job at Microsoft, started and ran Paperspine out of his garage.

Paperspine worked really well, and solved problems that people cared about.  It probably saved my family hundreds of dollars, just with my 16 year-old daughter, a voracious reader, and who routinely dropped tens of dollars at bookstores, only to read the books once.  She loved Paperspine.  She was on a five book out at once subscription at one point, and it enabled more massive reading without bankrupting her.

And while Dustin had gotten Paperspine off the ground with funding from friends and family, he couldn’t raise his next round of financing – in a market where raising money is almost impossible anyway.  But he applied himself to solving this problem with every ethical means imaginable.  Cut costs to get to break even, went back to work at Microsoft, tried to expand into ebook rentals.

Dustin and I spoke every 45-60 days, where he would walk me through his latest set of challenges, his ideas to address them, and we’d then spend the next hour testing his assumptions, plans, and brainstorm solutions.  But he always arrived prepared and ready to dive into a meaningful discussion, and sometimes I could help, other times I think he just valued the opportunity to have someone outside the company to run his thinking by.

But for many reasons, some within in his control, many outside it, he was unable to get his next round of financing.  And he seemed to be reaching the limit of how much this business was encroaching on his life, quality of life, and family.

So, last night I was truly saddened but not necessarily surprised to receive an email from Dustin, saying that he was closing the doors.  I can only imagine how hard this was for him, how heartbreaking.

And he closed off his dreams for Paperspine with the kind of grace and thoughtfulness that we should all take note of, and admire.  You should read his final blog entry, a real fitting testimonial to a worthy business, and an incredibly decent founder.  And you can see pictures of his “warehouse” in his garage, and learn more about how he took his idea and brought it to life.

His wife framed this so well, reminding him that “you miss 100% of the shots you don’t take.”

That phrase captures the essence of what it means to take an idea that crossed your mind, and have the courage to start a company to bring that idea to life.  And you bring it to life focused on why it will and should succeed, while also keeping, in a separate place, the knowledge that there are many reasons why it could fail.

Dustin, you should be very proud of what you accomplished and learned these past two years, but you should also be very proud of how you ran your company, and how you finished.  Well done, not painless, but well done, indeed.

Startup advice brilliance

October 21, 2009

A friend pointed me to a superb summary of advice for startups, specifically calling out the ways that advice can be flawed, along with some perceptive insights into how to identify advice that’s actionable and useful.  The post is by Eric Reis, and is appropriately titled The 10 Ways Startup Advice is Flawed

Eric’s pov is appropriately snarky, and at a macro level he calls out various ways that being lucky and being smart are frequently confused with each other.  Snarkiness aside, the really valuable point he makes is how important it is to be a critical thinker, in general.  The value of making your own assessment of the information you’re consuming, and not just accepting it.

I especially liked his point #6: Maybe the thing they did used to work, but it doesn’t anymore

I think about that a lot in my own context.  I was at RealNetworks back when it truly was pioneering this new phenomena of sending audio and video over the internet, and we owned that market.  In public we said we had 85%+ share of the market, but in reality it was closer to 95% for a good long time.

We called the shots, named the prices, dictated terms.  We muscled into and out of markets we cared about, aligned ourselves with titans of the technology landscape.

And then Microsoft showed up and we fought them tooth and nail.  It was a hard and ugly fight, which they eventually won (once they started paying attention).

Well, they won, sort of.  It was epic, and in a start-up kind of way, it was epic fun.  I remember picking a big fight with the Windows Media team on an internet media list-serve, where I’d just published some user research showing how people preferred our new video to Windows Media’s.

And Microsoft’s head of a/v technology posted to the list, accusing us of fluffing up the research, and he included a three page outline of the ways you could falsify/skew consumer surveys.  And it was so much fun to respond to the list , asking “how was it that Microsoft knew of so many ways to distort research?”

But I digress.

We each became so obsessed with each other we quit paying attention to what Macromedia was doing with Flash and what Apple was doing with the tight coupling of iTunes and the iPod.  So, while we were both wrestling in the mud pit, Apple and Macromedia left the building and started more interesting and lucrative businesses elsewhere.  And until that point the thing we did at RealNetworks really did used to work.

Eric’s “ten ways” are simple and insightful.  The hard part is putting them into action, in the moment.  My experience at RealNetworks is valuable to the startups I work with and talk to if and only if both of us are cognizant of its context.  And it takes discipline and a good dose of humility to walk the talk Eric is alluding to.

I know there’s a ton of stuff I did that was a product of luck and timing, and a lot that was a result of deliberate hard work and applied intelligence.  The hard part is being honest enough with myself to examine where those boundary lines are, to strip out the specific circumstantial knowledge from the generalized, truly durable knowledge.

So, let’s all get a good laugh out of Eric’s list, but also remember how hard it is to actually do what he’s suggesting.

Performance and an opportunity to explore it

October 2, 2009

The underpinning principle of this blog is “meaningful failure”, and what you can learn when you examine this critical juncture of where you fail and embrace what you can learn through that failure.

I’ve been seeking out others who share this interest, and last year I discovered Ross Bentley who runs a consulting business, Bentley Performance Systems, that focuses on improving performance for executives and interestingly, professional race car drivers.  That latter constituency intrigued me.  Failure on a race track has specific tangible implications that failure in business does not:  bent metal, physical harm, or worse.

Ross spends his time working with his clients on very personal elements of improving performance, along with more straightforward tools and techniques of planning and analysis.  His focus on who you are as a person I find interesting, the examination about what emotionally or psychologically may be holding someone back from achieving their potential is an area like failure where people are less comfortable speaking plainly and openly.

In the case of the racers and the executives the conversation goes in the same direction:  how can you best prepare yourself to be constantly improving, learning from success and failure?  He engages them in relevant and specific conversations focused on getting them to do to what they do differently and better.

And after this discussion, examination, and hard work the racers go to the track and the CEOs go to their offices.  In both cases they’re in environments where the information is flowing by, fast, and they need to make decisions and situation assessments rapidly.  And each ends up with a quantifiable data set telling them how well they performed: lap times & finish order, income statements & balance sheets.

Ross and I got together yesterday so he could share a research project he’s starting called Performance in the Workplace. He wants to to better understand how executives assess their own performance, and what affects their performance over time.

The research is nice and simple:  he’s asking them to fill out a short survey, once a week, and tell him how well they feel they’ve performed, and why.  You can participate in the project by signing up here.

What I like about his approach is that he’s not defining “performance” for the participants.  He’s letting them define it for themselves.  When he first told me about this my reaction was “that’s pretty subjective, why not quantify performance with metrics”?”.  But then I realized, that really misses the point.  When you’re trying to help people do better every day, metrics are the product of your performance, not the measure of it.

We run businesses based on a set of milestones, KPIs (key performance indicators) – “dashboards” – and these are important measures of the recent past.  And they’re critical – I’ve written about why a well documented operating plan and the corresponding assumptions are essential to managing your business.

But executives spend their days making decisions, asking questions, analyzing and assessing – and of course this results in metric-based results.  But not in the moment.  How do you assess the effectiveness of your performance while you’re making those decisions, asking those questions, digging into those numbers?

I think Ross is onto an interesting topic here.  What causes you to feel you’re performing well one day, and not so well the next?  Will the act of self-assessing performance help you, in and of itself, to become more effective and cause you to be closer to the top of your game?

I’m going to participate, because in my business, at best I get monthly or quarterly metrics from my companies in terms of valuations I can apply to rates of return – on paper – and it takes years to get to the point where you can convert the paper value to cash or stock you can sell for cash.  Daily performance is not at all quantifiable with metrics, but matters oh so much.

I’m sure I can learn something from this, and am eager to see how what he finds.

A BDP from an unlikely “industry”

July 29, 2009

My first job out of business school was with a management consulting firm who focused on growth strategies for their clients.  The four founders of the firm were former partners at Bain, and they brought to our firm the concept of “best demonstrated practices” which we referred to by the acronym “BDP.”

Bain defines a BDP as something that “generates the most value at the least cost.”  At our firm it referred to an example something done so well you could you use it as a model to learn from, where you could discern the essence of success from and apply it more broadly.  This could be a business process or a business model, communications or management style.  It’s a nice construct to help you identify patterns that could be relevant to you or your business.

Of course BDPs also have limitations.  Without the corresponding insight about the context of why an example works so well, about all you’ll be able to do is copy the motions of the example, but not the essence of its effectiveness.   To make a BDP really work you’ve got to simultaneously abstract away the context while also deeply understanding it.

I’ve seen some of the startups I’ve worked with over the years really get this wrong, whose teams will energetically seek out the best performing companies in some discipline (say, acquiring new users) and just copy what was done, without understanding whether or not those same methods really make sense or apply to their business, with their users. 

But every so often you come across an example of simplicity and insight, efficiency of communication, where the problem has been thought through so completely you just wish you could take it, copy it, and paste it into whatever business you’re running.

I came across one of these earlier in the week.  You know from my last post that I’m hiking the John Muir Trail next week, which will take about three weeks.  I won’t be able to carry all my food for that length of time and will need to resupply twice along the way.  This works pretty simply, you mail a package of supplies to one of two “resupply” points, and they hold it for you until you arrive.  You restock your backpack, give them your trash, and off you go again.

But it’s more complicated than that.  I am depending on that food being there when I get there, If it’s not there when I get there, I’m screwed – I’ll be close to being out of food and will still have more than a week of hiking to go to the next resupply.  So getting this right matters a lot.

The first resupply point is like a hotel in the mountains, about a six mile roundtrip detour from the trail.  The second resupply point, The Muir Trail Ranch, is much more convenient, literally on the trail.  The quality of thinking that went into the instructions about how to get your package to them, and how to ensure a successful resupply, is simply magnificent.  The fact that you ship your food to them in a five gallon plastic bucket makes this all the more whimsical.

It’s not just the explanation of the steps and logistics, it’s the tone of the communication.  Clear, simple, welcoming, conveying a desire to make you successful, to make the whole process successful, conveying a deep understanding of the context of their service. 

Their instructions reads like an FAQ, but it’s not a laundry list of questions, it’s a very thoughtful and insightful delineation of your needs and their ability to meet them.  They’ve addressed the “lifecycle” of a resupply – the range of needs you will have (email access, recharging devices, disposing of your trash) when you’ve come to get more food. 

To me the high point is at the bottom of the page, where they encourage you to pre-register your delivery, and will even e-mail you pre-printed shipping labels.  The example label sheet is stunning in its efficiency – I don’t know about you, but I’ve certainly never mailed a bucket before, and doing so is not obvious.

This experience certainly reduced some anxiety about my resupply, but made me appreciate how wonderful it is to be on the receiving end of high quality thinking and customer awareness.  Where insight about the context is abundant.

Societal costs and pure economics

July 2, 2009

I wrote earlier in the year about the challenges companies face raising Series B financings, and in particular how vulnerable companies are who have demonstrated potential but not yet converted that into a reliable, profitable revenue stream.

The issue is keeping an eye on your cash while continuing to develop the business, anticipating the next infusion of capital.

But what if you look at the business today and soberly assess that it’s just not going to get to where you expect or believe it needs to be: either to raise more money from an outside investor or to deliver meaningful value?

When do you make the decision to stop fundraising and use the remaining cash to wind the company down?  It’s somehow easier to get to that decision point as an investor.  You’re almost structurally set up to make that dispassionate call, not involved in the daily business, but fluent in the operations and the potential.

But that’s structure and theory.  In practice you are very close to the business and to the management team.  You’re spending tons of time with them.  You invested in their vision.  So unless the company has missed its milestones by a country mile there’s enormous room for debate, and ambiguity.

However a looming cash-out date sharpens everyone’s focus; there’s only a few short months until you’re out of money.  Time pares down the alternatives until there’s just one.

What about companies who have enough money to keep going for a year or more, but whose business is just not performing?  And what if you don’t expect it to?  What if the shape and trajectory of the business is just not mapping cleanly onto a business that will deliver the potential you expect, or more importantly, that the market will value?

That’s a much more difficult call.

Are you better off acknowledging the futility, the wasted resources (money, time, career opportunity cost), and be deliberate about making a difficult decision sooner rather than later?  The big issue is that in this market, unless the business is profitable, the likelihood of selling it is close to zero, and if you are lucky to sell, the price will be predatory at best.  A few million dollars, maybe.

So, let’s say you have $5 million in cash now, and you’re burning $1 million a quarter.  Do you spend $3 million and three quarters to see if you can get the company to perform to expectations knowing you might be able to sell it for $5 million a year from now if you’re wrong?  Or do you just shut down the company at a cost of $1 million, and redistribute the remaining $4 million to investors?

That math is harsh, but what’s harsher is the economic climate that supports it.  This isn’t a “present value of tomorrow’s cash” kind of problem, it’s more nuanced.

Are you better off giving the company the runway and time to try?  And the employees another year of security and jobs?  It’s that second part that in the past I think would have been easier to look beyond, but today, for me, it really becomes a significant variable in the calculus.

We’re in the business of making risky bets, and generally view time as an asset to develop options and deliver unexpected upturns; taking it off the “balance sheet” seems at odds with the whole ethos of our business.

But is that also a way of dodging the responsibility of making a tough decision?  Avoiding the inevitable is different from preserving options.

How much more do you weigh these societal costs against a purely “economic” decision?  In a growing economy, it’s so much easier to focus purely on the economics.  In a growing economy people will get new jobs, some more quickly than others, but they’ll move on.

But in today’s economy it’s just not that clear.

The vulnerability of a big idea

June 15, 2009

As Twitter approaches mainstream relevance, it’s also entering a period of strategic and operational vulnerability that startup companies with big ideas run into. 

By going mainstream it’s exposing the structural opportunity its founders saw years ago, but back then, only the founders and the investors were in on the secret.  There had to be a slide in the Series A deck that said  “Here’s the opportunity” and it wasn’t about building a small, derivative business.  It was about building a disruptive, billion dollar kind of company.

In Twitter’s case it’s the opportunity to redefine how people communicate, and shaping how the economics flow in and around this new communication.  It involves getting to scale, developing a third party “ecosystem” of other companies integrating with and depending on Twitter for their own success, and then monetizing all this in a compelling, huge way.  This is really hard, and the folks at Twitter are still struggling a bit with the exact business model that will do all this.

Eighteen months ago, only people in the echo chamber were exposed to the nature of the opportunity.  But today, with Twitter’s explosive growth and visibility, everyone can begin to comprehend the potential.  When Ashton Kutcher gets petulant about his million followers, when Dell trumpets that they’ve sold $3 million of products to their Twitter followers, the incumbent titans in the internet and advertising sectors, well they notice too, and they notice “threat” ahead of “opportunity.”

You saw this first with the Facebook redesign that provided a real-time status update feed a la Twitter.  A classic “fast follower” approach to someone else’s innovation. Facebook already owns a lot of people’s mindshare and time online, so the fact that they’re tracking Twitter tells you how significant the threat appears to them.  By the way, Facebook is also struggling with business model and opportunity vulnerability too, they just are further along the scale path.

How does Twitter keep eyeballs and session times growing if Facebook is just going to “fast follow” them, treating them like outsourced R&D?  This will be really hard, but let’s assume Twitter wins this round of the battle, gets to scale with a loyal and large audience for their new medium of tweets.  Do they jump out of the frying pan and into the fire?

What’s differentiated about tweets is that they flow in real-time, and finding out what’s interesting and relevant instantly has got to be worth something, and it’s so different from the problem Google solves.  Google crawls the web at a frequency measured at best in minutes, more frequently hours or days, so you could envision Twitter creating a new category Google can’t participate in. 

But what if “instant” isn’t in the end all that important.  The NY Times dug into this a bit, looking into  why Google isn’t Twitter.  And they observed that real-time search is hard and neither Twitter nor Google are currently architected to do this efficiently, or well. 

What became clear is that if you need anything other than instant, real-time search, Google can give you “close enough” search, and get closer and closer over time due to their scale.  We can all figure out who will reap the revenue rewards if all Twitter’s creates is another type of page Google can place ads on.

This kind of battle doesn’t result from incremental thinking, from safe bets.  Twitter’s vulnerabilities are proof of the significance of the idea, and what Twitter’s investors funded.  But it doesn’t mean it will have a happy ending. 

And there’s food for thought here for anyone running a startup.  Expect that you will become vulnerable to the incumbents just when you’re hitting your stride, just when people acknowledge your value and relevance.  The presence of that vulnerability is your ticket to the next round of the fight, validation that you’re headed in a worthy direction.

I dearly hope Twitter pulls this off.  I love to see the status quo up-ended, I love the mental image of apples spilling all through the marketplace as someone with a bold and compelling idea runs through, knocking the carts over along the way.

In defense of the echo chamber

May 28, 2009

I had two interesting conversations this week with super smart technology execs, and found myself uttering the same phrase to them, in different yet related contexts. The phrase was “…and it made me feel a million years old”. The context in both conversations was remarking on how long it takes for real, pervasive technology innovations to take root and how you reconcile that with early stage investing.

And I can’t really explain it to myself. I spent a 15 year phase of my career at companies transforming the entertainment and communications sectors, totally in the thick of the “next big thing”, and felt so urgently and palpably that we were shaping and enabling the next “normal”.

At one of those companies, C-Cube, we were making the foundational video technology that enabled the whole transformation to digital cable, satellite and DVDs. I spent countless hours with executives in these industries while we figured out how this would all work, and around 1994 I heard them tell us all that “500 channel cable” would be here, the coming year, maybe the year after that. Right around the corner.

Except it wasn’t. It only took about another 15 years.

But it never would have happened if we all hadn’t been working away, really hard and for a long time, acting, believing that “right around the corner” was really true.

I felt like I was a little smarter when I was at RealNetworks in 1999, and I heard many of these same executives talk about how by using the internet over cable (or telephone lines) they could deliver movies and 500 channels of TV the next year. Maybe the year after that.

And I remember leaving some of these meetings and telling my colleagues I’d heard this before, and it wasn’t going to work out that way, that they were “breathing their own exhaust fumes”. But I still worked really hard, and for a long time, trying to make that “right around the corner” become true too.

So here we are, in 2009, and I can order a movie from Amazon over the internet and have it delivered to my Tivo. Just ten years later, or 15 depending on whose vision of the future is the reference point.

And it struck me in the conversations I was having with the execs, that perhaps it’s not so much feeling a million years old, it’s realizing that early stage investing and startup companies places you in this strange place, where you straddle two worlds. The world “inside” the vision, where the idea is bold and the future seems right in front of you, and the world “outside” where you can look at these companies and understand it will take a decade, maybe more, for that reality to be commonplace and accepted.

There’s a semi-derogatory name for this inside world, and it’s “the echo chamber”. Most of the time it’s focused at Silicon Valley, but I actually think it’s not geographically constrained. The boundaries are more around the locus of a really big idea and a group of people who can pull it off. They get a bunch of other people to believe them, to buy into the vision – customers, partners, press, analysts – and now there’s a cohort that reinforces the belief system.

You can see this playing out, right now, with all the convulsing about Twitter. It’s been ascribed to being useful just to folks in the valley, just the people whose whole focus in life is in the development and consumption of technology most of “the rest of us” will never need or see the use in.

Kara Swisher of the Wall Street Journal wrote about Twitter in this context a year ago. And I read her column at the time and my reaction was “I’m glad she called this one out, it’s ridiculous how much hyperventilating goes on in the valley about stuff like this – it really is an echo chamber”.

But there’s nothing wrong with this, in fact it’s exactly how we ended up with Tivos at home and can’t imagine life without them, how we watch Susan Boyle shatter our expectations and assumptions about image and substance, and how a billion apps can be downloaded onto iPhones in nine months. And how we will all be tweeting and wonder how we ever communicated without it. In about ten years.