The Vision

New Phony Fed Stimulus Financial Paradigm = Deflation Not Inflation

noreply@blogger.com (Jeff Cohn) — Tue, 07 May 2013 20:19:00 +0000

Fed Stimulus = Deflation Not Inflation

The Fed has created another bubble that will likely pop but this time all the hedge funds are all long the market and not short. Is the business environment REALLY getting any better with all the Fed Stimulus, QE1, QE2 or QE3? Not really if you ask me and it has created a phony sense of reality with the over inflated equity markets. Historically, investors would value buying stocks based on that company making money. Today, investors are making stock purchasing decisions based on liquidity, yield and price action. The Fed wants investors to chase equities and bonds higher so we feel wealthy and spend more. But their intentions to create inflation could have the opposite effect on those who actually create the jobs and invest.

Sustainable jobs are created through organic growth and Venture Capital. It is not the job of Government to decide which industries succeed or fail. Our latest Fed policy has created a false sense of safety and has indirectly propped up businesses that historically would be failing. Business failure is actually a good thing for a capitalism and for investment because it moves people and money to new areas which we call the business cycle. It also allows the leaders to succeed more quickly by flushing out the weak competition. Flushing out crappy businesses in crowded industries is what our economy is lacking right now and thus why businesses are not seeing any benefits other than low interest rates.

Most industries are not experiencing earnings and revenue increases as quickly as the stock market leads us to believe. There are exceptions like real estate but for the most part industries are suffering from the lack of organic investment and job creation. If we had normal business cycles we might actually experience inflation in business and wages. We are not seeing that right now because most of the billionaires don't want to invest for the long term when they know it could come all crashing down. How about giving some money to the Venture Capital industry that creates jobs? Read this previous article we wrote back in 2010. How about some QE for the Venture Capital industry that is actually shrinking?

Ben Bernanke Has Purchased Double D's

Obama's Views About Business

noreply@blogger.com (Jeff Cohn) — Fri, 07 Sep 2012 03:14:00 +0000

Translation on Obama's Views About Business

Prop up all big crappy businesses (ie. Auto Industry & AIG) to protect middle class jobs that will crush all disruptive and innovative start-ups. Bigger businesses are better than free market innovation and smaller more volatile companies. Free market capitalism does not work so let the Government call all the shots about what businesses succeed.

Obama's business plan for the USA might as well have been written by a 5th grader. His vision is incredibly short term, thinking that roads, bridges and now runways (ooooh) will somehow create sustainable jobs? This is ridiculous since that was our business plan from the 1930's and has nothing do with wealth creation or capitalism. How does this help the United State create jobs and new companies that compete with China, Brazil and Russia in a global economy? It does not and has nothing to do with technology, education, healthcare or environmental innovation.

There is a huge disconnect and this is why IPO's, venture capital, start-up acquisitions are at its lowest lowest levels in decades. The Democratic National convention should be a rude awakening for all start-ups and investors. Put your money and checkbooks away if Obama gets elected because it will be a market of big businesses getting bigger. Protecting middle class jobs will be more important than letting start-ups innovate that create sustainable jobs and long lasting companies.

The problem is capitalism is happening 100x faster than ever before and many Democrats are too stupid to get out of the way. What would the auto industry look like today if we let GM go bankrupt? We might have fewer jobs but better & cheaper cars? Companies like Tesla might actually be an industry leader. Think about all the companies that wanted GM to fail? That's capitalism and preventing capitalism goes against the American ideals. Democrats call it a "zero sum" game. But no . . . the Government decided that GM is better.

Failure is good for business so they can be restructured. GM was a huge shareholder cram down without restructuring by a shareholder (aka Gov't) with unlimited money. Some call this a ponzi scheme because the cram down shareholder (Gov't) can print unlimited money and prop up the stock in the free market. GM has the same union problems and will ultimately fail soon as smaller companies slowly catch up to compete. Obama just delayed innovation by another decade. Slower change is better? F that.

This goes without mentioning that the capital cycle needed to start new companies is broken because of faulty taxation assumptions. Millionaires and billionaires (limited partners in VC, Private Equity and Hedge Funds) need to be incentivised more to invest more. Raising taxes on capital gains will kill the capital cycle flow back into companies drastically. Making the pie bigger is far better solution that redistributing money through higher taxes. Mediocrity will soon become a the middle name of the USA.

Our Government is too big and needs to be restructured as well.

Never Use "Honestly" in a Truthful Statement

noreply@blogger.com (Jeff Cohn) — Thu, 24 May 2012 19:00:00 +0000

One of my biggest pet peeves is someone who describes a statement using the term honestly. Why? Because there is usually a hint of dishonesty to whatever is said. Its a bad habit if you do it and usually a sign of insecurity about a statement or a sign that you are not telling 100% of the truth. If you have to describe your statement as honestly it unusually means there might be a slight "white lie" in your statement.

This holds true especially in the World of Wall Street and politics. I here statements like this often on TV and it immediately tells me this person might be full of shit. Its a good thing to listen for if you are a contrarian investor. I tend to run for the hills and avoid a stock or company immediately if I hear management use this.

"Honestly, I really like it." "Honestly, I really don't know the answer." "Do you want my honest answer?"

Pay attention to the next time you hear it and ask yourself what hidden agenda that person who said it might have. Feel free to submit your examples below.

The other statement I am starting to not like is also . . . "Trust me".

Intuit SiteBuilder Desktop & SiteBuilder Lite Problems

noreply@blogger.com (Jeff Cohn) — Tue, 01 May 2012 22:43:00 +0000

I have been a loyal customer of Homestead for over 12 years and something is very screwed up with the software and tech support at the company. Ever since Intuit purchased Homestead recently the support and software has gone way down hill. Ever since the update with the bug I have been unable to edit my sites and feel like I am being held hostage.

I run a few web sites that have heavy traffic and very tech saavy about how to use the software. I have been trying for 3 months to inform Intuit Homestead that their recent SiteBuilder updates have bugs in them. After numerous phone calls, emails and chat support nothing has been done to fix the problem. My problem is very simple and its frustrating that no one at this huge company is aware of the bug or has been able to fix it.

Intuit SiteBuilder desktop recently did an update to their software 3 months which is preventing me from uploading any lengthy html code. The Homestead SiteBuilder software freezes and does not allow me to upload or change any of the code. I have tried uploading 500 to 2000 lines of code into the html snippet and it does not work.

I tried using the SiteBuilder lite hosted version and this does not work either. Whenever, I try and upload my code to the site it inserts footer code into my page even though the boxes below are unchecked. The footer code that is mysteriously inserted into my pages creates formatting issues. The correct format for my site is here (correct page I haven't changed this page in 3 months) and see the footer code that Intuit screws up the formatting of my test page here.

The solution I was told by a customer support representative was to upload the page directly using the file manager. However, all my pages are indexed in the search engines under HTML and uploading an HTM file is the only way to do this. Why can I not create and HTML page and only an HTM page?

Another solution that an Intuit representative told me was to do a clean install of the software. I did this on two computers and even went to the store to buy a new $1,500 Samsung Series 9 Ultrabook with Windows 7. Same problem still exists and Intuit can't find a solution. They can't even let me use an old version of the software which works correctly. Very bummed and will likely be leaving the company soon.

Why Did Google Issue Class C Shares?

noreply@blogger.com (Jeff Cohn) — Thu, 12 Apr 2012 20:51:00 +0000

Can someone please explain why Google did this strategy?

Google plans to split its stock 2-for-1 in part to preserve its leadership's voting power. However, they are issuing a new class of stock to shareholders that won't have any voting power. All current stockholders will get 1 share of the new Class C stock. Google said the split is something investors have been asking for but why the new class of stock and not just a straight cash dividend? When will (Nasdaq: GOOG) issue new stock? Are people talking about the Google Class C shares having zero voting power aware Larry and Sergey currently have 60% voting power?

Investors will vote on the proposal in June. It's expected to pass because Google's senior leaders have most of the voting power. Larry Page said, "It's important to bear in mind that this proposal will only have an effect on governance over the very long term," CEO Larry Page and fellow co-founder Sergey Brin wrote in a letter. "It's just that since we know what we want to do, there's no reason to delay the decision."

Employees given Google stock in the future will get the non-voting share, allowing voting power to remain with existing shareholders. Also, management will have the voting stock tied to the non-voting shares through a "staple agreement".

Romney Paul vs Romney Santorum

noreply@blogger.com (Jeff Cohn) — Thu, 23 Feb 2012 15:29:00 +0000

Who is the Republican Establishment?

noreply@blogger.com (Jeff Cohn) — Tue, 21 Feb 2012 21:29:00 +0000

Can someone please explain who are the leaders of the Republican Establishment? Please provide a list of suggested names in the comment section below. I wish the "republican establishment" would explain themselves in front of a camera. The more I hear this term, the more I think its the liberal media telling us who the Republican Establishment is.

Vertical Incubators vs Startup Accelerators

noreply@blogger.com (Jeff Cohn) — Thu, 16 Feb 2012 01:14:00 +0000

What is the difference between a vertical incubator and a start-up accelerator? First, let me preface my opinions by stating that, most entrepreneurs and investors don't have a clue about how much competition exists or have any appreciation for how long it takes to build a business. Every entrepreneur and investor should always assume that 1,000 companies are doing the exact same thing and assume it will take five to ten years before the business reaches critical mass.

With this in mind I would like to share my opinion on the growing phenomenon of Southern California entrepreneurs turning to these organizations for help. Before you sell a piece of your idea or company to one of these companies or investors you should have a clear understanding of the incubator / accelerators long term goals. Do they have your best interest in mind and do you really need them to become successful. Ideas are a dime a dozen in the startup world and its all about the execution of your idea the makes you successful.

A vertical incubator is group of investors and entrepreneurs who collectively form companies that focus on a specialized industry vertical. Specific examples include: mobile games, telematics, social media, advertising are some examples. An incubator that proclaims they are focused on digital media, Internet or mobile is far too broad and unfocused. Typically the mentors of the incubator have deep domain expertise and contacts within the target industry that can foster accelerated business and technology partnerships. Also, most of the companies within the incubator portfolio focus on solving similar complimentary problems in the same industry where resources can be shared. Most vertical incubators are designed to help "first time entrepreneurs" with the basics of company formation, technology, management, business development and provide a small amount of funding for a pretty big chunk of the company.

A start-up accelerator / incubator is typically started by a group of smart people who have a backgrounds in finance, investment banking, venture capital or successful entrepreneurs. Accelerators tend to be technology agnostic or generalist. They will look at lots of deal flow in order to find ideas and entrepreneurs to fund. The founders and the portfolio companies do not necessarily overlap and there is typically no purpose or overarching mission to incubator. This lack of a mission or goal is why I am not a big fan of accelerators. Making money or giving back is not a reason to start a company or an incubator. Having passion about a particular problem or industry is most important, which lends itself to fulfilling a mission. Focus, focus, focus is everything!

In my opinion an accelerator / incubator with limited capital resources (under $500M) cannot be a generalist. It may be a lot more fun to see tons of ideas and deal flow but I guarantee you the incubator that focuses on a niche will be more successful. The 80/20 rule applies to just about everything in life and especially investing in the technology businesses. The incubation game is about focusing on what the people within the firm know and do best.

Putting all the energy of the firm into one particular area of focus is paramount. Why, because there are only so many experts in a particular field and the best always rise to the top. Its impossible to be an expert at everything despite what most VC's might claim. Yes, investors can make bets in lots of companies to hedge risk in an incubator, but at the end of the day 80% of the fund will likely come from 20% of the companies you start. Focus will be demanded as the incubator matures and some companies fail. So, it probably makes sense to have a common mission deliberately at the beginning because someday all the jockeys might be riding on the same hoarse.

Our monthly Venture Capital Alliance meeting this morning was particularly interesting as a sign of the changing times once again in Southern California. We met with the founders of MuckerLabs, Startup Engine, LaunchPad.LA and had some discussion with investor friends of Amplify.la. It encourages me to see the renewed energy in LA since the 40 or so VC funds started in the late 1990's are all but virtually extinct. However, LA still lacks the critical mass of capital resources that the Bay Area has and so it makes it that much harder to create a billion dollar ideas down here. LA doesn't have the financial resources to create "ponzi scheme like VC companies". (ie. Groupon)

Ponzi scheme VC investing is when angels and VCs form cult like groups that bid up private stock in illiquid private companies. Ponzi VC scheme companies rely on constant fund raising in order to keep the business afloat and never have any intension of making money. Financial engineering is common as most VCs participating have multiple funds (early and late stage) to create a false sense of growth. Soon private equity funds and hedge funds take the bait and then Wall Street investment bankers sell the stock in an IPO dumping all the shares on the retail investor. Groupon is a great example of a VC ponzi scheme as bigger dumber money kept pilling on top of early investors without any intension of making dime of profit. There were 1,000 other Groupon competitors in a company that had no IP or competitive advantage when it received a $100M VC valuation from a few Bay Area VCs.

The VC game has become an a very tight lipped investor club controlled by a half a dozen funds who only bet on their friends deals. If you are not in the club that don't try and get in because most the time you will get screwed unless if you have something very special. So, I would encourage the incubators based in LA to build hyper focused niche businesses that sell for $5M, $10M $50M, $100M and not $1B. Bay Area billion dollar ideas don't work in Southern California yet so lets start slow. Digital media companies based in will LA will kick the crap out of the Bay Area in the next down business cycle built on VC ponzi schemes. Smart people will come here and join the wave on Silicon Beach. Lets get back to the basics of business and ask the hard questions like, "What pain are your companies trying to solve?"

I would also encourage you to read Ryan Born's article: LA Startup Incubators/Accelerators/Mentorship Programs as Compared to NCAA Football Conferences

I encourage your comments below!

How to Be Smarter Than The News Media

noreply@blogger.com (Jeff Cohn) — Wed, 08 Feb 2012 00:04:00 +0000

Financial & Political News Media

Most smart people know that the mainstream media is controlled by huge companies at the highest level and they are simply puppets and not news reporters any longer. The majority of what we hear is not news but simply filtered PR and sensation stories that have filtered their way to the top of the pile in social media. If you take the time to read these blogs daily below, it will guarantee you to become smarter about interpreting the mainstream liberal news.

Social media is merely a representation of what is popular and not necessarily what is important. This drives news reports to talk about stupid things that any normal intelligent person would just ignore as a waste of time. Bloggers have taken over the role of reporting the news in finance, economics and politics. Bloggers do the best job of dissecting and interpreting the mainstream liberal media news, which is very hard to do. Some bloggers are reckless about not checking facts but information does have a way of getting filtered out eventually.

Here are the best blogger news sources I read that help support my conservative views about politics, economy and finance. I read them daily because the mainstream news is typically old, non-original and derived from blogger sources. At the same time it is virtually impossible in depth coverage of to get quality news coverage from NBC, CBS, ABC and even Fox. You can also follow this list on Twitter at Smarter Political News. Here are two other Twitter lists I am building that do a good job of interpreting the biased financial press and technology news. Smarter Tech News Smarter Financial News

Facebook's IPO Valuation Should Be $25B

noreply@blogger.com (Jeff Cohn) — Tue, 31 Jan 2012 23:34:00 +0000

I would like to take you through a simple math equation for determining the fair value of Facebook before its IPO filing tomorrow without comparing growth metrics. Here are my assumptions when comparing Facebook, while using Google as the benchmark. Google's annual revenue is $37 billion with a market capitalization of $188 billion currently as of January, 31, 2012.

Google's annual display ad revenue from Double Click is only $5 billion + they have $32 billion of additional revenue sources. That means if Google only had the display ad business similar to Facebook their valuation would be 1/8 or less or around $25B. Here is the scary part when you start to look at Facebook's proposed IPO valuation of $100B with 88% of its revenue coming from one source.

Facebook simple valuation equation based on current estimates:

Google Market Cap = $188B at $580 per share
Google Total Annual Revenue = $37B
Google Display Ad Revenue = $5B

Facebook Market Cap = $100B
Facebook Total Annual Revenue = $5
Facebook Display Ad Revenue = $4.8
Facebook Fair Value Equation = ($37 / $5 = .135) x $188 = $25B

The latest news sources reported that Facebook annual display ad revenues were around $3.8B in 2011 and so I will assume this revenue number has grown to $5B in 2012. $5B in annual revenue for Facebook is 1/8 the the size of Google's with $37B. Facebook has 88% of its revenue coming from display ads only which is not very diversified if you ask me. Keep in mind this does not factor in growth rates but they cannot be that dramatic to change my valuation estimates.

S&P Low 666 (2009) x 2 = High 1332 (2012)

noreply@blogger.com (Jeff Cohn) — Tue, 31 Jan 2012 17:03:00 +0000

S&P Low in 2009 of 666 x 2 = 1332 High in 2012

The rigged stock market will undoubtedly become a key issue in the 2012 Presidential race. The Obama administration will promote the fact that the stock market is up almost 100% since he took office in 2008. Mitt Romney is going to attack the fact that the market is up 100% but so is the unemployment rate that went from 5% to 10%. Pick your poison. The Federal Reserve's balance sheet is bloated and helped to rig the stock and bond market game. How will it end in the next few years and what is the best path to long term free market prosperity and organic economic growth in the U.S.?

The stock market has become a rigged game in the last few years. It is be propped up by the Federal Reserve and Ben Bernanke's team by printing unlimited dollars to buy futures and bonds in the open market. Bond prices are artificially low in order to encourage people spend and not save. However, the smart people running big corporations are sitting on hoards of cash earning 0%. Its because the market has been propped up in a phony way and there is no organic growth. Executives are expecting a stock market crash of grand proportion that will wipe out all of the Government businesses that have been propped up. Cash will be king in the future and there will be no safe havens. Its just a matter of time before the huge "House of Cards" bonds and stocks all fall at the same time wiping out the wealth that has been artificially created.

Yes, the United States can print endless amounts of money in order to create inflation and promote growth. The experts think we can grow our way out of the debt crisis and reduce the current 100% debt to GDP ratio that has doubled under the Obama administration. However, the austerity in Europe is nothing compared to what we might see in the U.S. if Mitt Romney gets elected and the Federal Reserve money printing press is halted. It will be painful in the short term but the long term gain for my kids and grandchildren will be tremendous. The U.S. Government must feel the pain of overspending and let the free markets take over their bloated and egregious spending habits. Don't forget Mitt Romney has been a private equity / restructuring guy in the private sector and will have the biggest turnaround project of all time on his hands once he pulls the Fed plug.

Mitt Romney knows that a healthy economy will grow through organic investment and capitalism at the local level. In healthily economies the Venture Capital & Private Equity industries thrive and so do quality IPO's that foster the cycle of wealth that has built the foundation of the United States. However, the recent financial crisis has led the Government to step in and act as the market "Big Brother" to prevent big investors from losing money. The VC industry and private equity industries are shrinking drastically because large LP's (limited partners) have no incentive to invest with below 0% annual returns due to overbearing Government regulations. We all know in healthy free markets there are winners and losers. However, now the losers are being prevented from losing and this is not capitalism. Bailouts have been preventing huge bankruptcies and progress towards creating new and more efficient businesses.

Thousands of banks should have gone out of business and so should have many of the auto companies like General Motors. Restructuring and bankruptcies are all part of the free market cycle and we have yet to go through it on a large scale downturn. The 2009 downturn was prevented by the Government by double its debt load in the trillions and now the next recession could be even worse and deeper.

In summary the only thing that is going to help the economy in the long run build a foundation of growth that is sustainable is if the Government simply gets out of the way. We investors are all "Big Boys" and taking loses is part of the game. Trying to impose regulations on the financial services industry to prevent loses only restricts the free market capital flows and prevents investors from doing anything. We need investors to be excited about investing and now restricted. These two bills / laws need to be repealed by the next President and then you will see healthy organic investment growth come back to the private sector.

1) Repeal Sarbanes Oxley
2) Repeal Dodd Frank Bill

Should US Government Spending Crash Like the Stock Market?

noreply@blogger.com (Jeff Cohn) — Tue, 18 Oct 2011 23:43:00 +0000

Thanks to Marry Meeker for putting out this slide on her latest Awesome Web 2.0 presentation about the "State of the Web". This slide struck me the most as a concern for investing in the future of technology. Until the US Government cuts spending by 50% and gets out of the private sector way we are going to be in stagnant economy for a long time. This slide is telling me a few things need to happen before our economy has even a chance of turning around. In Wallstreet terms, I think we need the great capitulation of Government spending in order to right the private sector economy. I will not get too excited about private sector investing until the following questions are answered . . .

Should US Government spending crash like the stock market?
Will industries that rely on Government spending be crushed?
Has the Federal Reserve lost all credibility with the markets?
The VC industry shrunk by 80% in the last decade so why not the Government?
Rising interest rates might actually be good for the "real economy"?
Are currency wars are going to get even more intense?
Is the US the new emerging market carrying highest investment risk?
Where & when will the next tech industry boom (ie jobs) come from?
Is the Obama administration trying to kill capitalism vs government spending?
When will kicking the Government debt can down the road STOP?

How Much Treasury Debt Does Japan Own?

noreply@blogger.com (Jeff Cohn) — Wed, 16 Mar 2011 21:38:00 +0000

Japan Owns 20% of the US Treasury Debt or $885 Billion

Why is no one inf the financial press talking about Japan being the 2nd largest holder of Treasury debt as a problem? Is this the stock Black Swan the market did not see coming? Will the US Government be able to issue enough treasury debt at current yields and continue the ponzi scheme it has been running for the last few years. The next few treasury auctions are going to be very interesting to see if the US government can fill the demand and at what price. If one of the largest investors Japan needs to pull back its contribution of over $885 billion? Isn't a red flag that one of the largest treasury bond holders funds Pimco has sold their entire portfolio? Will we see US treasury bond yields spike to 7-12% like Greece and Ireland? They are currently between .05 and 4.5% depending on the duration.

I happen to be one of the few people that believe the market has been artificially propped up by the Fed buying bonds in the open market. This cash gets invested back in the markets in order to prop up equity prices. I am all for capitalism and organic growth but the current run up in bond and equity prices have not been commensurate with the level of growth and unemployment.

Why am I worried about this as an early stage investor? Well, because I don't believe that our growth has been created organically by capital formation and venture capital. Our industry is still shrinking drastically. The day that the VC industry starts to expand in the US I will be the first person to claim we are in a real bull market for an extended period of time. However, for the time being I am bearish until the government can get out of way with regards to financial regulation and the government restructures their balance sheets to fit the private sector drop in wealth.

Comscore Competition - "We Don't Have Any"

noreply@blogger.com (Jeff Cohn) — Wed, 16 Feb 2011 23:26:00 +0000

ComScore is a company that uses panels to measure and track consumer behaviors, demographics, and advertising responsiveness for industries such as travel, pharmaceuticals, finance, and telecommunications. Consumer products companies use ComScore's website and online advertising network measurement tools and ComScore's Marketing Solutions products, which provide custom research and analysis from its panel. Scam or is this accurate information?

Today, on the earnings conference call Comscore management said "we have no competition". This answer was prompted after an analyst ask the following question: "how are your viewing the market competition?" Excuse me, but what about these web site analytics companies who more accurately measure? Alexa, Nielsen, Google Analytics, Omniture, Hitwise, Quantcast that provide more accurate information? What about this list of mobile analytics companies? Airsage, Amethon, Bango Flurry, GroundTruth, Localytics, Mobilytics, Motally, M-Wise, Openwave, Percent Mobile, Pinchmedia, TigTags, Xtract. How could you not consider these companies as competitors? If there are any other companies I am missing please let me know.

There are several mobile phone analytics and social media analytics companies and many of them are more accurate. Management also gave a very "wishy washing" answer to how they measure and manage social media and mobile analytics. How can you trust a public company that says we have no competition? How can you trust the data that so many large companies use but have limited reach to measure its traffic? Taking surveys and panels is not an ethical way to measure and track traffic. In fact its one of the largest digital media scams in the last decade. Someone needs to crack this egg and expose this.

Will Pandora's $100M IPO & Users Kill iTunes?

noreply@blogger.com (Jeff Cohn) — Sat, 12 Feb 2011 00:21:00 +0000

How Much Is Pandora Cannibalizing iTunes Sales?

I am happy to hear that Pandora announced a $100M IPO today after being rejected by hundreds of VCs who "pooh poohed" their "advertising based" business model many years ago. Fast forward a few years after Pandora's struggling years and almost shut down. Pandora currently has 80M users and is raising $100M in an IPO. This is not good news for music artists who get paid for music downloads and are quickly seeing this business dry up according to inside sources. What will an artist like Lady Gaga do? Up her licensing fees or partner with Pandora on a revenue share for advertising fees?

I come from the school that "if its free its me and if I have to pay no way". I am not a great customer of Apple iTunes because I could care less about owning the music. I just want to listen to it when I want. Since I have been a listener to Pandora guess how much music I have purchased? $0. Their really is no reason to own music for consumer to want to own music or videos any longer now that advertising based streaming music services like Pandora have arrived. I always thought the best move for Apple would be to buy Pandora to protect their iTunes music sales but it looks like that is not going to happen.

I predicted that Howard Stern would go to Pandora but that did not happen and he stayed with Sirius / XM and now you can listen to Howard on the iPhone. I also thought that Apple will buy Pandora but that didn't happen either yet. Here is a comparison of Rhapsody vs Pandora. Sirius is also a Pandora competitor but they need to get an app for the TV quickly. Broadband speeds have doubled and even tripled over the past few years. WiFi is very fast and reliable in most areas and 3G is maturing. So maybe Pandora video is coming also with LTE and 4G wireless distribution? Stay tuned and buy some shares of this disruptive company.

US Diplomacy Needs To Be More Transparent

noreply@blogger.com (Jeff Cohn) — Wed, 09 Feb 2011 22:44:00 +0000

The Egypt crises has certainly caused some confusion amongst financial community, media pundits, political conservatives and liberals. No one seems to know which side of the table to be on and who to support in the crisis. Wall Street and emerging markets responded to the protest by dropping a few percent immediately and volatility spiked but for what reason? What interests is the US trying to protect in Egypt and who do we trust? One important lesson from this power struggle crisis seems to be emerging and that is the "lack of transparency" in US foreign policy and support for Egypt. I don't expect a full disclosure Wikileaks style, but when I hear that Hosni Murbarak is sheltering billions and worth multiple billions of dollars it makes me sick. The US Government seems to be giving a billion dollars a year to whom? Egypt or Mubarak? How does it get spent if at all and who receives the check? How many other countries around the world do we support like this financially? I would love to see an in-dept study of this because hedge funds who invest around the World will be all over this issue to find the next "smoking gun". If anyone comes up with a InfoGraph to tell the story of US financial diplomacy please send it to me.

What Are the Largest Internet Publishing Networks?

noreply@blogger.com (Jeff Cohn) — Thu, 27 Jan 2011 01:19:00 +0000

List of the Largest Content Publishing Networks

In an effort to compile a list of the largest internet content publishing networks I would appreciate your help improving this list of 30+ internet publishing companies I have started below. I realize that this list could get exhaustive but in light of Demand Media's IPO it probably makes sense to crowdsource a list of the largest publishing networks and their monthly traffic numbers according to Quantcast top sites. There is likely going to be some consolidation in the space so companies like Demand Media can start building their own ad network to diversify from Google and Yahoo Ad Sense advertising. They will also need to scale their traffic in order for Wall Street to believe in the high growth story. Here is my list of the top generic 10 publishing networks and their respective monthly traffic numbers according to Quantcast. Its not always easy to distinguish the difference between an Ad Networks vs a Publishing Network but for this purposes we would like to build a list of companies who has a team of writers on staff.

Ranked by Monthly Unique Visitors - # of Web Sites
Interactive Corp IAC - 250M (Nasdaq: IACI) over 40 sites
Glam Media - 144M over 400+ sites
Answers Network - 102M (NYSE: ANSW)
Daily Motion Network - 93M
Federated Media Network -87M over 112 sites

AOL - 52M 1 site

About.com - 45M 1 site

Huffington Post - 37M 1 site

Demand Media - 34M (NYSE: DMD) over 9 sites

Gawker Media Network - 32M over 9 sites

Break.com - 32M over 9 sites
Hulu - 32M

Discovery Network - 32M over 5 sites

Associated Content - 28M (Nasdaq: Yahoo)

Manta - 23M
McClatchy Network - 23M over 67 sites
CNET & CPSSports - 22M (NYSE: CBS)

CNN - 20M 1 site

ChaCha - 20M 1 site
ESPN - 19M (NYSE: DIS)

WebMD - 18M

TMZ - 17M
NYTimes - 15M

Drudge Report - 13M
NFL - 12M
NBA - 10M
Mahalo - 10M

NBC & CNBC - 17M

MLB - 8M

Funny or Die - 8M
WSJ - 6M
Fox - ???

Are Groupon Coupons Getting Spammy?

noreply@blogger.com (Jeff Cohn) — Fri, 21 Jan 2011 23:05:00 +0000

The latest Groupon coupon fad reminds me of the mailing list spam days back in 1999. Back in the day companies like Yahoo couldn't get their hands on enough lists of emails and would use these lists to pump out advertising offers left and right. Eventually consumers got smart and had to use spam blockers and finally the Government required companies to offer opt-in email programs. Groupon is not much different, however, this time they give you a sense of urgency by saying that inventory is limited. Not only do most offers claim to limit the inventory but they often give you 50% off for a limited time. Yes, it seems like a good short term promotional tool but how long will it last and what will it do for customer loyalty?

Will Groupon become a victim of their own success always chasing the next deal and lose customer support? I think coupons should be scare commodity and not available to everyone. If everyone has a coupon it defeats the purpose of pricing anything and creates a sense of dishonesty amongst your loyal customer base. I think at the end of the day when this local coupon bubble pops the winners will simply be just good at local display advertising. I think Google gets this as well and will will likely start see display ads targeted on mobile phones that show offers like this.

Groupon turned down an offer from Google to buy them for $6 billion dollars apparently and it looks like they are headed for an IPO. I think this is a blessing in disguise for Google and they should be thankful that this did not work out. The competition in the coupon space is furious and there are literary thousands of Groupon clones that do the same thing. When Groupon first received funding and their valuation was north of $100M I said it was a great investor ponzi scheme and still think this. Its a big house of hards that is only held up by the huge pile of cash they have been able to raise. Its also not surprising to see them acquiring several companies in order to try and consolidate their competition. I also wouldn't be surprise to see some more controversy surrounding this company get publicized before it tries to go public. Groupon has lots of "skeletons in the closet" that will come out and at the end of the day the winners will ultimately be small niche local companies like Boomstreet who will be successful.

Did Google's Failed Acquisition of Groupon Prompt a CEO Change?

noreply@blogger.com (Jeff Cohn) — Thu, 20 Jan 2011 23:09:00 +0000

Did Eric Schmidt fail to consummate an important acquisition of Groupon that prompted the change? I personally am happy that Google did not buy Groupon because I think the company is very spammy. However, the category is growing quickly and Wallstreet doesn't wait around for excuses of why the advertising giant does not have a product in the category of group buying and coupons for local businesses.

Or is more about control and does Larry Page want more control of the company to make more acquisitions? Is Facebook's increased threat of taking market share from the search giant prompting some paranoia. The war is now on between company founders Mark Zuckerberg of Facebook and Larry Page of Google. It will be interesting to see how each will handle the growing mobile advertising industry and Google has a huge head start. Its kind of scary to see Apple and Google CEO have leadership issues as they are the two of the largest technology companies.

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Who is More Influential on the Economy Steve Jobs or Ben Benanke?

noreply@blogger.com (Jeff Cohn) — Mon, 17 Jan 2011 20:53:00 +0000

There is an argument to be made the Apple's $319 billion dollar market cap and its' publishing, advertising, software, retail and venture capital ecosystem of entrepreneurs and companies might be more influential on the economy than the Federal Reserve's interest rates controlled by Chariman Ben Bernanke. Here are 10 reasons why:

1) History has shown that the economy only grows when there is an ecosystem of technology that creates jobs & Apple has fueled the growth of tech which has created millions of jobs Worldwide.

2) Ben's 0% interest rates have had no effect on whether millions of consumers Worldwide have made emotional Apple purchasing decisions. Two thirds of the US economy is based on consumption and Apple is driving it.

3) Ben Bernanke is an academic that relies on historical data to make reactive decisions when economic history rarely repeats itself.

4) Steve Jobs relies on his vision to shape the future of the technology industry and millions of people are affected based on these decisions.

5) The stock market always needs a leading growth stock story like AAPL in order for investors to get excited and put money to work in the market. The Nasdaq 100 index QQQQ is 20% based on Apple and thus 99 other stocks are directly affected by how AAPL trades.

6) 0% interest rates over the last few years have done nothing but create a bond market and real estate bubble which does nothing for capitalism and growth.

7) Steve Jobs has created wealth for millions of entrepreneurs who have started companies to feed off the Apple ecosystem.

8) Ben Bernanke has put billions of dollars in the hands of bankers and bond fund managers to prop up the stock market and create a false sense.

9) Foreign countries who invest in US Treasury Bills, like China, are not happy that the US is intensionally keeping interest rates low thus devaluing the dollar. The Dollar cannot be devalued forever in order to finance the future and thus a long term bubble is forming if it were to rise suddenly.

10) Apple's stock (AAPL) has the largest market cap in the World at $319 Billion and if it were to lose value quickly it would take down a lot of hedge funds, pension funds who have jumped on the bandwagon of wealth creation and could be destruction if we are not careful.

Get well Steve! We need you and Google to keep all entrepreneurs and investors excited about the future. Technology NOT energy should be the basis of the World economy in order to leave a better place for our kids.

Register a Stock Symbol Without the SEC

noreply@blogger.com (Jeff Cohn) — Wed, 15 Dec 2010 16:42:00 +0000

A stock symbol or ticker symbol is a short abbreviation used to uniquely identify publicly traded shares of a particular stock on an exchange. A stock symbol may consist of letters, numbers or a combination of both. Today, tickers are registered with the SEC and are used by primarily public companies. Our Securities and Exchange SEC commission continues to fail in its ability to regulate the financial industry and doesn't have enough resources to do for the thousands of public and hundreds of thousands of private companies. One way to help provide transparency is to help make information more transparent for private companies so the bar isn't so high for investor liquidity and we see more IPO's. Here is one company that has a long term solution to that problem.

Manhattan Beach-based CapLinked.com the develop of software as a service tools for managing venture and angel fundraising run by Eric M. Jackson, reported Tuesday that it has started allowing companies to register unique "ticker symbols" on its site. The firm said that the symbols, which will be unique to private companies, can be used to identify companies on websites, in tweets, and also on such sites as SecondMarket and Stocktwits.

Previously, unique ticker symbols have been reserved for publicly traded securities and traders tag the tickers using a $AAPL symbol in Tweets. CapLinked is seeking to make tickers something that is also typical in the world of private investing. Private companies will benefit from a unique ticker for use in branding, social media, and investor relations.

Companies signing up for CapLinked’s free service also will be able to register a unique ticker symbol that could potentially be used on SecondMarket and Stocktwits since our system is based on their models. Caplinked's goal is to take SecondMarket’s concept, formalize it and create a ticker system that is universally accepted by the thousands of private companies and startups that register with Caplinked.

CapLinked gives private companies the tools they need to attract investment, share documents and act like a typical CRM Salesforece.com system would for sales. Caplinked companies will grow large enough to be traded on SecondMarket eventually and possibly take their CapLinked ticker symbols with them to the Nasdaq or NYSE. Ticker symbols can be reserved on a first-come basis, and that the existing symbols already in use on Second Market’s platform or by publicly traded companies will not be available.

SecondMarket focuses are larger VC back and private companies and unveiled the ticker concept for private company ticker symbols earlier this year when it created tickers for the nearly 500 companies traded on its site, including the likes of Facebook, Zynga, Twitter, and LinkedIn. SecondMarket’s private company ticker symbols have already been adopted by Stocktwits, a professional community of investors.

CapLinked is not working with SecondMarket or Stocktwits, but said it is using a system based on their models for ticker symbols. Jackson is one of the early employees of PayPal. CapLinked opened up its service in October.

Meebo Web Site Check-in Browser Plugin is Very Useful

noreply@blogger.com (Jeff Cohn) — Wed, 17 Nov 2010 22:32:00 +0000

Have you ever wanted to easily share the web sites you visit on a daily basis? Here is my web site profile that will allow you to see the Meebo web sites I like. While Foursquare and Google are fighting over location based check-ins and now Meebo has launched a new tool to allow you to checkin to web sites. Browsing by your friends is a new but obvious concept and I am surprised that Facebook has not developed a similar tool. Now its possible if you download and use the Meebo Checkins Plugin for your browsers. This concept is for real as Khosla Ventures led their $25M Series D venture round.

Watch the Web 2.0 Conference Live with Chat

noreply@blogger.com (Jeff Cohn) — Wed, 17 Nov 2010 18:30:00 +0000

Watch live streaming video from web20tv at livestream.com

Google Places + Hotpot vs Yelp

noreply@blogger.com (Jeff Cohn) — Tue, 16 Nov 2010 23:21:00 +0000

Google just launched Hotpot, a new service baked into Google Places that lets you rate restaurants, stores, bars, clubs and businesses to see which ones your friends like or dislike. It crowdsources rating or 1-5 stars or "best ever" if you really like it and think it special. It also allows you to view unrated, friends and all locations based on a search. One nice feature is the ability to click a box that says you are not interested as well. Its a very clean interface and the only thing it needs is an Android App which I assume is coming or will be integrated with Google Maps and Places. See the video below for more details on Google Places if you are restaurant or business owner and another video explaining Google Hotpot.

Its not surprising to see Google launching a business and restaurant recommendation service that would try and take market share from Yelp based on the traffic numbers below. This is great news for anti-spam lovers as Yelp's service has been gamed and is very spammy. Hotpot attempts to convert the recommendations of user connections for business recommendations advice for users. Recommendations and warnings will be used as signals to determine which establishments are presented to friends when they search and vice versa. Google Places is very well established geo location service that helps you find places nearby and likely understand where Free WiFi is available in the future. This ratings tool is also be another tool to help the company become more social and compete with Facebook.

How to Pitch Like Baba Booey

noreply@blogger.com (Jeff Cohn) — Tue, 16 Nov 2010 19:55:00 +0000

They Call Me Baba Booey

Gary Dell'Abate (aka Baba Booey) is one of the greatest radio personalities on the planet is Howard Stern's producer. Gary was visiting Torrance, California this weekend for his book signing "They Call Me Baba Booey" and also appeared on the Jimmy Kimmel show to redeem himselft to show everyone he can throw a baseball properly. If you listen to the Howard Stern show on Sirius / XM on a daily basis you will know about his famous pitch at the Mets game earlier this year and then now on the Jimmy Kimmel show. In the 2nd video below from the Jimmy Kimmel show he hits a woman in the head and an audience member catches the wide pitch. He has thrown 4 pitches and they all have been wild pitches. I love him but Gary how can you possible coach your son's baseball team? I hope you are not the pitching coach. On a side note Howard Stern's contract ends this year and it remains to bee seen if he will stay with Sirius or move to an new company like Pandora internet radio. Gary will likely follow him their having been together for more than 25 years. This should be a great book to read given all of the goofy bits over the last 2 decades.