One way to suppress this urge to give in, says Sebastian, is thinking the following: “Self destruction is generally counterproductive.” It’s smart. The idea is that, all things considered, giving in is almost always net negative. So why do it?

The thought goes from appealing to counterintuitive—usually, at least. Sometimes those brownies just smell too good.

*  *  *

It’s important to think about why this works, since that could tell us what makes it so effective, and maybe we could apply this thinking elsewhere. When you get into a stage where you’ve done away with something and used your self-control to do so, you eventually fatigue of doing the correct, but enormously less satisfying thing. (At least, that’s what dieting tastes like.) Rewarding yourself is now appealing and your self-discipline is weak.

So how does it work? My thought is: getting this reminder triggers a subconscious memory of when you first decided to set the goal, and reminds you of why you did it and what you imagined the end result to be. With this perspective floating in your mind, the urge to do better and be better, because indulging does mean a net negative, overpowers the nagging thought of the satisfaction of indulgence. This reminder gets you into the perspective and mindset from when you set your goal.

Another method for reconsidering the decision to indulge (or in this case, to drop the ball) is the well-known Seinfeld rule of “don’t break the chain” for keeping habits. I think there are a lot of ways this can be triggered.

However, rewards are definitely important, and sometimes indulging is the right thing to do. The problem lies with that it’s too easy to get into a habit of bad rewards. The idea of repositioning your perspective to see things from a past mindset can help set better, net-positive rewards. It’s powerful because one thing that is incredibly hard to hold on to is a mindset you had in the past, which you used to set a goal. Sometimes, after a short while of inspiration and discipline, it deteriorates, while the urge to defect becomes stronger. Being in the original mindset is a good way to hold fast to your original goal.

It’s one extraordinary feat to build a company from near-collapse 14 years ago, to one of the most innovative companies today.

It’s a whole different story for Jobs to look back on what he’s done and try to build the company to follow the dynamics of his leadership and his direction to continue without him. To reflect on what worked and replicate that success. To reflect on what didn’t work and avoid those in the future. To train his succeeding leaders on what he’s learned and how to implement that knowledge.

If Jobs succeeds, then he was able to isolate the secret sauce of building one of the most innovative and disruptive companies, with all of its leadership dynamics, strategy, operational procedures and everything else—and implement it, so that the company operates on cruise control with help from the leaders he’s trained, and continues its unmatched innovation.

Doing what Steve did—building a revolutionary company—is something that few have done. He will have taken this a step further, if this switch succeeds. Steve Jobs would have achieved his magnum opus: understanding why what he did worked, and implementing it so that Apple can continue revolutionizing technology.

Don’t work to be famous and be on the minds of those that don’t intend to do anything with their lives and go day after day without ambition.

Change the lives of the individuals that are making change themselves.

Success and failure, they are separated mainly by those who try, those who don’t, and all the subtle levels in between. To try means to move your ass, get out there, and hustle. The whole fucking world is open to you. Everything you love in this world that nature didn’t deliver to you was created by a hustler. By those who try. All the billions of people on this planet, they each need help with almost every detail of their existence. You can certainly be of value somehow.

Had to share this. From Judd Weiss’ about page.

Bing’s web cache shows the price being at (least, since we don’t know when Bing took the cache) 6.87 yesterday (http://cl.ly/0A1N0K0C2Q2W2H0U3h43) and now it is at 8.35. That is a difference of 1.48, indicating a gain of (at least) 1,480 customers. Every user x signing up past the point that the cache was taken generates (6.87 + 0.001x). Thanks to Gauss, we can find the total revenue using (6.87+8.35)(1480/2), and we can calculate roughly that Pinboard made something on the order of $11k yesterday, and probably a bit more since they probably round up instead of charging tenths of cents. Sweet! (comment link) (calc)

$11k for having a good service and charging for it. Web startups, take note. Succinctly summed up with Pinboard’s tweet to Xmarks, a bookmark sync service with 2 million users that was about to shut down:

@xmarks the model that has worked well for us is ‘charge people money for a useful product or service’

In March 2009, about a year ago, Apple acquired Power Architecture fabless semiconductor chip company P.A. Semi. P.A. Semi aimed to build low-power, efficient, and fairly powerful chips to use in various applications. Then-CEO Dan Dopperpuhl noted that P.A. Semi aimed to develop chips that consumed ten times less power than conventional chips.

Now with their own in-house team to develop chips for them, Apple released the A4 chip, an ARM-based system-on-a-chip based on ARM Cortex A9 with an ARM Mali 5-series GPU. Rivaling other ARM-based SOAC platforms, like Qualcomm’s Snapdragon or Nvidia Tegra 2, it focuses, quite clearly, on mobile performance with very low power usage. P.A. Semi’s last product was the PWRficient chip, which was a dual-core Power Architecture-based chip that ran at 2GHz and consumed 5 watts (25 watts at peak) of energy.

What does the presence of an Apple-designed chip forewarn about the future of Apple products? There are a number of considerations with Apple designing their own chips. Here are some of them.

Approaching compete control of the computing experience

John Gruber of Daring Fireball noted something that Apple COO Tim Cook said in June:

“We believe in the simple, not the complex. We believe that we need to own and control the primary technologies behind the products we make, and participate only in markets where we can make a significant contribution.”
— TIM COOK

Indeed, through developing so much of their products in-house, like the battery, processor, and other key features, they’re finding ways to control the user experience of their products. And it’s working: their revolutionary lithium-polymer batteries coupled with the Apple A4 processor create not only a pretty dazzling graphics experience, but a long-lasting one. The ten-hour high load battery life and the one month standby (!) are indicative of Apple’s ability to take control of the experience—not to mention the presence of what could be an incredible amount of DRM and security built into the processor, moving from software security to hardware security.

Radical innovation has never been a trait that Apple has neglected to execute brilliantly on. But now, Apple is doing so by taking control of the entire computing experience, now even down to the silicon.

Radical differentiation from competition

Few technology companies try to specialize in the finer points in computing, namely the processor. Including Apple, until lately. The iPhone 3GS is powered by the ARM Cortex A8 ARM processor, with PowerVR SGX graphics. We haven’t really seen much that has been developed without ARM-manufactured chips, Intel, Qualcomm, or Nvidia.

Has the new chip scared the chip manufacturers? You bet, and it’s also had an effect on the top manufacturers. While Microsoft and Nintendo try to nonchalantly shrug off the iPad as ‘humorous’ and ‘unimpressive’, it is clear that Apple has something they don’t have: a few steps ahead in product technology. All of the mobile phone manufacturers are behind, and while they’re struggling to catch up in technology, Apple will be moving forward.

Limitless expansion of Apple products

With the Apple A4 processor, Apple set an example: with their in-house semiconductor team from P.A. Semi, they could not only design their own chip, but they could design a damn good one. This would allow for the limitless expansion of Apple products. While competitors are constrained by limitations like processor power and processor energy draw, Apple can get around these limitations. They’ve bought a company that allowed them to design an excellent, efficient processor. There are few things more difficult to design than the very processing center of a technology device.

Whenever the next iPhone comes out, we’ll see something like a 700MHz Apple-designed chip in it with a lithium-polymer battery, and when we find out how fast it is and the battery life, Apple competitors will be quite astounded. Repeat by applying knowledge gained from the A4 to a x86 architecture, with the MacBook, iMac, Xserve, and other future Apple products, and it’s clear that Apple could perhaps become the market leader in an incredibly large gamut of technology.

It’s more than a processor. It’s an indicator of how important Apple might be in the future to technology and to our lives.

Using this tool, users can pick a category of problem (dropped call, failed call, no coverage, data failure, poor voice quality) and a frequency of this problem occurring, which is sent to AT&T along with your GPS coordinates. This will allow AT&T to increase its attention towards problem areas in the network.

I never quite understood why companies believed admitting to and fixing a problem was difficult and undoable because of the admitting part. Through such a tool, AT&T gains many advantages. Let’s take a look.

1. Users like that AT&T recognizes the problem.
2. Users like that they took action and released an application to help fix the problem.
3. AT&T gains many data points from millions of iPhone users—each with exact GPS coordinates to see which hives are the worst offenders—from which they can identify pain points and improve their network.
4. In the end, users gain a better experience using AT&T as improvements stemmed from this app are issued.

AT&T not only was able to increase its public image and improve their network, but they were able to do so by crowdsourcing millions of AT&T iPhone users’ data, all pretty much free of charge.

Sometimes, it’s okay to admit you’re wrong—as long as you fix the problem. It shows responsiveness and shows that the company is trustworthy to the point where they—gasp—admit that they made a mistake.

The past decade is the era in which the Internet ruined everything. Just look at the industries that have been damaged by the rise of the Web: Newspapers. Magazines. Books. TV. Movies. Music. Retailers of almost any kind, from cars to real estate. Telecommunications. Airlines and hotels. Wherever companies relied on advertising to make money, wherever companies were profiting by a lack of transparency or a lack of competition, wherever friction could be polished out of the system, those industries suffered.

Ignore the fact that media of all types is meant to catch your eye and—nowadays—your click. Headlines and openers are editorialized for maximum sensationalism. The sad part is that this isn’t even at the highest crux of possible sensationalism: it’s almost true, too.

Lyons, we know that the internet has affected your employer’s business and of Forbes as well (where he served as senior editor previously). If there’s anything that the internet has really killed, it’s print media. Yes, it can be disemminated quicker on the internet. It can be pirated on the internet. It can be much harder to monetize on the internet.

And yes, advertising is hard on the internet. For too long, users have been able to enjoy being able to access information for free, getting used to and ignoring advertising, and condemning more intrustive yet more profitable and novel types of advertising, such as video advertisements and interstitial pages. Indeed, the money that allowed these users to enjoy free and open access to information originally blocked by a paywall leaked from media corporation balance sheets.

This cultured notion of so many things being free on the internet puts pressure on creators and makers of any kind of content or service, whether it be news, technology, data, or any other kind of information service, to go with one of two of the ‘internet consumer-friendly’ options:

• release your information service for free.
• release your information service for free and run advertising on it.

And of course, the straightforward but non-internet consumer-friendly option:

• charge for your product.

Both of these can apply to literally any information product on the web. The former two allow for growth and traction and high losses, while the advertising won’t cover for as much as it did in traditional mediums where there existed one (i.e., print.) The latter allows for big profits.

That isn’t different from the traditional methods of marketing stuff in the real world. But the stigma associated with the dynamic on the internet is completely different: your product is expected to be free and immediately tryable.

Some startups get it. They don’t have a budget that the money could leak from, unless if they were a well-funded venture capital backed business. Profitability and its maximization are key in a top-notch startup environment, and such a leak equates to a startup finding that they had a loophole for everyone to get their product for pennies on the dollar. Devastating.

And that’s the stage that current media companies are starting to face.

Creative Destruction

Lyons brings up an extremely relevant and important point: we “have to endure a period of what economist Joseph Schumpeter called ‘creative destruction,’ as the Internet crashes like a tsunami across entire industries, sweeping away the old and infirm and those who are unwilling or unable to change.” Certainly—the internet, as an abstract entity, is the force that presses older systems to evolve or go away.

Creative destruction, associated with Austrian School economist Joseph Schumpeter, is described in his book Capitalism, Socialism and Democracy.

The technology and entrepreneurship community has its argument against the article, saying that it’s too bad that the companies fail to adjust and that it’s their own fault for taking so damn long to do so. But they have their own bias too: they’re the perpetrators of the creative destruction plaguing these companies. It’s like if radio broadcasting associations told unbudging record companies that they’re being too slow to adjust and are failing as a result. They know. They just don’t know how to coexist.

Entrepreneurs in particular are the largest perpetrators of creative destruction. This is seen in Schumpeter’s work and description of creative destruction, as well as in practice itself. Although the internet wasn’t exactly created by entrepreneurs, the disruptive technology that is being blamed for creating the critical mass needed to create creative destruction was, and still is, created by entrepreneurs.

What are some entrepreneurs doing in the current internet economy? Essentially: arbitrage. Here’s a bit from Lyons.

Newspapers are getting wiped out because the Internet robbed them of their mini-monopolies. For decades they had virtually no competition, and so could charge ridiculous amounts of money for things like tiny classified ads. This, we are told by people who are wringing their hands over the demise of newspapers, was somehow a good thing. Good or no, it’s gone, thanks to Craigslist, which came along and provided the same service at no charge.

Let’s assume for a moment that Craigslist is a regular dot.com (and not as described in the Wired article about Craigslist). Craigslist, the classifieds site, saw an opportunity to cash in on the growing void of decent classifieds on the internet. As a perfect arbitrage opportunity, they were able to execute and drive money away from newspaper sites and to themselves.¹ Low operating cost. Attractive value proposition. High volume. High profits. In a general sense of creative destruction, the perpetrators, mostly entrepreneurs, are arbitrageurs, leaving older systems one question: adapt or be obliterated.

The paywall on some sites like the Wall Street Journal giving you a preview of the article and asking you to subscribe is probably the best conversion from the print world to the online world. Sure, you can read on if you’ve got the print version in your hands. Just pick up the paper and read it. But that’s not socially accepted: you don’t walk into a supermarket, grab a copy of the Times, and start reading.

It’s different on the internet. It’s so much easier to go to Google and search “username password wall street journal” and hit Results within the last 24 hours. Instantly, without the glares of supermarket customers, without the shame of leeching off of the store (everything should be free after all, shouldn’t it?), without the physical paper in your hands that you know doesn’t belong to you—there is that information. Not stolen in the traditional sense, but in a modern piracy sense.

So how do you evolve against these virtual paper-nickers? It’s quite tough, and it’s up to the print world to figure out how to weather the creative destruction and reconstruct. Indeed, it may affect the entire media industry itself. With less profits, less profitable items, and the expectation to keep up the same content quality and volume as before, the media industry is going to find it incredibly difficult to reconstruct to adapt to these new needs.

Lyons, however, does not mention the future much. Lyons talks about what has happened in the past and its impact on the past and present. He does not offer any insight on whether these changes are in the long run positive (dare I say—Realpolitik) in perhaps reconstructing the media industry, or are they indeed completely destructive to the continuation of the media industry as we know it.

There are new technologies that will allow us as consumers to reconsider our addiction to free on the internet by drawing us away from the internet on a computer and rather to the internet as the framework for communication. A familiar example is the Amazon (AMZN) Kindle, which over Amazon Whispernet delivers newspapers like you knew them for a fee.

Both parties need to do some reconsideration on their parts. This, along with Gutenberg’s press, digital cameras and film, radio, and computers themselves, is but another instance of metamorphosis and radical change under creative destruction, and for it to be weathered, the same processes of reconsideration and reconstruction will need to apply.

—

¹ In actuality, Craigslist is not so much taking business away from a certain market, but rather destroying their market entirely, as they make a sliver of the money that used to be in the classifieds market, while owning it. It’s like if a competing coffee shop stole all of Starbucks’ customers as they sold good coffee for $0.01 per cup. Sometimes creative destruction equates to market destruction.

SiteAdvisor and Hunch co-founder, angel investor, and startup icon Chris Dixon announced the launch of seed-stage venture capital firm Founder Collective today, forming an entrepreneur-backed firm making investments worldwide. Headquartered in New York and Cambridge (MA), it is staffed with a number of serial entrepreneurs. In addition to Chris Dixon, it includes angel investors Eric Paley, David Frankel, Bill Trenchard, Mark Gerson, Micah Rosenbloom, and Zach Klein.

The notable part of Founder Collective is that all of the partners have been founders or co-founders of a startup, and most of them have done angel investments in the past. The pool of the investments that they have done is available on their Companies page, which represents the depth of the angel investments they have collectively done to date.

In Chris Dixon’s blog article, he talks about the new adapted private capital firms.

We think of ourselves as part of a new wave venture firms led by Y Combinator, First Round, Maples, Ron Conway/Baseline, and Betaworks, among others, that have adapted to a world where venture capital is abundant but authentic seed capital and, more importantly, mentorship from experienced entrepreneurs, is scarce.

The Mark Bao Journal drew some insights from Marc Andreessen’s new firm Andreessen Horowitz, a new kind of venture capital firm based on knowledgeable, serious, and supportive investments. Although it only focuses on seed-stage investments while Andreessen Horowitz does seed and more, Founder Collective is in the same vein of this new kind of metamorphosed private capital firm, a modern capital firm.

Adapted capital firms have a number of advantages over older capital firms.

• backed by entrepreneurs, they leverage the same knowledge as older (and prestigious) Sand Hill Road-esque firms like Sequoia Capital, and offer support from the knowledge they have gathered over the years—as entrepreneurs.
• the firms are usually backed by at least a portion of partner money, which allows the partners to have the same crucial “investing with my own money” approach that angel investors have, while increasing the volume of money that they can invest with, using outside capital.
• there is greater incentive for success. Not only do partners take their time more with their money (since a portion of it is theirs), there is a higher chance that they will work closely with the company to make it succeed. This comes from the angel side of the metamorphosical Angel-VC fusion.
• as a result, there is a greater emphasis put into the relationship with the partners of the firm, rather than just having a good place to get money from. There is greater value to applying to a adapted capital firm, since it doesn’t only come with money: it comes with dedication of partners and connections, not completely unlike the Y Combinator or TechStars programs (but definitely not completely similar.) This is what Dixon mentions is part of “authentic seed capital.”
• seed stage, while done at a more unstable stage of a company, is lucrative in the case of a successful exit. In many instances, a successful company had a lower valuation during seed-stage funding, which generally means a larger multiple of return for a seed-stage funding business (for a successful business.)
• the partners know what your product does and what’s going on. In many venture capital firms, the senior MPs are quite knowledgeable about the area that they invest in, such as technology. However, the rest of the staff decrease in knowledge about the sector. Zynga CEO Mark Pincus spoke at Startup School 2009 about a junior VC with no knowledge in technology taking over his board at one of his past companies.
• smaller core staff means more attention by the people that matter.

Founder Collective poses itself as a more accessible firm than Andreessen Horowitz. Founder Collective at least has a website, and one can connect to the partners at the firm; on the other hand, Andreessen Horowitz does not have a website and the only way to truly get to Andreessen or Horowitz is to know somebody to connect them. Although Founder Collective is a larger (in staff, not fund balance) firm than Andreessen Horowitz, they will most likely practice the same thing.

Though there’s one small thing that I’d like to note that is interesting, from Dixon’s blog post:

We try to be respectful. We’ve all sat in countless meetings where VCs show up late, email while you are presenting, and generally act arrogant and dismissive. We try really hard not to be like that.

Part of the venture capital culture is intimidation and a bit of disrespect, to show who really holds the power in the transaction. (Not all venture capitalists do this, but it seems like something that generally is associated with venture capital.) And indeed: part of the disdain associated with venture capital is with the venture capitalists that have this attitude. Take a look at TheFunded.

The new adapted capital firm is a new movement in funding for businesses. Time will tell how well these turn out—but when you put together established, proven startup entrepreneurs, with rigorously tested new startups, it’s surely going to produce industry-changing effects.

“Hopefully we won’t repeat the mistakes that Microsoft made 10 years ago that ultimately led to all these things that happened to them.”

Some of these mistakes include a lot of anti-trust and monopolic actions, profit ploys gone awry ending in lawsuits, privacy failures, and refusal to cooperate with competitors. These, along with some instances of not-so-great software (looking in your direction, Vista), have tarnished Microsoft’s (MSFT) business.

Eric Schmidt is trying to portray Google as a Good Business. They’re not going to make the same mistakes as Microsoft: they’re going to be truthful and follow Don’t be Evil. They’re going to aim for transparency. Are they truthful about that, though?

Many businesses in the world, without lies and fraud, would be well out of business. This includes companies like Cash4Gold and MLM scams. So would a lot of financial institutions, if it weren’t for the bailout. I have a personal gripe on the bailout. Why? NASA 2009 budget is 17.2 billion. National Institutes of Health 2010 budget is $6 billion for cancer research. TARP: $700+ billion.

Good Business and Google

Good Business entails transparency. Mad, mad profits more likely than not entails some kind of fraud going on. Google says they’re going to forgo these mad profits—and fraud, for that matter—and focus on the customer. Making the customer the top priority is something that is—surprisingly, as well as irrationally—lost in some modern businesses.

And we’re seeing a lot of great strides from Google to this effect: Google Dashboard, a tool that allows Google Account users to see what kind of information is associated with their Google Account, was introduced on the Google Blog in an article called Transparency, choice and control — now complete with a Dashboard!

“Over the past 11 years, Google has focused on building innovative products for our users. Today, with hundreds of millions of people using those products around the world, we are very aware of the trust that you have placed in us, and our responsibility to protect your privacy and data.”

Or—Google’s Data Liberation Front: their homepage states their mission: “Users should be able to control the data they store in any of Google’s products. Our team’s goal is to make it easier to move data in and out.”

The risk is huge, too. It’s not just that Google participates in far fewer fraud than most businesses of similar influence. They take the risk of losing customers that realize how wide the gamut of knowledge Google knows about them. One notable example is Google Dashboard: many users responded with “wow—Google knows a lot about me. Should I be concerned?” And if they are—Google is making it that easy to check out of itself.

Others said that among the privacy issues and information issues Google has, the Google Dashboard is like British Prime Minister Neville Chamberlain’s 1937 appeasement towards Nazi Germany: Google gives us a bit of what we want to see to make us think that they’re serious about their responsibility of protecting privacy and transparency, but in the long run they really, really want the data.

The great part about Google and Good Business? Customers get it. Customers appreciate the transparency, which makes it hurt just a bit less for Google on their balance sheet. In the long run, hopefully Good Business drives the following profit inequality: Bad Business < Business < Good Business.

Fantastic. One of the most important technology businesses is promoting Good Business through transparency and not being Evil. Google has its problems, and many, many instances that they have acted in an evil way. And whether this will hold for the next ten years is still up in the air. However, they’re taking a positive direction, and for a 10-year-old technology company with massive market share and massive influence, and massive profits and market capitalization, it’s pretty damn impressive.

Gist:

Google (GOOG) has made official the new Android 2.0 SDK, which allows the new 2.0 “Eclair” APIs to be used in Android applications, including improved bluetooth, multitouch, sync, account management, and, of course, support for new Android 2.0 devices such as the Motorola Droid. The new SDK update is downloadable immediately. Android 2.0 official video is at the bottom of this article.

Leading mobile industry news and insider source Boy Genius Report reports that the Motorola Droid (MOT) and HTC Droid Eris (2498.TW), two new Android 2.0 Eclair devices, will hit the stores on November 6 on the Verizon Wireless (VZ) network.

The Droid devices, highly hyped by Verizon as the iPhone killer, has been the subject of quite a bit viral marketing and noise in the mobile industry. Earlier this month, Verizon launched a mysterious marketing page for the Motorola Droid at DroidDoes.com, a direct attack against the Apple (AAPL) iPhone device’s shortcomings.

I’ve recently moved from bearish to bullish on the Android platform. The first T-Mobile Android G1 device wasn’t polished and didn’t at the time seem like a viable competitor to the iPhone.

However, the Motorola Droid could be a huge development in the Android environment. Droid represents a serious advance in promoting Android as a serious device, built and supported by two serious mobile companies. The specs of the device (the same processor as the iPhone 3GS and the Palm Pre, large screen, full of memory, ready for backgrounding applications, and more delicious specs) will hold its claim to fame as the premier Android hardware.

The bottleneck to the proliferation of Android has partly been the hardware that it runs on. The G1′s hardware didn’t cut it, especially since Android and all Android applications operate on Java, which is a notoriously slow platform. (EDIT: No, it isn’t, I’m wrong; I had neglected to mention that the Android platform has a custom build of Java called Dalvik.) The other bottleneck is the App Store, which, although it will improve over time, the derivative of available applications needs to start getting better. And with the new SDK and excellent new Android 2.0 Eclair, we may be seeing real changes soon.

Very recently, Amazon (AMZN) subsidiary Amazon Web Services released the

This is AWS’s second database service, the first being the schema-less SimpleDB service, a key-value data storage system. This new service mimics MySQL-like characteristics, and acts just like MySQL, allowing applications to move seamlessly between their current MySQL system to Amazon RDS. The valueadd of the service includes rock-solid reliability (as AWS is known for), high scalability to allow for extremely large datasets, patching of database software to keep up to date, and database backup.

Amazon RDS lists five instance classes available at this time, reproduced below:

• Small DB Instance: 1.7 GB memory, 1 ECU (1 virtual core with 1 ECU), 64-bit platform.
• Large DB Instance: 7.5 GB memory, 4 ECUs (2 virtual cores with 2 ECUs each), 64-bit platform
• Extra Large DB Instance: 15 GB of memory, 8 ECUs (4 virtual cores with 2 ECUs each), 64-bit platform
• Double Extra Large DB Instance: 34 GB of memory, 13 ECUs (4 virtual cores with 3,25 ECUs each), 64-bit platform
• Quadruple Extra Large DB Instance: 68 GB of memory, 26 ECUs (8 virtual cores with 3.25 ECUs each), 64-bit platform

Like most Amazon Web Services offerings, it is on a pay-by-usage model, the lowest being $0.11 per hour of compute instances, plus $0.10/GB/mo of storage and $0.10/million I/O transfer requests.

Amazon Web Services’ current cloud service offerings include Simple Storage System (S3), a scalable cloud file storage system; Elastic Compute Cloud (EC2), scalable computational resources, among other services.

On the AWS RDS marketing page, there is a guide to convert from using one’s own hosted MySQL instance to using an RDS instance. The valueadd of AWS RDS over SimpleDB is clearly defined structured data (versus a schema-less key-value store), and with that comes RDBMS features such as JOIN. However, the rigid schema with RDBMS and RDS makes it less flexible to change.

This could be very disruptive. Hosting databases in the cloud wasn’t an extremely simple thing to do earlier, as the main players in moving a database in the cloud essentially was SimpleDB. Converting an application from using a relational store to using a schema-less system like SimpleDB isn’t a trivial task, especially when JOINs are associated.

Now, however, MySQL databases can now be stored reliably in the cloud, and they scale up in both compute power, storage size, and transfer volume. The bottlenecks surrounding scaling a database to be larger or to crunch more data, fenced in by pre-defined CPU, RAM, or disk limits, is now gone. (Though, of course, you’ll have to upgrade instance classes if you hit that limit.)

The market is very big for such a service: MySQL (now owned by Sun Microsystems, JAVA) powers industry-leading sites such as Google, Nokia, YouTube, Zappos, Yahoo!, among others, and is the database portion of the popular open-source web stack LAMP. It is the most popular open-source database, and holds a market share of 49% in database environments (source: Gartner, Enterprise Databases in an Open Source World). Amazon Web Services could repeat their disruption of files to the cloud with S3, or computing power in the cloud with EC2, again by taking databases into the cloud.

However, RDS opens an important question while on the topic of database speed optimization: it scales up well, great: but how is the performance between webservers and the new RDS storage location? In many cases, webservers access the database on a local or nearby network, which improves performance; however, where is RDS located? Is it mirrored in multiple areas? It’ll work great for EC2, but who knows how well it’ll be for migrating MySQL users.

It’s an open question and we’ll see how it plays out when people mess around with it.

1. Paul Graham, Founder, Y Combinator: What Startups Are Really Like
2. Greg McAdoo, Sequoia Capital
3. Jason Fried, CEO, 37signals: Funding and Charging for Your Product
4. Chris Anderson, Editor-in-Chief, Wired: Freemium
5. Paul Buchheit, Creator of Gmail and Friendfeed: What I’ve Learned
6. Twitter Founders Biz Stone and Ev Williams: Q&A with Jessica Livingston
7. Mark Zuckerberg, Founder and CEO, Facebook: Q&A with Jessica Livingston
8. Mitch Kapor, Founder, Lotus: Startup Culture
9. Tony Hsieh, CEO, Zappos: Delivering Happiness
10. Mark Pincus, CEO, Zynga: My Startup Experience

Paul Graham, Founder, Y Combinator: What Startups Are Really Like

Below are some key points about his talk, but there are a lot more great soundbites in his transcript of What Startups Are Really Like.

• in his research, people have sometimes said that in a co-founder, character is more important than performance
• expect failure with deals.
• be optimistic about things you can control. you can’t control deals, so don’t be optimistic about them.
• having a founder is like you’re married but not fucking.
• luck is a big factor in startups. founders/programmers are more surprised than normal founders because programmers are used to concrete cause-and-effect
• sorry, guys: being a startup founder does NOT make you more attractive to women.
• quitting your job to start a startup depends on the age. harder at 35 with wife and kids. but at 21, your entry-level job is useless anyway, so go start a startup.

Greg McAdoo, Sequoia Capital

• the 70s and 80s economies performed just like the current economy: recession, unemployment on the rise, etc. however, Apple, Oracle, and many others came from it too
• likewise, the 2001 crash spawned companies like A123, Rackspace, and Aruba and Zappos
• it’s definitely possible to start a startup in a down economy, as some of the best businesses still around today started in recessions
• the demand environment in a recession: your competition is less irrational in their purchases and doings
• recessions create a lot of discipline.
• in startups, you have to start small, and stay focused, especially in a recession.
• good recession-era startups “buy the cash register early,” — they execute their pay business model earlier to generate revenues earlier and bank earlier
• Re: “RIP Good Times”: it didn’t say that everything was fucked, but rather that you have to run your startup like other past recession winners, and cut and be lean
• enterprise sales tip: promote and talk about the HARD DOLLAR ROI. it’s the most important thing to talk about. make them scared to reject your product. make them think “if my boss ever found out we could have saved 50% on software X, he would be pissed.” make them fear that the competition get the product in their hands and beat you out.
• startups that gain revenue early are disciplined earlier, and get used to being an actual business earlier, and generally are better and more recession-proof

Jason Fried, CEO, 37signals: Funding and Charging for Your Product

• the difference between a boostrapped and funded company is easy to understand.
• the bootstrapped company starts off thinking: we need to make money.
• the funded company starts of thinking: we need to spend money. these investors have given us x million dollars—we should spend it!
• the funded company detracts away from doing final execution of the product and making revenues.
• start as early as you can. you don’t become fantastic at piano by starting at 20 or 25. you do become fantastic at piano if you started at age 5.
• price forces you to be good and better than the rest. the pressure of price is very, very good.
• pricing your product will give an avenue for the people buying your software to give you feedback on it.
• if a product is free, you don’t get that feedback.
• if a product is free, it’s just “good enough.” people will take it and say it’s just “good enough” to use for free.
• the most intimate transaction between people: money. I’m giving you this money earned by hard work because you offer something that I want.
• funding is like crack. it’s an addiction with names like Series C. Don’t keep going back for more and more funding; it’ll make your addiction worse.
• planning is GUESSING. figure out stuff as you go, because you never really know. plan some, but improvise a lot.
• I promise you’ll still be using post-it notes in 20 years. Usefulness trumps innovativeness; usefulness stays while coolness deteriorates over time.
• all the art in the world in one room won’t make a museum. the fact that it rejects 99% of art makes it a museum. apply this to software features.
• 37signals’ byproducts include Getting Real, the job board, and more. they have generated 37signals more than $1M in revenue. the job board itself has made $1.5 million.
• “we apologize for any inconvenience we may have caused you” is the worst way to say “I’m sorry”
• the best are everywhere, even outside Silicon Valley, don’t think you HAVE to be here. 37signals is based in Chicago.
• sorry, failure is not a rite of passage. you don’t have to fail. failing once doesn’t prevent another. Fried thinks the idea of “you have to fail once” and having to “learn about failure” is ridiculous.
• learning a lesson from failure is learning what not to do. learning what to do is a lot better than learning what not to do.
• other peoples’ failures are other peoples’ failures. don’t worry about them.
• anyone know how to sell things for free? you can’t. you can only sell things for money.

Chris Anderson, Editor-in-Chief, Wired: Freemium

• freemium is a great way of marketing. 90% try 10% buy. digital freeloaders are affordable, too. the freeloaders are paid for by the paid users.
• conversion from free to paid means loyalty. freemium conversions hold the lowest churn rates.
• Club Penguin was free to play. children USE the service and SEE VALUE in it, and subsequently purchase the premium options. sold for $700 mil to Disney.
• types of freemium: feature limited freemium. people already familiarized. ex. iPhone apps.
• Anderson hates 30-day trials. ticking clocks discourage uptake. hmm.
• capacity limited freemium. like Google or Flickr, for file storage limits. unfortunately doesn’t work for all products.
• when Gmail launched, the Gmail free was more than Yahoo! Plus. Yahoo! shat themselves, but it turned out that they had experienced low churn in that period: subscribers tend to stay. not the least of which reasons is that your email is on the provider still.
• Bill Gates didn’t crack down much on Chinese piracy because they were a developing country. they much rather would have people pirate their software than other peoples’ software, and Gates believed that they would pay later because of the then-majority of software being Microsoft. and—they did pay later and is now a huge market for Microsoft
• (btw!) Jason Fried isn’t against Chris Anderson. 37signals products are all based on freemium. the idea is to charge $!
• make sure you articulate the free deal clearly to the customer. communication is the risk.

Paul Buchheit, Creator of Gmail and Friendfeed: What I’ve Learned

• “limited life experience + overgeneralization = advice”
• Buchheit started working on Friendfeed at 30 years old
• He worked at Google since 1999ish, after Intel, and did internships at Microsoft and Sun in college
• working at Google was his best education he received from anywhere
• after Google, he took a one-year retirement period to chill
• however, he “wanted to do things that mattered” – and started friendfeed
• it’s toxic to think that when you’re done with school, you’re done learning
• are you in startups for the money? if so, when (that’s a when, not an if) the startup feels hopeless and the rollercoaster is at the low, you’ll give up easily.
• if you’re into startups not just for the money, you’ll focus on external rewards and harder to give up
• “if you really care about something, do it now.”

Twitter Founders Biz Stone and Ev Williams: Q&A with Jessica Livingston

• Obvious was bored of Odeo and wanted to do something new. they weren’t passionately engaged in the product and rarely used it
• motivation behind Twitter: two week hackweek at Obvious. they built, used it over the weekend, and they were passionately engaged
• Twitter was incubated in Odeo, then spun out. Fred Wilson was first investor. they were lucky: they were able to choose investors
• SXSW 07 was big: people started using it for afterparties
• one guy said that one bar was crowded and to go to another one and posted it. before he got there, the line was out the door
• they realized WOW – this product actually had users, people loved to use it too
• some people said, it’s fun but it’s not useful. Ev responded: well, so is ice cream.
• going public with Twitter a possibility, they’d like to go big

Mark Zuckerberg, Founder and CEO, Facebook: Q&A with Jessica Livingston

• addressed the audience as “my people”
• first social hack: making an online study tool that had people fill in notes for him to pass a final
• first version of Facebook was about 10,000 LOC, release early release often worked really well for Facebook (employees push a lot)
• definitely build something people want. Facebook wasn’t a business at start, was a tool and project
• moving to Silicon Valley provided a lot of infrastructure for an early entrepreneur like himself
• launched Facebook at the least receptive schools and they still caught on
• Facebook is by definition is a naturally viral product: your friends are there. Lots of organic word-of-mouth happened at campuses.
• Half of Dartmouth College joined in one night, probably due to an email that went out from the student government.
• he says he never pitched Facebook a lot. Just got introduced to people because already had x00,000 users
• “we used register.com, which was a mistake”
• have to go through a lot of steps and iterate, no problem with mistakes, like being too perfect
• Facebook was very focused on keeping the management technical, vs. nontech folks running the company
• if a ‘technology’ company has a management that isn’t really technical, it’s not a tech company
• keeping a smaller team means leverage. 300 mil users and 300 engineers. FB: a company composed of hackers. look elsewhere, and the ratio of engineers to users is incredibly different
• cognizant of the fact that engineers tend to move around companies. Facebook is a place to learn; he’s cool with moves.
• he talked with classmates about big industry trends. One was more data and interaction.
• sometimes you shouldn’t listen to other people. Lots of people told him he had no experience etc
• we’re trying to get the world to be more open. openness and transparency is going to be important in the future
• not taking any risks is the riskiest thing you can do.
• Values are worthless if they’re not controversial. What are you willing to give up for them?

Mitch Kapor, Founder, Lotus: Startup Culture

• what kind of legacy do you want to leave? It’s about having impact.
• startups see themselves as more open, less politicky, but they aren’t actually better in some ways
• startups have more public humiliation and bullying than regular companies, says research
• some startups value face-time more than productivity, and some value rumors as the best source of info
• lots of tech startups see themselves as meritocracies. Research : “diverse teams are better”
• inaction is an action, too. Both what you do and don’t do affects your startup’s culture
• in startups, hold people accountable. Be serious about keeping a tight leash.
• Angel investors are really disruptive. Characteristics: smaller chunks of money, more favorable terms, often entrepreneurs themselves

Tony Hsieh, CEO, Zappos: Delivering Happiness

• sold LinkExchange because the culture with employees wasn’t good.
• the list of core values of Zappos was really important to culture and the co. Wish they did it at first
• “people tell us we should start an airline… or run the IRS”
• Zappos has three C’s: Clothing, Customer Service (what they experience), Culture (and core values)
• recommend Good to Great (Jim Collins) and Tribal Leadership (avail online at zappos.com)
• “chase the vision, not the money–and the money will end up following you”
• “what would you be passionate about doing for 10 years regardless of money made?”
• Inspire employees: culture and greater visions. Came up with Committable (!) Core Values.
• Zappos’ Committable Core Values are grounds for hiring and firing, very serious about it
• one hire that goes against the core values is fine, but making a habit of letting it slide all the time is detrimental
• more important to have core values and committing to them, rather than the specific values.
• “vision and culture can inspire passion and performance” (yes!)
• Zappos aims to deliver happiness to customers AND employees AND vendors
• When Zappos employees leave, they often go and hang out with other Zappos employees.
• Zappos recommends that 10%-20% of time outside of office w/ coworkers, and Tony said that it improves communication and happiness by 20-100%!
• what is your goal in life? then ask why? then ask why again? and again? it all leads to HAPPINESS
• happiness components: perceived control, perceived progress, connectedness, and higher vision/meaning
• give bonuses every 6 months vs every 18. Equivalent but happiness higher
• 3 types of happiness: pleasure/rockstar, passion/flow (time flies), meaning/higher purpose (long lasting)

Mark Pincus, CEO, Zynga: My Startup Experience

Check out this writeup on VentureBeat too.

• you probably have to have a screw loose if you want to be an entrepreneur
• at one point he was funded and the funder wanted the company to be “independently controlled” (disaster)
• they brought on an independent person on the board (would become CEO, independent person, and VC.) however, they realized that in a decision the independent person basically pointed to the VC and says, it’s their money.
• what really matters is that YOU CONTROL YOUR BOARD. Mark Zuckerberg claps.
• “Who gives a shit what your valuation us? Only your ego!”
• A lot of the time, the people that are dealing with your startup on the board of directors are junior VCs.
• if you go to the senior VCs, they’ll understand what you’re saying.
• however, the junior VCs aren’t very smart, and they’ll want to control your board a lot
• to first-time entrepreneurs, they’ll mark you as an investment risk and you lose more control. ironically, this is probably a first-time VC/board member as well.
• at some point, you’ll have to hire someone to be COO. however, you’ll then find that the COO that you may find will look at you saying: you’re a first-time entrepreneur. I don’t want you managing me. I want to be CEO.
• Fake CEO days: speaking at conferences, etc: he almost took one by speaking at Harvard Business School but instead went to Facebook and worked with his team to fix Zynga’s problems

Gist:

Advertising Age recently profiled Google’s brilliant Cloud conversion plan targeting college campuses. It’s a fantastic article documenting how Google is going for wide adoption of their OS.

For more than two years, Google has approached colleges and universities with a near-unbeatable offer: provide unlimited hosted e-mail and other applications, all branded by the institution and delivered free of charge.

The colleges take the hook of using Google (GOOG) for replacing their IT infrastructure, and it gives an immense cost-benefit. AdAge says that Google signs up 70 to 75 campuses per quarter (!), an astounding rate, given how large of a market they have. With a total United States number of two-year and four-year colleges of approximately 4,000, Google’s cloud offering is gaining 2% market share each quarter (not to mention word-of-mouth marketing for a perhaps increasing derivative of market share gain.)

Indeed, Google already holds incredible market share in the campus cloud market, as the article quotes: “On campus, Google is making inroads. In its annual study of the role of technology on campus, the Campus Computing Project found that two-fifths of participating campuses had either migrated to outsourced e-mail and services or planned to. Of those, 56.5% opted for Google, 38.4% for Microsoft (MSFT) and 4.8% for Zimbra, an open-source software maker owned by Yahoo (YHOO).”

Not only does the campus receive free, branded, and ad-free email, calendar, and various other services from Google through the cloud, Google also gains three things. One, familiarity of students to the service. Two, and connected to one, future use of the Google cloud offerings on their own after college. Three, knowledge of this cloud service, and with a positive experience, this may transfer into the workplace which will allow Google to convert more business (profit-making) customers for their Google Apps cloud offering. (Interestingly, this is similar to why the piracy of Photoshop is beneficial for the application: users of Photoshop make their workplace aware of the positives of the software package, and the workplace purchase the application, generating revenue for Adobe (ADBE).)

Furthermore, these campuses are the perfect place to target for the adoption of Google Chrome OS. The cloud-only, thin-client offering (discussed here in Google Chrome OS: Google’s Master Plan) to run on netbooks is a perfect offering for college students running on the cheap: cheap netbooks, open-source software, Google Apps cloud including Google Docs, Google Calendar, Gmail, and all other university-branded solutions that are already available to them, and Amazon one-click delivery of ramen. Google is undoubtedly aware of campuses as the perfect adopter of Google Chrome OS, and they’re smart to target the campus at first for a can’t-say-no adoption offer for Google Apps.

Startup Takeaway: Although Google presents itself as an immovable market leader (and offering these services for free, even), take away the power of other methods of marketing. Google’s marketing play here is brilliant: target users from the ground up, by offering an exceptional service for a price that can’t be argued against (free). Find other sources of marketing that can be used to bring, primarily, awareness, and let the product follow through for a positive experience.

Gist:

Google Inc. (GOOG) announced their new initiative today, the Google Chrome OS. Based on the Google Chrome browser software, it is a light, mobile operating system for netbooks, due to be open-sourced Q4 2009, but due to release Q3-Q4 2010.

Google Chrome OS is an open source, lightweight operating system that will initially be targeted at netbooks. Later this year we will open-source its code, and netbooks running Google Chrome OS will be available for consumers in the second half of 2010. Because we’re already talking to partners about the project, and we’ll soon be working with the open source community, we wanted to share our vision now so everyone understands what we are trying to achieve.

Yeah. We know exactly what Google wants to achieve: the thin client. A thin client provides a view and an input, and general processing and memory; however, the data storage, crunching, and application serving is done from a third party source, accessible through the internet. Netbooks represented a large surge in the thin client idea, building primarily upon inexpensive Intel (INTC) Atom processors, cheap memory, portability, and in some cases open-source Linux distributions such as Ubuntu.

However, Google Chrome OS may not just be “just another Linux distro” to power notebooks: its very premise makes it be based on the idea of a thin client, completely. GCOS, built upon the (relatively) advanced Google Chrome browser, powered by Webkit, offers many advanced application-like parallels. Not only does it allow for the use of the Canvas HTML element for advanced drawing capabilities inside the browser, but local data storage and more.

We’ve already seen web technologies as an OS in action. We’ve seen them starting with Google using XMLHttpRequest in Suggest and Maps, with Adaptive Path’s Jesse James Garrett’s coining of Ajax, then the replacement of desktop apps with web-based ones with Meebo and Google Docs, and recently with the release of Palm Inc.’s (PALM) Palm Pre device, based on WebOS.

There’s actually some interesting foreshadowing in Jesse James Garrett’s early speculations into the power of Ajax:

The same simplicity that enabled the Web’s rapid proliferation also creates a gap between the experiences we can provide and the experiences users can get from a desktop application. … That gap is closing. Take a look at Google Suggest… Now look at Google Maps. Google Suggest and Google Maps are two examples of a new approach to web applications that we at Adaptive Path have been calling Ajax.

Google will nearly eliminate the OS itself. Most of what people want in an OS can happen in a browser. Google has documents and collaboration down with Google Docs. Search down with Google itself, and Google Desktop for local search. Email and chat through Gmail. In the future, organization communications through Google Wave. Calendar and tasks through Google Calendar. Google has created the ultimate thin client system that allows for the browser to take over the OS.

Google’s master plan extends into the integration of the browser into the OS. Google might wage a war of the OS: not with Windows vs. Linux, but Windows vs. the Web OS. Google notes that current “operating systems that browsers run on were designed in an era where there was no web.” Apparently—the current operating systems aren’t enough for the future. Supplementation of the web with the OS is not enough. The OS must be immersed with the web.

And Google wishes to spearhead that immersion. That immersion will primarily be in the form of a thin client, with everything handled on the cloud, the client acting as solely a view of information and an input point. Through this, Google can essentially build this thin client interface into multiple points in reality, not the least being their mobile operating system Android.

Google is going down to the hardware and integrating the user’s own system with Google. And in the future, their mobile phones, and soon, perhaps a huge portion of their technological experience.

——
Disclosure: Mark Bao is the CEO of Avecora, an early-stage communications integration and consumer electronics firm.

Gist:

Marc Andresseen, known for founding Netscape Communications (now part of AOL Time Warner (TWX)) and Ben Horowitz have started Andresseen Horowitz, a $300 million technology venture fund. Andressen notes on his blog the launch and the details of the fund. They are investing $50,000 to $50 million into technology startups. Andreessen and Horowitz have built a venture fund that is special in a few ways.

First, Andreessen Horowitz is a very focused venture capital firm. Their investments are only in technology, and not in other areas (whereas some other firms invest in whatever might sound good.)

“We are almost certainly not an appropriate investor for any of the following domains: “clean”, “green”, energy, transportation, life sciences (biotech, drug design, medical devices), nanotech, movie production companies, consumer retail, electric cars, rocket ships, space elevators. We do not have the first clue about any of these fields.”

As a result, Andreessen Horowitz make an effort to really understand the product itself, along with making sure the business’s financial models are sound. It’s obvious that Andreessen knows quite a bit about technology and startups as well, and has experienced the trenches of startups (at, I may add, an extremely exciting 90s boom company, Netscape.) Andreessen Horowitz is more focused on understanding the product itself, how it works, and the technology behind it, without losing sight of the financials as well. Most venture firms lose sight of having an intimate knowledge of the technology and product.

They demonstrate this as well by preferring technical founders. The notorious “business-side founder” that likes to do whistle-blowing and order-giving that doesn’t want to do any of the heavy lifting doesn’t seem to be an interest to Andreessen Horowitz. In addition, they are looking for founders that intend to become CEOs. Extrapolating from that, they’re looking for a technical CEO lead. (Andreessen also notes that the firm will assist them in development of CEO skills.)

It’s also quite small in makeup. Andreessen and Horowitz will be the only two General Partners in the firm, and they don’t expect to bring on more. Andreessen has an eye for good startups. Along with co-writing the Mosaic browser and founding Netscape Communications, he is Chairman of Ning and on the board of Facebook and eBay (EBAY).

Interestingly, it’s also hard to find. To get in contact with Andreessen Horowitz, most likely an introduction would be required. Andreessen Horowitz doesn’t have a website or a contact email. We’ll see how this scarcity and limiting of connections and in-lanes works out for Andreessen Horowitz.

Andreessen Horowitz presents itself as a flexible, radical, forward-thinking and entrepreneur-focused venture fund, which is exactly the kind of venture fund that there needs to be more of. I’m personally a big fan of Andreessen Horowitz, since the firm sets itself apart from others.

Although Andreessen Horowitz is also investing $50k–$1 million, and from its size is somewhat close to an angel firm, it may be interesting to see an angel firm modeled after the same ideas and mentality as Andreessen Horowitz to rise.