Originally uploaded by smallchou

The view from the aisle at Alicia And Asian Paul’s wedding in the
Presidio.

Originally uploaded by smallchou

View from our Season Tickets at Candlestick, just before the Seahawks game in Week 2.

Look, there are a lot of barriers to becoming a multi-billion dollar business with a sustainable, high-margin, defensible business that “prints money” (though Twitter seem to think it’ll build one). You can count on a hand or two the Internet companies that have done it. But I always find it humorous when a journalist who has talked to a few commentators, or a random person on the street who has thought about a company for a few minutes announces triumphantly that they don’t know how the product will monetize efficiently.

A few weeks ago, I came upon a BusinessWeek article that talked about a young, hyper-growth Internet company. It read:

But how will [the company] ever make money? There’s the rub. The company’s adamant refusal to use banner or other graphical ads eliminates what is the most lucrative income stream for rival [Internet properties].

It was an article that succinctly conveyed the popular opinion of the company at the time and made a number of cynical assumptions about how the company was ignoring some fairly common ways to make money.

And of course, the article was about Google.

Google. Current Market Cap: $138B

Now I’m not saying Twitter will be as big as Google or even that they’ll become *just* a large business. There are a ton of hurdles for it to get there, not the least of which is not stifling its growth by spending energy putting banner ads on twitter.com when so many of Twitter users don’t even use the website. But think about this:

• (Tens or Hundreds of?) Thousands of businesses are already using Twitter for customer service, PR, and marketing.
• Hundreds of thousands of businesses are wondering how to use Twitter to get their message out more effectively. They’re trying new things and clamoring for better tools.

Now if you can’t think of a way to make money in an environment like that when you’re sitting on top of one of the fastest-growing Internet properties in history, then you’re either not thinking hard enough or… worse.

As a Twitter user, I’m glad they’re, as Jeff Bezos said in video yesterday, “Thinking Long-term.” Now if they’re still not making money a year from now, well… good luck to them .

(As an aside, it’s fitting that the Zappos CEO happens to be one of the best examples of using Twitter effectively in business: http://twitter.com/Zappos)

With that being said, and given a healthy amount of accompanying skepticism and cynicism, I dare say that location-based services really are on the cusp of mainstream. Just yesterday, Google launched this Loopt-lookalike called Google Latitude which essentially lets you stalk the shit out of your friends, assuming that they either a) mis-read the directions and accidentally consent to getting stalked, or b) actually let you see where they are.

What does that mean? Yesterday, when I arrived home in Palo Alto, I casually saw that my buddy Ben, who lives in San Francisco but whose girlfriend lives in Palo Alto, happened to be just a few blocks away at that exact moment. Kinda neat, yeah? We could meet up for a beer. And… that’s about the only useful real-world application I’ve found for the thing so far. That’s not to say stalking Husband of Pseudostoops as he commutes from Chicago to Evanston and back over Google Latitude isn’t fun, but it really isn’t a real use case beyond idle entertainment.

But I think Latitude is an enabler, not an actual application. And while products like Loopt were pushing in that direction, the truth is that starting up a service like that from scratch can take a while (even Twitter took years to get where it is now) and a catalyst like the latent email address books of millions of Gmail users is not a meaningless thing (though some folks who cry about Google copying Loopt would want you to believe that a product head start is all that matters). By the way, isn’t Google being pretty smart about leveraging that asset as a social network/graph these days?

Ultimately Latitude (and similar services) will only become really useful when really useful stuff is built on top of it. Anyone who’s seen Yelp on an iPhone knows that. Well, what are those applications? They’re literally everywhere if you think hard enough. I want a weather map that tells me exactly what’s going to happen within 100 feet of where I am in the next hour (without typing a bunch of shit in). I want to find 10 dudes within a mile radius who want to go play some pick-up basketball around the corner. I want to see a map of all the open parking spots within four blocks of this god forsaken place and reserve one for myself. See? That took 15 seconds to come up with those.

This could be the start of a big deal… or all of those crack addicts will have to keep picking their stuff up the normal way.

I’ll preface these comments by noting that I generally agree with most of the tenets of the entire Slow Food movement, particularly since I started eating more green things and learning about the environmental impact of eating meat. I’m lucky enough to have the option (financially) to shop at places like Whole Foods and I do think it’s a good thing.

That being said, I couldn’t help but chuckle, scoff, and even get annoyed by some of the answers and responses by the panel to a few very fundamental (and logical) questions. For example, the first question of the Q&A section of the discussion was, ‘Is it fair to force chain restaurants to post nutritional information on menus when small, local restaurants (i.e. Chez Panisse) would be exempted (per some ongoing potential legislation in California)?’ and was taken by Schlosser himself. This was a question that I myself had while I was running. While I agree that a lot of these chain restaurants should make clear that a Jumbo Jack is in practice ACTUALLY jumbo to your belt size, is it fair to set a double-standard just because they serve unhealthy food? If we’re talking about accountability, shouldn’t all food service establishments be accountable? Logical question, I thought.

Schlosser’s response was somewhere between righteous and dismissive. Oh, and completely illogical. It went something along the lines of, “Well, chain restaurants don’t make the food on-site, while places like Chez Panisse are buying fresh ingredients and cooking the food daily.” And then everybody clapped. No, seriously. it sounded like most of the crowd applauded an answer like that. Nevermind that the answer was essentially orthogonal to the question (which was, ‘Why should there be a double-standard? Why is the fact that a restaurant ships its food pre-cooked from God-only-knows-where grounds to enforce unique regulations on them?’). By the way, if someone has a legitimate answer to that question, I am actually interested to hear it.

A couple of questions later, Fernald was asked, ‘Is the Slow Food movement elitist? It generally costs more (in money and time) to eat local, sustainable ingredients. Is this really for folks who aren’t rich white people?’ I’ll get to (in my mind) the proper way to answer that question in a few minutes, but I was literally floored (had to stop my run to make sure I was hearing right) by Fernald’s response. She approached the question with a three-pronged answer, along the lines of:

1. The cost thing is perception and is built by the huge marketing budgets of fast food companies.
2. Sometimes Slow Food can cost as little as fast food.
3. People spend hundreds of dollars a year on things like their cell phones. We (they) all need to get used to the idea of paying a little bit more and spending a LOT more time preparing our food.

Let me start by giving some advice to anyone who’s ever in an argument. If your first point is that it’s the enemy’s fault, you’re screwed. If your second and third points then dispute your first point, you are insane. And, if your key point is making a plea to your potential audience that a technology they use 10’s or 100’s of times per day costs a lot and should be discarded for something they currently do not value at all (local food), you’re completely crazy.

These are arguments that work on people who, a) have the money/time to afford that optionality, and b) are skeptical enough to recognize the nuance of TV advertising campaigns. In other words, they are not for the vast majority of this country.

A parallel but completely unrelated movement, the renewable energy industry, has been tackling these same types of questions (’How do you create a model where your target audience recognizes transparent value?’) in a much more approachable fashion:

It’s better for the environment and it’s more affordable.

Is the technology there yet? Probably not. But they are at least approaching the messaging with a reasonable value proposition. Eric Schmidt went on the same radio program a few weeks ago (audio) with a simple message for other businesses: ‘We’ve moved to renewable energy on our campus and it’s economically cheaper. It costs less. Period.’

Now that is a message that resonates with its target audience.

For business executives thinking about this issue, cost is the ultimate arbiter. It is completely accountable, bears no double standard for ‘trying hard,’ and makes no excuses for itself. And, most of all, it doesn’t ask for people to sacrifice their time for something that costs more and lacks transparent value.

So the question is, then, what message should the Slow Food movement be using? Clearly I don’t think it should be, ‘We cost a little more and take a lot more time, but taste better!’ Try giving that message to a single mother who works two jobs, thinks a Big Mac tastes just fine, and likes the fact that Jack In The Box has a $0.99 menu. Seriously, go try.

No, the message has to be more similar to Alice Waters’ comments on the panel: local, sustainable agriculture is healthier and it’s fun/valuable/didactic to cook – kids will even eat chard if they’re involved in the cooking process. Now try giving that same single mother the message of:

Your children will get Diabetes, heart problems, a host of other medical issues, and probably die earlier if you keep feeding them fast food. Here are the numbers to prove it. Oh, and by the way, this shit (slow food) can taste good.

Now that is a value proposition that is clear and unassuming. No nuance required.

It’s simple. When a competitor competes on price, you can either complain about it or you can deliver the goods on greater value for the cost. You do that by emphasizing the value they get, not by pleading for more of their time.

Slow Food: it tastes good and it won’t kill you like fast food will.

Ship it.

• What happened to that crazy lifestyle eating change you were on? Are you still doing that?
• Have any New Year’s Resolutions?

Good questions both. One quick note, I usually do 5 New Year’s Resolutions every year, but I don’t call them that because it sounds like they’re afterthoughts and the word ‘resolution’ now has a loaded connotation of ‘IMPENDING COMPLETE FAILURE COMING MOMENTARILY’.

Instead, I usually call them ’simplifying principles’ because they’re things I’d really like to actively focus on this year and they’re meant to simplify my life, not add some additional thing I won’t remember to do. Before I get to those…

The Eating Thing

If you’ll remember, last year I attempted (mostly successfully) to undo 26 years of awful eating habits and prepare myself for the distinct eventuality that the next 30 years of my life are going to consist of: 1) working a lot, and 2) a gradually slowing metabolism. Let’s be very clear about this: I know of (maybe) five Asian males over the age of 35 who are not noticeably overweight. That’s it. If you’re Asian and your Dad is not overweight, then I’ll take your word for it and add him to the list, though he’s probably already one of the five.

With that backdrop, and because I often like to pit myself in games of will power against myself, I spent some time reading up on “What does eating healthy really MEAN?” last year and then attempted to live by that for 12 months. The results were largely good and I think the number of meals I strayed was probably less than 30.

This year I’ve made one slight adjustment to the approach, which I don’t think will make a material difference in practice, but I think will make an enormous difference in my personal mental state when driving by an In-n-Out. And that leads me to the five simplifying principles (of course non-work-related):

1. Eat healthy (as defined in 2008), with the exception that for every week in which I work out 3+ times, I get one free meal to eat whatever I want. Hopefully for all parties involved, that will be 52 weeks.
2. Write a short story. This was originally “Write more,” but in the name of setting actionable, measurable principles. Regardless, “Write more” is baked into this.
3. Read and thoughtfully review at least 12 books
4. Visit at least one new foreign country
5. Launch a couple (at least 2) useful, interesting sites

I would have added a sixth and a seventh (”Tailgate at least 10 times” and “Lower the beer to other beverages ratio”), but a) they seemed to work directly against one another, b) the seventh is pretty much covered by my #1, and c) I just really wasn’t ready to commit to seven different principles.

Let’s all have a solid 2009, people.

My favorite quote from the piece:

Yet even by WaMu’s relaxed standards, one mortgage four years ago raised eyebrows. The borrower was claiming a six-figure income and an unusual profession: mariachi singer.

Mr. Parsons could not verify the singer’s income, so he had him photographed in front of his home dressed in his mariachi outfit. The photo went into a WaMu file. Approved.

While in retrospect WaMu’s behavior as an organization was greedy and short-sighted, there is actually very little unique about the seemingly systematic misbehavior at the bank. As I was reading about WaMu, I was struck by how the pattern of increasingly dysfunctional behavior within the organization was, in reality, remarkably similar to other organizational failures.

As Diane Vaughan wrote in The Challenger Launch Decision, there are often very logical progressions within organizations that result in corner-cutting and risk-taking. In the case of Challenger, external pressures and internal culture/politicking led to systematic deviations from procedural norms. In other words, the organization made risky trade-offs to meet its goals.

In WaMu’s case, the motivating factor was even simpler: getting paid. Considering that financial incentive was introduced both at the organizational and personal levels within the company, it’s really not unexpected that WaMu would willingly (or naively) accept unreasonable risk for seemingly greater reward.

The truth is that organizations make fundamental decisions about their own risk profiles on a continuous basis. In the cases of both WaMu and the Challenger launch, clear-headed people would argue that the risk/reward structures were measured incorrectly at an organizational level. WaMu as a company, with all of its risks, was so unlikely to succeed over time that “the bet” was clearly a bad one. In poker, we would say that it was a dramatically ‘Negative Expected Value play’.

And that leaves the question of whether WaMu executives were stupid or just personally greedy. If they made such lax decisions for the organization believing that they would be successful long-term, then we could simply label them as stupid (and incompetent at recognizing risk/reward). Case closed. If, however, they made such lax decisions knowing full well that they could likely result in significant disaster, then the only rational reason for continuing on that path would be their own personal financial gain.

Fundamentally, the issue is proper alignment of incentives – would WaMu executives have operated in the same way if their own personal financial stability was completely tied to the long-term success of the company? One would hope not.

But then again, maybe they were just actually stupid, in which case they probably wouldn’t have changed a thing.

For completeness though, I’ll go ahead and finish it off this week. Looking forward to doing some sort of actual writing on this site in the next few weeks.

Last Week: 4-11 (no joke. plus forgot to pick the Thursday game)
Overall Season Results: 118-117-4

Sunday

OAK (+13) at TB
Lots of points, even for a team with something to play for.
Pick: OAK

DET (+11) at GB
Is the fear of going 0-16 enough to inspire Detroit to a victory?
Pick: DET

DAL (+1.5) at PHI
The Eagles could very well have nothing to play for by the time this game rolls around.
Pick: DAL

NYG (+7) at MIN
Who knows how much playing time the Giants starters are actually going to get in this meaningless game for them. They did seem to really go after it last year though.
Pick: NYG

CHI (+3) at HOU
Big game still on the line for the Bears.
Pick: CHI

CAR (-2.5) at NO
Carolina still has seeding to play for. They also really should’ve won that game last week – definitely looking pretty good.
Pick: CAR

STL (+14) at ATL
Too many points for OJ not to cover that.
Pick: STL

KC (+3) at CIN
The Chiefs are playing surprisingly well.
Pick: KC

JAX (+11) at BAL
Went back-and-forth on this game, but it’s just too big a game for Baltimore not to clean this off, right (NWE’s going to win in the morning)? And they really do feed on mediocre teams.
Pick: BAL

TEN (-3) at IND
These games are awful to pick. Dungy usually sits guys in end-of-season games and Tennessee has nothing to play for either. Flip a coin, I guess.
Pick: TEN

CLE (+11) at PIT
The Browns are really awful. Ken Dorsey is a complete joke.
Pick: CLE

MIA (+3) at NYJ
I think Miami wins and sneaks into the playoffs.
Pick: MIA

NWE (-6) at BUF
I’d be extremely surprised if the Patriots lost this game with so much on the line.
Pick: NWE

SEA (+6.5) at ARI
Oddly, Cardinals actually have something to prove in this game.
Pick: ARI

WAS (+3) at SFO
Faithful.
Pick: SFO

DEN (+8) at SD
Not really confident about the NTR in situations where something meaningful is actually on the line (and players find automatic motivation), but here goes…
Pick: DEN

Last Week: 4-10-2 (wow, that’s terrible)
Overall Season Results: 114-106-4

Thursday

Totally forgot to pick. Awful.

Saturday

BAL (+4.5) at DAL
Points, please.
Pick: BAL

Sunday

PIT (-1.5) at TEN
I think this could be the Steelers year.
Pick: PIT

MIA (-4) at KC
The Chiefs are really playing quite well right now. I can’t believe I just wrote that.
Pick: KC

ARI (+7.5) at NWE
Wow, not a ton of respect for the Cardinals, and honestly why should there be. Cold weather game on the East Coast. Cassel playing awesome.
Pick: NWE

CIN (+3) at CLE
I’d just like to state that Cincinnati covering against and beating Washington last week kept me from winning about 2 grand. Awesome.
Pick: CIN

PHI (-5) at WAS
Wow Philly looked good on Monday.
Pick: PHI

SF (-5.5) at STL
St. Louis can be a great remedy for red zone issues. You know, by my count, wouldn’t the Niners be a playoff team right now if 2 or 3 plays went differently this season?
Pick: SF

ATL (+3) at MIN
Atlanta hasn’t played great on the road, and Minnesota’s playing well.
Pick: MIN

NO (-7) at DET
It just seems like the Lions are going to be jacked up. They actually have something to play for.
Pick: DET

CAR (+3) at NYG
Wow, how things change quickly. The Panthers are looking very solid for a Super Bowl run after being the preseason trendy pick for like five years running.
Pick: CAR

NYJ (-4.5) at SEA
Odd line between a first-place squad and a team with three wins.
Pick: NYJ

HOU (-7) at OAK
Raiders suck.
Pick: HOU

BUF (+7) at DEN
That close game last week for the Bills was all about the Jets playing terribly.
Pick: DEN

SD (+3.5) at TB
The Norv Turner Rule, 11-4 I believe.
Pick: TB

Monday

GB (+4.5) at CHI
I’m done thinking Aaron Rodgers and company will get it together.
Pick: CHI

Last week: 7-9
Overall Season Results: 110-96-2

Thursday posted Wednesday evening