Media Transparent » Venture Capital http://mediatransparent.com Media is the New Marketing Thu, 09 Sep 2010 06:59:08 +0000 http://wordpress.org/?v=2.8.5 en hourly 1 Upending the Get Rich Quick Business Model http://mediatransparent.com/2009/04/07/upending-the-get-rich-quick-business-model/ http://mediatransparent.com/2009/04/07/upending-the-get-rich-quick-business-model/#comments Wed, 08 Apr 2009 07:56:45 +0000 Pat Kitano http://mediatransparent.com/?p=311 The title of the post should really be “Upending the Traditional Website Development Model”. This week, we launched Breaking Shopping News.com and Breaking REO News.com to prove conceptually how Twitter and the new real time micro-blogging and communication tools can be used 1) for local advertising and 2) local reporting of the bank-owned housing markets, respectively.

Simply put, we believe and want to prove that using Twitter to break news through an application like Breaking Shopping News.com, even if it is advertising, is compelling to a local community. And to reinforce our intention, we offer the template and business advice to anybody who can see how to adapt it to their local market. It’s like a free web franchise.

Here’s a table that explains the evolution of how websites have been built. Many developers have already adopted the 2009+ build it quick model as seen by the proliferation of Twitter based apps. How many are giving their ideas and apps away for others to use?

1997 (Web 1.0) 2003 (Web 2.0) 2009+ (Web 2.1+)
Seed idea Get idea: “Pets.com” Get idea: “Zillow.com” Get idea: “Breaking Shopping News.com”
Financing stage Go to VC for funding Incubate idea 6-12 months, go to VC None. Just build it.
Development stage Spend $500,000+ on site development Spend $100,000’s on site development Build it as cheaply as possible with available open source tools and apps. (Guy Kawasaki spent $10,000 to launch Alltop) Find like minded collaborators – corporate and individuals.
Launch stage Huge marketing budget, include Superbowl ads Launch with blogger testimonials Launch for feedback, any blogger testimonials are cherries on top
Ramp stage Beat up competitors Co-opetition. Work with competitors to stake out mindshare and business credibility Fine tune business model. Invite corporate partnerships for financing. Give away the template free or low cost to anybody who wants it (like Ning). Build mindshare if the biz model works.
Exit stage Get rich quick Build a business, and… get rich as a bonus Demonstrate that a new business can be built. Parlay credibility and knowledge to build more new businesses.

And btw, thank you #domus #301… your support and feedback helped to build these business models and we’re excited to work with you to get these new sites up and running in your locales.

]]> http://mediatransparent.com/2009/04/07/upending-the-get-rich-quick-business-model/feed/ 1 Open Source Funding – Mark Cuban Simplifies Venture Capital http://mediatransparent.com/2009/02/13/open-source-funding-mark-cuban-simplifies-venture-capital/ http://mediatransparent.com/2009/02/13/open-source-funding-mark-cuban-simplifies-venture-capital/#comments Sat, 14 Feb 2009 01:06:29 +0000 Pat Kitano http://mediatransparent.com/?p=245 Mark Cuban proposes his contribution to the Stimulus Plan by allowing entrepreneurs to post “business plans” as comments to his article Open Source Funding. His criteria in a nutshell – business plans are posted for all to see, comment, and steal if they want. Mark sends a non-negotiable contract for funding.

I’m glad Mark is using his media fame to push this financing model into the mainstream.

Stealth is no longer an efficient way to build a business model. In stealth, the world can’t provide feedback for the countless iterations required to fine tune any business model – funding, marketing, product development. In both my blogs Media Transparent and Transparent Real Estate, I propose new business models and strategies up front for feedback. This action does three things: 1) Like an academic publication, it brands the idea, 2) It provides feedback for iterative improvements, and 3) It attracts like minded thinkers who might be partners or supporters of the initiative.

Open source funding is the most efficient way to develop a business model because the most qualified entrepreneurs with the appropriate domain expertise will “rise to the top”. As Mark says:

If it’s a good idea and worth funding, we want it replicated elsewhere. The idea is not just to help you, but to figure out how to help the economy through hard work and ingenuity. If you come up with the idea and get funding, you have a head start. If you execute better than others, you could possibly make money at it.

I agree that in aggregation, the most efficient and productive business models (combined with the hard work) will create economic opportunities. That’s why stealth startups run by 24-year-olds based on an idea won’t work; their lack of domain expertise won’t ever get them funded for anything in an open source world. VCs can be just as guilty… they use stealth to keep ideas hidden among themselves so they may leverage negotiation power over entrepreneurs.

This transparency of business models should be extended across industry disciplines. Last summer, I created the Management Consulting 2.0 slideshow explaining our philosophy that consulting should be open source, not a closed book of research done behind McKinsey doors that can be charged out at $750/hour.

Management Consulting 2.0

View more presentations from Pat Kitano. (tags: mba marketing)
]]> http://mediatransparent.com/2009/02/13/open-source-funding-mark-cuban-simplifies-venture-capital/feed/ 0 The 12-Hour Incubation of a Crowdsource Investment Idea http://mediatransparent.com/2008/08/20/the-12-hour-incubation-of-a-crowdsource-investment-idea/ http://mediatransparent.com/2008/08/20/the-12-hour-incubation-of-a-crowdsource-investment-idea/#comments Thu, 21 Aug 2008 05:04:23 +0000 Pat Kitano http://mediatransparent.com/?p=21 What makes the social media intriguing is its facility to provide instant interpretation of random ideas and acts. These acts, adhoc and experimental by nature, generate interest – controversial, amusement, alternative perspective – within a social sphere, which then extends the premise within hours. This kind of micro-media will filter the best ideas, extend them further, until they are “news”… or worth reporting by mass media. We’re all privy to the incubation of these ideas depending upon the networks we belong to or share.

Here’s the chronology of a simple idea that was proposed today by Jason Goldberg of SocialMedian:

Jason Goldberg – View full feed
Twitter posted a message on Twitter

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Ex-securities lawyer Michael Arrington then pipes in the fact that Twitter solicitations for financing is an SEC violation. Jason takes the post down, but it’s recorded at Friendfeed.
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Prompting a Micro-financing venture capital room at Friendfeed, which I join because I think the crowdsource and peer-to-peer investment model is promising.
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And finally chronicled by Mathew Ingram, tech writer at Globe & Mail -  Twitter – a Microfinancing Vehicle

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