"Back in October, we wrote a research paper entitled 'Anatomy of a Large-Scale Social Search Engine' and submitted it to WWW 2010. We found out last week that it has been accepted, so we wanted to share a preview with you today!
Our paper was inspired by the classic Google paper, 'Anatomy of a Large-Scale Hypertextual Web Search Engine', in which =>Sergey Brin and Larry Page<= originally describe the algorithms and architecture of Google. This paper was published 12 years ago in the same WWW conference."
There was a time I believed all corporate activities were based only on merit. Anything not completely merit derived would be illegal. That's what we're made to believe with all kinds of anti-descriminition laws (you can't ask age, about kids, etc during interviews for example).
It turns out, everything is friend based. Know rich people? They'll help you get rich too. Have a project you don't want to do inside of Google? Just quit, make it anyway, then they'll re-hire you with a $5M per head bonus.
I'd find it delightful if I were in such a position, but I'm not. Not only am I not, but the more technical side of me doesn't want to play social games to become ingratiated to the decision makers. Deep down, I still believe the world is merit based -- and that's one reason why I'm still a nobody doing nothing going nowhere.
By "merit," I meant actual accomplishments and not some ethereal quality of a person or group just sitting idle.
I'm glad you chimed in though because you're one of the cases that kind-of fits the model above. From a complete outsider's point of view, it looks like friends giving friends tens of millions of dollars for nebulous reasons.
* Disclaimer: Text is a poor medium of communication and usually comes across more hostile in the reader's eyes than intended. There is much levity here.
I'm not implying that you were engaged in anything shady, but your success with friendfeed, you have to admit, was more than the sum of your technical/marketing talent, having friends in high places has to have come into it somewhere, no?
Not really -- we didn't know the Facebook team all that well. Your argument would make more sense if we had sold to Google, but even then it would be false.
If your point is that people can build future success on top of past success, yes obviously that is true, but there is nothing wrong with that. It means that you need to work at it for a while and not expect people to simply hand you whatever you want because of some imagined "merit".
Edit (because there's not reply link for some reason): Where do you think reputation comes from? You have to start by doing something, and over time if you keep doing things that makes you more valuable.
Well it's not exactly "Create something remarkable and people with money will find you." then. More like 'create something remarkable and have enough reputation or schmoozing ability, and be in the right geograhic area'.
Even the 'remarkable' thing is not entirely true. I don't think facebook or microsoft were remarkable, for example, they just hit the right combination of luck and skill at execution. Google on the other hand, was an example of something remarkable when it first appeared.
I'm tempted to thow out the over-quoted "luck favors the prepapred mind". Yes, Microsoft lucked out when Bill Gates' mom was a boardmember of IBM, but they certainly took full advantage of it, and their many other opportunities - most of which came with having a more accurate understanding of their market than others. What might seem like luck to the inexperienced mind is usually a well executed strategy in line with a superior model.
All in all, though, I think it wise to hold yourself responsible for your accomplishments - both geographic location and your circle of acquaintances is something you have significant control over.
I don't think you can attribute Bill Gates to superior understanding and execution, at 50/100 million or even 500 million, but getting to 100 billion at one point, I don't buy it. Is Bill Gates really that much smarter than the rest of us. The same can be said for most people that's over 10 million I reckon.
"All in all, though, I think it wise to hold yourself responsible for your accomplishments - both geographic location and your circle of acquaintances is something you have significant control over."
I agree in spirit, but the reality is different.
Yes.
-if you're a white/asian male
-born to middle class parents
-and you're parents emphasized education
-and good nutrition/genes so that you grow to above average height
-and that you go to a good college
-and can fit in with the right crowd
yes, you simply move to silicon valley/manhattan/london and fit right in.
IF you're a black man from a poor single parent family in small town mississippi, or the daughter of a farmer from a village in bangladesh, things are much more difficult.
If you really want to make the big bucks, what you really need is a monopoly on the desktop operating system. But the Sherman Antitrust Act, 15 U.S.C. § 1 and 2, and Clayton Antitrust Act, 15 U.S.C. § 25, are real bitches.
That's how Bill Gates made $100B. He had an opportunity to monopolize desktop OS'es and the luck/insight to bet they would one day be worth a lot, and the skills to execute on that opportunity. Yes, that kind of opportunity is very rare, but $1-100M opportunities are not.
That said, I agree with everything else you said - I agree that I'd much more like to live in a world where a black person with a poor single parent in a small town in Mississippi is given the tools to take advantage of the same opportunities as a Kennedy, but we should also accept that although it's something to strive for, and something to take steps towards (affirmative action/universal education/healthcare), there are also aspects which make it impossible. Ironically, one step towards equality is the removal of the meme "I was born <this and that>, so I can never accomplish what Bill Gates did".
Reputation comes from doing remarkable - or even just impressive - things repeatedly over time.
It compounds. The first time you hear that somebody just wrote something cool, you think "oh, that was nifty", and promptly forget about it a day later. The second time you hear it, you think, "Don't I remember hearing his name somewhere?" The third time, you think "Hmm, maybe I should watch out for this guy." By the fourth or fifth time, if you have money you want to invest it in him, and if you don't you want to work with him.
I've met a bunch of rich people, and in my experience, they're all basically the same as normal people. They're impressed by similar things. So think about the people you find impressive, and try to be like them.
Seriously, what are you going to say next? That the world is not fair? Only the 'remarkable' by your standards should see market success? That is wrong to get lucky, to be at the right place and right time?
Well theoretically, the low level people on the acquiring team could be bribed by the acquired, as is often the case in governmnet contracts.
edit: and you can 'dazzle' the acquirers with your reputation and nudge things along. Even if that hurts your reputation in the future, you can be making this as a last ditch cash grab. Kind out of taking out a mortgage and fleeing the country - or the 2000 tech boom and the current housing crisis
it's a fair and legitimate point that it's easier for already famous people to get their company acquired than it is for a nobody <-- you are pointing out the obvious. And your point?
It's naive to think that only products remarkable by your standards should see success in the market place.
It's another thing to be jealous of the success of others, because the world is not a zero sum game.
I'm done with this pissing match, I think I already said too much - say whatever you want, but your subtle attack on Friendfeed is malicious and I do not agree.
That problem exists regardless. Who can truly judge "merit"? However, investing has a built-in selective pressure. The people who are good at spotting things that will make money get more money -- the ones that aren't good at it lose money.
Your implying the cost to replicate the technology and gain the same traction would cost Google more then $50m. This is clearly not true, even if you grossly overestimate and assume it takes 20 engineers 6 months each at a salary of $300k each to replicate vark, plus $10m in marketing. It still falls short of $50m.
So is the difference the cost of mostly re-acquiring talent? Talent that you had already ascribed a value to when you employed them through assessing their annual performance?
Your implying the cost to replicate the technology and gain the same traction would cost Google more then $50m.
Not quite. I am implying that Google thinks the risk associated with doing it on their own is not worth the $50m for the acquisition.
It is way more complex than simply about tech and traction. ie. lets say google can build the same thing for $10M. But hey it might take them 2 years. In the same 2 years, a competition(Microsoft) might acquire Vark and turn it into a billion dollar competitor to google.
On the flip side, even if Google can build it for 10M and launch in 6 months, the risk from the other possibility is not worth the 40M in savings.
That's the Microsoft approach to building products, and while they meet all of the "feature check-list" of the product they're cloning, they usually somehow fall sort on execution. There's something a bit ineffable that comes with the people who truly grok the problem being solved and pour their heart and soul into solving it.
What you may not realize is that everyone is knowable if you put enough effort into it. If you have no drive and no talent, rich people won't be able to help you. There aren't that many driven and talented people out there, so if you're one of them, and you make an effort to meet rich people, they'll help you too.
I think the problem is that some people (Me included) would rather spend all energy making stuff people want, rather than schmoozing people who might buy you. But I do see your point.
If you spend all your energy making stuff people want, rich people will find you too. The problem is that making stuff people want is really hard, and usually involves going out and finding people that want stuff.
If you have real traction - as in people are already buying from you, without you going out and selling them hard - rich people will be knocking at your door trying to get a piece of the action. But then, if people were already buying from you, why would you need rich people?
I think it's better to approach this from a different perspective. "Engineering relationships" doesn't work in general - if you approach people because you want something from them, they'll sense it very easily and push back. It's much better to approach people because you genuinely like them and want to learn from them. Many rich people have a ton of knowledge and experience that most of us don't, and it's genuinely interesting to learn from them. It's no good to expect anything, it's much better to try and learn from them just like from anyone else. If you approach it this way, it becomes an activity with very positive connotations, as opposed to schmoozing.
"There aren't that many driven and talented people out there"
I beg to differ, if you assume that there are an equal distribution of talented/driven people, then how come there are more millionaires (talented people) in silicon valley than the rest of america, and america more than europe, and europe more than the rest of the world.
More likely is that rich people are cliquey and luckier/lazier/less talented at spotting opportunity/investing than they give themselves credit for (otherwise you'd see a more equal distribution of investment to where the talent is).
There's some truth to what you're saying (I'm afraid), though a lot of it is more general than just "rich people will help you get rich". You'll learn more around smart people and you'll be more likely to be a criminal if your friends pull you into it.
But overall your negativity throws me off a bit. One definitely notices when a company with many ex-Googlers is bought by Google. But if you think that's how the world is, nothing really stops you from joining Google: what were these guys doing before joining Google in the first place?
Networking definitely helps in a lot of situations (to find a job, to make a deal, to get in touch with the right people), but you can do something to arrive at a place where you can easily network with the right people.
Surely it's like the girl who sleeps with the boss gets a promotion. Sure, if you want a promotion you could sleep with the boss too, but it'd be nice if everything was just fair and done on merit. Not everyone wants to sleep with the boss.
I found it became significantly less irritating to me when I realized that decision makers simply suffered from an information problem and weren't specifically out to get me.
Imagine that you have something lots and lots of people want - say, a few hundred million dollars to give away in venture capital. Naturally, since lots of people want it, you're constantly bombarded by requests. After a short period of time, all these requests start to seem the same. Everybody has their startup baby. They all are absolutely certain that it's going to change the world. Most of them have very little experience and nothing in particular to recommend them.
If you're in this situation, what would you do? Every startup looks the same; you don't have enough information to pick one over another. You don't even enough time to begin gathering information to pick one over another.
So you winnow the field by picking ones that stand out for some reason. The easiest way is to pick only the ones that come recommended by friends. After all, you have a limited number of true friends, and they know how busy you are, and so they'll only forward on ventures that they really believe have potential.
The second easiest way is to pick founders whose names you recognize. Or founders whose past projects have names you recognize. There are a limited number of names that you'd recognize, and most of them are not asking you for venture capital, so this is a fairly safe way to narrow down the field.
Other than that, pretty much any way you choose of picking startups will be essentially random. It's like the half-season of House where he was picking his new team and randomly fired half the applicants. You wouldn't think that's fair either, right? Yet how else are you going to determine merit when you have far too many candidates to investigate each one in depth?
I agree that it would be nice, and that's the world most parents try create for their kids. Outside of meticulously engineered/supervised social structures, however, I see little reason for a pure meritocricy to arise, if only for the reason that the concept of "merit" doesn't exist outside of our moral models.
And you can certainly get a promotion many ways aside from sleeping with the boss.
Re-hiring a bunch of ex-employees does not look like a talent acquisition. It looks more like someone was shrewd enough to become buddies with the M&A department the first time around.
Sorry, would you care to elaborate? I'm not really sure what you mean by "the M&A department the first time around". I think the fact that only _some_ of the team members are ex-Googlers is significant.
Additionally, what other business case could their be to purchase such a small, new company. Couldn't Google just have integrated these features into their shiny new Buzz service _last week_ and have overshadowed Vark very quickly?
If you quit a company, do a successful startup, and then get re-acquired by the company you quit in the first place, chances are that you don't want to go back to work for them again. If you did, why did you quit your job in the first place?
Though in their case, with 4 founders, $6M invested and a $50M exit, it's not "that much" money.
I wouldn't spit on it obviously, but considering some of these guys' former positions at Google, they had probably made a good amount from stocks and such. What I'm trying to say is that it's probably in the same order of magnitude of their worth before that.
It would depend on the events which led up to leaving Google in the first place. I doubt the original team left Google because it wasn't challenging enough or there wasn't enough flexibility, both of which would be reason enough to leave a lesser company to go out on your own. If your logic was accurate, then why would Aardvark have even sold out to Google in the first place?
Possibly these people liked their idea enough and though they could make a lot more going it alone, now they like the idea of Google support in perusing continuing to peruse their idea.
Just a guess really, but what they are doing now make be considerably more exciting than what they were doing at Google previously.
Seems like a pretty large founding team and a lot of ex-googlers there. I counted 11 senior/founding members on their site.
$50 million sounds like a lot initially but considering the size of the founding team and that they raised 6 million from VCs I don't think any of them would want to retire just yet.
Saw these guys at Facebook HQ a couple months ago. Seemed like during their entire presentation they were trying to pitch their company to someone with purchasing power at FB
ha, I was one of the presenters there, for Sharendipity. You're right that Aardvark didn't talk much about the tech, considering it was for Developer Fridays. They did focus a lot on expanding the ways you could use the social graph in FB though. I thought it was nice to see that they've been acquired, although I thought the price tag was a bit surprising.
Where do they get this valuation from? That's greater than $500/user, and their growth curve doesn't look exponential by any means: http://siteanalytics.compete.com/vark.com/?metric=uv. (Yes, I know compete sucks, but often the shape is correct.)
Talent doesn't make sense at that price, more like a few million. The tech can't be that out of the ordinary for Google given they just launched Buzz and Wave. So what was it that deserved that price? Bidding war?
A lot of their service runs over IM and other non trackable tools. But it does seem like a high valuation. I assume its a talent + technology acquisition and not a play for eyeballs?
It is, however, merely pocket change to the Google Corporation. If it works out then they win. If it doesn't work out at least it won't benefit any of their competitors.
Plus they get the cool early-adopter-of-new-search-technology userbase.
It's a great product with a great team. Furthermore, acquirers are known to believe that with their brand and marketing might, with tight integration in their existing solutions, they can make a product succeed.
This might be wrong more often than it's wrong, but if it does work the payoff could be enormous. Who knows in this case. But I suggest you think of it as an investment at $50 million pre-money. That's a little pricey, but might still be worth it.
It may not be too high if you look at the VC money they had raised. $6M had been invested so if that was a 50% stake then you are looking at a 4x return for the VC. Isn't that about right?
Not true (or at least not ALWAYS true). Do you think corpdev guys are immune to anchoring? Here's a study:
"Take a minute and answer this two-part question:
1. Is the percentage of African nations in the United Nations higher or lower than 65?
2. What is the percentage of African nations in the United Nations?
This was one of the queries that Amos Tversky and Daniel Kahneman posed in their 1974 paper in Science called “Judgment Under Uncertainty: Heuristics and Biases.” It turns out that the answer you provide to the second question is heavily swayed by that first question.
The average estimate for question two was above 45 percent. When question one was lowered from 65 percent to 10 percent, the average estimation of question two was dropped to 25 percent. "
I'm not sure the comment was about valuation it was about the purchase price. The buyer has to pay what the company is willing to take and part of that equation is how much the VCs that gave them $6M want for a return.
$50 million is the same price as GrandCentral, which became Google Voice. It's all but impossible to tell how important strategically any one acquisition is to Google until they execute on it. This feels more important than Jaiku/Dodgeball, but really, only time will tell if $50 million was a bargain or a giveaway.
me: Why did google pay so much money for Aardvark, the company made by the mechanical zoo?
aardvark: Got it. I'm sending your question to someone who knows about Aardvark.
(Type 'tag' to fix that label, 'more' for options, or 'cancel'.)
Sent at 2:51 PM on Thursday
aardvark:
(Update: No response yet from people who know about Aardvark -- but I'm still looking. Type 'tag:' followed by a different category to try other people.)
Sent at 3:01 PM on Thursday
aardvark:
(An answer just arrived... From Derek P./28/M/Brookville,PA, Re: Aardvark)
That's what I'm trying to find out. I tend to hate services like this, that are for people too dumb to Google. ... WAIT A MINUTE?!
(To reply, type 'Derek:' followed by a message, or type 'flag' if this answer is inappropriate. Type 'more' for options.)
While there is definitely a bunch of talent on the team, I'd say this is definitely a technology acquisition, but specifically a UI acquisition -- Google could build the back-end to vark tomorrow, but the user interaction is something they could never have come up with.
This is also why they should acquire Yelp -- it's not about the tech (in fact, Yelp is built on Google maps). It's about the interface.
The map part seems like an easily switchable component, and the bulk of Yelp is the community and the reviews themselves. Also, I think other parts of Yelp use Bing and Yahoo maps.
Sure, but my point is that Yelp's core tech of storing venue information, ratings and reviews is not "hard" -- Google and Yahoo both have services that do this. But it beats the pants off of them because its user interface and social dynamics encourage better data.
One thing they probably really like is the natural language parsing. It's surprisingly good (though by no means perfect) at automatically tagging your question.
For example, looking through my old questions, I think it automatically tagged "what's a good place to get a cheap SSL certificate? I don't think I need wildcard subdomains" as "SSL".
In a perfect world, you ask Google a question just like you'd ask a person a question, and they answer it with the info you want, so they might be interested in the technology and people that make this intelligent tagging work as a step in that direction.
Not to be snarky, but what is impressive about tagging your question with "SSL" - the exact keyword is in the question. No semantic analysis or NLP required - just simple keyword based entity extraction.
I know, it's not brilliant, but SSL wasn't in a particularly special place in the sentence or anything that would make it easy for a computer to figure it out. Compare that question to something like "I am using Rails. How do I ...?", where a computer would have a pretty easy time of figuring out that Rails is important with some simple parsing logic.
Facebook is about getting information from your social circle, while Google search is about getting information from the internet at large. It seems they are looking at various ways to bridge that gap.
It kills a potential rival that could one day grow into a threat. Yahoo didn't acquire Google when they could have. Google has in its DNA the desire to prevent the same embarrassing disaster. IMHO.
When listening to Sergey talk about Google Buzz ten minutes into this video he brings up the value of using buzz to ask questions to his contacts with the recommendation system directing the question to who best can answer it.
Pagerank doesnt have anything to do with twitter and facebook.
Its a great idea, and its probably one of the major factors that made google a success, but today it is not a very important factor in google being a bigger company than fb and twitter.
Perhaps I poorly worded by saying "ten minutes in", I meant starting from 10 minute and 10 second mark Sergey brings up how he's been using the service internally.
Edit:But going back to your point, I not sure Pagerank is relevant to twitter/facebook, and I don't think Sergey was saying that it was. But I do think their could be search problem emerging in social networks when people start having several hundred friends and you want to find relevant conversations to your interests going on within your network.
Assuming VC's got 30% of the company that's a payout of $15 million from an investment of $6 million giving a little more than 100% a return on investment. These numbers are educated guesses of course, but it doesn't seem like the VC's got a lot out of this. Normally it's expected that the homeruns give a 1000% return on investment.
150% ROI to be exact, which is more than "a little more than 100%," but certainly not the order of magnitude more the VCs were probably looking for. Based on your assumptions though, is it fair to say the founders probably exerted quite a bit of control over when to sell, and if so why do you think they would do that? Desperate to return to Google? ;)
It's not just limited to your friends. I have a fairly small network on vark (~8 people I think), but I think only 1 time have I actually gotten a question from one of my friends. It extends to friends of friends and even just random people if it doesn't think your friends know or they choose not to answer.
I've also never actually gotten a question from a friend.
It's good with niche questions that only a human could help with. I've had luck with social questions ("where's the yscraper located?") and tech questions ("why's my jscript [code here] breaking in IE6?"). It's like stackoverflow, but "real-time" and not limited to coding questions only.
From Google's point of view, it's worth it. If they think they could develop this in-house for $5 million, and maybe it'd be great, maybe it'd be okay, and maybe it would suck. Spending $50 million to let them have the pick of proven technology that they can already see working before spending the money removes the risk.
I think this is probably more of a talent acquisition than anything:
Just the _highlights_ from http://vark.com/team
* Max Ventilla - former Googler; marketing and monetization
* Nathan Stoll - former Googler; headed Google News for three years
* Fritz Schneider - former Googler; founded and led Google's Firefox and Safe Browsing teams
* Winton Davies - founding member of Yahoo Research Labs and a Principal Research Engineer at Overture, GoTo, and Cadabra.
* Bill MacCartney - former Googler; designed an automated question answering system at Google Research
* Sameer Paranjpye - founded and headed Yahoo’s Grid Computing team, responsible for the Apache Hadoop project
--
Aardvark has also come out with some great research projects in the past few weeks/months. [http://vark.com/aardvarkFinalWWW2010.pdf]
"Back in October, we wrote a research paper entitled 'Anatomy of a Large-Scale Social Search Engine' and submitted it to WWW 2010. We found out last week that it has been accepted, so we wanted to share a preview with you today!
Our paper was inspired by the classic Google paper, 'Anatomy of a Large-Scale Hypertextual Web Search Engine', in which =>Sergey Brin and Larry Page<= originally describe the algorithms and architecture of Google. This paper was published 12 years ago in the same WWW conference."