Breaking Bad is a television show that takes place in Albuquerque, New Mexico. I have enjoyed watching the show because of the quality of writing, acting and directing… but there is something else. I have enjoyed watching Breaking Bad because I grew up ~200 miles away from where it is filmed, and thus the backdrop that the story takes place upon is eerily familiar.
The first thing to note is that the main character, Walter White, is a Caltech-educated scientist that previously had worked at Los Alamos and Sandia National Laboratories. These are very real and historically important scientific centers. For instance, a large percentage of US rocketry and atomic bomb research and development occurred in this area. Wernher Von Braun himself was based in this vicinity for an extended period during the post-war years.
This ecosystem attracts a great deal of scientific talent to the area. (Coincidentally, my high school physics teacher was formerly a scientist at Los Alamos who worked on classified research previous to career change.)
The original Microsoft office was in a low-slung building in Albuquerque that would fit right in with the locations that Breaking Bad filmed scenes in. Take a look at the Google Street View. Here is a Google Map showing the filming locations that were used in Breaking Bad. As you can see, several filming locations are within walking distance of the birthplace of Microsoft.
Vibrant tech ecosystems such as Silicon Valley, Seattle, and NYC are something that various civic leaders have attempted to replicate in different locations. These efforts have met with mixed success. The oft-quoted properties of a successful startup ecosystem are ample technical talent, local research universities/labs, and access to capital.
But what other factors matter? Exactly how much are tech ecosystems inordinately affected by the minor decisions of tech forefathers? If Microsoft had stayed in Albuquerque, would parallel universe versions of the Breaking Bad characters work in the tech business? Could Walter White have started an incubator/seed fund? Would Saul Goodman be negotiating Series A term sheets for his clients? Would Jesse Pinkman be a successful “bizdev hustler”?
I know this is an absurd point to make, but is it really any more absurd than a 1970s mail-order model rocket company, located in an Albuquerque strip mall, directly leading to the creation of Microsoft, and thus the 2nd richest man in the world? The truth is stranger than fiction.
It was my first public appearance since the ugly demise of the company I had spent the previous ~7 years building.
To be perfectly honest, I was deeply dreading giving the talk. When Paul Graham first invited me to speak, I pointed out to him that publicly rehashing all of the things I learned about the music business seemed a self-destructive thing for me to do: I was afraid my talk would be seen as “sour grapes” or perceived as an attempt to blame others/make excuses for my failure. I had trouble sleeping in the days leading up to the talk.
After years of having my public persona mediated by marketing and PR, I had been trained as a founder to never be controversial, to tell audiences what they want to hear, to hide my true feelings behind carefully-crafted soundbites. Sometimes I would read quotes attributed to me in press, and not recognize the words as my own. That aspect of the job always made me uncomfortable, but I was under the impression it just came with the territory.
So, I made a promise to myself that if I was going to accept the invitation and speak at Startup School, I would consciously reject my prior training, and do my best to tell the Complete Unvarnished Truth. I convinced myself that I would go out there and pour my heart out, and the audience could choose to take it or leave it. Perhaps this was a self-destructive way to think, but that was my state of mind at the time.
After my talk was over, rather than being ripped to shreds in the ways that I was predicting, I experienced an outpouring of appreciation and support.
There are a number of different ways that I could have changed my behavior as a consequence of failure. That talk was a defining moment in my attempt to explain my failure to myself… to give my failure meaning. The Startup School audience rewarded me for telling the truth, for not “dumbing down the message”, and for being willing to admit and display weakness in public.
As I reflect on that what I learned that day, it's now clear to me that the person I was on stage that day was and is my true self. I found my voice.
“I urge you to please notice when you are happy, and exclaim or murmur or think at some point, 'If this isn't nice, I don't know what is.” - Kurt Vonnegut
One of the best pieces of career advice that I have received is that you should never forget to have fun.
A lie that people like to tell themselves is that once “success” is reached (ie raising money, hiring new people, reaching important milestones etc), their life will get a lot easier, and only then can they start to have fun.
Unfortunately, “success” invariably raises the stakes and life actually gets harder and more complicated… not easier.
Instead of admitting this, we try to keep the lie alive by creating a new, more ambitious mirage of “success”. Months, years, decades and entire careers can fly by in this manner.
With all of this in mind, I am trying to take a deep breath, feel the love of my family and friends and say: “If this isn't nice, I don't know what is.”
As I write this, join.app.net just met our 500K goal, with 38 hours left.
Data Export
When you are logged into the App.net alpha, we provide a button which will email you a .zip file of all of your content in a structured format. If you are an alpha tester, go ahead and try it out. It works.
Impartial 3rd-party verification of results
We are using Stripe to host/power the billing aspects of join.app.net. In the very near future I will ask an impartial 3rd party take a look at our data (while preserving all privacy of our backers) and publicly verify that the join.app.net was operated in an honest manner. There has been zero manipulation of numbers, or “stuffing of the ballot box” by App.net.
Third party app development
We are excited to see quite a few 3rd-party apps already under development. If you are interested in taking a look, here is a crowdsourced directory of 3rd-party apps that are active or under development. This is especially exciting for us given that the API has only been live since Tuesday evening.
This is just an alpha test
Please understand that we built a functional web application and working API to demonstrate that App.net is not “vaporware”. We have a great deal of work to do. One of the most important things we need to do is put together a Terms of Service for the operating site. I will be spending a great deal of time in the coming days creating a draft of our ToS, and our forward plan is to host it on github. This way, folks can see it, offer feedback (even pull requests), and will be kept abreast of any future changes. Along these lines, there are still a great many questions that need to be answered before App.net should be thought of as an operating service, rather than just an alpha prototype.
Account claiming
Please note that once the backing period is over, users will no longer be able to “claim” their Twitter usernames. From that moment forward usernames will be awarded on a first-come first-served basis. We implemented “claiming” as a fringe benefit for our backers, not as a go-forward plan. I want to make sure that latecomers are not surprised and disappointed to see that they can no longer get their preferred username. To repeat: if you want to “claim” your Twitter username, and haven't already backed us, you have 38 hours left to do so.
To our early backers
Thank you for believing.
I know in my heart that what made join.app.net succeed was your willingness and openness to give App.net the benefit of the doubt, to read our github documentation, to ask to participate in the alpha, to write blogposts in our support. Thank you.
At the bottom of his post, he asks me to publicly state/clarify some important questions.
Perhaps that's biggest flaw with how App.net was presented thus far. Perhaps if Dalton had promised one or more of the following…
I am publicly stating that, if backing is succesful, App.net will support the following things:
Activitystrea.ms Atom & JSON feeds, as well as RSS feeds, of public posts for individual users, hashtags, etc. (Note that this is different from making them the foundation of our read/write API, which we have decided not to do)
Pubsubhubbub (PuSH) support (as a publisher, initially)
Exposing user identities with Webfinger
Commitment to coordinate between internal and external parties to create and support open-source “lightweight” clients in as many flavors as we can, ala Stripe
Commit to enabling and supporting users in building inbound and outbound syndication to and from App.net
Long story short, as the social web evolves, we want to be able to provide the hooks into our service for users to syndicate content in and out via current and emerging standards.
Please let the above list show that we will pragmatically implement features and standards at the request of our customers: developers and users.
We shipped an alpha version of App.net. You can browse the global feed at alpha.app.net. This is a webapp that we built in the last two weeks on top of our documented API. Think of this web application as a “proof of concept”.
We also released a dev API that allows 3rd party developers to begin building App.net applications. In the 12 hours since we released the dev API we have already seen several app developers start working on projects. Here is a screenshot of an iOS app that an alpha tester is building. We also have had an alpha tester successfully post messages from an Android app.
We're opening up the alpha to all backers of join.app.net that want to be included. There are still some rough edges, but feedback has been positive.
Some thoughts on the funding goal
We are currently 43% of the way towards our goal, with 5 days left. A lot of folks think that we will never hit the goal. I disagree.
One of my friends that works at Kickstarter explained to me that projects succeed or fail based on the first and last 24 hours. For that reason, we are not making contingency plans. Rather, we are trying to put ourselves in the best position we can be for the last 24 hours of the project.
Additionally, if you take a look at Kickstarter's official stats, it would appear that of 35,138 unsuccessful projects, only 2,026 of them ever reached 41% or more of their funding goal. In other words, only 5.7% of Kickstarter projects that don't succeed ever manage to reach 40% of goal. That is not to say that join.app.net doesn't need a great deal of support to succeed within the next 5 days, I am simply pointing out that the data would suggest this is not a “lost cause”.
If you have been considering backing App.net, but have stayed on the fence because you are afraid that App.net is “vaporware”, or because you think that backing us is a waste of time (because it will never succeed), I would encourage you to question those assumptions.
On June 13, 2012, at 4:30 p.m., I attended a meeting at Facebook HQ in Menlo Park, California. In addition to myself, the meeting was attended by executives at Facebook with the following titles: “VP, Engineering & Products”, “VP, Partnerships”,“VP, Corporate & Business Development”, and “Director, Developer Relations/Open Graph”.
As I understood at the time, the purpose of the meeting was for me to present/demonstrate a new iOS app & service I have been building on the Facebook Platform. Previously, I had been reassured by Facebook dev-relations employees that the service I was building was an interesting/ valuable use of Open Graph & Facebook Platform. I was hoping the outcome of this meeting would be executive-level support for my impending product launch.
The meeting took an odd turn when the individuals in the room explained that the product I was building was competitive with your recently-announced Facebook App Center product. Your executives explained to me that they would hate to have to compete with the “interesting product” I had built, and that since I am a “nice guy with a good reputation” that they wanted to acquire my company to help build App Center.
I quickly became skeptical and explained that I was not interested in an acqui-hire. I said that if Facebook wanted to have a serious conversation about acquiring my team and product, I would entertain the idea. Otherwise, I had zero interest in seeing my product shut down and joining Facebook. I told your team I would rather reboot my company than go down that route.
Strangely, your “platform developer relations” executive made no attempt to defend my position. Rather, he explained that he was recently given ownership of App Center, and that because of new ad units they were building, he was now responsible for over $1B/year in ad revenue. The execs in the room made clear that the success of my product would be an impediment to your ad revenue financial goals, and thus even offering me the chance to be acquired was a noble and kind move on their part.
I am not sure if this bubbled up to you, Mark, but after this all happened I directly communicated my feedback regarding just how unhappy I was with this situation to one of your executives. The executive apologized and said he would take my feedback under consideration.
Mark, I know for a fact that my experience was not an isolated incident. Several other startup founders & Facebook employees have told me that what I experienced was part of a systematic M&A “formula”. Your team doesn't seem to understand that being “good negotiators” vs implying that you will destroy someone's business built on your “open platform” are not the same thing. I know all about intimidation-based negotiation tactics: I experienced them for years while dealing with the music industry. Bad-faith negotiations are inexcusable, and I didn't want to believe your company would stoop this low. My mistake.
In a lot of ways, I got what I deserved. I have come to the conclusion that I took this foolhardy risk because the Twitter “platform” was even more of a joke than the Facebook “platform”. As someone that wants to build quality social software, software that doesn't force users to re-create their friends list, or not use oAuth, etc., I have to endure huge platform risk. Personally speaking, I am resolved to never write another line of code for rotten-to-the-core “platforms” like Facebook or Twitter. Lesson learned.
Mark, I don't believe that the humans working at Facebook or Twitter want to do the wrong thing. The problem is, employees at Facebook and Twitter are watching your stock price fall, and that is causing them to freak out. Your company, and Twitter, have demonstrably proven that they are willing to screw with users and 3rd-party developer ecosystems, all in the name of ad-revenue. Once you start down the slippery-slope of messing with developers and users, I don't have any confidence you will stop.
I believe that future social platforms will behave more like infrastructure, and less like media companies. I believe that a number of smaller, interoperable social platforms with a clear, sustainable business models will usurp you. These future companies will be valued at a small fraction of what Facebook and Twitter currently are. I think that is OK. Platforms are judged by the value generated by their ecosystem, not by the value the platforms directly capture.
I don't think you or your employees are bad people. I just think you constructed a business that has financial motivations that are not in-line with users & developers. Even if my project isn't the mechanism that instigates this change, the change will happen.
Mark, based on everything I know about you, I think you get all of this. It's why you launched FB platform to begin with. Do remember how you used to always refer to Facebook as a “social utility”? That is an interesting term to use. I haven't heard you use that terminology in a while. I can guess why.
Anyway, Mark, perhaps the public markets & your employees will give you the time and goodwill to fix the obvious structural flaws in your “platform” business. You are in a very challenging position right now. Good luck.
Most people don't remember this, but Google had a social network that predated Google+. In fact, Google's social network launched a few months before TheFacebook launched as a Harvard-only site.
Google's social network was called: Orkut. Orkut was invite-only, and the day it launched, an Orkut invite was a hot commodity in silicon valley. I seem to recall I was lucky enough to be one of the first few thousand users.
It was fun to use at first, but within months of launch, the user community started to change. I remember that as it started to really grow, I began getting several new friend requests a day… all written in portuguese. As the community rapidly changed, a lot of early users, including me, stopped using the site. Check out these demographic charts if you think I am exaggerating.
Wait a second, the conventional wisdom is that more users makes a community more valuable? Well, not in this case. US traffic and usage dropped like a rock. Orkut became an embarrassment to Google, and they quietly stopped talking about it. In fact, many people believe that Google stayed out of “the social networking space” for as long as they did because of how poorly they fared with Orkut. I wonder if Facebook would exist in its current form if Google had managed its nascent social strategy differently. Possibly not.
Critical mass
Everyone can agree that an online community has to have critical mass to be considered useful. Getting to critical mass is a high bar: most consumer internet startups fail because no one cares about their product. Many startups are left with a ghost-town, with nary a tumbleweed blowing through. This is one of the reasons that “grow your userbase as fast as possible at all costs” has become VC dogma for consumer Internet. I can absolutely understand the reasoning behind this, but dogma is still dogma.
One additional reason that growth above all else is VC dogma is the assumption that consumer internet companies are free & ad-supported. Think about it: if you have a free service that doesn't scale a large enough userbase, you end up with a desperate company that cannot financially sustain itself through advertising. Sounds like circular reasoning to me.
The “Suggested Users” mirage
I know a smart reporter that has 429,000 Facebook Subscribers. Really impressive network effects, right? Well, take a look at the comments on one recent news story she posted to Facebook. Here are some of the “likes”. WTF? This is the best her 429,000 subscribers can come up with? Are there other people in her following that are scared to participate? Are her core fans just not seeing her posts in their newsfeed? Something strange is going on.
Similar things happen to other people I know with an abundance of Facebook subscribers. Facebook must have pointed a ton of random users at high-profile influencers, but it seems these random users are profoundly confused/looking for a date. Is this value? Is this what advertisers and Wall Street are looking for? I'm not convinced.
I personally went through a similar experience with Google+. I was added to over 5,000 Circles within weeks of launch. I remember asking my newfound community why they added me. The responses I got suggested these folks had no idea who I was, or how I even ended up in their stream. I suppose it made me feel special to have that much of an audience, but really, aren't these big numbers a superficial numbers-game more than, well, quality?
Social networking tech press reminds me of The Three Stooges. Pretty much every day we get to read about Moe, Larry, & Curly poking and slapping each other with growth & engagement metrics. It's entertaining, but the entire discourse is centered on who among them can build the most profitable-seeming vanity metrics from the perspective of Wall Street and advertisers.
Anti-network effects
Anti-network effects occur when a community which has already achieved critical mass begins to lose value with each additional signup. The reason is that the core community that created the value to begin with starts to get marginalized and leaves.
In my opinion, Quora is more “valuable” than Yahoo Answers. But I would argue that Quora could easily become Yahoo answers if, in the pursuit of “network effects”, they begin to dilute the quality of the community, and which would have the side effect of causing the most interesting and value-adding users to vacate. The Quora team is clearly aware of this risk, and are apparently steering the ship in such a way as to avoid this possible outcome.
The power of the asymmetric model + global feed
Twitter's growth model is a nice blueprint for getting a critical mass and then growing to global scale. Specifically, if you launch with a small, dedicated group of interesting people that can asymmetrically follow each other, along with a global feed of all content posted, you can feel like you are the member of an interesting and vibrant community.
As the site starts to scale, the early userbase will depend less and less on the global feed, and use their own feed/following list to crank up or down the amount of information they are presented with.
The asymmetric follow model also takes care of some of the strange things that happen on Orkut, Facebook, Google+ etc. Strangers can choose to follow you, and @-reply to you, but it doesn't feel like they are “putting” their troubling messages on your content.
It should also come as no surprise that Pinterest and Instagram followed the Twitter blueprint of asymmetric follows + global feed to scale from a small critical mass of interesting people into a massive, global community. Those sites were fun and useful to early adopters on a small userbase, and have managed to keep their community mostly solid throughout massive growth.
App.net: social infrastructure, not a media company
When I look through the current backers of join.app.net, I am excited to see that it appears to have a large overlap with the early adopters of Quora and Instagram. What these early adopters have in common is an interests in quality, novel approaches to old problems, business models of 3rd-party “indie” developers, and willingness to be a part of something new and strange. I could not imagine a better group of people for join.app.net.
I believe that a critical mass of users and developers can take the basic plumbing we have in our API and webapp, and build a vibrant social ecosystem. My personal hope at this point in time is that our official webapp functions as a proof-of-concept that the API is sound, but is a bootstrapping medium by which novel integrations are built. Remember: Twitter community members, not employees, invented hashtags, retweeting etc.
The point of my post, What Twitter could have been, was to point out that they had the chance to jump off the precipice, abandon their official apps, and let the entire service be the API. Instead, Twitter chickened out and have decided to systematically control and destroy the ecosystem in the name of advertising. I am trying to make join.app.net a “do-over” on this mistake, armed with the benefits of hindsight and a radically different business model that has fundamentally different alignment of user & financial incentives.
If we look to history, infrastructure innovations such as electricity, cellular phone service, and the Internet are judged by the longterm value that was enabled and circulated throughout their ecosystem, not the amount of value that corporations directly captured. If “social platforms” really are as fundamentally important as many of us believe, they should start behaving more like infrastructure, and less like the entertainment industry.
Imagine that there is a hot new restaurant in San Francisco. The restaurant is currently selling hot dogs. However, they insist that there are some brilliant engineers from MIT, Caltech & Stanford in the back room working on a machine that can turn hot dogs into caviar.
This sounds a little bit far-fetched, given that various other restaurants have been trying to build a hot dog-to-caviar converter for the past decade, and it doesn't seem to have worked yet. But this new restaurant insists that there is another restaurant in Mountain View that figured out how to convert hamburgers into caviar, and that their restaurants have a lot in common. In fact, they even hired some of the same hamburger scientists from Mountain View to work on the hot dog converter in San Francisco.
However, the fact remains that this mythical hot dog technology doesn't exist yet, and the way the restaurant makes money today is selling hot dogs. Also, the restaurant is under intense financial pressure to get the machine working, and is valued by investors and employees in a way that assumes the hot dog-to-caviar machine already works. They have roughly 12 months to get the machine working or Bad Things will happen.
New social advertising units
The advertising units Twitter and Facebook are selling today are “hot dogs”: poorly targeted, poorly performing. Surrounded by offensive user-generated content that is bad for brands. These are low-end, volume businesses.
Remember all of the ridiculous statements MySpace used to make about “HyperTargeting”? That was their version of a hot dog-to-caviar machine. How did that work out for them?
One of the following statements must be true:
A new “social ad unit” will be created at Facebook or Twitter in the next 12 months that will manage to be far more profitable than current ad units, not piss off users, and immediately be embraced by advertisers.
A new social ad unit will be invented in the next 12 months, will be attractive to advertisers, but will be something that makes end-users run away in droves. Remember Facebook Beacon?
A new social ad unit won't be invented, and the Facebook/Twitter monetization path will be to cram their current low-value ad units down the throats of users at a far higher volume than they do today, in order to hit revenue targets.
I hope you like hot dogs!
p.s. I am trying to start my own restaurant that transparently sells good food to people that are interested in buying it. No magical machines.
I have been thinking a lot about what makes great 3rd-party developer ecosystems work. At the end of the day, it really boils down to financial incentives, and the ability of an ecosystem to support 3rd-party devs making a living and maintaining a good lifestyle.
If the rules are setup correctly, great 3rd-party development platforms create a strong financial incentive for 3rd-party developers to make great software. Why? Healthy platforms allow 3rd-party developers to make lots of money. If you can setup the financial incentives in the right way, people are able to make a great living by building great software that is useful and makes people happy. That is the world I want to live in.
On the other hand, if the “rules” of a development platform are setup without intention or thoughtfulness, the ecosystem will fail.
I would like to publicly share an idea for App.net and its relationship with 3rd-party developers. What if we took the subscription revenue we got from members, and did a recurring, monthly revenue share with 3rd-party devs?
For the sake of argument, let's assume a 50/50 split would make sense. In this hypothetical proposal, if in a given month an App.net member signs into a single 3rd-party client, that developer will get $2.08 from App.net. If a member uses 5 different 3rd-party apps that month, the revenue will be split between those 5 3rd-party developers on a pro-rata basis, probably based on how much the user actually used the client. Let me be clear: the definition of use is very complicated, and there will be insanely complicated corner cases to work out in terms of reporting, not least of which are developers attempting to game the rev-share system. Is there a fair way to define “use” that could fairly compensate the ecosystem? Perhaps someone out there has proposal about how this could be fair? I am fully aware that the devil is in the details here, and don't want to appear to be flippant about a very complicated question.
I like the idea that every month the 3rd-party developers will get a report of what usage occurred in their application, along with a check. The advantage is you get to distribute your app for free in the app store, but still get assured you will get financial incentive for building the best software. And, if a user is already an App.net member, they can just sign into your app for free without any money changing hands… the dev still gets paid at the end of the month. I think this creates an incentive for developer to create amazingly high quality apps that people will want to use in the long run, and get away from some of the App Store “chart gaming” going on today.
Let me be transparent here: I am trying to turn the brain-dead way Twitter is treating its 3rd-party devs on its head. 3rd-party developers added all of the value to the platform in the early days, and instead of being shut down they should get paid. The reason the Twitter developer ecosystem has failed is that Twitter itself has a flawed business model. We can do better.
3rd party devs: what do you think? I think you would say “hey, great idea, but where are the users, this only works at scale”. My answer is that we need to cooperate to create this ecosystem. If we all act together, I think we can build an ecosystem that will support all of us, and lead to you making a whole lot more money building great software than you are today. I believe this is a vision worth fighting for.
