If you thought you and your RepRap were safe from posers, you’re sunk: Amazon has just opened a store for 3D printers and printer accessories that seems to, at the very least, allow smaller manufacturers to get a foothold in an increasingly tight market.

Available on the “pop up web store” or whatever you want to call it are printers from Afinia and Flashforge (which, as you’ll notice, is a literal rip-off of the Makerbot) as well as offers from Makerbot owners who are selling used machines. In short, the store consists of smaller fry attempting to sell directly to a less educated consumer – which is fine.

With Staples selling Cube 3D printers and Toys “R” Us selling personalized ducks in Hong Kong, it’s clear we’re reaching the point when 3D printing is beginning to interface with the culture. It’s still “cool” enough to be cutting edge yet it’s lucrative enough for behemoths like Amazon to throw it a bone with this store.

And what of the folks who want their 3D printers to be the hardware equivalent of underground prog rock? Well, we’re probably out of luck. I’ll know it’s gone mainstream when my Dad asks for one and, the way things are going, that should be some time next week.

Article courtesy of TechCrunch

InternMatch has raised a $4 million Series A funding round led by ARTIS Ventures and Subtraction Capital, as well as follow-on investors including Kapor Capital and 500 Startups. The company will use the money to expand its engineering and marketing teams and build data-based technology to help match companies with the right applicants. InternMatch, which launched in 2009, has now raised a total of just over $6 million in funding.

InternMatch has also added Paul Willard, the former CMO of enterprise software developer Atlassian, to its board. In addition to Atlassian, Willard also helped scale up Coupons.com.

“It’s a really exciting development for us because he is one of the most widely regarded online marketing experts and typically works with a lot of growth stage companies, taking them from tens of millions to hundreds of millions in revenue,” says InternMatch co-founder Nathan Parcells. The site currently has over 5 million page views and 150,000 applications per month.

As its name suggests, InternMatch began as a platform matching up college students with internships. As InternMatch’s initial user base grows older, however, many are using the site to find their first jobs after graduating.

Companies have the ability to build hubs with extensive information about their work culture and benefits, which helps differentiate InternMatch from competing job-search sites like CareerBuilder, Monster, Dice and Indeed. This feature has proven attractive to organizations like Yahoo!, which lists its entry-level positions on InternMatch.

“A big part of it is helping companies define their culture. It’s part of the process that is really painful and broken. The flipside is that students are applying everywhere. Employers have 400 candidates for one role,” says Parcells.

“What we’re finding from employers is that they will resort back to networking and referrals because they can’t manage all those candidates. We’re now expanding to entry-level jobs, which is a huge market, but we’re also building technology to target candidates by understanding who their ideal fit is.”

InternMatch will use some of its Series A funding to develop products that take advantage of the data accumulated by the site, says Parcells. One of the company’s goals is to help students do a better job of deciding which positions to apply for instead of sending out a flood of applications. This in turn increases the quality of applicants companies see.

“We have knowledge of what kinds of students are applying where and we’re investing now in using that information and that data to delegate students to where they should be, places that they haven’t heard of,” says Parcells. “This demographic is so new to the job search process that there is a tremendous amount of value we can provide to students and employers about where else there might be a good fit.”

While InternMatch expands its audience to graduates, it will also continue to develop new products for its core user base of college students. According to InternMatch’s research, just 3.8% of students found their last internship at a traditional career fair. Instead, more than 42% launched their internship hunts on Google. InternMatch seeks to create a more targeted search experience as students start their internships at younger ages. The company’s research found that more than half of students began their first internships in their sophomore year of college or earlier.

“There is an increasing awareness of the importance of internships,” says Parcells. “It’s now the number one way students are getting offers for full-time jobs.”

Article courtesy of TechCrunch

Editor’s note: Kakul Srivastava is CEO and co-founder of Tomfoolery, Inc. She was General Manager for Flickr from 2004 – 2009 and helped the product grow from 37,000 users to over 60 million. Simon Batistoni is VP of Platform and co-founder of Tomfoolery, Inc. He joined Flickr in 2006 as the engineering lead for internationalization. 

People can’t help but look at the Tumblr acquisition through a lens colored by the many examples of large, public (and often screwed-up) tech acquisitions by Yahoo and others — Marissa even refers to it in her blog post announcing the deal.

As leaders who helped to guide the Flickr team in its early history at Yahoo!, we had front-row seats as Flickr was (sometimes painfully) integrated with the larger Yahoo! organization. Despite this pain, we believe that Flickr has come a long way as part of Yahoo!, and yesterday’s announcement of a major redesign and refocus is a testament to the continued excellence of the core Flickr team.

Kakul, a product/business professional, joined Flickr just as the ink dried on the acquisition deal. She represented Flickr’s needs through painful acquisition-integration check-ins and figured out how (and if) any of Flickr’s roadmap needed to change based on Yahoo!’s larger corporate needs. Simon, a hacker/engineer, was responsible for creating the translation technology and internationalization infrastructure that allowed Flickr to begin serving customers in Yahoo!’s overseas markets.

Navigating an acquisition can be tough, and though there are a number of differences between Flickr in 2005 and Tumblr in 2013, there are striking similarities:

• Yahoo! is on an upswing — at least in hype — and hope is rampant.
• The advertising powerhouse has acquired fast-growing sites featuring rich-media content and extremely passionate communities.
• There are ardent reassurances that independent growth will be nurtured.
• Both products are missing “e”s in their names.

So as former Flickr employees, here is some practical advice from us to our friends at Tumblr, humbly shared:

Don’t pretend it’s not happening or that it doesn’t matter.  

Regardless of who’s involved, acquisitions always make communities nervous, if only because they represent significant change. For some people, an acquisition can feel almost like a betrayal, and some Tumblr community members will be looking for any reason to justify their distrust of the situation.

The more honest you can be about the direction you’re taking and the reasons behind it, the better. Give your members a means to easily communicate back to you — the Flickr Forum, while sometimes contentious, has always been a great bellwether of how the community feels, as well as an opportunity for the team to explain and (hopefully) reassure.

Open discussions can be exhausting to manage, but they’re often more rewarding (and instill more confidence in your community) than pronouncements with no outlet for feedback. Avoid reassuring platitudes that gloss over the issues – if putting ads on the Dashboard will allow you to reach a goal of tripling annual revenue, it’s better to say so plainly. Honesty is appreciated by most communities, even if the truth is unpleasant.

Don’t forget you’re awesome.

Merging your company culture with another is a bit like combining a Trifle and a Tiramisu into a single dessert, layer by layer — hard work, probably messy, and it might taste a bit weird for a while. Losing focus on how you all work together can make the difficult moments seem worse than they really are.

Don’t forget that your culture isn’t just important to you — it’s important to Yahoo! too. Over the years, Flickr had many opportunities to influence the wider culture at Yahoo! including:

• Innovative approaches to database sharding, website localization and geographic data handling which were adopted by other teams, and informed company-wide initiatives.
• A highly productive team culture focussed around continuous deployment, which influenced a general trend towards faster development of many Yahoo! products.
• Faceball, one of many ongoing experiments in office clowning, which became something of an official Yahoo! “sport,” and was even played live onstage by senior company management.

Tumblr can set new precedents on how to join and influence Yahoo!’s culture and management. Equally importantly, a truly strong product is usually the result of the strong, connected team behind it. When acquisitions wither on the vine, it’s often a symptom of that team having dispersed over time, taking too much knowledge and culture with them.

However, the magic that really binds a team is larger than any one individual and can persist through multiple “generations” of people, provided everybody feels ownership of it. Ensure that new team members understand the value of the culture you’ve built, and the history that led you from being an experimental blog engine to a 400-million-user powerhouse.

At Flickr, we had several traditions to aid in ensuring that history and culture were passed along. When veteran members left the team, they were asked to provide a “last lecture,” summarizing the most important things they knew, and the lessons they’d learned at Flickr. Equally, new employees spent time with managers from each department during their first week on the job, learning more about how the team operated, the product philosophy, and the engineering infrastructure that made it all work. Every new Flickr team member was also encouraged to spend a day answering member help questions, which allowed everyone to understand how to communicate with the community, and the common problems they had with using the product.

Finally, the importance of goofing around was also underscored by regular bouts of spontaneous dancing, foam-dart wars and liberal posting of lolcats on the walls.

Plan for the Bear Hug.

Yahoo is a friendly place — and everyone will want to greet the new neighbors. Everyone will want to figure how they can work better with you. Everyone will have ideas about what Tumblr can do to support their property. By and large, these meetings come from a genuine desire to be a better partner, but they can take time and focus away from your core mission and slow the whole team down. Sometimes too much of this “love” can be overwhelming, and at times it definitely led the Flickr team to handle the overtures less than gracefully. In some cases, this led to relationship management headaches for years.

Allocate a “first point of contact” to triage the ideas and opportunities that come your way. Filtering in this way will allow you to seize the best opportunities and execute well on them, without draining your resources trying to handle too much. And remember that, while the occasional approach will be from someone furthering an agenda of their own, most folks are trying to help both Yahoo! and Tumblr get better. Even if their approach is clumsy, they mean well.

Think bigger.

Tumblr has promised to continue executing on its own roadmap, and right now that’s essential. But Yahoo! wants 1+1 to equal 5 (or even 15), not just 2. Back when Flickr was acquired, it seemed everyone was thinking about what the “Flickrization of Yahoo” might mean — except for the team at Flickr. We just wanted to keep Flickr as “Flickrized” as we could. In our case, we missed out on some promising avenues for product improvement and growth.

Don’t forget to leverage what Yahoo! can really add to your business. Whether it’s 24-hour datacenter support, the world’s largest Hadoop cluster, international legal expertise or better Tumblr schwag, you now have access to the resources of a large company that wants you to succeed. Relying on these resources whenever you can will free you up to focus on the things — your core team and your product — that you’re truly the experts on.

Know how deep the rabbit hole goes.

For both parties to really benefit from the acquisition, Tumblr will need to embrace certain Yahoo! technologies and infrastructure, but sometimes a successful integration can be much more complex than it initially seems. Will it require that you host Tumblr in Yahoo! datacenters? Perhaps you’ll also need to start using Yahoo! IDs or introduce new features to comply with foreign laws? When large, complex “sub-problems” crop up halfway through a project, the knock-on effects can cost months of time to address.

Make sure you’re always asking questions and scoping out the entire landscape – a large company like Yahoo! has some intrinsic challenges and approaches that will be unfamiliar, and you need to be ready to embrace and work through them. Being a part of Yahoo! will subtly change a few things about how you do business.

• You’re a bigger target for hackers hoping to get access to Yahoo! data, or to “punish” Yahoo! for a mistake that might have nothing to do with you.
• You’re a bigger target for opportunists like patent trolls looking for a quick payout from an “Internet giant”
• Yahoo! is a multinational company with offices in many countries — the legal landscape in which you operate will likely change as a result.

Don’t be afraid to reach out to people for a “gut check” even if you feel like you’re asking a silly question. It’s better to spend 20 minutes before you start ensuring that your security measures are adequate, or you’re legally compliant, versus having to significantly rework a project after you thought it was finished.

Parting Words.

We are still passionate advocates of Flickr, we use Yahoo! Mail, and run our company blog on Tumblr.  We are thrilled about these marriages and can’t wait for you all to show us how well it can be done.

Article courtesy of TechCrunch

Woot, the daily deals site that Amazon bought in 2010 for $110 million, built a reputation for its “pile ‘em high, sell ‘em cheap” business model for shifting goods. Now, the company is facing up to a shift of a different kind: that of its own talent. In the last week, TechCrunch has learned that five six key employees are parting ways with the company.

They include Darold Rydl, who had been president of the company and one of its very first employees; CTO Luke Duff, who has been the technical lead for all things Woot since 2005; CFO Rene Gonzalez; Dave Rutledge, who had been the creative lead on all of Woot’s editorial content as president of Woot Workshop; and Jay Johnson, leading both the deals and affiliate marketing divisions at the company as director of deals.woot. Rydl and Gonzalez have already left, and the other three have given notice but will be with the company for another week. Update: after publishing, we found out about another departure: lead developer Shawn Miller is also leaving, with his last day May 17.

This comes 11 months after founder and CEO Matt Rutledge (brother of Dave) also left the company.

No, these six are not banding together for a new startup. Rydl distributed a note to staff and then later posted it on Facebook (we copy it below) describing a desire for a change of scene, and we understand that each is doing his own thing.

(We have reached out to Amazon for a response to this story.)

But we have also been hearing another story about what’s going on at Woot that may have spurred some of these departures, simmering issues with Amazon management that have finally started to boil over. “I don’t think any of us ever envisioned leaving Woot,” one person told me. “I thought I would stay there and grow with the company as the industry changed. But there were a lot of frustrations.”

These, we understand, are connected to a gradual set of changes at the company over the years as it has bedded down at Amazon. “Amazon wanted to come in and do things in a different way, not considering the importance of the other stuff,” I was told.

It seems like one of the thorny points is Woot’s CEO, Garth Mader, who had been put in place by Amazon to work under Matt Rutledge, and was promoted after Rutledge left.

In short order, changes pushed through by Mader have spread to various aspects of Woot’s business.

Turning straw into gold

The site, founded in 2004 by Matt Rutledge when it was first incubated inside Rutledge’s preexisting company Synapse Micro, was one of the pioneers of the “daily deal” model of selling goods online. It did so in an irreverent way aimed at disrupting the relationship between buyer and seller by making it far less formal. The original concept was to sell one “crap” item at a time that was at the end of its line (consumer electronics was a mainstay) at a competition-busting price, and then to launch another product at midnight each day.

Breaking up the pattern of single items for sale until they sold out, once a month Woot also sold a “Bag of Crap,” a group of items for a single price. Frank and funny commentary ran through all of this, along with an attempt to remain transparent with consumers through forums and details about how much of an item was sold.

All this brought a cadre of loyal users to the site — some 5 million per month at its peak, according to Rydl’s letter — rushing to buy things that, in a sense, no one else wanted to buy. Turning straw into gold, as Rydl describes it in his letter below.

Today, things have changed. Woot no longer shares data on how much of a product has sold. If you think about it, that kind of transparency also runs counter to how Amazon is about its own sales numbers for specific products.

Meanwhile, the Bag of Crap stopped getting sold monthly, because it was deemed to be too much of a strain on the system, and the server crashed every time it was sold. “That wasn’t an acceptable customer experience,” the source says Woot was told. “But there were a million people trying to get 1,500 items, of course they would crash.” It didn’t make sense to scale up the hardware to support something we did once per month, he said. The workaround was that the company ended up creating a scavenger hunt to find a (less frequently offered) Bag of Crap, but given that users had to “like” Woot on Facebook to get the first clue, “the perception for many was that it simply went away.”

Another change was more backend but crucial to Woot’s business model. The company made a “big push” to ship products using Amazon’s fulfillment system but this proved inefficient and far less profitable for the kinds of products that Woot sold. The Woot method involved a big palette with the item able to be taken and thrown into a shipping box; the Amazon method was less simple, if perhaps more professional.

“The end result was that our variable costs quadrupled. We used to be able to sell 50,000-100,000 items per day at a lower price point, but now we can’t profitably sell items under $10 because the variable cost for shipping got too high.” It’s unclear whether at some point Woot will revert to what it had been doing in the past.

However, there is more possible pain to come in this area, with wider ramifications. Along with the push to move product into fulfillment by Amazon, Woot scaled down its warehouse operations but has never communicated to the operations staff what the plan is for them. Our source says that “has left the remaining operations staff with an uncertain future and has had a dramatic effect on morale as others across the company wonder if their group will also be shuttered as more Amazon services are used. The fear is that soon, all Woot employees will be asked to move to Seattle [from its current HQ in Carrollton, TX, north of Dallas] or they will be replaced by Amazon services.”

The bigger picture for daily deals

To be fair, there have been other pressures on Woot’s business that have less connection to Amazon’s ownership. Daily deals, as we have seen with Groupon and Living Social, have become less fashionable, partly because of an oversupply of companies working in this space.

“The fact that so many retailers started doing these kinds of promotions and started pushing so many emails I think led to fatigue,” our source says. Woot resisted emails, until two years ago, but “even then a small percentage came from there. Most still came from direct traffic, from people hitting the site every day to be engaged with the content.”

That direct traffic on the site, nevertheless, is down nearly 30 percent year on year, and is continuing to decline.

But ironically, because Woot is selling significantly more items now than it did in the past, this hasn’t impacted business. In fact, Woot’s revenues have been growing at a 20 percent rate over the last two years, and 2013 appears to be shaping up in the same range. Specifically, through Woot Plus, its flash-sales section, the site now offers more than 400 SKUs every day instead of six a year ago.

(Amazon does not break out how individual businesses are performing in its earnings statements.)

The Zappos fairy tale

The story of how Woot was acquired and subsumed into Amazon can be a cautionary tale for other startups. Our source says that Woot had envisioned it would follow in the path of Zappos, the shoe and fashion e-commerce site that was acquired the year before Woot for $1.2 billion. Into that sale was built the idea that Amazon would stay hands-off. At the time of the acquisition, Zappos CEO Tony Hseih noted in a letter to employees:

“We plan to continue to run Zappos the way we have always run Zappos — continuing to do what we believe is best for our brand, our culture, and our business. From a practical point of view, it will be as if we are switching out our current shareholders and board of directors for a new one, even though the technical legal structure may be different.”

Indeed, while some of Amazon’s acquisitions still do get to do things their own way, more or less, there are others that have been held to more integration.

This is, of course, to be expected: Amazon’s wafer-thin-margin business model is predicated on economies of scale, so it doesn’t make much sense to run different organizations within it in ways contrary to that.

“Maybe because we were only a $110 million transaction, we didn’t have as much leeway in how things worked out for us,” our source said. But that brings a mixed fate: “The core reason we’re all leaving Woot is because we’ve lost the ability to do what’s best for our brand and culture. The business will no doubt continue to grow because Woot can leverage Amazon systems, but Woot will look more and more like Amazon until it is unrecognizable.”

Rydl’s letter:

“In the summer of 2003, a little group of three started kicking around ideas, hoping to let a little wholesale company [to] move a ton of crap. None of us believed the guy in a DeLorean who stood out front yelling “THIS IS WHERE IT ALL BEGINS, YOU GUYS!!!” In retrospect, we probably shouldn’t have called the cops on him. Our bad, guy.

But anyway, that little project soon garnered international acclaim and earned the love and adoration of millions of fanatical customers, all of them begging us for the crap no one else wanted. Every day, I felt fortunate to be around the sort of people who could turn straw into gold.

But today, after lots of soul searching, I’ve decided to take up new challenges. Tomorrow I leave Woot to embark in a new direction. No destination is clear, no course is plotted, but I remember the excitement of starting something from scratch, and I can’t ignore the urge to go create something new.

With my parting words, I want to make it clear: each of you should be proud of your contribution to Woot.com. With the simplest business idea ever (and no advertising dollars to spend) we attracted over 5 million customers, managed well over a billion dollars in sales, and spawned an entirely new industry.. from SCRATCH. We grew from a team of 15 to over 200 people in multiple states, and we even earned the attention of the biggest internet company in the world, a company that decided that it would be safer to flat out buy us instead of trying to compete. Few people in this world have accomplished what we did – always remember to reflect on these wins and celebrate them. In the world of retail, you guys are the freakin’ Justice League.

Please know that I am so incredibly proud of each of you and what we’ve all accomplished together. And understand I didn’t arrive at this decision easily. Nevertheless, I know my decision is right. I leave you all in the capable hands of my hand-picked leadership team – I am 100% certain that they are ready to take the lead. Although you may miss me with your hearts, day-to-day you’ll never feel a thing. And please, keep any tears off the product in the interest of optimizing the customer experience.

More seriously, I still consider my time at Woot to be one of the best things I’ve done, and I’m proud to have worked with all of you over the years. My love for Woot runs deep and eternal. Keep doing great things. After all, you’ve done so many already…..what’s one more?

Woot on,

Darold

Article courtesy of TechCrunch

Matt Sanchez, co-founder and CEO of Say Media (which owns sites like xoJane, ReadWrite, and Dogster), just told me that the company has laid off about 10 percent of its 400-person staff.

Sanchez described this as part of Say’s transformation from an ad network to “a digital media company.” The company isn’t getting out of the ad network business completely, but that part of Say is relatively mature and that the company’s focus should be on the content side. The layoffs, Sanchez said, were really about looking “at all parts of the business except for sales and our content organization” and bringing them in line with that vision.

As for why the layoffs are happening now, he said there’s more pressure on digital media companies to become profitable. For example, he pointed to TechCrunch-owner Aol’s recent earnings report (the company is still facing a lot of questions about whether its content business can ever be a moneymaker, and CEO Tim Armstrong tried to allay those concerns by saying that Patch will be profitable in the fourth quarter).

Sanchez told me that with the layoffs, Say should be profitable in the second half of 2013. Looking ahead, he said he plans to stay focused on the content verticals that Say has already established (style, tech, and living), but that doesn’t preclude launching or acquiring new sites in the future — he just wants to do that using the company’s profits, rather than raising more venture capital.

“Regardless of whether it’s an IPO, an acquisition, whatever you think about our long-term prospects from an exit perspective, nothing’s changed,” Sanchez said. “We want to build an enduring media company. … We just think the best way to get there is to get profitable and grow from strength.”

Here’s the memo that Sanchez sent to Say staff:

Sayers,

This morning we had to say goodbye to some really talented Say Media employees and it was tough. It’s been a difficult day for all of us, and I know that many of you are feeling the absence of our colleagues and friends. We did not make these decisions lightly; each person that left today has contributed to our mission and will be missed.

Two and a half years ago, we set out on a course to build the media company of the future. We knew it wouldn’t be easy, and along the way the media landscape has continued to shift. We’ve navigated from ad network to media company while the transactional display market has commoditized on exchanges as predicted. We’ve invested heavily in this transformation, and are coming out the other side with a solid foundation for the future.

We have built out a world-class publishing platform, transformed our sales team, evolved our offering to content-led marketing programs and filled out our brand portfolio with talent and brands we are all very proud of. Our focus on Point-of-View content is working. Our brands are deeply engaging, growing communities of readers. The publishing platform on which these brands sit boasts a pipeline of new products that are poised to change the media landscape. And our advertising solutions are impressive and working hard for our marketing partners.

That said, the time is right for us to transition aggressively to continued growth with profitability. To that end, we’ve made a set of hard decisions aimed at right-sizing our business with a greater focus on supporting our strong content brands, growing sales and building innovative publishing and advertising products — while at the same time achieving profitability in the second half of this year.

Each and every one of you is incredibly important to what we are building at Say. Your passion, intelligence, energy and loyalty are what make this company and our culture so special. Today’s actions were painful but necessary for us to move forward, and I am confident we are on the right path to creating the media company of the future.

We’ll get together tomorrow for an All Hands, and I’ll share more detail about this action and our plans for the year. As always, please reach out to me if you have any questions.

Thanks,
Matt

Article courtesy of TechCrunch

Serial entrepreneur Evan Williams spoke onstage at Wired’s Business Conference, about going from Pyra Labs to Blogger to Obvious to Odeo to Obvious to Twitter to Obvious to Medium. Whew! “Turns out I’m bad at parallel entrepreneurialism,” Williams laughed, joking about why he just can’t stop focusing when a particular startup takes off within one of his many umbrella companies.

The most recent bright, shiny object in Williams’ purview is Medium, the publishing platform that’s focused on “ideas and stories with a longer shelf life.” Williams is now spending most of his time helming the 30 person team of former Obvious and now Medium employees. Curiously, the still invite-only publishing company is paying freelance writers to write for it, much like a traditional media organization.

When asked by Wired senior writer Steven Levy when the time was right to pull the plug on a company or when to stick with a project like Blogger, Williams said it was basically a gut check every time: “There’s something about just hanging in there, on the Internet. If you don’t die, then you win sometimes.” Google acquired Pyra Labs and Blogger for a rumored eight figures in 2003. You probably first started blogging on a Blogger blog. I sure did. And it is still around.

Twitter is another one of the wins. When asked what surprised him the most about Twitter’s hanging in there (seriously), to an eventual IPO in 2014, Williams, who still is on the Twitter board, said, “Everything.”

“I’m impressed and amazed every time I have a board meeting there. You zoom out and you think it’s pretty much the same as it was two years ago, but in other ways it’s just more and more indoctrinated into the culture. And everywhere you go, at least things I pay attention to, it’s like Twitter’s built into everything … It’s been really educational for me to see the evolution of a company that I was involved in from the very beginning now grow to be almost 2000 people. When I stepped down as CEO [two and a half years ago] it was 300 people, which felt like a big company.”

Eventually if you stick around enough, the wins will add up. To close the talk, Levy brought up one of Evan’s recent tweets, a quote from Nassim N. Taleb’s ANTIFRAGILE, a book that Williams is “obsessed” with, “Success brings an asymmetry: you now have a lot more to lose than to gain.”

“Success brings an asymmetry: you now have a lot more to lose than to gain.” – @nntaleb—
Evan Williams (@ev) April 30, 2013

Article courtesy of TechCrunch

Editor’s note: Peter Levine is a partner at Andreessen Horowitz. He has been a lecturer at both MIT and Stanford business schools and was the former CEO of XenSource, which was acquired by Citrix in 2007. Prior to XenSource, Peter was EVP of Strategic and Platform Operations at Veritas Software, where he helped grow the organization from no revenue to more than $1.5 billion, and from 20 employees to over 6,000. Follow him on his blog and on Twitter @Peter_Levine.

As a former CEO and senior executive, there was a time when I did not quite understand the profound impact a CEO has on the culture of a company, even though I always knew culture was important.

The organization reflects the behavior and characteristics of the CEO, and that establishes the culture. Foster an environment of open communication and the organization inherits a culture of open communication. Operationally detailed? The organization becomes operationally detailed. Political? The organization becomes political. Curse a lot? The organization curses. Angry? The organization gets angry. Have a big office? Everyone wants a big office. It doesn’t matter what’s written on a coffee mug or on a “culture” slide, what you do as a CEO, day in and day out, and how you behave will define your company’s culture.

Dysfunction

Despite the best intentions, companies often become culturally dysfunctional. This occurs when leadership has a perception about the culture that conflicts with reality, or leadership behaves differently than what might be written down. 

The organization reflects the behavior and characteristics of the CEO, and that establishes the culture.

One of the most studied examples of cultural dysfunction occurred at Enron, the former energy-trading giant. The CEO (Ken Skilling) and several top executives were arrested for a pattern of deceit, dishonesty and illegal financial practices. They promoted a culture of dishonesty, self-dealing and self-enrichment that destroyed the company. Ironically, the Enron code of ethics outlined four key principles: communication, respect, integrity and excellence… So, yes, culture matters and the CEO defines it.

Cultural dysfunction is not limited to large companies. When I arrived at XenSource, which was a 50-person company, the culture was dysfunctional, despite the fact that the founding team believed the culture to be awesome and supportive of innovation and collaborative thinking. There were two telltale signs: 1) Employees painted a very different cultural view from the founders; and 2) The responses were inconsistent with each another, indicating that the culture was a free-for-all with very little leadership. One clear example of the inconsistency resulted in the organization having two engineering efforts that competed with each other. Here was a company with a supposedly “collaborative, non-political” culture that had engineering teams pitted against each other to see who would win. The competitive activity turned out to be corrosive and undermined the intended culture of the company.

Stemming dysfunction

I often talk about CEO self-awareness as one of the key attributes of corporate success. In the case of XenSource, the leadership espoused and verbalized cultural “intent,” but practiced and allowed something very different in the company. The company almost failed due to a highly dysfunctional culture. Make sure what you believe is what is truly happening in the company. 

Stemming dysfunction requires leadership and taking some simple but important actions: proactively define cultural attributes important to the organization—write them down and let people know what they are, and “walk the talk.” You must practice and exemplify your culture and have a mechanism to review culture deep within the organization. Ask the following questions:

• Is the organization’s culture consistent with the defined attributes?
• Where are the differences?
• What are we doing right or wrong to keep a strong and consistent cultural backbone in the company?

The Cultural Paradox: I can’t change the culture because that’s not part of our culture

Culture is formed — whether intentionally or not — in the early days of a company’s life. Activities and behaviors are repeated and these become the elements that shape the culture of the company. Examples of such early practices might be: 1) The founding team always interviews all new people applying to the company; or 2) a product-oriented focus in everything the company does. The accepted and repeated practices become the culture and define how the company operates.

However, what has worked in the early days might not be as effective as the company grows up. As a result, you might be forced to choose between two conflicting cultural attributes.

Take the attribute “the founding team must always interview new people”—a great cultural practice intended to ensure new employees are a perfect fit. Is there a point where growth is hampered because the company can’t interview fast enough and candidates go elsewhere? What part of the culture do you change? Limit growth or change your hiring practice? Changing either impacts culture.

One of the most difficult aspects for technical founders is hiring outside the comfort zone of the founding team. This is evident when hiring sales, marketing and finance people. A good example of this is how a technical founder might apply engineering hiring techniques to a sales organization, which my partner Ben Horowitz recently blogged about here. The fear here is that bringing on non-technical people will destroy the company culture. Do you put engineers in all the non-engineering functions and continue to only hire technical people, or do you augment the culture and integrate new and different organizations into the company? Here again, sticking to the past practice/culture of only hiring technical people might be counter to building a great finance or sales organization.

Steering change

Existing culture can get in the way of future growth and company leadership must steer the transition. Changes to practices and culture should be done by first asking why something is done a certain way and what’s the intended outcome. Preserving the intended outcome should trump the practice. 

A strong culture is the backbone of any organization, and the CEO is the standard-bearer and the agent of change.

Let’s go back to the example, “the founding team shall interview all new applicants.” The intended outcome is to make sure that all new employees are of the acceptable caliber and intelligence, and understand the culture and origins of the organization. The problem is the system does not scale, particularly as candidates are hired around the world and at a pace that far outstrips the capacity for the founders to handle.

A change to the practice might be to empower key employee “ambassadors” who act as a proxy for the founding team. Alternatively, maybe just one of the founders meets all new candidates as opposed to all founders meeting all candidates. If part of the intended outcome is for a candidate to meet the founders and get a feel for the company, then have all new employees meet the founders at a lunch or dinner after they join the company. Developing a strong and scalable interview process and on-boarding/mentoring system will ensure that the intended culture is preserved while steering change from an operational perspective.

Managing culture

The concept of managing culture may seem a bit heavy-handed, particularly in tech companies that pride themselves on being free from overbearing rules and bureaucracy. However, not managing culture can be likened to not managing growth, or not managing expenses, or simply not managing and certainly not leading…

Remember:

1. Self-awareness. If you can’t accept self-awareness, you should not be CEO.
2. What are you trying to accomplish? What’s the end game?
3. Translate energy to the areas you are least comfortable understanding.

A strong culture is the backbone of any organization and the CEO is the standard bearer and the agent of change. In a recent Fast Company article, GitHub Co-founder and CEO Tom Preston-Werner shares his perspective on how he and his cofounders have thought about and managed the company culture from 10 people to 160. Regardless of age, background and experience, culture is something that evolves with the CEO and the process of creating a great culture requires leadership to routinely and consistently assess and exemplify the core values of the organization.

Article courtesy of TechCrunch

We all remember the last scene in The Godfather, where Michael Corleone is depicted as the next Don, taking over the role from his father as the figurehead of the mafioso Corleone family. As a viewer, we are partly left with a sense of relief — finally, Don Corleone’s wishes for his dynasty to carry on through his son will come true, Michael Corleone has finally accepted his destiny as a mob boss, and the infamous Corleone family will live on for another generation. Horsehead-in-the-bed behavior aside, the way that VC firms groom their talent isn’t all that different from how the older Corleone groomed his sons.

Here are the facts: the number of active VC firms are shrinking. There are now just over 800 active VC firms. Compare this to the 1,100 in 2002 when there was a boom of new firms rising from the ashes of the dot-com bust. There are a number of micro and macro reasons for this drop, but one of the reasons for the demise of many of these firms is poor succession management. These firms did not find, groom and promote the talent that would one day take over the firm and help it find the next Google or Facebook.

And there are crop of firms, many of whom we talked to, that rose in the 70s that have been doing this for years. The ones who have maintained their leadership, investor and LP reputation, been able to raise fund after fund, and manage several locations, have been able to master how succession management is done right.

As Emily Mendell, VP of communications at the National Venture Capital Association explains, succession management is one of the most important issues VC firms currently face. “The reputation of a firm is built on its partners, and a brand is built. But at some point those people leave and retire and if a firm doesn’t have the next wave of up-and-coming investors who are known to both LPs and entrepreneurs, they can have a big gap, and even have trouble raising a new fund,” she says. She explains further that there are a number of VC firms that have had trouble raising funding because there isn’t a proper succession-management plan in place.

We sat down with a number of leaders at various firms who have managed to pass the baton and thrive for decades.

NEA

Peter Barris, managing partner of well-known top-tier Silicon Valley VC firm NEA, recalls the moment when the founding partners (Dick Kramlich, Chuck Newhall and Frank Bonsal started NEA in 1978) handed him the baton in 1999, after he had been at the firm for seven years. He says that all of the founding partners were still involved in the firm, as well as active in board memberships and the overall direction of the firm. The fact that they were still actively involved in NEA at the time they passed is one of the key factors in making the succession a seamless transition, he explains.

He also credits the founders’ ambitions for wanting to create a “100 year firm” from the outset. “It was not about three guys coming together for a partnership, it was about creating an institution that would last for decades,” Barris says.

That way, he adds, the founders didn’t put their names on the masthead. They chose a generic name that would last and still have brand value years after they passed.

Now that Barris is at the helm, he is constantly finding ways to give people leadership responsibility to help foster a younger generation of partners who will one day lead the firm. He cites talented partners like Scott Sandell who runs the technology practice at NEA, as well as David Mott, who leads health care investments. And there is Pete Sonsini who runs enterprise investments and Harry Weller, who leads the firm’s East Coast practice.

“If you don’t take the approach that you are thinking of as a 100-year firm, then you are more likely to manage for short-term, which is to the detriment of the other partners at the firm,” he says.

Part of fostering talent and succession management at NEA is getting face time with LPs. “With LPs, we have a 12-year partnership. If you aren’t around, who is? It matters to them,” adds Barris. “Limited partners are in it for success of partners as well as the firm, and they want to make a bet on partners who will be involved in multiple funds.”

NEA has three face to face meetings with partners and the firm’s board of advisors, which is made up of larger LPs of the firm. The firm also has an annual meeting with LPs, where various partners present on their investment areas and get face time with the people who are investing in the firm.

Last year, NEA raised $2.6 billion for NEA 14, its 14th venture capital fund, and a raise that has been speculated as the biggest in VC history.

Kleiner Perkins Caufield & Byers

“Succession management is something we’ve done well and it’s really hard,” says Ted Schlein, a long-time partner at Kleiner Perkins who helps manage the firm.

“The generational transition has to be part of the culture of a venture firm,” Schlein explains. “It has to be built-in because VC firms are like a clay you are molding — the firm is in an ever-changing state.”

Schlein adds that the firm’s leader John Doerr rose through the ranks as an associate, and Schlein himself joined at a mid-point in his career (he joined the firm in 1996, Doerr joined in 1980).

One way that Kleiner tackles creating a deep bench of talent is to never have one partner work on one deal. Each deal that Kleiner does, has a senior partner and a younger partner. Schlein says that the firm believes the VC business is very much built around mentorship.

Part of creating that bench of talent is having a diverse mix of partners. He says that the firm has brought in younger talent like former Googler and product head for Square Megan Quinn. He says that prior to Quinn, it was Chi-Hua Chien, who has now been at the firm for five years. The firm has also brought in senior people like renown technology analyst Mary Meeker or former EA exec Bing Gordon.

“People are coming in from the side and below and that’s what makes this a great partnership,” says Schlein. But the challenge, he adds, is getting the right personalities and creating a chemistry.

Schlein brings up a good point in that without younger talent, or partners who have outside operational experience, firms risk being irrelevant in the current, dynamic world of technology.

Sequoia Capital

Doug Leone, one of the leading partners of Sequoia Capital, the VC firm founded by Don Valentine back in 1972, says “succession management is a huge issue if you have the notion of building a partnership that is enduring. Some venture partnerships are in the moment partnerships, and VCs need to have that crystal clear in their mind if they want a lasting firm.”

Leone, who is responsible for coordinating the daily work of Sequoia’s business, recalls that when Valentine handed the keys for Sequoia over to Michael Moritz and Leone in 1996, the founder didn’t ask Moritz and Leone to buy into the partnership. He trusted that the duo would help make sure that Sequoia would last for generations. Leone adds that Valentine is still involved in the firm and comes to partner meetings around 25 percent of the time.

Similar to Barris’s views, Leone credits Valentine’s choice of a generic name for the firm, which he says takes away the pressure when the original founders are gone.

The other element to doing succession management right, he explains, is to build a partnership where there is no single point of failure involved in changes. “Changes should happen in a way that nobody notices,” says Leone.

When it comes to actually grooming talent, Leone says that the firm likes to nurture talent and grow them from within. Younger partners and principals are working in tight-knit teams with experienced partners mentoring, with more junior staffers working on deal flow, and then as they mature, working directly with portfolio companies. “There is no notion of my deal at the firm,” Leone says.

He also cites the actual organization of Sequoia’s offices (there are no individual offices) as a way for junior partners and staff to work with senior partners.

Alfred Lin, the former COO and CFO of Amazon-acquired-Zappos, joined Sequoia in 2010, and he, along with former Googler Bryan Schreier, Aaref Hilaly and a few others, are part of the new, rising guard of VCs at the firm.

Lin tells us that even as young partners, responsibility is spread quickly, with plenty of interactions with senior partners on deals. Lin adds that within the first year of Sequoia, he was interfacing with LPs.

Leone says that the interaction with LPs is another way to tackle succession management. And often times, he adds, it’s the younger partners who have operational experience in newer technologies like mobile gaming, who can actually impart key knowledge on LPs and senior partners.

Greylock Partners

One VC who wished to remain anonymous points to Greylock as model example for succession management.

The firm infamously moved its headquarters to Silicon Valley in 2009 from Boston, with partners David Sze, Asheem Chandna, Workday founder Aneel Bhusri, James Slavet, and others helping lead the firm’s practice. The firm then added LinkedIn founder Reid Hoffman, former Mozilla CEO John Lilly, and enterprise guru Dev Ittycheria as partners.

Now Greylock has secured its place as one of the members of the elite group of top-tier firms in Silicon Valley, just a few years after basing itself out of the area.

Transition and Tradition

The next guard will lead a world much different than their predecessors. The families on Sand Hill no longer only compete against each other, but against a growing crop of Angels, Micro-VC’s, and Studios. They will start new practices and hire new types of talent to stay top-of-mind in a fast-paced ecosystem where seed checks are a commodity.

Michael Corleone led the family into a new set of dealings and geographies, including Vegas and Cuba. But as a viewer, you get the sense that he stuck with the values his father set. He led a transition, without abandoning the tradition.

What will that look like for Sand Hill Road?

Photo Credit/Wikipedia

Article courtesy of TechCrunch

We normally don’t cover criminal accusations against individuals without police reports or other documents filed, or significant evidence like self-acknowledgement. But we’re making an exception.

TechCrunch founder Michael Arrington is facing very public accusations involving physical threats, assault and rape. Given his relationship with us, and the culture of transparency that he helped create, we’re sharing where we are at with our reporting on the story.

The original claim, posted on Facebook by former girlfriend Jenn Allen, is that he physically abused her, then threatened to kill her if she told anyone about the episode. Gawker found her post, and she followed up with additional comments there claiming that he had raped her as well as another woman.

Rumors of similar alleged abuse have circulated in previous years amongst our peers. Many tech reporters have investigated them, but no stories had been published until those based on Allen’s posts this week.

Some former friends of Arrington’s, including Jason Calacanis and Loren Feldman have come forward this week to support her general claim, saying they have heard similar rumors. Another Arrington friend from that era, Nik Cubrilovic, is now saying that he lived in the same house as Arrington when Allen was also staying there and knew of no abuse.

Today, Gawker unveiled another story detailing an alleged assault by Arrington that took place at a company he worked at in 1999, RealNames. A colleague of Arrington’s, Cecile Sharp, is quoted in the article saying that he had assaulted another coworker. The article also quotes sources alleging that in 2009 he threw then-girlfriend, Meghan Asha, against a wall.

Neither Allen nor Arrington have provided us with comments at this time.

We take all of these allegations seriously. We are treating them like any other story of this magnitude, in that we have been working to understand the situation as thoroughly as we can before publishing about it. We have a little more to add at this point, while we are continuing to report the story.

Regarding Allen’s claims, we are not yet able to determine if they are true or not. She has not filed any police complaint or lawsuit to our knowledge.

Regarding the RealNames allegation, we have confirmed that there was an accusation, the conclusion of which did not result in a punishment for Arrington. We are still trying to understand the details of that from other people who were at the company at the time. So far we have this from RealNames founder and long-time Arrington friend Keith Teare:

“Mike was indeed the subject of an accusation at RealNames. As is normal in these circumstances an outside party was hired to conduct an investigation. This was extensive and I was never directly involved in it as I was not a witness to any events. The investigation concluded that there was no behavior to answer for. Mike was never reprimanded in any way. Both parties asked for confidentiality and to date this has been honored.”

Regarding the claim that Meghan Asha was thrown against a wall by Arrington in 2009, we have spoken to a number of secondary sources, some of whom claim that it happened and some who say it did not. Asha has not spoken publicly on the matter.

We have also spoken to two other women who Arrington had previously dated. One is Rebecca Woodcock, who some rumors had indicated had suffered abuse from him while dating. She tells us this is absolutely not true. The other woman, who wishes to remain anonymous, also said that there was no abuse.

In sum, there have been some claims and more rumors about Arrington, as well as counterclaims and most of all, lots of missing information. We are continuing our reporting to find definitive evidence. We hope that anyone who knows more facts as to what happened between him and the women he is accused of abusing will come forward publicly, or privately.

Article courtesy of TechCrunch

There’s no aphorism that describes successful women more than “damned if you do, damned if you don’t.”

Yet, thankfully we keep doing. As we are Millennial women who’ve worked under plenty of women, and are now on our second female CEO, we’ve reaped the benefits of this “doing” firsthand. It was a lot harder to be in the workforce 30, 20 or even 10 years ago — sheerly as a numbers game.

As women in our early 30s, we’re just beginning the adventure of being successful females with families, and we appreciate that there are more of us around these days. But to us the discussion around this is still somewhat stilted, as there is a generation gap still not accounted in the narrative.

We’re not the first women to find something very wrong with media criticism of Facebook COO Sheryl Sandberg’s book “Lean In” and her efforts to help empower professional women. Sandberg postulates that many women tend to not “lean in” to their careers. Instead of leaning back, she encourages women to remain focused on their professional work and not to neglect that work in favor of responsibilities with family and home.

There’s no aphorism that describes successful women more than “damned if you do, damned if you don’t.”

Because she herself is in a very privileged position, it’s easy for critics to find fault with her approach, as they feel like a woman who can easily afford two nannies, a cook, a driver and more doesn’t represent the norm. This despite the cultural idea that as a woman, Sheryl Sandberg by default represents all women.

Yes, Sandberg has luxuries that many of us don’t have — but she didn’t achieve those things without sacrifice, diligence and work. Instead of basking in the fruits of her labors, she’s taking her platform and success and attempting to make younger women’s professional lives better by sharing lessons she has learned.

Sandberg and other tall poppies like Marissa Mayer entered the workforce when there were very few women in leadership positions — especially in heavily male-dominated fields like technology. This led to those women being seen as exceptions to the proper order. Exceptional women became tokens, as if there were only room for one in a power position, one per company, one per board.

The backlash that’s happening to Sandberg (and Mayer and so on) is what happens when one of us stands out, perhaps because women have historically pulled one another down to compete. But back in the day the fight was over men or other scarce resources, not the corner office.

This competitive tendency might explain why we ourselves have found it extremely difficult to find older female mentors. There have been few women in our professional lives who wanted to invest in our careers. They were too busy tearing us down or scared that we would somehow rise above them to take the time. But this doesn’t have to be the case. Women leaders are increasing in frequency: There’s now room at the table for more than one of us. It’s not a zero-sum game.

Right now Sheryl Sandberg is an outlier. But, as Box communication head Ashley Mayer remarked, we need more outliers like this, especially if we want professional success to be a given for our daughters. These are the women we want to be. These are the women who defy convention to try to improve the lives of women in future generations. These are the role models we see, who prove there’s space for many of us at the top.

It’s problematic when the criticism of these outliers comes from people we suspect are subjectively defensive of their own positions instead of objectively judging the ideas on their own merits. Instead of applauding efforts to change the culture, they nitpick them, find flaws that don’t even exist and literally twist quotes.

We need to realize that we can mentor others, men and women, and that their success won’t take away from ours.

“There’s an uncomfortable truth in what Sandberg’s saying, and a lot of the blowback is because of our collective squirminess with the subject,” Reuters’ Megan McCarthy wrote. “So, critics focus on the things they can grasp, like her privilege, and then make the argument about that.”

“But her privilege is beside the point, ” she emphasized, “The idea that women can be seen as individuals in our professional careers is audacious and bold. There’s power in the thought that we can shape our situations around our expectations instead of always searching for a spot where we fit in. Audacious, bold, and powerful ideas aren’t usually well received.”

For this to be a non-issue for our daughters, we have to avoid the Prisoner’s dilemma of feminism, “If I sell out all the other women, then I get away with it, and I get the “reward” of being accepted.” We need to realize that we can mentor others, men and women, and that their success won’t take away from ours. In fact, it may increase it.

As for gaining power in your own job, your career, it’s sort of like the “put on your own oxygen mask before you try to help others breathe” instruction on airplanes, our editorial director and Gen Xer Fara Warner noted. “Respect yourself, respect your work and act like an adult. Lean in all you want but lean in the way you want the world to see you…not what you think the world wants to see.”

For women of all generations, and the men who love and work with us, our best weapon is the awareness of repeating these destructive patterns — and honestly analyzing and counter-programming this behavior when it happens. Otherwise we’ll backslide.

Lean in to this, at least — because it’s better than the alternative.

Article courtesy of TechCrunch