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December 2011

 

2012 New Years Resolutions

Here are my resolutions/goals for 2012 (with a recap and review of my 2011 list below):  

1. Run a full marathon, 5 halves, and a triathlon
  • Run a marathon (already registered for the Oakland marathon on 3/24)
  • Run at least 5 half marathons
  • Find a trathlon and commit to the training

2. Have more of an impact

  • Create more value at my own company
  • Advise/consult with more startups (on sales/sales strategy, customer acquisition, etc.) 

3.  Build a better blog

  • I think one of the reasons I failed to write more in 2011 was that the barriers to entry felt too high. I do like taking the time to do research and write longer-form posts (like this latest one on local) but I often find the need for more short-form posts with quicker thoughts (but longer than 140 characters) on news and products.
  • Building a better blog also = becoming a better writer
  • Redesign and consider a new theme/platform

4.  Take more pictures

  • Get a nice camera
  • Take an intro photography class
  • Take more pictures

5.  Eat Slower Meals

  • I ate a lot healthier in 2011 but I hope to eat much slower in 2012. Lots of research shows that meal time with friends and loved ones is a direct predictor of happiness. They recommend at least one 2-3-hour dinner and/or drinks per week with people who make you smile and feel good. And I've found that to be true -- some of my best memories of 2011 were long meals with friends and family. I hope to have more of those in 2012. 

6.  See more live music and comedy

  • Live shows just make me feel good so I hope to see more. 
6.  Track books I've read in a public spreadsheet
  • I'm a big believer that exposing a personal metric, e.g. one’s runs on RunKeeper, workouts on DailyBurn, etc., often encourages tracking of the measure. So I'll start to track the books I've read in a public spreadsheet and keep it updated. I'm interested to see if the publicity of the list impacts how often I read. 
  • Some of my most popular posts have been on books with reading notes so I'll continue to post notes from my favorite books too. 
7.  Travel
  • Visit more new places: Hong Kong, Thailand, Turkey, Whistler.
  • Try to line up half marathons with new U.S. cities 
8.  Build a Web app and an iPhone app
  • Brush up and learn how to code enough to build a minimim viable product (MVP) of a few ideas I've been thinking about
9.  Improve on public market investing
  • Read more on swing trading, value investing and options strategies
  • Eliminate most of the noise from my news stream and focus on basics
  • Improve overall % performance
10.  Do full-scale body composition and DNA tests
  • Do body composition and blood work tests to guage levels of vitamins, antioxidants, minerals, etc. to find diet, supplement changes. 
  • Sign up for 23andMe and their Personal Genome Service to see what diseases I may be predisposed to and find diet/lifestyle changes. 

 

And here is my full 2011 list with notes. Here's a recap: (6 FAILURES and 4 SUCCESSES): 

 

1. Eat Healthier - SUCCESS!

2.  Switch from coffee to tea - FAIL (reason: added tea 50/50, will likely continue)

3.  Drink more water - SUCCESS!

4.  Read more - FAIL (reason: didn't track, take enough notes)

5.  Write more - FAIL (reason: work/life balance, didn't do much short form posts)

6.  Contribute more to online communities I follow - SUCCESS!

7.  Get back into scuba diving - FAIL

8.  Be more mindful - SUCCESS!

9.  Travel more -  FAIL (Went to Seattle, Chicago, and Boulder. But didn't get to nearly as many new places as I wanted)

10.  Compete in a marathon and triathlon - FAIL (reason: ran 3 half-marathons but never committed to a full or tri)

 

Hopefully I can do better in 2012 than I did in 2011. How about you?

Filed under  //  diet   health   new years   reading   resolutions   supplements   writing  
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The Groupon, Angie's List and Yelp IPOs Proved One Thing: Local Is Really, Really Hard

Yelp_ipo
Damn, local is tough. 

That's the one thought I'm left with after reading through the S-1's of Groupon, Angie's List, and Yelp.

Let's dig into the numbers. Here's a look at the losses and revenues for each:

  • Groupon 
    • FY 2010: a loss of $456M on revenues of $713M. 
    • Q1 2011: a loss of $146M on $644M in revenue.  
  • Angie's List
    • FY 2010: a loss of $27.2M on revenues of $59.0M. 
    • First six months of 2011: a loss of $25.8M on $38.6M in revenue. 
  • Yelp
    • FY 2010: a loss of $9.51M on revenues of $47.7M. 
    • First nine months of 2011: a loss of $7.6M on $58.4M in revenue. 

 

And what's the main driver of these losses? 

  • Groupon
    • $208M spent on marketing in the first quarter of 2011 and another $178M on sales people and the rest.
  • Angie's List
    • $48M spent on marketing (of which $35 million was on TV ads) and $22M on sales.
  • Yelp
    • $38.5M, or nearly two-thirds of its revenue, spent on sales and marketing.

So a very large contributing factor to the losses for each of these companies comes down to marketing and sales. The marketing side of this is pure customer acquisition (read: advertising). And the sales side is simply feet on the street. Or warm bodies hitting the phones.

As Rocky Agrawal noted in his analysis of Yelp, there is very stiff competition in the small business advertising market so earning and keeping their business is difficult and expensive. 

Of course, there is a good reason why these companies are putting so many bodies behind the phones: the local advertising market is massive. So massive in fact that when I tried to find a number for the size of the local advertising market I came across a range from $14 Billion all the way up to $130 Billion. Companies realize that "to the winner go the spoils" so they're dedicating lots of resources to local in order to get out ahead of the competition. 

Indeed, local advertising is such a big market that my own company Pandora is aggresively going after it as well. Although it's a slightly different market in that we're going after local radio dollars specifically -- an area where I think we're well primed to gain market share in.

There are of course many strengths in all of the above businesses. The rate that each of them has grown revenues is no easy feat and should be applauded. I am personally a huge fan of Yelp the product. It's by far the most comprehensive source of reviews out there and the best place to go when I want to find a new restaurant. I am no longer a Groupon subscriber because the emails got to be too much but I've been impressed by their efforts with personalization. And I've bought deals through Groupon Now a couple of times too and been happy with the experience. Marc Andreessen nailed it when talking about Groupon recently in his predictions for 2012:

I've always felt that the criticism of Groupon has been unwarranted. People have really underappreciated what Groupon has done, which is they've created a way for small businesses that aren't online to spend money online and be able to dial up customers on demand. That's a really big deal. 

But investors have to look for the strengths AND the weaknesses of a company. One weakness (if big enough) is enough to cripple even the best company despite its many strengths.

The question, that we've asked before, is can these companies get their marketing and sales costs down even in the long term? I'm of the opinion that a more automated solution is the answer. I know it might be sacrilege for a salesperson to say so, but if a local advertiser wants to book $1,000 worth of ads, should they have to go through a sales rep in order to do so? At some point it is just not scalable.

More importantly, the question gets put back startups: is there a better way to do things in local?

Also: Two Opposing Views on Groupon

 

Filed under  //  IPO   groupon   investing   pandora   yelp  
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