The Friendster Story

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NYTimes has a comprehensive article (req. free registration :() on the rise and fall of Friendster, and what may have gone wrong.  The author Gary Rivlin was able to get first-hand points of view from many of the early players in online social networking, including Mark Pincus and Reid Hoffman, who are dealing with different versions of the Friendster story at their own companies, while companies like MySpace, Bebo and Facebook are counting nine zeros in their valuation discussions. 

It’s interesting to see how you can have all the right ingredients and still fail (or fall behind competition).  The article supports my belief that creating a business is as much art as it is science.

Corporate Alumni Send Signals Back

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Knowledge@Wharton has an article confirming what we, at SelectMinds, knew, but had a hard time quantifying with empirical data.

“Contrary to the view that companies lose something when a worker
leaves, the study found that they stood to gain. Specifically, firms
that lost an employee to another firm were 8% more likely to cite that
firm than other equivalent firms, Rosenkopf says. The reverse flow of
knowledge was particularly pronounced when the employee moved to
another region. Then the old firm was 22% more likely to cite the new
firm.”

Via David Teten.

GooTube

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Big news over the weekend was YouTube’s $1.6 billion, all-stock acquisition by Google.  There’s much debate on whether this was a good deal for Google, or not.

I think Google paid a reasonable price for YouTube.  In addition to its future cash flows, Google must have looked at the potential of someone else (Yahoo!?!) buying YouTube, and what that would have meant for video search and video-related ad syndication, which will both undoubtedly be critical for Google.  Combined with YouTube, Google will now carry about 60% of all video traffic on the internet.

Baris looks at it from a "purchasing searches" perspective, which I also agree with.

 

UPDATE: No one’s doubting that YouTube and its investors got a good deal, though. 🙂

Monk Puzzle

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Here’s an amusing puzzle, from Marginal Revolution:

One morning, exactly at sunrise, a Buddhist monk began to climb a tall
mountain. The narrow path, no more than a foot or two wide, spiraled
around the mountain to a glittering temple at the summit. The monk
ascended the path at varying rates of speed, stopping many times along
the way to rest and to eat the dried fruit he carried with him. He
reached the temple shortly before sunset. After several days of fasting
and meditation he began his journey back along the same path, starting
at sunrise and again walking at variable speeds with many pauses along
the way. His average speed descending was, of course, greater than his
average climbing speed.

Prove that there is a spot along the path that the monk will occupy on both trips at precisely the same time of day.

My favorite approach to the solution is in the last paragraph.