SecondMarket, WikiLeaks, and Institutional Innovation

December 13, 2010 § Leave a comment

Institutional innovation sounds like a contradiction in terms. How do you take a clunky, bureaucratic organization/process/thing and transform it into something modern, efficient, and useful? In my experience the only way to innovate institutions is to force their hand – by creating fundamental change they can’t ignore.

Take SecondMarket, a company that (among other things) helps privately held companies postpone the hassle of an IPO while gaining some much-needed liquidity. The internet is filled with tales of VCs pushing for the first Microsoft/Google/Amazon buyout offer. SecondMarket provides startups with an alternative to dealing with jumpy VCs or angel investors – leveraging a controlled private market for transaction of private stock. It’s totally legitimate: Facebook employees have already used SecondMarket to cash out millions of dollars of options pre-IPO.

Start-up employees: there are now fewer institutional barriers separating you from your cash. Start-ups: you now face less pressure to sell out, and less pressure to go public.

With liquidity out of the picture, there are plenty of reasons to avoid an IPO (beyond the paperwork). Public corporations are forced into a weird sort of transparency. Yes they must publish a set of public financial reports, but this blog for the Harvard Business Review argues that the quarterly reports public corporations publish are meaningless in the modern world. Further, it argues that the fundamental volatility of the stock market is based on infrequent access to meaningful information. This thirst for information is what made the WikiLeaks scandal possible, and is the reason WikiLeaks will have copy-cats. Sure, real-time cooperate reporting sounds scary, but in our information-addicted world, privileged information isn’t sacrosanct – for public or private entities.

To me, SecondMarket and WikiLeaks sound like the beginning of an important (and inevitably profitable) trend. Transforming outdated institutions for the modern world could be the next big opportunity. WikiLeaks will inevitably force some hands, and it will be interesting to watch SecondMarket’s impact on the (?) First Market.

Behind the Scenes of a Microsoft Keynote

December 4, 2010 § Leave a comment

When I worked in Live Labs, our schedule centered around launching at big conferences to generate publicity. It is a very Steve Jobs strategy – create a highly publicized event and show off your coolest stuff to maximum impact. I was surprised to learn that Microsoft’s developer division also relies on these conferences. On stage coding in Visual Studio lacks the impact of a Steve Jobs iPhone demo. But the Silverlight FireStarter 2010 conference’s success was crucial in light of Microsoft’s general shift towards HTML5 and Bob Muglia’s comments at PDC. After a series of mishaps and bad press, the pressure was on the Silverlight marketing team to prove that Silverlight is a relevant developer platform, with richness that HTML5 can’t match.

Normally, I’d be interested in talking business strategy. But I had a closer-than-normal look at this conference (I was thrust into the keynote last-minute), and I was really amazed at how much orchestration goes into one of these events. You have:

• A set of feature teams responsible for building technology (normally, this is where I’d come in)
• A set of vendors responsible for building the “wow factor” demos of the technology (I’m frequently pulled into this stuff too)
• Demoers and presenters – called “talent” backstage (um, seriously?)
• A bunch of marketing people ensuring that presenters are hitting the talking points
• People who coordinate events like this for a living – helping with timing and slides
• PR people running about, doing who-knows-what
• Various event people: video, sound, lights, logistics
• Security – I mean, actual guards – one up front, and one backstage
• Hair and makeup (?!?!)

All of these people running around, everything coming in at the last minute, things being added and removed from the keynote on a minute-by-minute basis. Crazy, but exciting.

The full keynote was practiced the night before to give as much time for polishing demos as possible. I hung around all night, waiting to demo PivotViewer – knowing that there was a good chance it wouldn’t fit. But, once everyone saw the demo, PivotViewer was in. The big surprise: I was asked to demo. So I had about 12 hours (minus whatever sleep I wanted to get) to tighten up the script I’d written for someone else, and perfect Gary’s magic of talking and Pivoting (as evidenced here). But I think it went well in the end, and it was a unique and fascinating experience. You can check out the recording here:

The PivotViewer demo starts at the 1:19 mark of the keynote, and it is one of the most compelling demos of the day. In the future, it will be easy to generate PivotViewer collections (with visuals!) dynamically, client side. This is exciting, because it means real websites can embed PV controls to browse whatever data they have lying about – no matter how often that data updates. And wouldn’t most websites be better Pivotized? I certainly think so.

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