Category Archives: Business

The Floodgates Have Opened

temp..yaidgitb The floodgates have just burst open, not just in the world of technology, but in the entire free market. In the very way we view capitalism.

I am, of course, talking about Facebook’s acquisition of WhatsApp for $16 billion ($19 billion when you count the restricted stock units). It is the largest acquisition of a private, venture-backed company in history. This deal is worth more than the GDP of nearly half of the countries on earth. Let that sink in for a moment. We haven’t had an event this high on the Richter scale since AOL-Time Warner and the 2000 bubble.

Of course, the market then isn’t the market now. As my old colleague Chris Taylor intelligently points out, the Facebooks, Googles, Apples and Amazons of the world have grown up. They have billions in cash. They are profitable. They aren’t going anywhere, even if it means acquiring their future threats for $19 billion. Or acquiring one of the world’s most advanced robotics companies. Anything it takes.

Zuckerberg is a rare breed. He’s willing to do anything to make sure Facebook is at the forefront of its mission of connecting people, even if it means giving up 9.5% of his company to do it. He doesn’t care — he thinks about the next 30 years, not the next three. And he has the complete control to make deals like this one. But so does Larry Page. And the same will be true of more and more founders who reach the IPO pinnacle. As Zuckerberg has shown, control is good.

Two years ago, everybody stood shell-shocked when Instagram sold to Facebook for $1 billion. Now we don’t even bat an eye to that number. And with the WhatsApp acquisition, that number is going to continue to look smaller and smaller.

Facebook has opened the floodgates. Nobody knows what’s going to happen next. Don’t believe anybody that tells you otherwise.

~ Ben

Announcing “Captivology”, My Book on the Science of Attention (HarperCollins/2015)

Dear friends, family, colleagues, and supporters,

I’m thrilled to announce my first non-fiction book, working title “Captivology: The Science of Capturing People’s Attention“, due in early 2015 from HarperOne, an imprint of HarperCollins.

I hope you will sign up for updates on Captivology through my book’s website. You can follow @Captivology on Twitter or like Captivology on Facebook. You can also follow @BenParr for regular updates. And finally, here’s a link for sharing this announcement.

Or you can just click this lovely button for updates:

Captivology is about the science and psychology of attention; why we pay attention to certain people, products, companies and ideas; and how to capture, maintain and grow attention. My book pairs the research of the world’s greatest scientists and psychologists in attention theory with the stories from the world’s Masters of Attention.

The book dives into topics such as:

  • The role scarcity and working memory play on our attention.
  • How Nintendo’s Shigeru Miyamoto created one of the world’s most iconic characters.
  • The power that framing and salience have in directing our attention.
  • The secret sauce of disruptive campaigns and viral products.
  • Sheryl Sandberg on the power of motivation when it comes to capturing attention.

During the course of my research, I have had the opportunity to interview more than 50 scientists, researchers, experts and Masters of Attention. I’m grateful to thought leaders such as Sheryl Sandberg (Facebook), Dr. Alan Baddeley (leading researcher in working memory), Steven Soderbergh (famed director), Alexis Ohanian (founder of Reddit), Dr. Michael Posner (leading cognitive psychologist), Jeff Weiner (CEO, LinkedIn), Adrian Grenier (actor, producer and director), Dr. Eli Finkel (expert on attraction), Grant Imahara (Discovery’s Mythbusters), Susan Cain (NYT bestselling author, Quiet), Jon Armstrong (Magician, Chairman of the Academy of Magical Arts), Dr. John Sweller (leading expert on cognitive load), Alexia Tsostis (Co-Editor, TechCrunch), Shigeru Miyamoto (Nintendo), Josh Elman (Partner, Greylock), Dr. Dietram Scheufele (Expert on Communications, Framing), Michael Stevens (creator, Vsauce), and many more who have taken time our of their days to chat with me for this book.


Above: A screenshot from my interview with Adrian Grenier and Dr. Thomas De Zengotita. A special thanks to NASDAQ for letting me use their studios for the interview.

If you have suggestions for my book, please email me at ben@captivology.com with your ideas! I’m especially looking for interesting people to interview and unique stories about how you or somebody you know captured the attention of an individual, an audience or the entire world. A major reason we’re announcing the book now is to gather great stories for the book that I might have otherwise missed.

I hope to complete this research-heavy book in the next few months, so please forgive me if I’m much slower than usual responding to your emails, texts and tweets until then.

A Few Other Announcements

I’m working on Captivology on top of my day job as Co-founder and Managing Partner of DominateFund, the early-stage venture capital firm I started last year with Matt Schlicht and Mazy Kazerooni. We’ve expanded the fund from its original focus on connecting Hollywood with tech, though that is still a component of what we do. Our focus now is on helping startups capture attention for their products and accelerate their growth through our expertise in five key areas: Strategic Celebrity Partnerships, Press, Marketing, Customer and User Acquisition, and Building Viral Products. The fund is the reason I decided to write this book.

We will be making more announcements about DominateFund in the near future, including several new additions to our team and updates on our amazing portfolio companies.

Because I had all of this on my plate, CNET and I decided to retire The Social Analyst, my column at CNET, last year. I want to thank CNET, and especially Jim Lanzone, Mark Larkin and Jim Kerstetter, for being so supportive of me and my column, for being amazing bosses, and for putting up with me and my hectic schedule.

I won’t be bringing The Social Analyst back. At least, not in its current form. The column, which I started at Mashable in 2009, has been my place to opine on the most pertinent issues in tech. CNET was kind enough to let me continue my column.

I will eventually be back writing columns and thought pieces on a regular basis, but ones that are about more than just technology. There is a mountain of research from my book I want to discuss and advice I want to dispense for every entrepreneur who struggles to get the attention of users or artist who wants to be heard. I also have a lot of other insights in media, entrepreneurship, investing and science I hope to eventually share.

One final announcement — I’m proud to announce that I have signed with the Worldwide Speakers Group, which now represents me for all my speaking engagements. You can check out my speaking topics or book me by sending a message to Keith Lambert at KLambert@wwsg.com or calling WWSG at 703-373-9806. I primarily speak about attention, attention for brands, innovation, technology and entrepreneurship.

I want to thank a few people right now for all of their help the last few months. Thank you to everybody I’ve interviewed for the book so far. A special thanks to the best agent in all of publishing, David Vigliano, for always having my back. The same is true of Will LoTurco, who works with Vig. Thank you Marcy Simon and Melinda Mullin, for going above and beyond the call of duty for me. Thank you to my editor, Genoveva Llosa, for being just sensational. Thank you to my partners Matt Schlicht and Mazy Kazerooni for being my unofficial brothers (Nat, you too). A thank you to Hallie, my badass EA. Thank you to my family (love you mom & dad!), and finally a special thank you to my girlfriend Julie, for being my rock.

Onward and upward!

Thank you for kindness,
~ Ben

Please follow me and Captivology on social media!

(p.s. — Happy birthday, sis!)

Snapchat and the Logic of Turning Down $3 Billion

In July 2006, a two-year-old company received the offer of a lifetime: a $1 billion acquisition offer from Yahoo. While its board was ready to accept the offer, its founder and CEO instantly dismissed the offer. “I don’t know what I could do with the money,” the CEO said. “I’d just start another social networking site. I kind of like the one I already have.”

That company, of course, is Facebook, and the CEO is Mark Zuckerberg. Today, that decision seems wise, considering the company’s current $118 billion market cap. Zuckerberg has cemented his place among the greatest entrepreneurs of all time as a result.

But nobody would have blamed Zuckerberg if he had sold to Yahoo in 2006, just as nobody can blame Kevin Systrom for selling Instagram for $1B. While Instagram has thrived since its acquisition, it’s easy to see how it could have become a Groupon, whose decision to spurn Google’s $6B acquisition offer seems flawed in hindsight.

Today, the rumors are flying around Snapchat, the hot new mobile social networking startup with millions of users and hundreds of millions of “snaps” and growing. It reportedly spurned a $3B all-cash acquisition offer from Facebook recently.

My Twitter stream is filled with commentary on the rumor that boils down to either “I’d take $3B” or “the founders of Snapchat have balls”. But let’s put the mindset of the founders into context, because while turning down a $3B acquisition offer is unfathomable to most of us, it makes logical sense for Snapchat.

1) Snapchat is still growing rapidly: If Snapchat’s growth were slowing down, the decision to sell would be significantly harder. But when you’re sitting on a fast-growing entity that should only increase in value, taking a $3B offer can look small in just a few months.

2) The founders will cash out regardless: From the last line of the WSJ report: “If Snapchat pursues an investment early next year, Spiegel has told investors he would like to sell a block of his own stock, according to people familiar with those conversations.”

Spiegel and his team are going to make millions either way — more than enough to live a happy and comfortable life. It frees the team to “go the distance” because even if Snapchat totally collapses, they will never have to worry about money again.

3) The chance to become one of the greats: Q: How do you become the next Jack Dorsey, Mark Zuckerberg or Steve Jobs? A: You take your company all the way to IPO.

Changing the world is certainly on the minds of the founders of Snapchat. So is legacy. While you can certainly change the world as part of a larger company, it’s easier to fulfill your vision when you’re CEO. These thoughts must certainly slide through the thoughts of the founders. They’re only human.

Turning down billions of dollars seems insane on the surface, but can have a payout far greater than money if you succeed. Just ask Mark Zuckerberg.

Regardless of your opinion of Snapchat, it’s tough to blame the founders for wanting to hit the Grand Slam. They have a rare opportunity to build a legacy and change the way people communicate. I wish them the best of luck.

Microsoft & Nokia Can Carve a Niche in Mobile, But Wearables Is the Next Battleground

Gates Watch

Microsoft + Nokia still has room to grow in the smartphone market, but perhaps the software giant should focus on the future of mobile: wearables.

Originally, I intended to write a thought piece bashing the Microsoft-Nokia deal. On the surface, Windows Phone feels much like BlackBerry, whose moves I correctly predicted were too little, too late.

But as I did the research, I realized that the same isn’t true for Microsoft, at least abroad. While market share of the Windows Phone has stagnated between 3% and 4% in the U.S., Microsoft’s mobile OS is making positive gains abroad.

In the UK, its market share has doubled to 9.2%. In France, it has tripled to 11%. There are still millions of people with feature phones looking to upgrade, and they still can be swayed away from choosing Android or iOS.

It won’t be easy, of course, and it may ultimately be a futile effort on Microsoft’s part. You can also argue that Microsoft didn’t need to spend the money on Nokia, but it has so much cash to spare that a few billion to improve development speed and bring phone development in-house makes some amount of sense.

I don’t believe Microsoft can triple its market share by 2018, but I do think it can grow a respectable niche. It’s not going to get any easier though, with great phones like Google’s MotoX and the upcoming iPhone still superior in terms of apps and core features. Microsoft will have to find a proprietary way to differentiate from the competition that it hasn’t found quite yet.

The Next Battleground


The battle for smartphone dominance may not matter in five to ten years though, because I believe a new battleground will soon emerge: wearable tech. Yes, I am talking about smart watches and Google Glass. While the technology today draws curious stares and makes you look like a cyborg, it will vastly improve to the point where we will wonder why we actually carried around bulky computing devices in our pockets.

Will wearable tech look like Google Glass in a decade? Probably not. And that’s why Microsoft still has an opportunity to dominate by creating a compelling product that doesn’t look like anything else on the market.

Microsoft can no longer dominate the smartphone market. The best it can hope for is a few percentage points of market share over the next decade. In fact, Microsoft risks missing the next big trend by focusing on a few percentage points of a market that, several decades from now, will probably not exist.

That’s the beauty of technology — it changes so quickly that new opportunities present themselves often enough for a company like Microsoft to turn their fortunes around.

Ballmer is being coy about Microsoft’s plan for wearables, but we can only hope the company is taking wearable tech seriously, because if it doesn’t, it will end up playing catchup once again.

Image courtesy of IGN

The Tech Community Must Invest More In San Francisco

Several years ago, when Square was just eight people, I was invited by Jack Dorsey to his loft in SOMA to meet the team and get a sneak peek at the Square device. After I interviewed Dorsey, he took me up to his roof and showed me his neighborhood. He specifically pointed out the outdoor tables and chairs, which he helped get placed in his neighborhood. It was just phase one of a bigger plan he had to help his neighborhood.

You see, Dorsey’s always been active in his community, whether it’s his neighborhood or San Francisco at large. Dorsey and other Square employees picking up trash in San Francisco on Fridays is an extension of his values and his long-held sense of civic duty.

Unfortunately, Dorsey’s the minority here. The stereotype — and the tension — has been, for as long as I have lived here, that the techies who fill the ranks of Facebook, Google and the startup community’s rosters jump on their air-conditioned shuttles, drive up housing prices and don’t respect San Francisco’s unique, quirky and downright amazing culture.

A blog post by a tech founder and recent SF transplant only helped to confirm this stereotype in the eyes of many. And who can blame long-time San Franciscans for thinking that techies are ruining their city, with unfortunate blog posts like these?

It’s clear that the city is changing and that unlike the tech bubble of the late 1990s the techies are likely here to stay, along with the higher rents that come with it. In some ways, this is a good thing — it means that San Francisco and the bay area are economically booming in an era of stagnant job growth, although it’s also clear that not everybody is sharing in the wealth or the benefits. From the LA Times:

“Unlike in previous booms, the tech industry isn’t creating as many middle-class jobs or as much goodwill. The gap between Silicon Valley’s high and low earners is widening, with average per-capita incomes going up while median household incomes have fallen for the third consecutive year, according to Joint Venture Silicon Valley, a private group that publishes an annual report card on the region.

In a region that lays claim to some of the world’s wealthiest companies, food stamp participation has hit a 10-year high, and homelessness has increased 20% in the last two years, the group found.”

We can do better than this.

This is not a (complete) indictment of SF’s tech community. There are some that have gone above and beyond the call of duty to help San Francisco (Dorsey, Conway), and others who volunteer with a favorite charity or keep active with their neighborhood. I suspect, though, that the vast majority of us techies aren’t doing the things that we, as civic-minded individuals, should be doing. Simple things like volunteering, attending neighborhood meetings, manning the polling booths, meeting our neighbors. Oh, and did I mention volunteering?

But we need to do more. No matter if you’ve been here for three months or thirty years, this place is now your home. Our home. And while you may be overwhelmed by your startup, it isn’t an excuse to ignore the state of your home and the plight of others. Make it a company activity if you have to. Every little bit helps.

I love this city. I love being able to walk from my apartment in Russian Hill and dance away at a blues and jazz street fair. I love being able to hike through Lands End to the beach and relaxing with friends. I love the city’s secret pop-up art gatherings. I don’t want these things to go away.

I also love the tech community, and its idealism and its innovation. I don’t think that the tech industry and San Francisco are incompatible in any way. I simply think we, as a tech community, need to make a greater individual effort to be part of the community at large.

So if you haven’t been very civic thanks to your startup or your long-ass ride on the Google bus, ok, I understand. But let’s start something now. I’m committing to volunteering in San Francisco — something I haven’t done enough of since my Eagle Scout days — and I hope you’ll join me in embracing San Francisco as well. Go to the Opera and donate if you love music. Go check out VolunteerMatch or the Bay Area’s volunteer information center. Even just going to a local show does a lot to support the community. Grab some friends while you’re at it. Start small to get started and you’ll find that it’s incredibly rewarding and fun.

I’m also calling on the startups and tech companies of San Francisco to do more as well. Give your employees opportunities to give back to the community.

San Franciscans — if you have a great cause or charity, tell me about it by posting in the comments or tweeting at me. I will add it to this post and to a new post I’ll write with more ways people can get involved in their city. And if your company is already giving back, I want to hear about it so we have more examples of how companies and startups can be more involved.

Start with one small act, and others will follow. Let’s be good citizens to our neighbors and our community.

Badass image by Ubeam’s Meredith Perry. Seriously, she’s amazing.

NSA’s PRISM: This Isn’t Over, So Can We Please Breathe Before We Jump to Conclusions?

dark-prism

The dropped a bombshell last night — the government is spying on you! And it’s in cahoots with the world’s most popular Internet companies to do it!

If that isn’t a recipe for a shitstorm, I don’t know what is.

But are Google, Yahoo, AOL, Facebook and the other tech giants willingly sending the NSA user data, or are they not? If you ask the companies named in the PowerPoint presentation, they don’t know what the hell you’re talking about:

  • Google: “We have not joined any program that would give the U.S. government—or any other government—direct access to our servers.”
  • Facebook: “Facebook is not and has never been part of any program to give the US or any other government direct access to our servers.”
  • AOL: “We do not have any knowledge of the Prism program.”
  • Microsoft: “If the government has a broader voluntary national security program to gather customer data we don’t participate in it.”

Okay, those are pretty blanket denials, but their statements could be carefully crafted to not be lying, but not be telling the whole truth. At least, that’s what Arrington believes.

Or maybe Palantir is behind the whole thing? (nope.)

Or maybe these companies aren’t actively involved in the program? Well, The Washington Post just stepped back from the accusation that these tech companies were directly involved.

So basically, we have a scandal with no actual answers and lots of accusations flying around. It’s a field day for the press, but users should wait before they start boycotting companies, and the press should do its job — investigate into PRISM until it finds the truth.

Until then, I’m going to sit out the blame game.

Photo Credit: wonker via Compfight cc

Is Apple’s Tim Cook on the Money with Changing U.S. Tax Laws? My Thoughts on CNBC [VIDEO]


Ben Parr on CNBC Apple

I dropped by CNBC this afternoon to discuss an issue that will dominate the headlines this week — a proposal by Apple CEO Tim Cook to simplify the tax laws regarding the repatriation of corporate cash.

Currently, Apple has more than $100 billion sitting overseas ($1.7 trillion is doing the same from the top 1000 U.S. companies) because of a rule that would tax that money by 35% before it can enter the U.S.

It’s a complicated subject that we discuss in depth. Check out where I fall on the issue below:


Debating Samsung vs. Apple on CNBC


Samsung has unveiled the Galaxy S4, but will it be enough to topple Apple?

That’s the question that CNBC posed to me and my friend Colleen Taylor of TechCrunch. I took a position that even surprised me. Here’s what I will say for now: the long-term trend of growth is clearly in Samsung’s favor. Apple will have to hit back hard.

Check out the video, and let me know what you think in the comments:

My Thoughts on Apple’s ($130B) Stacks of Cash on CNBC

Apple has $130 billion in cash, and nobody can seem to agree what the tech titan should do with it. That’s the impression I got from Greenlight partner David Einhorn’s recent suggestions that Apple deliver more of that cash to shareholders.

Of course, I had my own opinion on the matter, so I went on CNBC today to talk about it. Check out the video above, and let me know whether you think I’m in the right or the wrong.

Ben Parr on CNBC

Announcing “Startup Attention & PR 101″, Now on Udemy

I’m thrilled to announce the launch of “Startup Attention & PR 101: From Launch to Damage Control and Beyond“, my 19-lecture online Udemy course. I’m also thrilled to announce that half of the course’s proceeds will be donated to THRIVE-GULU, a not-for-profit dedicated to building rehabilitation and community centers across Africa, starting with Gulu, Uganda.

“Startup Attention & PR 101″ is a deeper look at how to better work with the press. This is not a course about traditional PR. Instead, it’s a deeper dive into what makes a journalist tick and how you can can take advantage of that for your company or cause.

The course covers four broad themes:

  • How Journalists Think
  • How to Launch a Product
  • How to Keep Users Interested
  • How to Deal With a Press Crisis

This course won’t make you a journalist’s best friend, but I hope it will give you more clarity to how journalists make decisions and how that affects you and your company.

As I noted above, I am donating half the proceeds from this course to THRIVE-GULU. Thrive was founded in 2010 by Professor Judy Dushku to assist the communities of Northern Uganda to heal from the traumatic events of war, sexual enslavement, extreme poverty and lost opportunities. It’s a charity I’m honored to have supported in the past, and one I’m thrilled I can support now with this course.

So take the course, tell your friends and send me some feedback, because I will be adding more material based on your feedback.

~ Ben