Someone recently wrote that you know you are in a bubble when reporters start their own startups. Maybe that should be revised to be "when reporters start their own venture funds."
(that said, this ain't the same as the last tech bubble, and the issues around Arrington/access/other angels are only going to get more and more complicated.)
Well, it's no exact science to measure whether there's another bubble or not. There's plenty of arguments for both sides.
But if someone as insightful as Michael Arrignton himself is willing to make this bet. Shouldn't this give you hint that maybe we're actually not in a bubble? Or at the very least, that a bubble bust is likely not imminent for the near future?
Imho, reading this news makes me a bit more hopeful.
I think MA has more connections that could be beneficial to startups that most angels. I for one would give him ownership in exchange for introductions to people he knows.
I do not see what makes MA less qualified than most angel investors. He spent 5 years interviewing founders, being the first to learn about their ideas, seeing the ones he wasn't fond of (Twitter. Mike used to talk shit about Twitter, granted in a friendly way, all day long). I think he is very well placed to start his own angel fund.
If you can start the platform where companies like Mint launched, and have Marissa Mayer show up for your conference, I think you can launch a startup fund.
Interesting. Let's see how his first startup goes, and how it ends up. Remember the crunchpad? The main problem i see with him is that he's not technical. Also how popular are his conferences/blog going to be if others see him as a competitor? Anyway, best of luck to his endeavors.
Agreed. If MG Siegler starts one I'm going to start stuffing my mattress. But Arrington deservingly should be seen as the business owner/CEO more than as a "reporter."
It's funny because it's unethical. With any luck, he'll get greedy and push the "reporting on companies I invest in" needle so far that it gets too noisey we stop reading (and posting everything he does on HN).
He's in a good position to do this. Connections and fame aside, he has the perfect avenue to give exposure to the startups he invests in. I think this is critical. Part of the reason why many tech startups "go big" is because they're given broad exposure and are shown in a good light from the beginning. For example, Y Combinator has Hacker News to promote their investments.
I've said before that without HN you probably wouldn't hear about very many YC companies. (I think I said something along the lines of "you simply don't front-page stories about every YC company on Reddit.") Michael Arrington will have TechCrunch to promote his investments and I think he will be able to give them a good chance for success if he promotes them well. You might also say that Arrington has TechCrunch and Hacker News given how easily TC front-pages around here.
not really...the new Techcrunch is putting up a ton more stories...so the TC coverage won't be as useful, since it'll hit the 2nd page within a few hours.
1) Shown to a huge number of people. Their traffic, I'm sure, dwarfs HN's traffic.
This is definitely true. My startup was at the top of the front page on HN for a day or so (a year ago), and that sent us something like 1500 visits. The subsequent TechCrunch writeup garnered something around 5000.
i wonder how that's changed since then, though? i guess both have got bigger, but what were the relative rates? i got 9k unique visitors on a front page blog post from hn last week, fwiw.
Actually having worked at TC and gotten the HN numbers from pg, I can assure you this is not true. HN is very similarly sized to TC. I left TC before the Aol homepage which I'm sure is driving much more traffic, but HN has rocket-shipped and all without things like sharing features.
Sure but that has conflict of interest all over it, and while Arrington can be as conflicted as he likes...
...a) people don't have to read TC and as the level of conflictedness for that site increases more and more people will stop reading it
...b) the conflict is at odds with Aol's wider aspiration to be a respected media outlet (Arriana Huffington, etc). At some point such 'exposure for self interest' will cross a line even Aol won't go - esp if they don't have some/any upside in the CrunchFund venture.
The worse situation is that you end up with Arrington as an investor and TC can't write about you because Aol decides it really is too much of a conflict. And other outlets won't write about you or they give you shit because they still perceive Arrington as a competitor. Worst of both worlds.
I agree that he should be careful about the editorial conflict of interest issue. This is assuming he hasn't already cleared it with AOL. I do think that it is a conflict of interest, but in a similar sense that HN is run by YC and an inordinate amount of YC startup news is poured through here. I'm not saying that PG et al are causing this to happen directly, but it is not a coincidence.
I think the point I'm trying to make here is that you can't scold Arrington without acknowledging that this already happens -- either directly or indirectly.
>...in a similar sense that HN is run by YC and an inordinate amount of YC startup news is poured through here.
The difference being that YC doesn't try to hide it at all on HN. YC ads cannot be commented on, and YC related stories are(generally) noted in the titles. HN is essentially an advertising channel for both YC and YC funded companies.
The problem is that Techcrunch has positioned itself as a news reporting site, not Michael Arrington's Super Startup Investment Blog(tm). So it should be held to a higher standard than YC, especially when it comes to investments.
At the bare minimum, I think that Arrington should(assuming he doesn't leave TC to work on this) disclose his fund's involvement in anything that TC is covering. This goes not only for his personal articles, but anything that any TC reporter is covering.
He does say "The easiest way for me to handle this is to be up front about all of these investments and disclose it in posts, which I've done and will continue to do..." So at the very least he has acknowledged that disclosure is important.
the conflict is at odds with Aol's wider aspiration to be a respected media outlet (Arriana Huffington, etc).
What? Huffington Post, if you ever read it, is a left wing tabloid. It's filled with leftist propaganda, celebrity gossip, bad-women's-magazine style nonsense, and other crappy linkbaiting. Buying out Huffington is no way for Aol to become a "respected media outlet", it's a way for Aol to become a media outlet in the style of News Corp.
Yes, by traditional journalistic standards Arrington's fund would be a massive conflict of interest. But traditional journalistic standards are all but dead. And frankly, the only new development in the past decade is that people are no longer pretending otherwise.
Agree/Disagree -- Agree that CrunchFund ("CF") would have a great avenue to promote its investments through TC, but I think doing so is unethical. On the other hand, I think YC operating HN is completely fine. Here's why:
1) YC's primary business is being an accelerator. This business preceded HN. HN compliments YC's primary business, but doesn't undermine or corrupt it. Conversely, TC's primary business is an online tech blog/journal (and is often a launching pad for startups). CF would undermine the primary business (i.e., TC) by calling into question the legitimacy of all pieces written about CF investments.
2) HN is a online community/news aggregator -- i.e., no original pieces (other than comments). TC is a group edited blog/journal that publishes original content. This means that TC can write opinion pieces to promote its investments, while YC can only post links to third party pieces about its investments.
3) TC has a much deeper reach than HN. Although HN is wildly popular in the tech community, people outside the tech community are generally ignorant to its existence. TC on the other hand, is the place that many "normals" go to get their tech news -- so a biased piece about a CF investment would reach a much broader audience than a biased piece posted to HN.
When you combine these three factors, I think that TC having CF is unethical, but YC having HN is not.
Why do people think PR and coverage is so important? It's not at all obvious to me that techcrunch has anything to do with who actually succeeds, they really don't do real coverage of early stage startups- it's just PR Newswire plus trolling authors. Yet so many founders seem to think it's important and even worth hiring a PR firm to get into techcrunch and other similarly thin tech content farm blogs. That techcrunch nofollows all outbound links says enough about how they think about your startup, no matter how cool it may be.
PR and Coverage CAN BE very important. Everyone remember the Opera browser? Amazing little browser, fast, secure, first to implement quiet a few features. It was around before Firefox, before Safari, before Chrome, and as the other browsers grew in market share, Opera is still in last place. Why? My guess, lack of PR and coverage?
While I think the exposure would be great for startups, but his attitude and approach on things just seems to be toxic. I'm all for not beating around the bush on things, but I'm not sure I'd like someone like Arrington providing guidance (or even associated with me).
crewbuyer.com is a startup focused on group sales where members establish groups (otherwise known as a crew) to buy products. They have an setup that'll let members refer friends in return a 1% discount for each member referred.
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[ 2.6 ms ] story [ 75.3 ms ] thread(that said, this ain't the same as the last tech bubble, and the issues around Arrington/access/other angels are only going to get more and more complicated.)
But if someone as insightful as Michael Arrignton himself is willing to make this bet. Shouldn't this give you hint that maybe we're actually not in a bubble? Or at the very least, that a bubble bust is likely not imminent for the near future?
Imho, reading this news makes me a bit more hopeful.
I think MA has more connections that could be beneficial to startups that most angels. I for one would give him ownership in exchange for introductions to people he knows.
I do not see what makes MA less qualified than most angel investors. He spent 5 years interviewing founders, being the first to learn about their ideas, seeing the ones he wasn't fond of (Twitter. Mike used to talk shit about Twitter, granted in a friendly way, all day long). I think he is very well placed to start his own angel fund.
If you can start the platform where companies like Mint launched, and have Marissa Mayer show up for your conference, I think you can launch a startup fund.
Not too shabby for a reporter.
It's not as if it hasn't happened before. He used to write about Edgeio on TechCrunch without much of a problem: http://techcrunch.com/2007/12/06/edgeio-to-shut-down-in-the-...
I've said before that without HN you probably wouldn't hear about very many YC companies. (I think I said something along the lines of "you simply don't front-page stories about every YC company on Reddit.") Michael Arrington will have TechCrunch to promote his investments and I think he will be able to give them a good chance for success if he promotes them well. You might also say that Arrington has TechCrunch and Hacker News given how easily TC front-pages around here.
1) Shown to a huge number of people. Their traffic, I'm sure, dwarfs HN's traffic.
2) They have an enormous amount of people subscribed via RSS who will be able to read the news at their leisure.
3) Their stories are also shared via Facebook, Google+, Twitter, you name it.
4) TC articles make their way to HN and Reddit as well, providing additional exposure.
The second page of TechCrunch will still provide you with more than enough eye balls.
This is definitely true. My startup was at the top of the front page on HN for a day or so (a year ago), and that sent us something like 1500 visits. The subsequent TechCrunch writeup garnered something around 5000.
...a) people don't have to read TC and as the level of conflictedness for that site increases more and more people will stop reading it
...b) the conflict is at odds with Aol's wider aspiration to be a respected media outlet (Arriana Huffington, etc). At some point such 'exposure for self interest' will cross a line even Aol won't go - esp if they don't have some/any upside in the CrunchFund venture.
The worse situation is that you end up with Arrington as an investor and TC can't write about you because Aol decides it really is too much of a conflict. And other outlets won't write about you or they give you shit because they still perceive Arrington as a competitor. Worst of both worlds.
I think the point I'm trying to make here is that you can't scold Arrington without acknowledging that this already happens -- either directly or indirectly.
The difference being that YC doesn't try to hide it at all on HN. YC ads cannot be commented on, and YC related stories are(generally) noted in the titles. HN is essentially an advertising channel for both YC and YC funded companies.
The problem is that Techcrunch has positioned itself as a news reporting site, not Michael Arrington's Super Startup Investment Blog(tm). So it should be held to a higher standard than YC, especially when it comes to investments.
At the bare minimum, I think that Arrington should(assuming he doesn't leave TC to work on this) disclose his fund's involvement in anything that TC is covering. This goes not only for his personal articles, but anything that any TC reporter is covering.
What? Huffington Post, if you ever read it, is a left wing tabloid. It's filled with leftist propaganda, celebrity gossip, bad-women's-magazine style nonsense, and other crappy linkbaiting. Buying out Huffington is no way for Aol to become a "respected media outlet", it's a way for Aol to become a media outlet in the style of News Corp.
Yes, by traditional journalistic standards Arrington's fund would be a massive conflict of interest. But traditional journalistic standards are all but dead. And frankly, the only new development in the past decade is that people are no longer pretending otherwise.
1) YC's primary business is being an accelerator. This business preceded HN. HN compliments YC's primary business, but doesn't undermine or corrupt it. Conversely, TC's primary business is an online tech blog/journal (and is often a launching pad for startups). CF would undermine the primary business (i.e., TC) by calling into question the legitimacy of all pieces written about CF investments.
2) HN is a online community/news aggregator -- i.e., no original pieces (other than comments). TC is a group edited blog/journal that publishes original content. This means that TC can write opinion pieces to promote its investments, while YC can only post links to third party pieces about its investments.
3) TC has a much deeper reach than HN. Although HN is wildly popular in the tech community, people outside the tech community are generally ignorant to its existence. TC on the other hand, is the place that many "normals" go to get their tech news -- so a biased piece about a CF investment would reach a much broader audience than a biased piece posted to HN.
When you combine these three factors, I think that TC having CF is unethical, but YC having HN is not.
That said it just screams of me too, jumping on the bandwagon to cash in before it's too late
What is that?
I hope that helps.