WePlay.com

Today it was announced that WePlay.com received major funding from Pequot Ventures in New York, a firm I have great great respect for and whose people I know and trust. AS I started to write this post, I admit I was very negative on this investment. In fact, this is what I had written: “It smells to me like yet another in a string of “Web 2.0″ investments in websites that don’t really have solid long-term business models.”

Here’s what I had originally written:

As many have pointed out this morning, there is already a long line of successful websites providing digital services to the youth sports community, including Highschoolsports.net (which was bought for 50m) and eTeamz.com, not to mention other newer sites like  TeamSnap.com and RosterBot.com. It would therefore seem that this is already a crowded space (and one which is shrinking- at least from a traffic perspective), so I’d next look for evidence that someone else could take advantage of an opportunity and do a better job than the existing players. This would have to be a pretty compelling opportunity, since so many have tried and are trying to penetrate this space.

I was then going to point out that the only ways WePlay is differentiated are the following: 1) It’s a little more Web 2.0-y than some of its competitors, 2) It’s got social networking – whatever that ends up meaning, and 3) It has major sports figures involved.

This is actually where I changed my mind, because while I was cynical about these differentiators at first, I can easily re-phrase them to be quite compelling: 1) A lot of the other sites in this space are really poorly designed at at a cursory glance seem like they’d be clunky and difficult to use, 2) It doesn’t seem that anyone has tried to integrate social elements into what are ostensibly team management tools (a logical next step for something that is by definition a social activity – sports), and 3) It has major sports figures involved that will undoubtedly drive traffic and benefit marketing efforts. As for the business model, services like team mailing list management, profiles, and calendars are pretty cheap to provide, and there isn’t anything else about this service that seems like it is going to be bandwidth or storage intensive. However, my gut tells me that these are services that leagues and coaches would definitely be willing to pay for, even if not that much. My advice would be this: keep building a solid product, figure out a way to market it directly to large groups of users (like local little leagues), and don’t blow all your money on the big stars just for PR value.

So there you have it. I can actually change my mind. Congrats to everyone at WePlay – and good luck!

Digital marketing insights inspired by Avenue A Razorfish

I finally got around to reading Avenue A Razorfish’s 164 page 2008 Digital OutlookReport, and I must say that it’s a great overview of pretty much everything that is happening where digital media and marketing is concerned. It was so good that it inspired me to craft some marketing concepts for Indaba Music that I think should contribute to shaping the future of our company.

A few themes were particularly relevant and got me significantly excited about their application to Indaba:

Value for marketers needs to be measured across multiple touchpoints – not just pageviews on a homepage. In the past, you could determine how valuable a website was to marketers based on how heavily consumers interacted with it online, but now, consumers interact with websites across an array of technologies from RSS and email to widgets and content syndication. The internet now blends seamlessly with an astounding array of offline activites. No where is this more true than on Indaba, where community members download audio files which they then work with over significant periods of time offline. I found this point particularly interesting because in Indaba’s case, it means that members engage with our company in significant ways even when they are not using the website. There is value that can be delivered to both marketers and users throughout the entire story of this engagement (from pageview, to file download, to digital production, to file upload, to content syndication), and everyone, especially marketers and websites (like Indaba) need to get better at measuring, explaining, and capturing that value.

Smart companies are ceding control to their most passionate users so that they are empowered to market for them. This one is pretty obvious to those of us in the tech community, but it’s particularly relevant to Indaba. Our most passionate, vocal, and active users are both our biggest fans and biggest critics – they love what we’re doing and they don’t like it when it doesn’t work the way they want it to. Indaba as a team and a company has forged meaningful relationships with these individuals, but we can also go further and empower them to help shape the Indaba community, the message it sends to the outside world, and the tone of its activity and collaboration. It’s obvious that core Indaba members are begging for this kind of empowerment, and so we’re thinking about what the best tools and techniques will be for giving it to them.

The news from Goldman and what it means (maybe) for startups

I’m sitting in the Denver airport on my way back to New York and I’ve just heard the awful news that Goldman Sachs, yes, Goldman Sachs, is going to lay off 15% of its workforce. This is obviously horrible news – Goldman is the marquee bank on Wall Street (and it has a sterling reputation for taking care of its employees), and this means that other banks will almost certainly follow suit. Supposedly the layoffs are going to be mostly in capital markets and support staff. Following the near bankruptcy of Bear Stearns and acquisition by JPMorgan last week, this is huge news that plunges the economy deeper into the big “r” word (I dare not say it out loud .

From my perspective at the helm of a startup music/web company,  all this news could be a signal to entrepreneurs to take funding now if they can get it. Of course, I’m never in favor of handing equity over to investors for no reason, but if you’re not on sound financial footing it might be wise to have enough capital in reserve to weather the storm. I won’t go so far as to say that any startup should take all the money it can get – the same formula won’t apply to every business – but there is obviously merit to looking at your financial situation through the lens of broader economic conditions.

Just to play devil’s advocate and make matters more complicated, tech is typically insulated from broader economic downturns due to lower capital intensity (among other factors), so again, today’s news from Goldman isn’t a clear signal in one direction or the other. On top of that, strategic players and financial institutions are going to need to continue expanding their businesses and producing returns for their investors – “r” words don’t change that. Every time the economy takes a turn for the worse cynics forget this simple fact and start screaming that the sky is falling and any startups that don’t stockpile cash are going to be done for.

That said, the news from Goldman is a clear signal that entrepreneurs should be thinking hard about their capital situations, and for some, it may be a good time to store up cash for the winter.

Congrats to Jukebox

One of our favorite bands here at Indaba is Jukebox the Ghost, and I wanted to congratulate them on their big new publishing deal! We were lucky enough to celebrate them with them down at SXSW (plus Seth, their manager and our former Indaba intern).

Guitar Hero is Going to Ruin My Life

We just got Guitar Hero here at Indaba (it was a birthday present from someone special) and I can legitimately say that it might ruin my life. I now understand what all the fuss is about – it’s A LOT of fun to play. I also understand the South Park episode far more than I did when I first saw it (even though it was funny to being with).

SXSW Roundup 2008

Reproduced from the Indablog…

The Indaba Music crew is officially back in New York having returned from Austin for this year’s SXSW. We’re missing the warm weather, the BBQ, and we’re still wondering how long the hangover is going to last. We did the whole thing this year – Interactive straight through to the end of Music (about a week and a half), and we can say with certainty it was a big success on many fronts. We wanted to share a few big themes that we thought defined the conference, and also some of our favorite shows and parties.

Big Ideas

Whether you’re a website or an artist, more connections need to be forged with customers in more meaningful ways.

There was a progressive mindset about how to treat customers and fans throughout all of SXSW that we think is particularly important for artists. During Interactive, a lot of talk about community and customer service boiled down to a shift from thinking about “users” to thinking about “members” or “customers” – people who make meaningful contributions to online communities and actually use web-based products in meaningful ways. This distinction is important because it reflects a more personal, focused way of looking at the people who actually use internet companies’ products. The same concept was evident throughout almost every discussion we participated in during the music festival, although it was manifested in a slightly different manner. As the way people consume and experience music changes it is increasingly important for artists to treat their listeners as customers with a lifecycle – not people who are motivated to do one single thing…buy an album. Even the greatest traditionalists of the music biz seemed to agree that artists of the future will need to forge closer, more meaningful connections with there fans, and figure out ways to offer them value over a greater spectrum of interactions, beyond just the CD store shelf or iTunes download store.

The music industry is more aware of what is happening to it than it was last year.

In 2007, we were troubled by the Music festival’s general lack of excitement regarding new technologies and changing business models in the industry. The attitude overall was one of resistance to change and sometimes outright disgust over the use of new technologies. This year, we noticed a marked change. Although still not as innovative as the Interactive participants, it seemed that the music festival overall was more open to change – from the participants all the way up to the most well-known panelists. Many new websites were represented at the tradeshow, and across all discussions there seemed to be a focus on embracing change to create the best outcomes for artists rather than fighting it. One panel attempted to teach artists the best ways to use the web to their advantage, and another even embraced the free distribution of music online as an enabler of different revenue streams (not that this is the answer for everyone).

There can be a better dialogue between the music industry and new media.

From our vantage as a music company that utilizes technology to serve artists, we’re still dissapointed at the lack of exchange between the traditional music businss and new media. This cuts both ways. There were panels at the Interactive festival on music, for example, one on piracy – but it had no artists represented. During the Music festival, a panel on the best ways for artists to use the web didn’t present the best, newest, and most forward thinking web technologies and ideas (e.g. YouTube isn’t anything new, and suggesting that artists should upload their videos isn’t exactly revolutionary). Discussions of music in the interactive world could benefit from the perspective of artists, and discussions of the internet in the music world could benefit from the latest technology thinking. This is true beyond SXSW.

Artists need to think about themselves as businesses if they want to survive in the music industry.

This is a tough thing for a lot of artists to grasp, but it’s getting harder for a lot of people to make money in the music business in the ways that they used to. Part of continued success is going to mean that artists need to conceive of themselves as businesses – with multiple revenue streams, customers, operations, marketing, brands, etc. Most everyone at SXSW seemed to understand this – the Interactive folks because it is natural thinking for business-minded individuals, and the Music folks because necessity demands it.

Favorite Shows

N*E*R*D (Stubb’s & Perez Hilton Party)

N*E*R*D never fails to impress with their reputation for great live performances. SXSW was no exception and, although it sounds funny for a largely independent rock festival, there was pretty wide agreement on our team that N*E*R*D were the best performers of the week. The first time the Indaba crew saw them play was at Stubb’s, one of the larger indie venues in Austin, where they proved their ability to captivate and command a larger audience (probably about 1,200), something that is more of a challenge to artists that draw hip-hop crowds. But it was their 3am performance to a packed crowd of 300 people at the Perez Hilton “One Night in Austin” party that was arguably the best performance at SXSW 2008. Pharrell and Chad Hugo’s energy and ability to engage the crowd was impressive and the tightness of the band (2 drummers, bass, guitar, keys/synth, 2 singer/MCs and one guy that just hangs out, dances, and makes sure everything goes smoothly) was nothing short of amazing.

Brazilian Girls (Red Bull Moontower)

About a 15 min cab ride away from 6th street (the musical center of Austin with an incomprehensible number of venues lining both sides of long street), there was what seemed to be a big parking lot. Except that this year during SXSW that parking lot was transformed into a large venue with professional lighting, sound, and stage, and a two story indoor lounge that was constructed especially for SXSW. Sponsored by Red Bull and Facebook this lesser known party had great bands play each night of the music festival from around 11 to 4am. One of the best shows Indaba caught at SXSW was the Brazilian Girls at this venue. While it seemed that many people in the crowd were not familiar with their music, by the end everyone became a fan as the whole crowd moved and grooved together. Our very own Mantis even exposed his manly figure to dance shirtless in front of one of the giant light screens. This particular show was unique as two of the four Brazilian Girls had other obligations and couldn’t perform at the show. Instead we were treated to an unusual trio version with guest drummer Shawn Pelton (probably best known as the Saturday Night Live house band drummer) joining Didi Gutman to back up frontwoman Sciubba. We found it especially impressive that Didi was able to create such a full sound behind his keyboards when he was essentially holding down the bass, keyboard, synthesizer, and electronics part of the show – simultaneously.

Does It Offend You, Yeah?

When they walked out on stage, Emo’s Main Room, Friday night, no one knew who they were, and no one had any idea what was about to happen. They did their best to get the crowd cheering to mixed results, but by the end of their set they had the entire room jumping with arms outstretched begging for more. A very dancy group from the UK that mixes punk and house with Daft Punk-esque vocoded lyrics.

Crytsal Castles

Easily the group exuding the most mystique. Everyone in the group was shrouded darkness except for a strobe light carried by the singer. They were a half hour late to the stage, but they asserted their authority and rocked the hell out of their set like nothing we’ve ever seen. An incredibly short set too – a half hour late and five songs later they were done – but still one of the most memorable shows of the entire festival. Like Does It Offend You, Yeah?, they’re another electropunk group, but they have an intense and sharp edge to their sound. Reminded us of a screaming-girl version of Ghostland Observatory.

Jukebox the Ghost (Lovejoy’s)

Jukebox is a favorite around Indaba, but usually we only get to see them play to crowds of die-hard fans and friends. It was a real pleasure to see them take SXSW by storm – getting a fully seated crowd that had never experienced their music before to be completely excited and into the music. Ben keyboards were out of control as usual, and Jesse didn’t even miss a single tambourine toss! Special congrats to Ben, Jesse, and Tommy for signing their first big publishing deal while in Austin!

Bela Fleck (Maggie Mae’s)

When we stumbled into a smaller bar that couldn’t hold more than a few hundred people we were incredibly excited to peek over the crowd and see Bela sitting with his banjo plucking away just 10 feet in front of us. As he weaved in and out of Paganini, favorites like New South Africa, some more recent compositions, and pure improvisation, we were able to see up close just how much of a virtuoso he is. As this was just an hour or two before he premiered his film “Throw Down Your Heart”, we were treated to a few sneak preview scenes. The film is a documentary tracing the roots of the banjo back to Africa where Bela collaborates with several different groups of musicians across four African countries. After the intimate performance we shot across the street to see the official film premiere and a Q&A with Bela and the film’s director Sacha (also Bela’s brother). The movie had eruptions of applause throughout and had the audience feeling the highs and lows of exuberance and sadness as Bela and his crew travelled throughout the continent. Oh, and the movie theatre serves pitchers of beer and food as you watch – amazing!

The Most Serene Republic

One of the many mind-blowing groups from Canada we got to experience. This group is overflowing with remarkable musicians. Perfectly blended vocal harmonies layer over odd-time rhythms and intricately developed textures. Their songs tend to escalate to moments of critical-mass tension and intensity leading into incredibly satisfying moments of release. Reminded me of Broken Social Scene and Dismemberment Plan.

The Acorn

Carefully crafted songs and tight vocal harmony with insightful lyrics. One of the only groups PJ made a point of seeing while at SXSW (as they were not a random band he’d never seen or heard before). They have a focused, positive energy on stage, possible the exact opposite of Crystal Castle’s stage presence – they were very open and seemed like they were having a great time on stage. We always love it when the band is into it as much as the audience. It makes the music more accessible and enjoyable.

Cryptacize!

Another group PJ intended to see before getting to SXSW. They’re a collaborative group consisting of a very talented songwriter, Nedelle, and former Deerhoof guitarist Chris Cohen. PJ discovered the group by following Chris Cohen’s work (in Deerhoof and his other project The Curtains, also a favorite group). Their sound is extremely minimal yet perfectly so – there’s nothing extra and nothing missing either. He saw them play at the Okay Mountain Gallery while sitting on the grass in the backyard on Saturday afternoon. Their warm melodies and presence made for a memorable and relaxing afternoon after the insanity of Friday night.

Black Moth Super Rainbow

Chosen based on their name and the fact that they’re from Pittsburgh (another of PJ’s favorite groups, sadly no longer active, Don Caballero is from Pittsburgh as well). They have a dreamlike, slow-motion sound like the musical score to things you can barely remember from your childhood. We’d describe them as Boards of Canada meets Air. Good mixed-media performance as well – mash-up videos of track runners and other athletes on what looked like super-8 film were being projected over the stage, adding to the nostalgic, bittersweet ambiance of their set.

Vampire Weekend was the big talk of the festival, but unfortunately we couldn’t get in to their show so we can’t really report back on it (in case you’re wondering why we didn’t mention them). We also know that the other big story coming out of SXSW was Sarah Lacy’s botched interview with Facebook founder Mark Zuckerberg. We only mention it as an afterthought here because as poor of an interview as it was, it wasn’t really the earth-shattering train wreck it got made out to be, and we didn’t think anything particularly insightful was said (which might be why Mark made himself available the following day for an open Q&A at the Facebook developers garage).

SXSW 2008 was great, and we’re looking forward to next year!

They Want me to be a Republican

I don’t think I blogged about it but a few months ago the Republican Party of NY called me saying I had won some kind of award for support of the ideals and candidates of the party. My laughter made it clear that they had the wrong guy; I am a registered Democrat and Obama supporter.

I thought the matter was closed, but they faxed me the award anyway. They must have been desperate to get rid of them. Oh, but the story gets better.

Today is my birthday, and upon checking my mail this morning I realized I was the proud recipient of a signed color 8×10 of George Bush. Is this not absolutely hysterical? I must be on some kind of list that I don’t belong on…

SXSW Update #3

In the morning, we learned that original ideas for the internet date back to the 1830s…that’s right, they didn’t have the telephone, but some guy still thought the internet would be a pretty cool idea. Since most of our short term memory was erased later on in the day by the nuclear tacos (read on for more), you can check out that cool dude’s name and other interesting factoids about the history of the interwebs at Alex Wright’s website.

One of the new friends we’ve made here at SXSW (a great guy from ASCAP by the name of Mark Palermo) decided that as SXSWi newbies we had to experience the nuclear taco buffet in Brush Square Park. Being the cavalier hot-pepper-eaters that we are, we dove right in to the nuclear
(nucular as Reagan would say) tacos and we were certainly regrettful of our arrogance. These were the most painful things we’ve ever had to eat, but at SXSW, if it’s free and you can eat it, you have to take it.

We capped off the night with an awesome show from Boston synth-pop act Freezepop - Jesse has been photographing the band for years and insisted that this was one show we didn’t want to miss – it certainly dissapoint. This band is a lot of fun – especially if you like to dance – and they have exceptionally stylish schwag that I would recommend wearing even if you don’t like synth-pop and keytars.

SXSW Update #2: Throw Down Your Heart

The highlight from yesterday (our 2nd day down here at SXSW) had to be meeting Bela Fleck and seeing the world premier of his documentary film, Throw Down Your Heart (co-produced with his brother). Bela is one of our favorite musicians (and people) at Indaba; I’ve been fortunate to have met him a few times, and every time he’s just as warm and genuine as ever (despite obviously having no idea who I am). Yesterday Bela played a great solo set and then went across the street to premier the film at the Alamo Ritz.

Bela, who is one of the greatest banjo players of all time, takes his banjo on a trip across Africa to trace its roots as an African instrument and play with traditional musicians, many of whom have never even seen a banjo before. The film was beautiful and inspiring, and the music was incredible. A highlight for me was the 15 foot marimba that was played by upwards of 5 people at a time over a giant pit in the ground. I am anxiously awaiting the release of the soundtrack for obvious reasons. If you have a chance to see Bela’s extraordinary movie, make sure to go.

To recap the day from a broader perspective, the whole experience of Bela’s film served as a great little microcosm of why I love being here at SXSW so much. We got to interact with an incredible musician face-to-face after hearing him play an incredible set. We got to see a piece of media that no one in the world has seen before while drinking a pitcher of great Texan beer in a movie theater that, yes, serves drinks and food at your seat. And to top it all off, we made a new friend while waiting in line for the movie who also happens to be
creating new opportunities for musicians (check out Magnatune – a very interesting company experimenting with new models for how a record label can function). More to come!