Entrepreneurial

Scoutmob tries to outdeal Groupon

Despite Groupon’s virtual stranglehold on the group-buying space, David Payne thinks it’s vulnerable.

The co-founder of rival startup Scoutmob said Groupon’s margins aren’t sustainable and feels he has a better solution for deal-crazy consumers and businesses.

“When people look at this space they see it as a zero-sum game,” said Payne, who has heard all the naysayers since launching his Atlanta-based company last year. “They see it as Groupon’s raised a billion dollars in private capital and some (other) companies have raised one, or ten or twenty (million)… how can they compete?”

Payne said the group-buying, or “local,” space is large enough to accommodate newcomers such as Scoutmob, DailyCandy, Gilt City, SCVNGR, GroupPrice and others. He added that Scoutmob is part of this “next wave” of deal sites that are following in Groupon’s oversized footsteps and changing the business model to better suit their clients.

“I think what’s happening is that Groupon started allowing local merchants to really monetize and drive traffic in a measurable way and that was a baby step into something much larger,” said Payne, whose service uses Groupon-type deals, but makes them free to consumers and charges business owners $2 per converted customer, compared to the 50-percent cut taken by Groupon (on a typical $25-for-$50-worth-of-food coupon, Groupon pockets $12.50).

There’s a bubble in talk about bubbles

– Joanna Glasner is a contributor to pe HUB, a Thomson Reuters publication. This post originally appeared here. The views expressed are her own. –

There may or may not be a bubble in Internet startup valuations. But one thing in which there is definitely a bubble is in talk by journalists, investors and anyone else looking to raise their online profile through constant punditry about bubbles.

A recent Google News keyword search for instances of “Internet” and “bubble” unearthed 960 links. Facebook, Twitter and Zynga are bubbles, said one. Is Yelp: the dot com bubble part deux? asked another. One more asked: Is Twitter the harbinger of the second bubble?

It’s not a bubble, people; It’s a pyramid scheme

– Connie Loizos is a contributor for PE Hub, a Thomson Reuters publication. This article originally appeared on PE Hub. The views expressed are her own. –

Mark Cuban knows a thing or two about bubbles, having profited handsomely from an earlier Internet boom. But ask him if we’re seeing Bubble 2.0 and he’ll give you a different theory.

“It’s almost the 2011 version of a private equity chain letter,” said Cuban, who sold Broadcast.com to Yahoo in 1999 for $5.7 billion and went on to buy the the NBA’s Dallas Mavericks.

Small business ad spending fuels Facebook growth

The growing use of small business advertising on Facebook is a trend worth watching.

As much as 60 percent of the social media network’s estimated worldwide revenue of $1.86 billion in 2010 was gleaned from self-service ads, according to a new study from eMarketer, which specializes in digital market research.

The low risk associated with this type of promotional activity is increasingly attractive to small companies across the board, according to Debra Aho Williamson, the firm’s principal analyst.

from MediaFile:

For Web startups, 2011 kicks off with flood of funding

MARKETS-KOREA-FOREX/The East Coast has been buried in copious amounts of snow this winter. In Silicon Valley, the only thing falling from the sky seems to be money.

If the first couple of weeks of the new year are any indication, Web startups appear to be awash in cash, with every day bringing one or more high-profile funding announcements.

The latest company to join the fund-raising parade is Formspring, which announced Wednesday it has raised $11.5 million in a round led by Redpoint Ventures. The San Francisco online social networking service, which has garnered more than 20 million registered users since launching 14 months ago, actually raised the money late last year, but had not disclosed the round until now, CEO Ade Olonoh told Reuters.

What does 10 million Facebook fans mean?

Bryant Simon is a professor of American history and culture at Temple University and the author of “Everything but the Coffee: Learning about America from Starbucks.” The views expressed here are his own.

Last week, the Harvard Business Review published a long interview with Howard Schultz. The Starbucks CEO talked about the coffee company’s many moves to win back customers and battle against the ill winds of the recession.

As evidence of Starbucks’ rebound, Schultz pointed to the biggest of the social networking sites out there. “We’re the number one brand on Facebook,” he boasted.

Does Posterous have staying power?

posterousSachin Agarwal created Posterous as a way for his parents to be able to see what he posted online. Two years later the blog publishing tool has more than 15 million monthly users, but experts still wonder whether its ultra simple functionality can catapult it into the rarefied air of Facebook or Twitter.

“No one has solved the problem of how does my 60-year-old dad see my photos,” said Agarwal, who launched his San Francisco, California-based technology startup two years ago with friend and former Stanford University alum Garry Tan. He said it was important for him that Posterous appealed to people who may be intimidated by the terms “blogging” and “social media.” “We don’t want to be thought of as a tech toy for Silicon Valley geeks. We’re surrounded by a lot of crazy tech, but our goal is to be so much more universal and applicable to normal people.”

Agarwal said Posterous gets around the need for having users register accounts by getting them to post their content – text, photos and video – directly via email to a central Posterous email address, which is then immediately published online in the form of a blog.

Do entrepreneurs need education?

Mark Zuckerberg created Facebook from his Harvard dormitory, but after the social networking website exploded in popularity, he promptly quit school and became a full-time entrepreneur.

An informal roll call of Fortune 500 CEOs that dropped out of high school or university and went on to become self-made billionaires, includes the following: Bill Gates (Microsoft), Larry Page (Google), Michael Dell (Dell), David Geffen (Geffen Records), Steve Jobs (Apple), Richard Branson (Virgin), Ralph Lauren (Ralph Lauren), Jerry Yang (Yahoo) and the aforementioned Zuckerberg.

Most on this list received a modicum of post-secondary education, before bailing and pursuing their entrepreneurial dreams.

A lost generation of entrepreneurs?

Jeff Bussgang is a General Partner at Flybridge Capital Partners, an early-stage venture capital firm in Boston. This post originally appeared on Bussgang’s blog www.seeingbothsides.com. The views expressed are his own.

I’ve been worrying lately that we are suffering from a lost generation of entrepreneurs.

That was my first reaction when I read what Sequoia’s Doug Leone said a few weeks ago about innovation and age at a recent talk with MIT Sloan students visiting Silicon Valley. Leone claimed only people under the age of 30 are truly innovative. Over 30 folks can manage innovation, Leone observed, but you need to be under 30 to create it. He cited people such as Jack Dorsey, Twitter’s founder who was 30 at the time he started the service.

Pet startup needs to get more social (media)

Entrepreneurs Tina Cannon and Christi Scovel have developed a great way to connect pet owners with veterinarians, but they need to get much more involved in social media in order to get people flocking to their website (PetsMD.com), said experts.

Cannon, an accountant by trade, got the idea for their website a couple years ago (see original story here) while witnessing friend Scovel, a veterinarian, answer phone calls around the clock from desperate pet owners trying to book appointments, or just seeking information about their pets’ maladies. Cannon jokingly suggested there should be a website to handle this, freeing up vets like Scovel to enjoy an evening out.

Cannon said 175 million vet appointments are made annually in the U.S. and “they’re all done by the telephone,” she said, adding: “nobody is offering online integrated booking. We’re the first and we’re either crazy or smart.”

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