2011 David Teten. More at ffventure.com and teten.com Internet Business Models Founder Institute Singapore Launch April 26, 2010 http://www.flickr.com/photos/zetotal/3841245048/ David Teten, Partner, ff Venture Capital ffventure.com blog: teten.com @dteten New York, NY [email protected]
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
2011 David Teten. More at ffventure.com and teten.com
Internet Business Models
Founder Institute Singapore Launch April 26, 2010
http://www.flickr.com/photos/zetotal/3841245048/
David Teten, Partner, ff Venture Capitalffventure.com blog: teten.com@dtetenNew York, [email protected]
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
• Introduction
• Business Models
• Tells of People and Companies You Want to Know
• Growing Your "Network 2.0"
• Next Steps
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
ff Venture Capital (ffventure.com)• Early-stage technology venture capital fund based in New York• Founded 1999, with over 100 investments in over 40 companies• Focus on early stage web-based services companies with disruptive models, including
SaaS, video gaming, digital media, social, mobile and VoIP• First investments typically $50-$250K at valuations of <$5m pre-money• 50% of fund reserved for follow-on investments• Prominent angel investments include:
Cornerstone OnDemand (IPO); Quigo Technologies (sold to AOL for reported $340m); Klout, Hashable, Voxy, Phone.com
• Two partners: John Frankel (21 years Goldman Sachs) and David Teten; one Venture Partner (Michael Yavonditte, CEO, Hashable)
2011 David Teten. More at ffventure.com and teten.com
David Teten (teten.com)• Partner, ff Venture Capital, early-stage technology venture capital fund• Founder and Chairman, Harvard Business School Angels of New York• Founder and Chairman, Navon Partners, research and analytics focused on private
companies• Managing Director, Evalueserve, through September 2008. 2,500-person finance-focused
research and analytics firm. • Founder and CEO, Circle of Experts (investment research firm), sold to Evalueserve• Founder and CEO, Teten Executive Recruiting, sold to Accolo, #42 on 2007 Inc. 500• Founder and CEO, GoldNames, domain name investment bank, based in Israel• Technology/Defense Investment Banking, Bear Stearns (#1 group at Bear investment
banking by revenues) • Lead author, The Virtual Handshake: Opening Doors and
Closing Deals Online (TheVirtualHandshake.com)• Harvard MBA 1998, Yale BA, both with honors.• Contact: [email protected]
2011 David Teten. More at ffventure.com and teten.com
• Introduction
• Business Models
• Tells of People and Companies You Want to Know
• Growing Your "Network 2.0"
• Next Steps
http://siteboat.com/what-is-an-internet-business/
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Symmetric vs. Asymmetric Business Models
Symmetric models are ones where the user of a product and the person paying for it are the same
Asymmetric models are ones where the user is different from the person paying the company for the product
Munjal Shah, “Revenues”, presentation to Founder Institute; http://www.flickr.com/photos/andre-batista/2697697617;http://www.flickr.com/photos/gustty/286033333/
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Symmetric vs. Asymmetric Business Models
Amazon.com Sales force.com Yahoo Mail (old) iTunes Store All virtual goods Hyatt.comiphone games
Facebook Google Gmail Yahoo (mostly) eBay Twitter Like.com
Munjal Shah, “Revenues”, presentation to Founder Institute; http://www.flickr.com/photos/andre-batista/2697697617;http://www.flickr.com/photos/gustty/286033333/
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Symmetric Business Models• Are easiest because your team only has to focus on one type of customer• No push and pull within internal teams on “selling out the UI to advertisers”• Revenues end up a very accurate proxy for user interest / satisfaction, so
you only have to focus on one variable, but there is huge friction to distribution
• Unfortunately for B2C companies, usually asymmetric models dominate• ~80% of the market cap of internet companies is asymmetric
Munjal Shah, “Revenues”, presentation to Founder Institutehttp://upload.wikimedia.org/wikipedia/commons/thumb/f/f1/Esplanade_by_slivester_for_wiki.jpg/800px-Esplanade_by_slivester_for_wiki.jpg
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Why Are So Many Success on the Web Asymmetric?
Because the cost of distribution is almost zero: so very easy to make it free for customers
E
Quantity0
∞
∞
Price
PSupply
Demand
Quantity0 ∞
Price
P
http://laserlike.com/2009/04/18/microeconomics, cited in Munjal Shah, “Revenues”, presentation to Founder Institute
∞Supply
Demand
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Don’t Be Low Traffic and Low Commercial Intent
Lead Gen Nirvana
Death Valley Top 20 sites
BillshrinkLike.com
Most Web 2.0 companies
FacebookTwitter?Online Games
Only Google Search Twitter?
Low Traffic High Traffic
Low
Inten
tHi
gh In
tent
Cons
umer
Inte
nt to
Do
Com
mer
cial T
rans
actio
n
Scale in Terms of Number of Users
Munjal Shah, “Revenues”, presentation to Founder Institute
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
Corollary: Relevancy Doesn’t Equal Intent
Any ads with Budweiser Girls on a Mommy blog
Geriatric shoes on a MMORPG gaming site
Dogfood ads next to photos of dogs
Botox ads on dating issues
Low Relevancy High Relevancy
Low
Inten
tHi
gh In
tent
Cons
umer
Inte
nt to
Do
Com
mer
cial T
rans
actio
n
Relevancy of the Ads PlacedMunjal Shah, “Revenues”, presentation to Founder Institute; http://www.flickr.com/photos/the_airrunner/174915900/; http://www.flickr.com/photos/cobblucas/3225553226/;
Tells Network Next StepsCharacter – Competence – Relevance – Strength – Information – Number – Diversity
Intro Models
2011 David Teten. More at ffventure.com and teten.com
• Introduction
• Business Models
• Tells of People and Companies You Want to Know
• Growing Your "Network 2.0"
• Next Steps
Tells Network Next StepsCharacter – Competence – Relevance – Strength – Information – Number – Diversity
Intro Models
2011 David Teten. More at ffventure.com and teten.com
= D * ∑ (Chn *Con *Rn * Sn *In)
Ch = CharacterCo = Your Firm’s Competence R = Relevance of the contactS = Strength of your relationshipI = InformationN = Number of peopleD = Diversity
Network Valuation Formula
N
n=1David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com
• Introduction
• Business Models
• Tells of People and Companies You Want to Know
• Growing Your "Network 2.0"
• Next Steps
Tells Network Next StepsIntro Models
2011 David Teten. More at ffventure.com and teten.com