Hold The Phone, I Want My Dick Tracy Watch

A few days ago, I read Nilay Patel’s review of the Pebble smartwatch for The Verge. Like many others, I bought a Pebble on Kickstarter, and I can’t wait to try it out myself. But one part of Patel’s review stuck out at me in particular:

Any incoming notification will quietly buzz the Pebble and light up the screen. Frankly, it’s great â€" being able to see who’s texting, emailing, or calling you without looking at your phone changes the entire dynamic of being connected. The upside is obvious: only reaching for your phone when it’s something important means you reach for your phone much less often. (I particularly enjoy screening calls from my wrist.)

This. This is what I’ve been waiting for. Well, it’s close.

The entire world is enamored with smartphones right now. And rightfully so â€" they’re reshaping almost everything we do on a daily basis. It’s a computer, in your pocket, with internet power.

But wait. Go back. Did you catch it? “In your pocket.”

I don’t know how many times a day I now reach into my pocket to pull out my phone. If I had to guess, I’d guess a hundred. Maybe it’s a lot more. That’s a lot of the same motion over and over and over again. And for what? Usually, nothing important. My phone vibrates, I pull out the phone. Nothing important. I put it away. Five seconds later, I repeat the process.

In aggregate, I probably waste at least 30 minutes each day doing this. But again, some days it’s probably more. That’s insane.

I know that I’m going to experience the same feeling of bliss that Patel did when I use the Pebble for notifications and stop pulling out my phone every minute. But I also know that I’ll immediately want more. I’ll want what I’ve always wanted. A Dick Tracy watch.

For those of you under 70 years old (and honestly, I probably only know about Dick Tracy because of the 1990 Warren Beatty/Madonna man-in-the-banana-suit oddity), Tracy was a police detective with the coolest gadget ever: a wristwatch phone. And while that was extremely forward-thinking in the 1940s, a wristwatch that’s just a phone (they’ve obviously existed in various forms for years) seems narrow-minded now. Even on smartphones, the phone aspect itself is arguably the least interesting feature. And amongst the younger demographics, probably one of the least-used.

I want a Dick Tracy watch that can do all kinds of things beyond just making calls. Call/SMS notifications are a great first step. Third-party app notifications will be even better. But the next step will be something like Siri on the device, that allows you to talk to your watch to actually do things.

If you think about it, a watch makes more sense for Siri-type technology than a smartphone does. With a smartphone, it’s still very easy to type commands. Many people avoid talking to their phones when they’re not on a call so they don’t look like asshats who are talking to their phones. It’s still awkward and it will be for a while. But with a watch, you have no other choice. There’s no room for a keyboard (well, unless you get something like this). Voice is the only thing that makes sense. It will force a paradigm shift. And Siri (or another similar technology) will be there to take advantage of our suddenly chatty society.

“Siri, take this note:…” “Siri, send this message to dad:…” “Siri, what was the score of the game today?” These are all things we can do right now. But it’s usually still faster to simply take those actions by typing them into a smartphone. Again, on a watch, the voice commands will be the only option.

Obvious, right? We all know that’s coming. I’d be shocked if both Apple and Google are not working on wristwatch-type devices right now. Apple must have seen how many different iPod nano watch projects emerged over the past few years on Kickstarter. And I have to believe they wouldn’t have changed the form factor of the nano unless they knew they’d address this desire themselves one day. Now everyone is looking at the Pebble and the various other wrist devices and seeing dollar signs. Someone is going to nail this space. Maybe a few people will.

But even a Siri wrist device is just step two towards what I really want. The ultimate wrist device would be about push and not just pull. That is, such a device should know your location and serve you up information beyond explicit message notifications or information you’re actively looking for. Think: Google Now. Or perhaps even better, Google FieldTrip.

Maybe you’re walking through a city for the first time, your watch should know that and serve you up interesting tidbits about the area. Maybe its Foursquare venues your friends have been to and liked. Maybe it’s historical data you’ve searched for on Wikipedia in the past. Maybe it’s an Instagram that a friend took. Maybe it’s a place to get toothpaste that you were searching for on Google earlier. Maybe it’s a warning that it’s about to start pouring rain.

This obviously doesn’t have to be audible information, the watch would still have a screen to serve this information up. And if you wanted more than a standard, quick overview, maybe you could “send it to your phone” to dive deeper with more screen real estate.

But wouldn’t all that get annoying very quick? Yes. Patel brings this up as well even with the limited notifications the Pebble provides:

The downside is that it’s harder to simply ignore your phone and let messages stack up while you focus on something else; having the Pebble buzz your wrist for every email and text means you’re hyper-aware of your inbox at all times. Some filters and priority settings would go a long way â€" having a Pebble changes the contours of distraction, but doesn’t reduce it. But once you’re used to having notifications on your wrist, it’s hard to live without them.

In other words, the good outweighs the bad. And Patel is right, smart filters would go a long way here (don’t buzz me at certain times, only show important information, etc). Even more simple would be a do-not-disturb toggle. If you’re walking around and want the notifications coming your way, flip it on. If you just want to enjoy a walk the old-fashioned way and remain oblivious to the river of information flowing all around you, turn it off.

At first, these Dick Tracy watches are undoubtedly going to rely heavily on your smartphone, just as the Pebble does. Eventually, though, the tech can and will reside on your wrist. Maybe then the smartphone is the thing people carry around mainly to take pictures with. Crazy to think about now, perhaps. But why are we all walking around with a computer in our pockets?

Google Glass is a fascinating bit of technology. But I say there’s no way that sees any sort of mainstream adoption before my Dick Tracy watch does. Baby steps. And we’re getting very close to that particular step. I can’t wait.

German Proposal For Search Engines To Pay For Displaying Publishers’ Text Snippets Gets 2nd Reading, Google Rails Against “Mad Law”

Google is sounding a warning klaxon about a proposed law change in Germany which aims to strengthen copyright law for press publishers by requiring search engines and online news aggregators to pay a royalty to display snippets of copyrighted text â€" such as the first paragraph of an article displayed within a Google News search. If the ancillary copyright law passes, fines would be imposed for unlicensed use of publishers’ snippets.

The draft ancillary copyright law (online here in German) gets its second reading today (German law requires three readings before a law can be passed), and is backed by the majority of the governing coalition â€" having being included in the coalition agreement between the Christian Democratic Union and the Free Democratic Party.

Currently displaying text snippets is free and legal in Germany so Google argues that the proposed amendement is a complete legal reversal. The issue is known as ‘Leistungsschutzrecht für Presseverleger‘ in German, and has also colloquially been dubbed a ‘Google tax’.

Mountain View is of course ideologically opposed to the proposal â€" calling it a “mad law” and arguing that it breaks the “founding principle” of the Web’s hyperlink-based architecture. From a business perspective the company questions why it should have to pay for helping publishers to acquire readers.  ”We are bringing massive traffic to the publishers’ websites,” Google Germany spokesman Dr. Ralf Bremer told TechCrunch. “We cannot see a reason why we should pay them for bringing them the readers.”

Setting aside the inconvenience to its business, Google also argues that the law will be damaging for web users because it will make it harder for them to find German documents because the context provided through use of snippets will be lost. Why should German publishers be treated differently to other publishers, it says. There’s no question of Google agreeing to pay for the snippets â€" you can imagine the company viewing that path as a slippery slope leading to an avalanche of copyright claims falling on its head.

There’s little doubt Google is being directly targeted by the proposed law. It specifically cites search engines as the target entity for the additional publisher “protection” â€" and Google is far and away the dominant search engine in Germany. But Mountain View claims the law is not just going to cause it pain â€" but could also apply more broadly to other online companies and startups that make use of text snippets.

The text of the current draft of the law states that the proposed protection “is only against systematic access to the publishing performance by the search engine providers” (translated from German via Google Translate) â€" and goes on to add that other web users are not included (“such as Blogger, other industrial companies in the economy, Associations, law firms and private and voluntary users”). However Google says the wording of the draft law also references “suppliers of search engines and suppliers of such services, who process content similar to search engines” as falling within its remit â€" a vague definition that it says could even apply to social networks.

“The question â€" which services are meant by the latter [portion of the draft law's wording] â€" is controversially debated. The latest interpretations, we have seen, assume that Twitter, Facebook and the like will also be affected,” said Bremer. He argues that every web service or information-based startup that wants to use publishers’ snippets could potentially be affected â€" adding that many such companies won’t have ‘Google-levels of resources’ to ensure they are able to comply.

“As soon as this law comes into place there will have to changes made by every platform working on the web,” he said. “It’s not just a law about Google… it’s about the entire startup scene that we have in Germany, and especially in Berlin. Because potentially every company that works on the web has to deal with snippets, more or less, in their business.”

“From the day this law comes into place, every company that wants to use these snippets… would have to reach out to publishers and call them individually â€" ‘hi, can you please allow me to use your snippets and what do I have to pay for that?’ And if you understand there are more than 1,200 publishers you can imagine that it is simply not possible,” he added.

Another problem with the draft law, as Google tells it, is that it does not nail down the definition of a snippet â€" meaning it would be left to courts to decide whether a snippet means a few sentences, a few words or even just a URL. “It is not even sure the pure hyperlinks are free because some hyperlinks contain part of the text,” Bremer added.

If the law is passed â€" and Bremer concedes it looks likely, thanks to the backing of the governing coalition â€" Google says it would have to pull German snippets from search results. Setting aside the ideological position of not being willing to pay for something it believes should be free to use, it argues that the legal risk of displaying snippets when the law is so ambiguous would be too “fraught”.

According to Bremer Germany’s big publishing houses originally lobbied for the law change. He describes them as politically well connected â€" and also points out that it’s an election year in Germany this year, arguing that politicians are more likely to want to cosy up to publishers than counter their wishes. “Pressure from the publishers is really high to get this law done within the coming months,” he said.

Bremer said today’s second reading â€" which will involve input from a panel of eight experts (ostensibly independent but three of whom Google argues “belong to the publishers’ lobby”) and at which Mountain View has not been invited to speak â€" could be “the last change to get this law off the table or to shape it in a way that is not so dangerous today for the web architecture”. Google’s hope, says Bremer, is for the governing coalition to listen to the views of the independent experts and think again.

“The arguments against this law are very strong. The arguments for this law are very weak,” he added.

So what about the arguments for the proposed law? German publisher Axel Springer â€" whose publications include the newspapers Die Welt and Bild â€" is an active supporter of the proposals. Asked to respond to Google’s arguments against the copyright extension, Christoph Keese, Senior Vice President of Investor Relations and Public Affairs for the company and chair of the joint copyright committee of Germany’s newspaper and magazine association, told TechCrunch that “Google’s statements are unfair and disproportionate” and “in no way represent what this law is really about”.

Keese also rebutted criticisms about the potential scope of the law, claiming it will “have no effect on the right to quote or link”, and that “citations and links stay free”.

He continued:

It is neither “mad” nor will it harm users, the internet, open society or information pluralism. To the contrary: This reform brings German copyright law much closer to the US concept where publishers traditionally enjoy strong rights. Over here publishers have no rights on their own to this very date even though music, film, television and performing arts have enjoyed ancillary rights since the mid sixties.

What this reform does is very simple: It establishes on opt-in model for commercial copies of content and parts of content. This will lead to license agreements between publishers and aggregators.

On the specific point about the impact on startups, Keese argued that being as the pricing for licensing the snippets will be “reasonable” then “no business model shall be discouraged”, adding:

We have carefully considered impact on the thriving start-up culture especially in Berlin. There will be no negative effects. To the contrary: New innovative business models will arrive built on legally licensed content. Even before the law comes to effect we observe rising demand by start ups seeking investment and licensing opportunities.

This law will help establish a market for aggregator content which at the moment is non-existent. Google (>90% market share) displays monopolistic behavior by trying to impose its legal view on publishers to protect its margin. While publishers respect Google’s technological and entrepreneurial achievements we are not prepared to give content away for free. Search indexing is more than welcome. But aggregators have gone far beyond that.

The royalty rate that publishers would charge has not been determined yet. On the question of pricing, Keese said: “Parliament has not decided yet if it wants the right to be exercised through a collecting society or not. Absent this decision it would be premature to speculate about pricing.”

September 7, 1998

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Google provides search and advertising services, which together aim to organize and monetize the world’s information. In addition to its dominant search engine, it offers a plethora of online tools and platforms including: Gmail, Maps, YouTube, and Google+, the company’s extension into the social space. Most of its Web-based products are free, funded by Google’s highly integrated online advertising platforms AdWords and AdSense. Google promotes the idea that advertising should be highly targeted and relevant to users thus providing...

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The 17 Winners Of The Facebook, Gates Foundation’s Education App Contest Are Making College Easier

Back in September, The Bill & Melinda Gates Foundation launched a contest that aimed to challenge entrepreneurs and app developers to build awesome, innovative education apps on Facebook’s platform. The so-called College Knowledge Challenge kicked off with an EdTech hackathon co-hosted by the Gates Foundation and Facebook, located at the social network’s headquarters in Menlo Park.

As Josh wrote at the time, the contest called on developers of all ages to create apps that “build pathways to college, build peer groups for in-coming college students and assist with college admission and securing financial aid.”

The co-hosts distributed $18K in hackathon prizes in September, with the winners of the overall challenge vying to earn one of the $100,000 grand prizes. Today, The Gates Foundation and Facebook announced the 17 startups and apps that will be taking home those grand prizes. [For more, see below.]

But first, while social technologies are certainly a fundamental part of the ongoing seachange currently taking place in education, one might ask, why encourage developers and entrepreneurs to build for Facebook? Instead, it might seem as if we should be encouraging builders to focus on disrupting archaic K-12 infrastructures, encouraging WiFi support and penetration in schools, helping low-income students to smart, digital devices and Internet access and push computer science and technology education into the core curriculum of our schools.

To that point, Gates Foundation Deputy Director of Education Stacey Childress said at the time that “social networking sites are emerging as critical platforms for students â€" and low-income students especially â€" to allow them to build social capital outside the boundaries of their neighborhoods. Facebook contribues not only to academic success but their persistence as well … They feel more connected and are more likely to stay in school.”

In turn, technology has proven its ability to democratize the access and distribution of information and Elliot Schrage, VP of Public Policy at Facebook added that Facebook’s Open Graph sharing system reduces friction and gives young people the opportunity to have their content or experiences go viral. Bringing social networking and education together, he said, has the power to use sharing to transform the way students live their lives and the way they learn.

The Challenge focuses on developing apps for low-income and first-generation college students in particular, and many of the contest’s winners seek to capitalize on a growing trend within education technology: The personalization of the learning process, especially within the framework of education targeted at low-income and first-generation college students.

But, without further ado, meet the 17 winners of the College Knowledge Challenge, with basic information about the startups copied below:

Applyful â€" Currently in private beta, Applyful is a collaborative college selection platform, designed for college applicants to collect and share information with one another on the road to choosing a college. As applicants use Applyful to manage research during the application process, Applyful surfaces trends and insights to encourage more informed decision-making, while developing peer groups to offer support and broaden one another’s horizons.

Career Connect by ConnectEDU & CareerVillage â€" The Career Connect app is a partnership between ConnectEDU, a technology company committed to connecting the world’s learners to life’s possibilities through clear education-to-career pathways, and CareerVillage, an edtech venture that creates social games that prepare students for careers. The Facebook app creates a forum for students to get answers to their college and career planning questions by leveraging their social network. Questions are searchable by any topic and multiple app users can respond to each question.

Coach Me, Beyond 12 â€" Beyond 12 is a technology-based service organization dedicated to increasing the number of underserved students who graduate from college. The startup’s new app, CoachMe, aims to provide college students with automated alerts delivered to their mobile devices and Facebook accounts to help them keep track of key deadlines. Students will be rewarded, in the form of badges, for completion and mastery of certain tasks and skills, and will be able to share their successes, challenges and key lessons learned with their support network and peers. Ultimately, CoachMe will bridge the “information gap” and help students master the activities, behaviors and habits that increase their success in college â€" and beyond.

College Abacus â€" The Chronicle of Higher Education recently announced that College Abacus has given net price calculators “the Kayak treatment”; much as Kayak.com created the “search one and done” experience for travel, College Abacus is the free one-stop search for comparing higher education pricing. Now available in Spanish and English, College Abacus allows college-bound students and their families to search and compare net prices â€" tuition and fees minus grant aid â€" across more than 2500 schools (and counting).

CollegeGO by The College Board â€" The College Board is a not-for-profit membership organization whose mission is to connect students to college opportunity and success. The College Board’s “CollegeGo” mobile app is an interactive college action plan that puts under-served students on the path to college enrollment by helping them explore the key components of effective college planning: academics, career discovery, college exploration, paying, and applying. The app takes a step-by-step approach through the process, visualizes student progress, and includes a built-in support and encouragement system.

CollegeZen by The College People â€" The College People LLC a Pittsburgh based company started by former higher education administrator Wahab Owolabi and Carnegie Mellon University engineering student Neil Soni with the mission of creating software to increase college access and provide tools for education administrators. Their first product CollegeZen.com is a community centered web application that simplifies the college search, decision, and funding process while enhancing the experience for prospective students and parents with the belief that there is a perfect college for every student.

The FAFSA Community by NerdScholar â€" The NerdScholar FAFSA Community App will create a Facebook-enabled support network of students, parents, and administrators. This resource will aim to increase the FAFSA completion rate among low income and first-generation college students. By promoting a social community and the support of a peer network, NerdScholar aims to improve financial literacy and enable any student to achieve their college goals. NerdScholar is a service of NerdWallet, empowering students to make better decisions about their higher education.

FastForward by Unigo â€" FastForward helps high school students, community college students and any college student struggling with their future plans to: visualize potential career paths; develop personalized college/career action plans; and locate resources for taking action. FastForward puts the student in the context of various career paths, using their own photos and Facebook timeline as a starting point for exploration, discovery and planning of careers. Unigo adds FastForward to its growing collection of tools, http://www.unigo.com, one of the largest college resources on the web.

GradBadge by GradGuru â€" GradGears’ mission is to increase completion rates among community college students and accelerate their path to completion. We build student-centered products that increase retention, reduce drop-out rates, and accelerate students’ academic success. Our first product is GradGuru, your community college advisor in your pocket. Through earning badges, GradBadge helps enrolled community college students more easily understand and learn from their peers what behaviors lead to faster completion. GradBadge leverages the GradGuru platform, Mozilla Open Badges and Facebook.

I’m First by The Center for Student Opportunity â€" Center for Student Opportunity (CSO) is a national nonprofit empowering first-generation college students on the path to and through college. Our I’m First project is collecting pledges and stories from first-generation college graduatesâ€"and students who will beâ€"to inspire the next generation of students who will be first. The I’m First web application will feature tools and resources to help aspiring first-generation college students and their supporters take the steps necessary to pursue and succeed in college.

Logrado by Mission Control Center â€" Logrado is a social-mobile guidance system to support students in accessing, persisting in and completing college. Students use their mobile phone or Facebook to access interactive missions that guide them through critical steps in preparing for college. Missions leverage Facebook as students collaborate with peers and form personal success teams of family, mentors and friends for encouragement. Logrado enables schools and college access programs to improve the quality and scale of guidance, communication and individualized support for low-income and first generation students.

PossibilityU by Cambium Enterprises â€" PossibilityU is an online program designed to help students find the college that fits â€" academically, socially and financially. Its blended learning curriculum and data driven tools are designed to give context to the $1 Million decision that each high school student makes, often with less than 1 hour of individual guidance. The company uses technology to personalize each students search, to visualize important trade-offs in the process, and to persuade them to stay on time/on track.

Raise by Raise Labs â€" Raise Labs is rethinking how college scholarships are accessed and distributed, particularly for low-income and first-generation college students. The Raise platform enables high school students to earn “micro-scholarships” towards college starting in 9th grade based on their individual achievements and progress towards graduation. Raise helps students pursue their college ambitions with confidence and adds transparency to the scholarships process.

Step2College â€" Step2College aims to make the college-going process more transparent, cooperative and easier to navigate for all students, and particularly for underprivileged youth. We will build an app that provides a comprehensive and resource-rich list of college readiness tasks which are specific and personalized to the user’s needs, including state-specific requirements. Our app will leverage social media platforms such as Facebook so students can publish the completion of their tasks, connect with friends and access additional functions.

Transfer Bootcamp by The Melville Institute â€" Transfer Bootcamp is an online guidance application for students seeking to transfer from community college to a four-year university. We build a plan for each student to help them identify their unique goals, graduate from community college on time, select the right courses for transfer and to better understand their financial aid options. Transfer Bootcamp will eliminate the confusion of community college transfer and make higher-education accessible for millions of students.

What’s Your Road by Roadtrip Nation â€" Roadtrip Nation started in 2001 when a group of friends took a Roadtrip with this simple idea: talk to people who do what they love, and you’ll get a better understanding of how to build a life you love. What started as a Roadtrip sparked a documentary series, live campus events, a video archive of hundreds of interviews, and most recently, curricula and resources to help at-risk students in disadvantaged communities gain access and exposure to life pathways. Roadtrip Nation’s latest endeavor, “What’s Your Road?”, is a virtual roadtrip experience (in Facebook) where youth explore pathways aligned with their aspirations and connect with mentors in those fields.

Zombie College by Get Schooled â€" Get Schooled is a non-profit that engages and motivates students using the media, technology and popular culture integral to their lives. It has designed Zombie College, an app that will be as entertaining as it is educational. The game has a low barrier to entry â€" no complex instructions â€" and is played in short bursts. The twist? The Zombie College game map is the college going map. Students will continually play the game because it is an “addicting game”, while internalizing the key steps to go to college.

U.S. Online Reputation Management Firm Reputation.com Acquires U.K.’s Reputation 24/7 To Expand Internationally — Will Invest “Millions” In U.K. Operation

Call it a digital dark art but there’s apparently a growing market for companies that sell services to help individuals and businesses improve their online reputation by removing or burying negative bits and bytes. Redwood City-based online reputation management and digital privacy company Reputation.com has announced it’s acquired Liverpool, U.K.-based Reputation 24/7 to bolster its international business â€" which is active in more than 100 countries. Terms of the deal were not disclosed. Reputation 24/7 has been rebranded Reputation.com (U.K.) and will sell Reputation.com’s suite of consumer and business online reputation management offerings to European customers.

“With this acquisition, Reputation.com is expanding Silicon Valley to the United Kingdom and opening the door to a strong market for future growth,” said CEO and Founder Michael Fertik in a statement.  “Reputation 24/7 exemplifies the best of the U.K.’s robust tech industry and its capabilities align nicely with our core strengths.  This acquisition supports our growing international presence, which includes customers in more than 100 countries.”

Reputation.com said it plans to invest significantly in the Liverpool-based operation, using it as its European headquarters. A company spokeswoman told TechCrunch it would be investing “millions [GBP] over the next year to support the UK branch’s expansion â€" in both capabilities and hiring”.

Fertik also told Liverpool’s Daily Post newspaper that he had chosen to base Reputation.com’s European HQ in Liverpool ahead of London and Germany because of the quality of the city’s workforce and universities. ”The other great thing about Liverpool is that Liverpool people want to stay in  Liverpool. That gives us a stable workforce, and that’s a terrific resource for a company like  ours,” he added.

Reputation.com, which says it has patented “solutions that safeguard and remove personal data from the Internet, monitor and respond to online reviews, build a positive and accurate Web presence for clients, and help businesses proactively engage customers” describes online reputation management as “removing or burying any website, online newspaper article, blog, forum or review which does not represent our client as positively as they deserve”, and cites the following among its past successes:

• DEFENDED: Search suggestions presented when searching this client’s brand highlighted recent regulatory announcements.
• DEFENDED: A disgruntled ex-employee of our client had been posting malicious comments online for several years.
• DEFENDED: One dissatisfied customer in 1000’s created a hate-site dedicated to a Reputation.com client’s business.
• DEFENDED: News of the World story appearing in search results for our client’s brand.

Full release follows below.

Reputation.com Acquires U.K. Online Reputation Management Leader
Acquisition Supports Company’s Customer Base of Global 2000 Corporations and More Than a Million Consumers In Over 100 Countries

REDWOOD CITY, Calif., Jan. 29, 2013 /PRNewswire/ â€" Reputation.com, the market and technology leader in online reputation management and digital privacy, announced its global expansion with the acquisition of Reputation 24/7, a United Kingdom-based online reputation management firm.

“With this acquisition, Reputation.com is expanding Silicon Valley to the United Kingdom and opening the door to a strong market for future growth,” said CEO and Founder Michael Fertik.  “Reputation 24/7 exemplifies the best of the U.K.’s robust tech industry and its capabilities align nicely with our core strengths.  This acquisition supports our growing international presence, which includes customers in more than 100 countries.”

Now known as Reputation.com (U.K.), the former Reputation 24/7 will offer Reputation.com’s suite of consumer and business-focused online reputation and social media management solutions to European customers.  Reputation.com will also invest in the U.K. operation, enabling it to grow significantly over the next year.

“As a global company, we’ll continue the mission we adopted since Reputation.com’s inception in 2006: to empower individuals and businesses with innovation that supports digital privacy and online reputation management,” said Fertik.

Reputation.com’s business products enable both small and medium businesses as well as FTSE 100 companies to manage their online reputations, including monitoring online review sites and social media outlets, analyzing content to understand customer perception trends, and creating customized outreach campaigns.  Customers can also use Reputation.com’s patented scoring technology to obtain their reputation scores, which show how a business measures up against local and national competitors in the eyes of their customers.

Reputation.com also offers consumer-focused solutions that empower individuals to manage all aspects of their online reputation, from removing personally identifiable information, to monitoring social media photos and content to optimizing their search results.

About Reputation.com

Reputation.com was founded in 2006 to give individuals and businesses the power to control their digital privacy and reputation.  The company continues to pioneer patented solutions that safeguard and remove personal data from the Internet, monitor and respond to online reviews, build a positive and accurate Web presence for clients, and help businesses proactively engage customers.

Reputation.com is a World Economic Forum Global Growth Company and multiple award winner, including the recent Silver for the Best in Biz Awards for “Most Customer Friendly Company” in 2012.  It is funded by top-tier venture capital firms and has customers in 100 countries.

Reputation 24/7 offer industry leading online reputation management services. Our clients benefit from our range of innovative services. We bury negative online news, forums, blog and customer review site content allowing businesses to regain control of the most valuable asset they have: reputation. Other services: Online Reputation and Brand Monitoring Reputation Management Online PR and PR services. Specialties Reputation Management, Online Defamation, Online Reputation Management, ORM, Hebrew Reputation Management, Swedish Reputation Management, Spanish Reputation Management

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Reputation.com helps businesses and consumers control their online lives. By expanding the scope of available information, the Internet has altered the concept of privacy. The proliferation of blogs, online forums, and social media has created a space for exchanges of information between individuals across the globe. While readers often take what they find seriously, such content should not always be considered at face value. With the backing of Kleiner Perkins, Bessemer, and Jafco, Reputation.com primed an industry focused on providing individuals...

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NewVoiceMedia Takes $20M Led By Highland Capital, MMC To Build Contact Centers In The Clouds

NewVoiceMedia, an enterprise startup riding the wave of cloud-based services, has raised $20 million for its business of contact center solutions, which currently serves 8,000 agents in 30 countries. The Series B round was led by Highland Capital Partners and MMC, with participation from existing investors Eden Ventures and Notion Capital, and brings the total funding for NVM to $26.3 million.

NVM’s CEO Jonathan Gale says that the new investment will be used to help the UK-based company expand further into the U.S., as well as product development in workforce optimization and multi-channel solutions.

The company already sells products for marketing, sales, service desks and other operating divisions; and it also targets home workers and small businesses through to larger enterprises. The goal with new product development is to combine functionalities to meet how businesses run themselves, and also to ensure that its products remain cost-effective. “They are likely to have invested in a CRM and are looking to maximise that investment by integrating additional services,” notes Gale.

But that’s not to belittle the amount of investment needed to crack the U.S. â€" a must-have market for any serious enterprise tech startup, in the mind of Laurence Garrett, the Highland partner who will be joining NVM’s board. “It is really tough for European companies to do America properly and correctly,” he noted.

The enterprise market for cloud services has been in the ascendent for some time now, with investors like Andreessen Horowitz putting tens of millions of dollars, and a lot of consideration, into backing startups that tackle the space from disruptive angles. While there may always be a public appetite for hearing about the latest and coolest consumer tech service, the enterprise startups often fly a little lower but can be just as revolutionary and game-changing in what they ultimately achieve.

NVM’s disruptive angle is in the area of contact centers, specifically replicating â€" for a fraction of the price â€" the offerings based on costly customer premises equipment that helps customer service teams route calls, offer automated responses and integrate live responses with customer record access.

NVM’s business comes from two directions: The first is the larger enterprise looking to cut down operational expenditures, choosing to leave CPE behind in its next upgrade cycle in favor of lower-cost cloud solutions. The second is the smaller company that never had the scale to invest in physical contact center solutions before but is now able to consider less-expensive, more flexible customer service options in the cloud.

NVM is not the only company tackling this area. Cloud competitors include Five9, Contactual and Interactive Intelligence; and of course on-premise companies like Genesys, Avaya and Aspect are also trying hard to remain in the game. Gale notes that NVM stands apart because of its heavy investment in “the security, availability and performance aspects of its service,” with the status of these played out in real time on a public trust site.

With a lot of cloud services competing on price â€" NVM’s offering starts at $47 per agent per month for a minimum of five agents and one supervisor â€" cloud companies longer term may seek bigger margins and more multi-channel efficiency by way of consolidation. But for now NVM has continued to make itself as adaptable as possible, with native integration with Salesforce among its features.

“The objective is not to address the agent desktop market directly, but to integrate seamlessly with it bringing voice, chat, email and social channels to the desktop through intelligent queueing and routing,” notes Gale. “Couple this with management reporting, analytics and management tools (like workforce optimisation) and that represents a multi-billion-dollar market opportunity annually.”

For Highland, the decision to invest was influenced in part by the leadership at NVM: one of Gale’s past roles was as VP of business development at MessageLabs before it was sold to Symantec for $695 million. “He really understands the software-as-a-service business model,” notes Laurence Garrett, a partner at Highland who will be joining NVM’s board. “At NVM, he’s taken a great business and made it better.”

The company now is seeing year-on-year growth of 200 percent, as well as an annual run rate of over $15 million, with customers like Parcelforce, PhotoBox, QlikTech and SHL showing that the company can “grow well on modest capital,” Garrett says. “Once we see that criteria met for a European startup, we get excited.”

NewVoiceMedia helps businesses of all sizes to remove the frustrations of poor call handling, at an affordable cost.Smaller businesses can take advantage of a sophisticated telephony solution that identifies callers, prioritises and routes them effectively. Larger companies operating a call centre can take advantage of a more flexible system that doesn’t require specialist expertise or months of time to implement or adapt. NewVoiceMedia’s telephony solution is delivered using cloud-based technology, which provides the functionality of an on-premise solution at a fraction of the price. NewVoiceMedia’s customers include Berry Bros....

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Highland Capital Partners was founded with the mission of helping great people build great companies. For twenty years, the firm has taken a sector-focused approach to investing in exceptional seed through later stage growth companies in the healthcare, internet & digital media and technology markets. Highland actively seeks to provide the right mix of strategic guidance, hands-on leadership and deep industry domain expertise for helping entrepreneurs and their teams become market-leading organizations. With over $3 billion of committed capital...

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MMC Ventures invests in UK growth companies, particularly in business services and technology (including cleantech and media). With £78m under management (as at October 2010), including a £30 million committed Enterprise Capital Fund, MMC puts c.£8-10 million to work each year. MMC also has a Syndicate of experienced private investors who invest alongside the managed funds. MMC addresses the equity gap in the UK with initial investments of between £500,000 and £2 million. As an active investor MMC works in...

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Truth, Money, Right, Wrong

Yesterday I wrote about the ongoing CNET editorial independence issue. I said that the editors and journalists at CNET were part of the problem, and suggested that they either publish their (assumed) dissent, or resign, or both.

A conversation began in the comments of that post, with some people saying that it isn’t reasonable to expect people to resign.

From Danny Sullivan:

I think a lot of CNET staffers probably aren’t resigning, Mike, because they have families to support, as well as themselves. It’s not exactly a great economy out there. I think what Greg did was very brave, but not everyone is that brave nor even able to make that type of move.

Rof Hof:

I don’t blame people in today’s publishing business for wanting to line up work first. Not everybody can be sure of being able to support their families, and when they’ve been screwed by their employer, they shouldn’t be expected to *immediately* screw themselves too. But don’t be surprised to see more leaving.

There were similar comments on Twitter. These comments were often combined with statements my position wasn’t valid because I have made some money selling my business.

As just one example, David Carnoy, Executive Editor at CNET, says:

@arrington In your post about @CNET you neglected to disclose $$$ you made from selling out to AOL. Easy to walk when you had your BIG EXIT.

And finally, some people have said that it’s only reasonable for people to resign if they have another job lined up.

Hunter Walk, in a comment to the original post, says:

Let’s see other journalists stand with their brethren and start a “free the CNET staffers” fund that can be tapped by any CNET journalist who wants to walk away but needs the money to do so. Mike, I’ll match up to the first $500 of your contribution

I think some of these are valid points and worth exploring.

First, sure it’s easy for me to say they should just quit their jobs when I’m not the one doing it and I may have more financial security than most or all of them. If I worked at CNET, had a family to take care of and had little financial breathing room I cannot say for certain that I’d resign. My family would certainly come first (and second, and third). It’s a fair point.

Second, I agree that it would certainly be easier for CNET people to resign if they knew that they had another job waiting for them.

Still, I think there are some profound issues to think through that drive to the core of what it means to be a journalist, and these issues are worth exploring.

What does it mean to be a journalist? If I have bias here, it isn’t in net worth. It’s that I don’t respect what I’ve called the Priesthood of Journalism. Journalists hold themselves apart, and above, the common person. They have rules designed to ensure their objectivity and impartiality.

Among those rules â€" “Be vigilant and courageous about holding those with power accountable.”

It doesn’t say “unless you report to them,” or “unless you might lose your job.”

No, journalists hold themselves to a higher standard. Situations like CNET are exactly what journalists are supposed to fight. That’s why we entrust them as the fourth estate.

Is the pushback here because we’re just talking about tech press and not real press? What if someone at the New York Times was under express orders not to write about a political or financial scandal? Would we say it’s ok if they were at risk of losing their job and maybe not being able to pay their mortgage? Hell no, we’d consider that reporter as part of the overall conspiracy. “Just following orders” doesn’t cut it there, and the tech press should hold themselves to those same standards.

Journalists are supposed to put the people first, even before themselves. Around the world and throughout history journalists have died to get the truth out. We’re not talking about losing a job and having trouble paying the bills. We’re talking about things like having your head removed from your body.

Of course covering the latest tech gadgets isn’t quite the same thing as covering a bloody civil war. It’s not as important, or dangerous. But there is still quite clearly a principle at stake here. If a tech journalist needs financial security before doing what their conscience dictates, I’m not sure they should be calling themselves journalists at all.

Would it be ok for a CNET reporter to take a bribe to cover or not cover a certain product? Or what if CBS said “in appreciation of you not leaving after this debacle we want to give you all a 10% spot bonus.” Would that be ok? But what if they really need that bribe or spot bonus? What if they have a sick kid and can’t pay the hospital bills? Is it ok then?

To me, every paycheck a CNET reporter receives from here on out is just a bribe. A bribe that they are accepting in exchange for putting up with CBS telling them what they can and cannot say. By staying they are making it easier for companies to do evil in the future.

“It comes down to *why* we do this job. Do we have a burning passion to report the truth, or simply a desire to eat?” â€" Lee Hutchinson

So to end this I’ll say this. I don’t think CNET reporters are bad people for not quitting, and I quite understand that some of them may not be in any kind of financial position to even consider it. But as this crisis passes, perhaps those that couldn’t make that hard decision should consider if, over the long run, they should continue to call themselves journalists. Perhaps a new line of work, one where the public isn’t relying on them, is a better choice.

Unlocking Your Phone Is Now Illegal, But What Does That Mean For You?

All the salacious headlines are (mostly) true â€" as of today, you can’t unlock a carrier-subsidized smartphone on your own before the contract associated with it runs out without technically running afoul of the Digital Millennium Copyright Act. Granted, I’d wager that the number of people who faithfully stick to their multi-year wireless contracts far exceeds the number of people who would unlock their phones and bail, but this is still a damned lousy turn of events for all you proponents of phone freedom out there (myself included).

But how did this actually happen? To more clearly understand the change that went into effect today, we have to flash back to the heady days of 2010.

In late July of that year, the Electronic Frontier Foundation announced on its blog that it had won three big exemptions to the DMCA. One of them dealt with the legality of using copyrighted footage from DVDs for noncommercial works of “criticism or comment,” but yet another exemption made it legal to jailbreak a phone, and the final was actually the renewal of an existing exemption for (you guessed it) unlocking phones for use on other networks.

Everything was copacetic until this past October, when the U.S. Copyright Office and the Librarian of Congress spent time reviewing some of those exceptions made to the DMCA. Geekier endeavors like jailbreaking or rooting your devices are still totally kosher, but after extensive review the original exemption for unlocking phones was overturned, noting the ability for users to unlock their own phones for use on other networks just wasn’t necessary anymore given the perceived ease of obtaining either a pre-unlocked phone or a carrier-sanctioned way to unlock one:

The [Register of Copyrights] concluded after a review of the statutory factors that an exemption to the prohibition on circumvention of mobile phone computer programs to permit users to unlock “legacy” phones is both warranted and unlikely to harm the market for such programs.

At the same time, in light of carriers’ current unlocking policies and the ready availability of new unlocked phones in the marketplace, the record did not support an exemption for newly purchased phones.

The decision goes on to say that, considering “precedents in copyright law,” a 90 day transitional period would be allowed so people would have time to unlock their phones before the exemption kicked in. That period has just run out.

The full text of the Librarian’s report can be found here (the section on unlocking starts on page 16), and after taking a few moments to glance through it, the amount of lobbying and discussion that went into the process of drawing a conclusion is pretty amazing. As you might expect, one of the most vocal proponents of axing the exemption was the CTIA, a wireless trade group that counts every major U.S. wireless carrier (not to mention a whole host of others) among its members. It’s no shock to see the CTIA â€" and, by extension, the carriers â€" get a little worked up over this.

You see, shelling out a mere $99 and signing a piece of paper may seem like a trivial action for the person actually doing it, but the carriers view the situation a little differently. They sell those phones with hefty subsidies in hopes that they’ll make up the difference (and then some) over the two years a customer is contractually bound. In this case, the CTIA’s argument basically boils down one of money: “the practice of locking cell phones is an essential part of the wireless industry’s predominant business model.” Put another way, unlocking a phone can be considered one of the first steps in jamming up a carrier’s revenue stream, and they certainly don’t want that happening too often. In this case, carriers get some additional protection without inconveniencing their customers en masse â€" not a bad deal for them.

So yes, unlocking your phone without your carrier’s explicit approval is technically verboten. But let’s not forget what this particular change doesn’t mean â€" the police most likely aren’t going to knock down your door because you felt the compulsion to free your phone from your carrier’s shackles. It also doesn’t mean that the stash of old phones nestled in your drawer can’t be unlocked â€" so-called “legacy” devices are exempt from silly change, so feel free to take your old phones and show them a little bit of freedom. You can still buy unlocked phones from eBay and Amazon like you always could, and hey, some phones sold by carriers are unlocked right out of the box anyway.

But all those caveats raise an even weightier question: what will actually happen if you unlock your phone? For now, it’s the sort of question that comes without any clear answers â€" if anyone, it’s the carriers who have the ability to detect and crack down on unsanctioned unlocked phones, but so far none of them seem very keen on addressing the matter. I’ve reached out to representatives from AT&T and T-Mobile, the two most prominent GSM carriers in the country (and therefore the two carriers that are mostly likely to deal with the issue of unlocked phones) and asked what would happen if either carrier had determined that one of their customers had illicitly unlocked their phone.

Surprise, surprise â€" I was met with canned responses and unsatisfying non-answers at every turn. It seems they’re angling to keep that particular card close to their chests for now. What’s also unclear is whether or not intrepid unlockers (and the folks that make unlocking tools and services) will soon face any legal ramifications. Electronic Frontier Foundation lawyer Mitch Stoltz told Engadget earlier today that the U.S. Copyright Office is “taking away a shield that unlockers could use in court if they get sued.”

The key word in that sentence is “if” â€" while I doubt we’ll be hearing about many unlocking-related lawsuits in the weeks and months to come, there’s little denying that this turn of events has left more than a few people wondering about what it really means to purchase and own something. Some have already made their discontent known; a We The People petition imploring the Librarian of Congress to rescind the decision has already made the rounds on Reddit and Hacker News, and racked up nearly 15,000 signatures in two days.

UPDATE: To its credit, the CTIA has painted a clearer picture of the potential legal penalties of unlocking a phone on its official blog. Sadly, those penalties aren’t inconsequential:

Civil penalties are based on the carrier’s actual damages and any additional profits of the violator, or a court can award statutory damages of not less than $200 or more than $2,500 per individual act. Criminal penalties are even more severe: any person convicted of violating section 1201 willfully and for purposes of commercial advantage or private financial gain (1) shall be fined not more than $500,000 or imprisoned for not more than 5 years, or both, for the first offense; and (2) shall be fined not more than $1,000,000 or imprisoned for not more than 10 years, or both, for any subsequent offense.

Marc Andreessen On The Future Of Enterprise

In doing research for a post on “The Enterprise Cool Kids” at the tail end of last year, I interviewed Silicon Valley veteran Marc Andreessen about where he thought the enterprise was headed.

While excerpts of that interview made it into the post, the transcript of the entire interview was so good it deserved to be published in its entirety.

************************

Alexia Tsotsis: Since people like me (millennials) are putting pressure on our IT departments to buy products that we can actually use and aren’t blinded by, what do you think the enterprise space will look like in the next five years?

Marc Andreessen: Yeah. So let me maybe start with sort of â€" top-down and bottoms-up is how we think about it, because both are important â€" so let me start with historical context and then maybe go to the stuff happening right now. Is that all set?

Alexia Tsotsis: Yeah, it’s perfect.

Marc Andreessen: So the computer industry started in 1950 and basically ran for 50 years with the same model, which was a model where all of the new computers, all the new technology, all the new software started out being sold for the highest prices to the biggest organizations.

So originally the customer was the Department of Defense. It was the first customer for the computer. In fact, one of the big first computers was called SAGE, which was a missile defense, the first missile-defense computer, which was like one of the first computers in the history of the world which got sold to the Department of Defense for, I don’t know, tens and tens of millions of dollars at the time. Maybe hundreds of millions of dollars in current dollars.

And then five years later computers became â€" they dropped half in price and then the big insurance companies could buy them, and that’s when Thomas Watson, who ran IBM at the time, was quoted as saying, “There’s only a market need in the world for five computers.”

The reason that wasn’t crazy when he said it is because there were only five organizations that were big enough to buy a computer. So that’s how it started. And then IBM came along and productized the mainframe, and then all of a sudden big normal companies â€" manufacturing companies and banks â€" could start to buy computers. And then DEC came along and came out with the minicomputer, and then all of a sudden smaller companies could start to buy computers. And then the PC came out and then all of a sudden individuals could start to buy computers. But the PC only ever got to hundreds of millions of people. It never got to billions of people.

Now, the smartphone has come out and it can get to billions of people.

And so it has always been this kind of trickle-down model for 50 years. We think that basically about 10 years ago the model flipped. And so we think that the model flipped to a model where, today, where the most interesting and advanced new technology now comes out for the consumer first. And then small businesses start to use it. And then medium-size businesses start to use it, and then large businesses start to use it, and then eventually the government starts to use it. But this is a complete change from the way it has always worked.

Alexia Tsotsis: It’s grassroots versus trickle-down.

Marc Andreessen: Versus trickle-down. And the reason is because â€" the reason fundamentally is because now that you have got these things, you have â€" now that you have a computer in everybody’s hand, all of a sudden all these barriers â€" it used to be these barriers to market entry were so big, it used to be there just weren’t that many early adopters in the world. To bring out a new technology for consumers first, you just had a very long road to go down to try to find people who actually would pay money for something.

And now all of a sudden you have got this global market of all these early adopters that have smartphones connected to the Internet, and they can just pick up their things and run with them.

And of course consumers can make buying decisions much more quickly than businesses can, because for the consumer, they either like it or they don’t, whereas businesses have to go through these long and involved processes.

So that’s the big, big, big change that’s happened. And that’s been reflected in the entrepreneurial community, where entrepreneurs, especially between 2000 and 2008, entrepreneurs really only wanted to do â€" for the most part wanted to do consumer software, because that’s the only software that they could actually get anybody to adopt. It became very hard to get businesses to adopt new stuff.

In the last five years, there’s been this sort of acknowledgment of the consumerization of the enterprise, which is consumer product development, design methods applied to business software, of which SaaS and cloud and all these things are examples. Salesforce.com, Evernote is an example. So now you have got the rise of this new set of companies that are sort of consumerized technology for businesses.

Then from a bottoms-up standpoint what you said is exactly right, I think, which is that the new generation of employees grew up on smartphones and tablets and touch and everything, social networking and Twitter and everything else. And so if you take a typical mainframe or, even these days, PC-based system and you give it to a 22-year-old college graduate, it’s like beaming in products out of the Stone Age. Why would you do that? Why would you force people to use all this old stuff?

And then that leads to the big thing that’s starting to happen right now, which is this “Bring Your Own Device” movement, where more and more companies are saying, well, basically, if I have to support smartphones and tablets anyway, and my CFO is probably carrying around an iPad and all my new employees are coming in with iPhones, so I have already got to support this stuff, so then I might as well encourage it.

And I might as well basically have a model where instead of issuing a company laptop to everybody or even a company phone, why don’t I just let people bring in whatever device they want and just plug-in and access it.

And then they get all excited, because then they say, well, not only are my employees going to be happier and more productive, but then I don’t have to buy them hardware anymore, so I can cut my budget. So that’s the big thing that’s starting to happen right now.

Alexia Tsotsis: So how does it affect the way people are building? I have about five companies that have made this list. Some of them are yours â€" Okta, which is big on the Bring Your Own Device thing, because you are logging in through Okta. Okta, Cloudera, Box, GitHub, Zendesk, and Asana. Are there any that I have missed?

Marc Andreessen: We just invested in this company called ItsOn, that we announced yesterday.

Alexia Tsotsis: Oh, the mobile â€"

Marc Andreessen: The mobile billing. The advantage â€" the thing that that’s going to be able to do is do split billing in a new way, between the business and the consumer. So on a single device you will be able to cleanly build data usage by application. So your employer can pay for your Salesforce.com and your Workday data usage on your phone and you get to pay for your Facebook and your Hulu usage. So that will be another enabler for a lot more of the Bring Your Own Device stuff.

Marc Andreessen: We have a bunch of stealth investments. I mean, this is a big, big thing â€" big change for us, so we have a bunch of stealth investments â€" I mean, companies that haven’t talked about what they are doing yet.

Who else? I mean, there is a bunch, who else should we have â€"

Alexia Tsotsis: Platfora.

Marc Andreessen: What’s that, Platfora? Yeah, Platfora is the actual user interface layer on top of Hadoop. So sort of Platfora and Cloudera kind of go hand in hand.

Actually â€" we have another one actually that is â€" well, it sounds esoteric, but it actually is very relevant. We have a company called Tidemark, which is in a category. It’s called Enterprise Performance Management, which is kind of a weird term. It’s basically large-scale financial planning and analysis for big companies.

The significance is it has a â€" I believe it only â€" I don’t know if it only or primarily, but I think it only has an iPad UI. So it’s the first complex financial system for big companies, where the assumption is that the user is on an iPad.

That’s a really big deal, because that category of software, line managers and businesses have never actually used that software themselves. Instead they employ analysts to use the software who become highly trained on the software.

By putting the iPad UI all of a sudden you can have anybody in the business have access to all the financial analysis and planning. Even in a very deep sort of sector of enterprise software where most people would never see it, this change is having a big impact.

What else? Asana you mentioned.

Alexia Tsotsis: Asana, Box, Zendesk, these are the companies that I am assuming I will be using four years from now to run my business.

Marc Andreessen: Yeah, exactly! Exactly right! Then of course Workday, of course, Salesforce.com, of course NetSuite, 37signals. We probably have three or four others in our portfolio that I am blanking on, but yeah, this is sort of the â€" and then by the way, the corresponding thing is that a lot of this is on how you run a business and then how you do marketing, of course; AdWords and Facebook and Twitter, all these systems and then all the enabling systems for that; so HootSuite and Marketo and â€"

Alexia Tsotsis: GoodData.

Marc Andreessen: Oh, another one, GoodData. So GoodData is at the intersection of kind of marketing and business. So GoodData is an actual easy-to-use analytics package. It’s sort of like a supercharged version of Excel that lets you suck in data, you can suck in all your Facebook advertising campaigns, you can suck in all your Salesforce.com data, and you can run â€" you can actually, yourself, as a small business person, actually analyze and find friends and data.

Alexia Tsotsis: I have heard good things about them and they just sent us a guest post. 

Marc Andreessen: They are very good. So then you add up all these companies and you are like, “Well, okay, so number one, they are all basically new companies. I think who is not on that list are all the existing companies that sell business software.”

Alexia Tsotsis: SAP, Oracle … I mean I wrote a post about this that was supremely misunderstood and then today SAP came out with SAP Jam, which is a competitor to Yammer and to Salesforce, but it’s their own socialized CRM, like HR management software. I worry about this because it’s not going to work. You can’t fight the future.

Marc Andreessen: Oh, right, right, right. I mean, the joke about SAP has always been, it’s making 50s German manufacturing methodology, implemented in 1960s software technology, delivered to 1970-style manufacturing organizations, like it’s really â€" yeah, the incumbency â€" they are still the lingering hangover from the dot-com crash.

So a lot of incumbent business software companies did what a lot of big companies actually did and other industries, media companies after the dot-com crash, which is they said, “Oh, thank God we don’t have to worry about this Internet thing. It’s over. Stick a fork in it. It’s not going to be a big deal.” And then it turned out that it actually wasn’t over, and they still haven’t adjusted.

Alexia Tsotsis: Yes, and we are watching that now. And so the other reason that I am very interested in delving deep into this space is that it seems like IPOs like Workday, Palo Alto Networks are sort of â€" they have metrics and analytics that Wall Street understands, more so than a Facebook; like “We are going to sell X number of this in the next year.” So it would seem like they are an antidote to, or at least less offensive than, social/consumer Internet companies are to the public markets.

Marc Andreessen: For now. The whole market goes back and forth in whether they prefer enterprise businesses or consumer businesses. The argument in favor of consumer businesses is you don’t have these crazy end of quarters like when the IT purchasing manager doesn’t buy the product and the company misses the whole quarter.

The advantage of the consumer businesses is they tend to be much broader-based, much larger number of customers, that tend to over time be a lot more predictable. The advantage of the enterprise companies is they are not as subject to consumer trend, fad, behavior.

But I would say the market is schizophrenic. So right now we are in an era where the market wants enterprise companies. I am just saying like wait a year, that will flip again; wait another year after that, that will flip again.

It’s sort of the picks and shovels thing. Like everybody â€" it’s like the consumer businesses get really hot and then everybody realizes that there is lots of competition and that those models have â€" they are complicated businesses and they have their issues, and then everybody gets all excited about picks and shovels.

And everybody rediscovers the picks and shovels analogy and says, ” Oh, the Gold Rush in California, the people that made all the money were the guys who were selling picks and shovels to the prospectors.” And then people realize the picks and shovels business is really hard, and then everybody says, “Oh, we should invest in the consumer company because they” â€" so it’s just â€"

Alexia Tsotsis: It’s cyclical.

Marc Andreessen: It’s cyclical. It’s deeply cyclical. But we are in an environment right now, to your point, where there has been huge rotation out of the consumer companies into the enterprise companies.

Alexia Tsotsis: It seems like the consumer market is starting to cool â€" I mean, not starting, but the signaling is there.

Marc Andreessen: Yeah. It’s unpredictable. All you need is for one of the new enterprise companies to completely whiff a quarter and their stock will collapse and then everybody will get all freaked out. I mean, it’s just a continuous â€" the reality is every single business is hard.

Alexia Tsotsis: I love this.

Marc Andreessen: There are no easy businesses in the world other than maybe Google, but other than that, there is no easy business anywhere in the world. So what happens is Wall Street gets enamored by the businesses that look like they are easy, until it turns out that they are not, and then Wall Street gets disillusioned and freaked out, and then rotates into the businesses that they think are going to be easy, and then they get endless disappointment. It’s like a seventh or eighth marriage at some point.

At some point the problem isn’t with your seventh wife. At some point the problem is with you.

Alexia Tsotsis: Is the solution “keep calm and carry on,” or what is the solution to this?

Marc Andreessen: There is no solution; it’s a permanent state of affairs. So this is a big part of what actually we do. A big part of why venture capital actually is important and enduring is because the public market is flighty and late-stage investors are flighty, and customers for that matter are flighty, and so you can’t â€" if you are running one of these companies you can’t â€" you just can’t rely on people being balanced. They are just not going to be.

And so you have to have a level of determination to just stick through the good times and the bad times. And you need to have investors at the core of your company who are going to support you through that.

The big advantage that we have as a venture capital firm over a hedge fund or a mutual fund is we have a 13-year lockup on our money. And so enterprise can go in and out of fashion four different times, and we can go and invest in one of these companies, and it’s okay, because we can stay the course.

And then what happens is everything tends to get better, all the products tend to get better, all the companies tend to get better over time if they are working hard at it. So we are fine. Like if everything we are investing in goes out of fashion, we are not going to change anything we do, because we can’t change anything. We are already invested in these companies; we can’t sell our stock. We don’t have to sell our stock. So we just say, we will go back to work. And then at some point it really gets exciting again.

Alexia Tsotsis: I guess the trick is to be hyper-aware.

Marc Andreessen: So the big thing we try to do is be aware of the difference between the reality and the psychology, and the reality tends to progress in a certain way and then psychology tends to whip all over the place.

It was very educational for a lot of us to go through the dot-com crash, because you remember, in 2002, like there were a number of universal truths asserted in 2002; the Internet didn’t matter, consumer Internet business was dead. Larry Ellison in 2002 came out and gave a speech and said the correct model for enterprise software, enterprise computing, will last for 1,000 years.

He said all these kids that were trying all this new stuff and it didn’t work, and now we know it didn’t work, and so the model is going to be the existing IBM and Oracle for the next 1,000 years. And everybody kind of said, hmm, you know, that makes a lot of sense, like all that innovation stuff didn’t work, and so â€"

Alexia Tsotsis: That’s what David Sacks said.

Marc Andreessen: Exactly, this is the fact. People reach a point where they start to get a little bit too rich, maybe a little bit too old, and they start to say these things.

And then so here we sit 10 years later and we are in the middle of a complete reinvention of everything in enterprise computing, and it’s like, okay, like that’s the reality. People happen to be excited about it again at the moment. That’s great. I am happy for that. But wait two years and they will be depressed about it again, but that won’t keep it from happening. It will still happen.

Alexia Tsotsis: It’s just like the fashion industry. So because it’s heavily fashionable now, do you see it being over in a year?

Marc Andreessen: No, I don’t mean to make a specific prediction. I don’t know if it’s a year, two years, four years. Look, all of the products are going to keep getting better. All of the trends that we are talking about are going to keep continuing. Nothing is going to stop consumerization of the enterprise. Nothing is going to stop Bring Your Own Device. Nothing is going to stop Software-as-a-Service. Nothing is going to stop cloud. All those things are just going to keep going.

I am just saying people are going to be â€" they are all excited about them now. At some point again they will be unexcited about them and then at some point after that they will be excited about them again. So it’s hard to draw conclusions about the importance of the trends or the progress of the trends by the current level of press coverage, the current level of Wall Street enthusiasm.

Alexia Tsotsis: So beyond the press coverage, beyond the fickleness of trends, beyond the application layers â€" because most of those companies are just apps â€" what are the real opportunities you see in the enterprise stack as it stands right now?

Marc Andreessen: Well, there is a whole bunch. So there is a big thing â€" there are a couple of big things that are happening. So one of the really big things that’s happening is, historically the best enterprise technology was only â€" it’s a trickle-down thing â€" the best business technology was only ever available to the biggest companies.

And so if you were a Fortune 500 company with a big IT department, you had a huge advantage over a small business that was trying to compete with you, because you just had so much more budget and staff and professionals and expertise and access to all these big vendors and you could spend tens and millions of dollars on all this stuff.

So it was very easy for â€" in the old world it was very easy for big companies to use IT as a weapon against small companies.

The classic was Walmart versus local retailer, right? Walmart’s advantage in logistics and in pricing and in data analytics was just so great that they could kill small retailers at will.

Today all the consumerized enterprise stuff is as easily usable by the small business as it is by the large business. In fact, it’s probably more easily usable by the small business than it is by the large business, because with a small business it’s like you can just use it, like you don’t have to go through a long process, you don’t have to have a lot of meetings, you don’t have to have committees, you don’t have to have all this stuff, you can just start picking up and using it.

So the best technology for inventory management and for financial planning and for sales-force management and for online marketing can now be used just as easily or more easily by a small business. There is an opportunity here for a shift of the balance of power for big businesses to small businesses.

And then for vendors, the companies we fund, there’s an opportunity to really dramatically expand the market, because a company like Oracle, as successful as it is, it only really has about 5,000 customers that really matter worldwide. Whereas, a company like Box or a company like GitHub could have 500,000 customers or 5 million customers that really matter, and that’s a huge change.

So market expansion, small business versus big business, what else? Oh, the shift, the other big one, the shift from CAPEX to OPEX. So the shift from buying a lot of servers and databases and software licenses and networking equipment, the shift instead to just renting it all. So the shift towards cloud services.

So we don’t have â€" no company that we invest in anymore actually ever buys any hardware. I mean, they buy their laptops and that’s basically it. And increasingly they might not buy their laptops, because their employees will just bring their own devices. But they don’t buy servers. They don’t buy storage devices. They don’t buy any of this stuff, they just rent on AWS. And they don’t buy sales-force automation software, they rent on Salesforce.com.

And so having sort of a much lighter-touch way for businesses to be able to get funded, you just need a much smaller budget. And that’s why you see these â€" you see it in the startup world, you see three or four kids with laptops who are able to go do amazing things on a global scale for no money. And I think businesses are going to figure out more and more how to do that as well.

Alexia Tsotsis: Do you think that the biggest inefficiencies are at the network layer, the database layer, or the storage layer currently?

Marc Andreessen: All the above. They are all changing. I think they are all changing.

Alexia Tsotsis: What do you think about the interplay between the enterprise market becoming more efficient and the explosion of the consumer market because you don’t have to pay for something like storage?

Marc Andreessen: I don’t know, it’s sort of all intertwined. I mean it’s all â€" because a lot of what businesses do is then offer consumer services based on all these changes. So it’s kind of all â€" that’s why I say it’s kind of all happening at the same time, a lot of the same stuff.

I would say the consumer Internet companies â€" in a lot of ways if you go inside the consumer Internet companies and you see how they run, it’s how all their businesses are going to run. They are going to be doing all of the same kinds of things. The big businesses are just in the process of trying to figure out how to catch up.

So everything, Hadoop and scale-out architectures and cloud services, and the whole thing it’s all â€" and use of new technologies like Box and GitHub, the consumer Internet companies all are just built this way. And then if you go inside a big consumer product’s company or a big manufacturing company, they are all trying to figure out how to make the jump. But it’s all kind of the same stuff.

Alexia Tsotsis: So which of the big incumbents do you think are most likely to get disrupted by this new wave of the enterprise cool kids?

Marc Andreessen: Yeah, this is the part where I get into the most trouble.

Alexia Tsotsis: That’s why we save it for the end.

Marc Andreessen: Yeah, exactly! I don’t know if I am going to â€" let’s see, I am going to try and figure out if I am even going to answer the question.

So I would say for sure â€" like the systems companies, like the companies that provide hardware, the server companies and networking companies, the bad news for them is the end customers are not going to buy as much stuff; the good news is the cloud companies are buying a lot of stuff.

So for every server that’s not bought at a manufacturing company, there’s a server being bought at Amazon. So it’s a change in purchasing pattern for all the gear, but the gear is still being bought.

I think it’s at the software layer where the big disruption happens. I think it’s application software in particular and just sort of an extended infrastructure software. It’s like anything for which there is a â€" any piece of installed software for which there’s a web or a cloud equivalent, I think is in real trouble, and I think that’s just now becoming clear.

The other thing that’s happened is 2012 seems to be the year of the actual SaaS tipping point, like where big companies are now saying, you know what, it’s fine, like I can do it, I can do Salesforce, I can do Workday. Because there used to be lots of issues around can I trust the security issues or liability issues, and an awful lot of big companies are now saying, “You know what, I am going to save so much money, the service is going to be so much better, my users are going to be so much happier, more productive. I have got to make this stuff work on iPhones anyway, so I have got to do something new.”

“My old software vendors are charging me these huge upgrade and maintenance prices. I can switch to SaaS for less than the cost of the maintenance on the old software.” Like, at a certain point it becomes â€"”Oh,” and then on security it’s like, “Yeah, I may have concerns about SaaS security, but it turns out I have the concerns about my own internal security anyway.”

So every one of these companies has had an employee steal a laptop that has 25 million customer records on it, and they are like, “Well, okay, if I can’t even lock that down, then why am I that worried about whether somebody is going to break into Salesforce.com?” And by the way, Salesforce.com has gotten much better at security.

So there is a bunch of new technologies coming out that are going to make cloud and SaaS even more secure, and I think are going to end up making â€" I think cloud and SaaS are going to end up being a lot more secure than anything inside the firewall. So that’s the other thing that’s about to happen.

Alexia Tsotsis: So which enterprise companies are doing their best to adapt to just this tidal wave of trends and which ones are just completely failing?

Marc Andreessen: The problem is I have conflicts on this issue, because I am on the HP board in particular, so I can’t really â€" unfortunately I am kind of gagged on the topic of the big companies.

Alexia Tsotsis: Are you happy with how HP is doing?

Marc Andreessen: This is exactly what I can’t talk about. I just can’t talk about it. So the problem is I can’t talk about HP and I can’t talk about HP’s competitors, so it’s just a no-fly zone for me.

Alexia Tsotsis: I respect that.

Marc Andreessen: So I have to stick to the startups.

Alexia Tsotsis: Let’s see, what about other companies that aren’t in your portfolio?

Marc Andreessen: Although I have a lot of opinions. You mean startups?

Alexia Tsotsis: What about startups that aren’t in your portfolio, because you said that only 10, 15 companies a year are responsible for 97 percent of the returns. Which enterprise companies that aren’t in your portfolio are you interested in?

Marc Andreessen: So let’s see, there is this category of kind of outsourced work.

Alexia Tsotsis: TaskRabbit.

Marc Andreessen: Well, there’s TaskRabbit and Zaarly and companies like that on the consumer side; and then on the business side there’s eLance and oDesk and RentACoder. So these companies that are kind of for â€" in the sort of mechanical term, distributed workforces and outsource work being run online.

So like oDesk, oDesk you can actually have remote contractors working on a project, and one of the features is that it actually takes snapshots of their screen every five minutes. You can see if â€" anybody who actually manages anybody, number one that sounds spooky, but number two, “Wow, that sounds great, like, I sure wish I can do that.”

So there is sort of the whole category of an outsourced workforce that sort of â€" it goes back to what you said about the employees is, you will have â€" it feels a lot like in the new economy you will have a lot more contractors. You will have a lot more people with sort of fluid careers contracting on a project basis, and then all this technology is going to be an enabling layer for that.

So anybody on their laptop, anywhere in the world, being able to tap in and be able to get work and do work, whether it’s for small companies or big companies like that. There is a whole layer of software there. We haven’t seen anybody really punch through on that yet, but I am very fascinated by it. We haven’t made an investment there yet. That’s one layer.

Let me think, what else haven’t we done? I mean, Cloudera is I think a good â€" we haven’t actually done an investment at that. We haven’t done an investment at the Hadoop layer. We have done â€" Platfora is our investment, which is the intelligence layer above Hadoop, but Cloudera definitely deserves to be on the list.

Zendesk and kind of its generation of companies are definitely for real, or so it appears.

What else? We have been pretty active. I mean, we have been trying to take down mostly good companies. We haven’t done anything yet with this whole category of marketing, the new marketing software so like Marketo and HootSuite and companies like that, we haven’t really done anything yet, but that’s a big deal.

It’s sort of like â€" if you are starting a new company it’s so obvious that you would want to do most of your marketing on Google and Facebook and Twitter, whereas a lot of the existing companies still haven’t wrapped their heads around that.

Education â€" there is actually going to be more and more. So actually companies are going to get a lot more interested in education for two reasons.

Number one is, a lot of companies need to actually educate their customers or their partners, and a lot of that has to happen online.

And then the other thing is companies are having â€" if you talk to anybody running a company, they are having real trouble hiring enough qualified people. So companies are going to have to take a more direct role in educating the candidates or educating their current employees.

So the sort of model of employees just show up and they are either educated or they are not is not working very well. There’s lots of mismatches. It’s one of the reasons unemployment is running as high as it is, is people just don’t have the skills they need for the jobs.

So I think employers are going to have to get a lot more actively involved in making sure that the supply of candidates is actually educated and that they can hire somebody who doesn’t yet know what they need to know and actually educate and train them, and a lot of that is going to happen with the new technology.

So we have this company Udacity as an example, that’s going to be, I think, important in all of that.

Alexia Tsotsis: I think the model there is if someone shows up and they have got 80 percent of the skills.

Marc Andreessen: Yeah, let’s teach them â€" right, exactly, the employer says let’s teach them the other 20 percent. And it’s like, well, instead of literally sending them to college, which presumably didn’t work the first time around or whatever, let’s just go ahead and provide them with the online training. Let’s set them up with their tablet at home with high-definition video. They can develop their remaining skills, or be able to retrain people once they are in the jobs.

The other is there is this real issue, like for some people it feels great to never be tied to a specific employer and to always be doing contract work and be changing jobs every two years, and it feels like it’s fun and exciting and exhilarating. For a lot of people that’s really scary. And so the lifetime employment promise that the big companies used to be able to make was very compelling for a lot of people because it felt safe.

So now you are in a world where the big companies can’t deliver â€" even if they wanted to deliver on lifetime employment, they can’t, and so then they have got sort of two choices.

One is, do they start to basically be a lot rougher with their â€" they start to do a lot more layoffs, a lot more restructurings. I remember IBM â€" I don’t think IBM had a layoff for 50 years. And I was actually at IBM â€" I was an intern at IBM when they were ramping up for their first layoff I think they had ever done, and, like, the level of freak out in the company was beyond belief. And people had no idea what to do if they got laid off from IBM. And it turns out their skills weren’t actually very useful to work for any other company, because IBM was so unique in how it ran.

So I think the companies have a real question about how do they develop their workforces, how do they make sure that their employees stay relevant for the purpose of staying inside a company for a longer period of time? And then how do you get the workforce over time to be a lot more flexible and adaptable, so that if you have to layoff a ton of people, or if you have to get out of a line of business, or if you have to expand into a new business, how do you get your current employees to adapt better to that?

Alexia Tsotsis: Do you think that’s the most ripe-for-disruption area in the enterprise currently?

Marc Andreessen: I don’t know if it’s the most, but it’s a big issue for every company. It’s a big issue for companies, because companies have hundreds and thousands of employees, it’s like, yeah.

Alexia Tsotsis: What are the top three issues that startups don’t exist for yet, because that sounds like one that a startup doesn’t exist for …

Marc Andreessen: Sort of. Education is a big component of it, yeah, it’s possible, it’s possible. I don’t know. We will wait for the entrepreneurs to answer that question.

Alexia Tsotsis: Probably the biggest enterprise cool kid is GitHub?

Marc Andreessen: They are a big one, yeah.

Alexia Tsotsis: And you made a major investment?

Marc Andreessen: Yeah. We think it’s the largest investment ever done.

Alexia Tsotsis: How did you convince them to take your money?

Marc Andreessen: That’s the key thing. So they were beating off venture capitalists with a stick. So they actually â€" I don’t know if you remember this, they used to have on their website, they used to say â€" they had four metrics that they would put on their website. They had, I think, it was number of users, number of projects, number of code check-ins, and amount of venture capital that they had raised, and that final number was always zero, and they were really proud of that.

The GitHub guys did an amazing job. It’s very rare actually to find a main â€" it’s very rare to find an important company that never raised any money. It’s very rare that they actually successfully bootstrapped, because it’s just so hard to do if you can’t invest any money.

So what they did was incredibly impressive. They reached a point though where they decided that they had the opportunity to become a very big and important company. And again, I would say there was a top-down and a bottom-up reason for that.

The top-down reason was they are the place, we think, and they believe, they are the place where all the software code wants to live. They are the place where all the open source code increasingly lives. All other code increasingly uses a ton of open source code. And so all the software basically wants to be in the same place, and it wants to be in the place where all the open source software is.

So they have an opportunity to be the main company that provides the systems for developing software, number one, which is just a very big opportunity, and they really decided to go for it, and that requires investment on their part.

And then the bottom-up reason was because they have enterprise customers lining up, like they have enterprise customers bombarding them with interest in buying services on GitHub. And they did not have â€" at the time we invested they didn’t yet have any sort of sales or marketing kind of motion to be able to do it on. They didn’t have a Salesforce, they didn’t have the sort of pricing plans â€" the whole thing to be able to do that â€" and we have a lot of experience with that.

Alexia Tsotsis: So who are the enterprise companies and do they have â€"

Marc Andreessen: Tons, it’s like the who’s who. I mean, they gave us access. One of the things they did in the diligence process was they gave us access to the email box that had all the incoming messages from all the CIOs and purchasing managers and all these big companies. And it’s literally like, “Hi! I am from big bank X and we already have like 600 people on GitHub and we want to buy an enterprise license. Who do we call and where do we send the check?” And they just had the email queue up this, and they didn’t have â€" they weren’t â€" like it’s just sitting there.

And so we are working with them to help them build out the sales and marketing capability to be able to really go get all that business.

Alexia Tsotsis: And that’s how it will make a billion dollars a year?

Marc Andreessen: Yeah, yeah. Well, I don’t know, we will see how. I mean, aspirationally, yes. It should be a very big business. Historically companies in that market have been very successful. Big one, Rational is a big company that IBM bought a while back that’s in the same market.

And then even companies, Mercury Interactive was a big company that HP bought that was in a similar kind of market. And then in the old days you had companies like Borland and Lotus that were very big in these markets. So this is sort of the new version of all that. So if it works it should be very â€" I mean, it’s working, so it should be very big.

Alexia Tsotsis: So we are watching the collapse of Zynga and Groupon and LivingSocial in the consumer space. Where is the bloodbath going to be, if there is one, in the enterprise space?

Marc Andreessen: I don’t know. Probably in the second and third tier. I mean, usually when you have a funding boom, categories usually get overfunded.

So probably it’s in the second- and third-tier competitors. We actually get yelled at for this a lot, but we really believe it. So the big technology markets actually tend to be winner take all. There is this presumption â€" in normal markets you can have Pepsi and Coke. In technology markets in the long run you tend to only have one, or rather the number one company in â€" the number one company in any consumer products â€" cars, the number one company in cars is, I don’t know, Toyota or whoever it is.

Alexia Tsotsis: I think it’s Toyota.

Marc Andreessen: Fifteen percent or 18 percent market share. The number one soft drink has only 60 percent versus Pepsi, but like what is Coke as a percentage of all drinks, it’s, I don’t know, maybe 10 percent.

The big companies, though, in technology tend to have 90 percent market share. So we think that generally these are winner-take-all markets. Generally, number one is going to get like 90 percent of the profits. Number two is going to get like 10 percent of the profits, and numbers three through 10 are going to get nothing.

And the problem is, of course, there is too much venture capital, and so companies three through 10 still get funded. So there are probably lots of sort of second- and third-tier companies that are getting funded right now that won’t succeed, but that won’t have anything to do with whether or not the winner succeeds.

Alexia Tsotsis: Which is all the venture capitalists â€"

Marc Andreessen: Well, the venture capitalists who are successful in investing in the winners will be very happy with this. The venture capitalists who are investing in the losers will be very sad. But everybody will get freed, because at some point there will be a bunch of companies â€" a bunch of startups that will go bankrupt, and then everybody will say, that must mean the whole sector is going down.

I just think people get confused. People get confused about â€" it’s really funny watching the stock. Like the stock market does this all the time. It’s like one Internet advertising company will have a bad quarter and the other Internet advertising companies’ stocks will all drop.

Alexia Tsotsis: It’s tethered.

Marc Andreessen: Maybe, but maybe it’s because the other ones are now taking market share away from the one that had a bad quarter. So I find the markets all have trouble processing cause and effect in the short-term and people get all confused.

Alexia Tsotsis: What is the solution to that? It’s so perplexing.

Marc Andreessen: That’s permanent. I think it’s permanent. I think it’s human nature. There are certain things that can’t be fixed, and I think that’s one of them.

Alexia Tsotsis: One would argue that the enterprise has come back into fashion, because the market is cooling on the Instagram deal being a billion dollars and now being $700 million. The market is cooling on all these photo-sharing apps and just ways to update your friends about your whereabouts.

Is the only reason the enterprise is sexy because it actually makes money and has results, or is there some overlaying tide of innovation that’s happening that’s exciting people simply because it’s culture-changing?

Marc Andreessen: I think it’s all the above. I think the changes are real. The businesses are good, which is nice. And then I think it’s also sector rotation. We talk to a lot of the big hedge funds, mutual funds. It’s really funny. We are talking about big hedge funds, mutual funds, about six months ago they all started saying, well, you know, we really think there is going to be a rotation from consumer and enterprise, and we are going to really get ahead of that. And I am like, yeah, you and 10 other guys in the last two weeks have told me the same thing. It’s like, good job, you are way out ahead on the leading edge on this.

I get to the point where I am just like â€" my running joke has been, it’s like little kids, like everybody out of the consumer pool, everybody into the enterprise pool. So everybody out of the waiting pool, everybody into the hot tub.

What happens when you have capital flowing in a rotation is, if all the capital starts to leave one sector and go to another sector, then all the stock prices rise in the sector that all the capital is going into, because everybody is buying those stocks.

And then everybody says, wow, look at how much those stocks are going up. We should invest in those stocks. And so the up cycle starts perpetuating.And the down cycle similarly â€" a lot of reasons people have been selling out of the consumer stocks is because they have been going down, because people have been selling out. So the cycle is perpetuating.

Alexia Tsotsis: So what should the smartest entrepreneur do? You have $1.2 billion to spend. Where are you spending it?

Marc Andreessen: Investing. So the smartest entrepreneurs I think generally ignore all this. We really look for the entrepreneurs who don’t pay any attention to this. We really look for the entrepreneurs who say the following, they say: “I have this really good idea and I know it’s a good idea for the following eight reasons, and I have thought about it and I have worked in the field, and I know what I am doing, and I have talked to the customers and I have figured it out, and I am going to do it. I am just going to flat-out do it. And I am going to do it whether you fund me or whether you don’t fund me or I don’t get funded. I am still going to do it.” That’s the entrepreneur we are looking for.

Sometimes that entrepreneur is in a sector that’s completely dead, and that entrepreneur is going to say, I know that everybody thinks that this sector is just dead, and in fact that’s probably why now is a good time for me to do this â€" is because I am not going to have very much competition.

Well, so a lot of these companies you talk about now, like Workday and GitHub and Box, got formed and funded when everybody thought enterprise was dead. Just like the consumer companies like Facebook and Twitter got funded and everybody thought the consumer stuff was dead.

So sometimes you get the entrepreneurs who are actually counter-cyclical. They are doing it precisely because nothing else is happening in that sector, and that means the big opportunities are just wide open.

On the other hand, sometimes you get the entrepreneurs who say, “I know I am doing the 36th workforce collaboration system in the consumer side; Google was the 36th search engine, and I know it’s 1999, and I know the whole sector is overfunded, but I have a better idea. I know how to do it better, I know how to do it different. I have learned from the mistakes that everybody else is making, and I am going to be the winner.”

And so we will fund either one. We fund companies in the hot sectors and we fund companies in the not-hot sectors. The only difference is the pricing, and the pricing varies basically by like 4x. But what we have just found or what we have sort of tried to learn from history is you can’t â€" for what we do you can’t really time the stuff. And the last thing you want to do is look at what’s happening in the public market today. And this is the thing that’s weird about how venture capital works â€" a lot of venture capital investments are decided based on whatever the NASDAQ is doing.

Alexia Tsotsis: Are you seeing down rounds because the NASDAQ is down?

Marc Andreessen: No, we have not seen down rounds yet. We have not seen down rounds yet, but consumer rounds that are happening now â€" consumer growth rounds are happening now at 2-4x lower prices than they were six months ago.

And the enterprise pricing is up a lot. Enterprise pricing a year ago was probably half what it is today. Maybe a third in some cases, and that made us happy at the time, but it’s all good.

Alexia Tsotsis: Last question â€" your top five enterprise cool kids?

Marc Andreessen: I think they are all on your list.

Alexia Tsotsis: They are on my list?

Marc Andreessen: Yeah, yeah.

Andreessen Horowitz, Ning, Facebook, Qik, Hewlett-Packard, Kno, Bump Technologies, eBay, Asana, CollabNet, Opsware, Netscape

Mr. Marc Andreessen is a co-founder and general partner of the venture capital firm, Andreessen Horowitz. He is also co-founder and chairman of Ning and an investor in several startups including Digg, Plazes, and Twitter. He is an active member of the blogging community. Previously, Andreessen developed Mosaic and co-founded Netscape. Mosaic was developed at National Center for Supercomputing Applications, on which Andreessen was the team-leader. Andreessen co-founded what later became Netscape Communications which produced the ‘Netscape Navigator’. Netscape Navigator...

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