Last Day to Vote - Get Out There Florida!

I've been a political junkie for a long time.  This year, I decided to do something about it beyond writing or donating.  I had some free time after selling Brand Monitor, so I decided to spend a week in Florida, knocking on doors, urging Obama supporters to vote.  I write this as I get ready for the last day of pounding the pavement - from 7 AM to whenever polls truly close.  I believe that the ground game is going to win Obama the election - and Florida is going to make it an overwhelming one.

I still urge Floridians and voters everywhere - get out there and vote.

I came to Broward County, Ft Lauderdale, Pembroke Pines, the land of the hanging chad because I wanted to see it all first hand.  The weather is nice and the people are too.  The shenanigans are real: under-resourced voting locations creating 2-6 hour waits, police ticketing cars of early voters, people not receiving absentee ballots, shutting off early voting days on the Sunday and Monday right before.  This will only serve to motivate more people to get out there.  I've talked to them.  They are resilient.

I want to thank all those folks who were friendly enough to answer my questions.  Some of you even invited me into your homes, gave me a bottle of water and let me use your restroom.  The door slams were few and far between.  The visceral anger was limited as well - though there was some.  I understand.  I will be a little friendlier to those who come to my door.  It's a lot of work.  I really appreciate the amazing stories - like the Haitian woman who was proud to wait in line to cast her vote because in her country she had to fear for her life for this action.

The Obama volunteers and staff were great.  I met a lot of young kids who are incredibly dedicated - from 7 AM to 1 AM almost every day.  I enjoyed every day with you.

My feet ache but I'm going for a long day myself.  That smile will be back in the next hour.

This time, I agree with Nate Silver's graph:

Five Thirty Eight Blog

The ground game along with all the air cover works.  That's the first time Florida turned blue.  More tonight... Yeah, and don't forget to vote!

Facebook Marketing and Hurricane Irene

As Hurricane Irene sweeps up the East Coast, the only thing you think of all the losses and damage it would cause. There are friends, relatives and business that will be affected by this once in a lifetime natural disaster. Well... not everyone is thinking that way...

Check out these 2 businesses, they've seized the moment using Facebook:

With CJ Construction, you can get a pre-Hurricane damage assessment and prepare your home. Afterwards, you would be first in line for a repair.

Rick Tucker Construction will take care of your post Irene demolition needs.

Who says that construction is behind the times in social media?

Of all the businesses, CVS is doing this most tastefully, by discussing how people should get their pharmacy refills and how they are stocking up the best they can. They acknowledge that many of the stores will be closed because of evacuation procedures.

In the comments to the post, there is a very favorable response from people appreciating the notice or discussing how CVS steps up in the community during these situations. You would think there might be some backlash given the press releases about how CVS is ready, but by engaging with their users, people are responding positively. On the other hand, competitor Rite Aid has normal promotions, but no acknowledgement of Irene that matches its press releases.

Even in a natural disaster like Hurricane Irene, companies can be opportunistic in Facebook marketing just like the construction companies. At least they are making themselves available. In the case of CVS, they are leveraging their brand to create greater levels of engagement.

Position2 Brand Monitor was used to cull through the displayed Facebook posts.

Hey Congress! Stop Messing Around!

As I watch the Dow drop another 200 points today, I've gone from amused to very concerned. In the last few days that's 400 points. Every day, there's more back and forth - Boehner this, Cantor that, Obama Grand Bargain, etc. It's one thing to discuss a long term solution to a financial deficit issues, but it's quite another to renege on America's financial obligations.

For a while it was sport watching the House get up into a lather over a crisis they created. Most House Republicans voted on extending the debt ceiling every year as they cut taxes while spending more on wars, the prescription drug benefit and general discretionary spending on their districts. Democrats have been spending as well, but they are not creating a crisis over the debt ceiling. They are willing to approve the increase straight up.

People seem to think that not increasing the debt ceiling will stop "excess" spending. They have been misinformed. The President cannot unilaterally impose cuts in spending. Nor can Congress. That "excess" is our defense and our grandparents Social Security check. It all stops when the government loses the ability to finances its obligations.

This is an artificial crisis that is impacting people perceptions of US creditworthiness and ability of politicians to solve problems. The budget has already been voted on by both sides. In fact, they committed to a payroll tax cut, Bush tax extensions, and unemployment extensions that increased the deficit by over $600 billion/year. Where were those deficit complaints at that time? If the US cannot pay what it has committed to pay, why would you put your money here? It's like taking a loan out on your car, then saying that you are not going to pay for it afterwards and expecting to get a new loan on your house in the future. You will have to pay next time - just a lot more because you've increased risk of default to the creditor.

Already, this is having an impact as long term bond rates are going up and the insurance on American debt has risen. This is a tax on all of us as mortgages, credit card rates and car loan rates have the Treasury bond rate as it's basis. All business decisions use have risk hurdle rates based on the risk free rate - US Treasury bonds. If rates rise or changes from AAA to AA+, that's a huge issue.

Do we want another day where the Dow drops 700 points like we had in 2008? This would hurt all of our portfolios and pensions. It takes money out of our pockets. It increases the tendency to put money into cash or gold rather than invest in stocks or start-ups. I'm wondering whether I should just go to cash because the acrimony is disconcerting.

Businesses thrive when there's certainty and consistency. When the rules of the game are not clear, people are more reluctant to invest. The budget crisis, backsliding on financial and environment rules, and the artificial debt crisis doing their damage. The risk premium is increasing. While that may reduce Obama's chances of winning re-election, it helps no one. It may boomerang.

Everyone who looks at spending and tax revenue knows that spending increases and entitlement growth will have to slow and taxes will have to go up for everyone. There's no free ride here. I'd love to see both sides release their versions of a balanced budget by 2020. It's doable if our legislators have courage (go Coburn!). Work on it for the next budget cycle. But don't screw up the economy today.

TiEcon 2011: Touching the Entrepreneurial Sun

Every year, The Indus Entrepreneur (TiE) throws the largest entrepreneurial conference of the world, TiEcon. Though the membership is primarily of Indian descent, the event is open to all. It brings great entrepreneurs, VCs, inspiring keynote speakers and aspiring entrepreneurs together to learn and network with each other. I like to go every year because it's my chance to touch the entrepreneurial sun and remember why I've spent so much of my career in starting and building companies.

Sometimes, you get down on yourself because the process is always a lot longer and harder than you originally thought. The process of creating a new company, a new product, a new brand and a strong culture is always is always easier on paper than reality. The world is skeptical of what you are building because invariably you are going against the existing order. You have to be able to handle far more no's than yes' while keeping your confidence at an unshakable level.

Today helped me reconnect with that energy and spirit. I really enjoyed the keynotes. Steve Case was great not only because of his amazing and well-known AOL experience, but more because of what he is doing to further entrepreneurship through StartUp America. The organization is trying to replicate the Silicon Valley entrepreneurial infrastructure and ecosystem all around the country. New companies that have created all the new jobs in the US over the last 20 years. Large companies have been static or declining, so it's important to harness American creativity to build the next Google, Facebook or Genentech.

Dr. David Ferrucci of IBM presented a detailed account of the Watson project where they built a computer system to beat Jeopardy Master Champions. I liked how they structured the problem and measured success. They knew this would come in iterations, however each iteration had to be designed in a modular fashion that had sufficient headroom to improve with experience. Given our efforts to improve sentiment analysis with Position2 Brand Monitor, I could appreciate the difficulties that the IBM team had in trying to parse wide-ranging yet unstructured Jeopardy answers and quickly come up with the right answer. Natural Language Processing (NLP) is a hard problem to solve especially with analogies and allusions. Given the brevity of Jeopardy answers, it's like reading a tweet and understanding that "bad" sometimes is actually positive. Given the long tail of subjects, building a recognition engine that understands language and responds quickly not only is cool, but has a wide range of applications from medicine to education to... yes... call centers.

The capstone keynote was Vinod Khosla, the entrepreneurial maven who not only got Sun off the ground but built so many successful firms at Kleiner Perkins and now his own fund. He discussed his research on the energy transformation. The experts are wrong, as Vinod offered years of expert forecasts that were completely wrong - as much as 5x for the price of oil. The world has a situation where 5.5 billion people want to live and consume like 500 million. China's oil consumption is expected to grow gradually, but if it follows Japan's or S. Korea's growth curve, oil consumption will be 3-4x today within a couple of decades. However, Khosla believes that oil prices will drop dramatically. He also believe as will electricity use will drop steeply as well. This will be done in a way that is not government support dependent. His thesis is based on the black swan theory where discontinuities are the norm rather than what typical probabilities represent. Linear thinking doesn't work for him - it's about exponents and discontinuities cause by new technologies and steep cuts in price. I took some notes on interesting energy companies in his deck:

Kior - renewable, biofuel based oil that is less expensive than fossil oil
Ecomotor - an engine platform that double gas mileage
Ciris - driving methane from coal mines done with mining
Calera - converting CO2 emissions from power plants into mineral products
Soraa - 80% more efficient light that pays for itself in year 1
Lightsail - using compressed air storage to triple electric grid capacity

Then there was some company that would make sugar from pine chips reducing the vast amount of corn production used primarily for high fructose corn syrup and animal feed.

Khosla's belief is that technology innovation would rise to the challenge of energy, food and natural resource demand. After listening to him, some of the concern about $150 oil diminishes, because people will find a way to develop cheap energy. These technologies need to win in an unsubsidized market which can do to energy like Carnegie did to steel (cut the cost by 80%).

As exciting as Khosla was, I enjoyed seeing some of the TiE50 winners in social media and mobile. Each firm had a different story, but they all had really unique ways of looking at the world. They had an intensity and energy that was contagious. Even the VC panel on social media indicated to me that we were on the right track of mining social media data to create actionable insights and engagement for brands. The key was to listen to people, learn from their ideas, but remember that you need to follow the beat of your own drum.

I came away this Friday at TiEcon 2011 energized about the great things that entrepreneurs can do. It was fun to reconnect with many of the volunteers that put together this special event that highlights how people can go outside themselves and change the world in a positive way that also builds wealth. It's not a zero sum game. I'm sure my team is ready for the many new ideas I will hit them with on how to leverage our social media technology for growing brands, especially ones on reducing friction.

Onwards to tomorrow, where I'm taking Arjun to expose him to this special Silicon Valley world.

Dan the Tow Truck Man

There I was in town called American Canyon with my broken down Bimmer. The 10 year old 328i served me well but broke a belt and overheated about 70 miles from home. God knows how much this was going to cost - $500, $1,000, who knows with these cars. I was coming back from our Position2 Holiday party that Noelle so thoughtfully arranged up in Napa. After panicking about how I'd get my car fixed so far away from home, I got some help from AAA in the form of an extended towing upgrade. I just had to sit in a tow truck for a couple of hours, but at least I'd get it done with the mechanic I know.

That's how I met Dan. He was an old man, probably in his 50's, though he looked in his 60's after years of hard work. One of those salt of the earth kind of guys, he had a mustache on his white weathered face and some spots on the sides of his jaws - either missing teeth or gaps. I thought I'd be spending some time with a classic blue collar guy. I brought some business magazine in case I'd get bored. When he started with, "You know, I never thought I'd drive a tow truck for 15 years," I thought I'd be listening to a tale of woe of someone who has been screwed over for this reason or by that person.

It would be the little guy against the world deal. After touring the Chandon sparkling winery and eating a sumptuous meal Mustard's in Yountville, I guess I deserved some balance. Little did I know, I'd come away absolutely inspired.

Dan started in with telling me that he was a tow truck mechanic before driving trucks. He had made a lot of mistakes in his life, before he settled on this job. The tow business is 24 hours on call. The pay is not particularly great, but it's consistent. Cars always broke down for one reason or another. With the right company, work would be steady. One thing Dan always did was take advice from his father, a man who started and owned his steel fabrication business. He told Dan to never spend more than you take in. It's better to be able to pay for a car that was functional over one where you had to overextend yourself. The same thing for your house. Get a 30 year fixed loan and do not take equity out like the neighbors. Because of those decisions, Dan worked hard but could provide for his 3 kids.

So that's an easy opening. 3 kids? I have 4, so we had something to talk about. Little did I know that I'd have more fun listening to the story about his 3. So I asked, "How old?"

"3 boys - 2 that are 18 and one that's 15," said Dan.

"Oh, so you had twins."

Not really, 1 of his 2 were adopted. I asked when he adopted him. Dan told me when he was 15. Apparently, his oldest son and the boy were best friends. His father was a rapper who decided with his wife to start touring locally. They apparently got caught up in the fast life and forgot about their son. The boy called Dan's son from a hotel room where he was left all alone and asked if he could stay with Dan's family. Most might take him in for a little while, but Dan really cared for the kid. Dan decided to not only take him in, but let the boy's family know that they would have to give him custody. Dan would adopt him. He knew how important it was for a boy to have a strong father figure and didn't want this boy messed up.

It turns out that his new son loves to read, gets good grades and is looking at various colleges for scholarship opportunities. His oldest son is a top AAU basketball player and is being recruited by various colleges. Dan is pushing him to go to the best academic one. In my conversation, Dad never once differentiated the boys - they were all his sons.

So here's a guy who single-handedly raised 3 boys. They are all college bound - full of hope for the future. Later I found out he has a daughter from another marriage who has 7 grandkids. It turns out she has a good guy she's married to and Dan brings the whole group together to play basketball together.

Dan may have made some mistakes, but he's done something amazing. He not only provided for his family without taking anything but advice from his successful father, but he also took another kid in. He didn't just think about himself. He felt for others. Dan doesn't make a lot by any standard, but he not only lived within his means, he made a little extra and still brought up a whole family. He wasn't resentful. He was optimistic. Dan liked how he could work at night, so he could spend his days with the boys.

After Dan dropped me off on Alma in Palo Alto, we shook hands and he said goodbye with a smile. He offered to drive me home, but I was meeting my wife at the Medical Center because my youngest was in urgent care over a tough fever. While my car might cost a few hundred dollars, I came away thankful for the experience - the inspiration of spending a couple of hours with Dan the Tow Truck Man.

Clinton & Wonder Inspire at Dreamforce '10

Today was one of those days, you are thankful that work comes together with inspiration. As a last minute decision, I decided to go up to the Dreamforce '10 event in San Francisco. I scheduled some client meetings and intended to walk the tradeshow flow before going to hear the scheduled President Clinton speech. Because of rain delays for the former President's flight, Salesforce CEO Marc Benioff brought in an unexpected treat - Stevie Wonder. He talked about many stories from his life from how he decided to perform again mother's death to his early experiences in school, but I think the one thing I'll remember is how he deals with adversity. He is an optimistic person who believes that his passion for people and music transcends and particular issue. Benioff is right when he says that everything happens for a reason.

Then President Clinton walked on the floor with an impromptu introduction by Stevie. Clinton made his opening comment about how as an amateur musician, this was the first time when a pro was the opening act. I've always admired Clinton's leadership skills and his desire to do good in the world. I've heard many speeches on TV, but nothing is like seeing him in person. He can go from the high level trends of interdependence to the detail of new discoveries in stem cells and disease recovery. After a successful Presidency where he left the country with 4 years of surplus, then making incredible money on the lecture circuit, he then chases big problems through the Clinton Global Initiative.

He is a master of making complex problems simple. In his mind, the central characteristic of nations is interdependence. What happens in halfway across the world is known instantly everywhere. Ideas, capital, and goods flow everywhere presenting all sorts of opportunities. However it creates 3 large issues: inequality, instability and unsustainability.

• Inequality is increasing concentration of wealth to a few whether it's in the US or around the world. This concentration impedes broad based wealth creation because consumers will not be able to afford the new products or act in the creation of new innovation.
• Instability is caused by this free flow of capital where a bubble in the US can impact the whole world. Similarly, terrorists or a rogue nation can significantly destabilize the world order.
• Unsustainability speaks to the environment and energy. We are emitting more than the world can handle. The US is the only country in the world that has recently elected officials that believe the overwhelming science on man-made climate change is wrong. Luckily, the US is the only industrialized nation that has this uncertainly. The key is what will happen if the ice on Greenland melts and Europe goes into a new Ice Age.

So Clinton thinks about how his organization can address these issues in an economically advantageous way. As great as it is for the wealthy to give to NGO's, those firm should look for ways to serve while building the systems and institutions to put themselves out of business. People need to become self-reliant for help to be worthwhile.

On the mid-term elections, Clinton believes Democrats erred by not advertising their accomplishments on tax cuts (16 for small business), health care or in financial reform where there is a process to prevent future bailouts of large financial institution. The ad budget was there, but they decided to make elections local when the sentiment was national.

I love his thoughts about the history of society and how they fail by spending too much time in protecting the present. It goes to the notion of living beyond our means for this moment while not building for the future. For example, Germany and China have decided to dedicate significant resources to green energy whereas the US is potentially not renewing credits for green energy development. It is about not investing in education as US students fall behind the rest of the world in high school and college graduation rates. However, there is inspiration for the hi tech crowd. Unlike any of time in history, we can do work related to our interest, rather than needing to work to survive. There are great advances in hi tech, green energy and biotech that are making a new future. As long as we drive towards broad-based economic success, there is tremendous hope. The fact that we are in a place where becoming an entrepreneur is easier than ever before, means there is opportunity for disruptive innovation - the kind that creates new potential.

I came away encouraged because it took me out of the day to day drive to serve clients, acquire new customers and run the business. At Position2, we have been driving the leading edge for some time where there's uncertainty and great potential. Listening to great people like Pres Clinton, Stevie Wonder, and Marc Benioff helps you understand that we are fortunate to be in a place where we have an opportunity to create change. Wealth, political and living conditions are unequal, but intelligence is more evenly distributed. We should be thankful that our condition gives us an opportunity to express our full potential.

Thanks to the people Salesforce.com for providing inspiration with an excellent event!

Tesla Unleashes Great Hope... and Doubt

June 29th was a momentous day for Tesla and the future of the electric automotive industry. The IPO was priced way above initial expectations of $14-16 a share at $17. After some fluctuation, the stock was up 40% to $23.89/share. The market value was over $2 billion driving up founder Elon Musk's portfolio value tremendously. This on a day where the Dow fell 268. As an entrepreneur, this was a day that filled me with hope, because here was an entrepreneur that put his heart, soul and money into a company and won. However, the press was having nothing of it. The day before many of the news articles were fairly negative. Most of them went something like this Wall Street Journal article, "Tesla Motors: IPO Fueled by Glamor":

"So far the company has accumulated $290 million in total losses, on $148 million in sales. It expects net losses at least until 2012. Anyone betting on Tesla stock is gambling on the success of the forthcoming Model S. But Tesla itself warns that car "is at an early stage of development" and will not be in production until 2012. It adds that it has yet to finalize the design, or complete the engineering, manufacturing or component supply processes for the new car."

Many articles and comments said the same thing:

-Tesla proof Wall Street still believes in fairy tales - Oakland Tribune
-Tesla IPO: False promises for clean tech - Fortune

However, the investor community had a different response. The positive energy was palpable. The Position2 Brand Monitor graph on Tesla shows the massive spike and positive sentiment differential.

The number of posts (tweets, news articles and blog posts) on the company exploded to over 2,700 today from an average of 25-30/day. There was a 4:1 difference in positive vs. negative sentiment. While much of it positivity in the sentiment algorithm related to the increase in share price, there were tweets and posts like this:

- The Future of Luxury - Tesla Model S http://tinyurl.com/2flua9l beautiful design, 0 emissions, nearly affordable - @ThomasOhhh
- Something else that helped Tesla was having major strategic investments from Daimler Chrysler and a commitment from Toyota - WSJ Blog

An Entrepreneur's Take...
As an entrepreneur and technology geek, I find the IPO to be heartening. Elon Musk, successful PayPal founder, is a longtime entrepreneur who bet it all to bring Tesla to market. Previously, electric cars were considered doudy - for the granola set. They suffered from high costs, poor driving performance, long charge times and short driving range. The conventional thinking was that a car would have to be available for the masses first, so companies tried to shoehorn a high cost vehicle into a mass market or weird platform (GM EV1). Tesla, by contrast, utilized the typical technology lifecycle model. Original founders, Martin Eberhard and Marc Tarpenning understood that expensive technology needs to be sold to a premium market to move down the learning curve of product development and manufacturing efficiencies. So they built a sexy sports car on the Lotus platform that took advantage of the high torque range of electric motors, the low cost of electric car operation, strong lightweight materials like carbon fiber and a unique powertrain that gave a first-of-its-kind 200+ mile range.

While there are many sides of the Elon Musk story, he focused on building a great car. He focused on high quality materials, production quality and service. He did not compromise in creating a great brand experience from vehicle to showroom to post-purchase service. At the previous TiEcon, I remember my when Musk drove into the room with the Tesla Roadster. The car was stunning. Even more inspiring to me was that Musk was willing to bet it all to make Tesla and SpaceX successful.

The Model S has the potential to reach a wider market than the Roadster. With federal stimulus loan money for the factory and powertrain facility, Silicon Valley now has a new technology development and manufacturing opportunity.

There is more to the car than the actual vehicle. There is the technology behind it. There's an electric powertrain that has the interest of Daimler-Benz and Toyota. There's all the experience that Tesla has gone through to build the vehicle. All of these technologies have value beyond the economics of building a vehicle. Like Amazon's Z shops, the licensing of electric motor, battery and powertrain technology can provide a tremendous margin boost to the company.

It's my hope that the desolate winter of new IPOs is ending. Up until recently, the only way to get an exit event was to be acquired. This reduced valuations for entrepreneurs and made start-up investment more difficult because of the increased uncertainty. While risk adjusted rewards are still not entrepreneur-friedly, IPOs like Tesla, OpenTable and ReachLocal move the needle in the right direction.

So let's celebrate Tesla, Musk and his team. Let's hope the stock rises in value so that VantagePoint Partners and other investors can see a significant return. We want them to cycle their money into new innovative start-ups. We should want them to be the next Google. If Silicon Valley and America wants to lead the way in new job-creating, game-changing innovation, we want companies like Tesla to succeed.