The 20 smartest companies to start now – September 1, 2006

While I applaud the journalists for getting this story, I have to ask what in the h*ll the VC’s were thinking? They are going to get hammered with every hair brained scheme ever conceived.
Their motivations aside, I found this one of the more interesting articles from CNN in a while. After all who doesn’t want to know where the money is. I found the Accel partners idea particularly interesting as it has a direct tie in with the social production of manufactured products. One thing we have been contemplating is how makers can earn money from their creations. The answer of course is a social marketplace. I hope someone does it. It would make a great partnership.

The 20 smartest companies to start now – September 1, 2006

The Social Marketplace
The Investor: Jim Breyer, partner, Accel Partners
What he’s backed: Brightcove, Facebook, Prosper
What he wants now: Social-networking sites may be sprouting like weeds, but none yet operates as a bona fide marketplace, with members buying and selling their own creations as much as they blog, link, and post. Breyer, who sits on Wal-Mart’s board, is interested in backing an international network for indie artists, musicians, filmmakers, authors, designers, and other creative types from dozens of countries.
Ideally, the site would have the download and payment features to create what he calls a “micromarket” for members’ wares. “There might be a Chinese student filmmaker with a five-minute film who wants to reach a niche of U.S. users,” Breyer says. “He could find people willing to buy his films, and maybe a producer willing to bankroll more.” Transaction fees would supplement ad revenue.
Breyer wants a five- to 10-person team to build a prototype using a peer-to-peer structure that would reduce bandwidth costs, and to identify core groups of users that would get traffic moving to the site.
What he’ll invest: $10 million
Send your pitch to: — S.H.






2 responses to “The 20 smartest companies to start now – September 1, 2006”

  1. ralphg Avatar

    >”Social-networking sites may be sprouting like weeds…”
    I am vastly interested in the new social networking scene (some call it Web 2.0), but I fear it is a rehash of communism: lots of people toiling away for free or little pay, while the heads make immense incomes.
    “… but none yet operates as a bona fide marketplace.”
    Nor can it. For example, YouTube is only popular because value of each video is similar to its cost — virtually nothing.
    Now, I could be wrong. I recall a recent arrival from Brazil to our city, who complained to me that our town could not continue to exist “because it lacks heavy industry.” I smirked inwardly, because I deal purely in information. Just as he was wrong, maybe I am, too.

  2. Chris Avatar

    Ralph – thanks for the comment. I agree with the premise that the cost of EACH item is negligible, but that only negates the power of the marketplace for the individual, the economic marketplace at least.
    The value of all the submissions taken as a whole though, is measurable (by advertising revenue for example) so there is a strong attraction for the market creators to make it work. The key is to figure out how to get people to “work” for you for no economic compensation. The compensation offered so far is largely social: get more diggs, get more video views and you can become a quasi-star at least in internet terms. It will be interesting to see what other forms of individual non-economic compensation can be developed to help fuel the development of these markets from the bottom-up.
    Nick Carr had a really good post on his blog recently that I think captured this perfectly.  If you go to you can read what he had to say.

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