I recently wrote a guest post for Forbes talking about startups and how you need to be ready to fail and use your learnings to move forward. Check it out and let me know what you think.
Zoosk is moving on up! In the last year, we’ve more than doubled the size of our team – from around 50 to over 110. As a result, we’ve more than outgrown our office in the Financial District. Getting a meeting room, or even a cup of coffee, has become a real challenge.
We’ve also gotten a bit underwhelmed with our typically-corporate high-rise building. Zoosk thrives on its funky, fun and free culture (check out our recruitment video below) and that means we – and all our office dogs – stand out like sore thumbs amongst all the suits in the building.
That’s why we’re so excited about our new digs at Market and 6th Street. Across the street from the rocking Warfield and surrounded by theaters, museums and clubs – not to mention amazing food – this is a much better fit for Zoosk’s unique team and culture. We’re even thinking of building a yoga studio in the new place! The building is gorgeous and full of character. It’s one of the few survivors of the 1906 earthquake (check out the photo) and has loads of old-timey charm!
There’s also a broader trend here. As pointed out by Patrick Hoge, in a recent San Francisco Business Times article entitled ‘This is San Francisco’s Time’:
“Tech companies have signed 14 leases of more than 100,000 square feet in San Francisco since Jan. 1, 2011, the busiest such 15 months ever. More than 1 million square feet was signed by tech tenants this year alone, the fastest quarterly take-up of space in more than a decade. Seventy-five percent of first-quarter leasing was to tech companies, and the frenzy is unlikely to slow down soon.”
So why is San Francisco such a magnet for tech companies like Zoosk and others? It’s the city’s culture and spirit of freedom, adventure and choice. Every food, sport, type of music and social scene is readily available to San Francisco residents and this infinite freedom to do your own thing seems to attract the most clever, creative and ambitious people from around the world. Couple that with fairly mild weather (just cold and rainy enough to write code indoors) and some of the best transport in the country, and it seems to be the perfect recipe for innovation!
Of course, it doesn’t hurt that we’re also taking advantage of the slews of tax incentives introduced by Mayor Ed Lee for pre-IPO startups to move to the Mid-Market district. Twitter is just down the street and we’ll also share the building with our old friends at Zendesk. Plus, we feel it’s appropriate that the Blick Art Supplies store is just downstairs, since Zoosk thrives on creativity – even if it’s not with paints and brushes.
We’re more than doubling the size of our office too – to 52,000 square feet – which means we can keep up our tireless recruitment drive and keep on growing!
It’s no secret that Google wants some of that social data that Facebook is keeping away from them in their data centers, so they can utilize it for ad targeting in addition to creating engagement with consumers on G+. It has actually (in my opinion correctly) been argued that Google doesn’t really even care if users engage and spend time on G+ as long as they give Google their information and browse the web while logged into their Google identity.
Google is able to get consumers to create G+ accounts with no problem given the reach of its other products like search, Android, etc. And the company has been doing a great job at that. Where it has fallen short is enticing people to give it data beyond the basics, which Facebook has done at an astronomically fast rate by virtue of status updates and like actions.
Google has failed here because the consumer doesn’t spend time on the G+ property. I believe Google can solve this problem by using the developer community as a proxy in its battle with Facebook. If I was running Google, I would leverage my assets (search and Gmail) to drive developer behavior that would open the floodgates of social data into my platform.
User OpenGraph tags in search crawler
Facebook is pushing all developers to get on the bandwagon of OpenGraph where developers have to add semantic context to their pages and submit that info to Facebook as part of user engagement. Developers are happily doing this because, in return, Facebook is adding this information to users’ timelines, which results in more distribution for developers.
Google should take a page out of Facebook’s book and leverage this open set of information in its search crawler to give pages with Open Graph data some weight in search algorithm. I know we are all frustrated when Google changes search algorithms for corporate objectives, but there is a good case to be made for use of semantic data at scale to provide a better search experience.
It just happens to be Facebook’s recommended semantic data, but when you are behind in a game, you have to play with some of the rules set by the front runner.
Ask Developers to submit their OpenGraph objects/actions
The next step would be to reach out to developers and ask them to submit their open graph objects and actions just like they do with Facebook. The developer incentive would be the SEO juice they can get through giving Google more semantic information. Google would also benefit from having full context around the meta tags we talked about in step 1.
Give Developers ability to submit actions to G+
This is where it gets interesting. Give developers a very easy way to get opt-in from their users to publish their actions to their G+ accounts. This only requires mashing up some of the technology Google already has (OAuth, etc) with the addition of APIs for publishing actions on behalf of the user from properties outside of Google. They could even go ahead and copy how Facebook does it. There is no need to innovate here just for the sake of being different. Developers would not mind doing less work.
Expose actions in G+ stream
To bring it all together, expose these published actions on G+ feed and give them a decent weight. Make sure you give developers more love than Facebook. Believe me, the favor will pay off.
All of a sudden, all developers on Facebook platform have an incentive to push G+ integration in their products, because they get more distribution: through SEO juice and exposure on G+ feed. Just imagine all the vertical social networks such as Pinterest, Path, Foursquare, Zoosk, Foodspotting, etc. pushing your platform and driving social content into Google’s data centers.
Your move, Facebook.
For a long time, Facebook has embodied what “social” meant to the web. And with its IPO only months away, some are already calling social ‘done’, focusing their attention on finding the next big differentiators in consumer web.
But for all the pundit talk, an interesting contradictory phenomenon has been occurring in front of our eyes for the past few years: more and more successful ‘special purposes’ (or dare I say, ‘vertical’) social networks are taking off.
Examples abound: Instagram, Pinterest, Foodspotting, Foursquare, Quora, Path – just to name a few. How can these social networks find large audiences, when the undisputed king of social networks, Facebook, still controls the throne? Hypothetically, couldn’t a consumer do, directly on Facebook, what they’re doing on these other, smaller social networks?
Or… are these people living under a rock somewhere, where no one’s discovered Facebook yet? To the contrary, all of these services are well-integrated with the Facebook platform and have no problem maintaining a huge audience overlap.
Some argue that consumers are building new social graphs more relevant to their special purpose (an interest-based graph if you will) on these other social networks, causing them to thrive. The argument goes, for example, that my social graph on Instagram is drastically different from Facebook, and I have curated a ‘special friend-list’ there, peopled mostly by those who care about beautiful photos. Or, that my friends on Foursquare are more interested in location than my friends on Facebook.
I find this argument weak at best. Sure, there are some differences between friends across various networks. But, by and large, for most people, the friends they maintain across these different networks (and Facebook itself) are more similar than different. If anything, friends who are excluded on my vertical social graphs are simply those who have yet to sign up for the services; as these vertical networks grow, the friend lists on these networks converge toward, not away from, the mean – which is to say, toward the Facebook graph.
So how else we can explain this phenomenon? The real draw for consumers is, I think, the more targeted user experience that vertical networks are able to provide.
Take Instagram: you know what you’ll get when you use Instagram. Photos aren’t mixed with cat montages from YouTube and articles about education reform from The Washington Post. And your publishing action is highly targeted at photos, at uploading and maybe adding filters to them. That simple focus has turned the service into the destination for posting photos and discussing them with friends. Most Instagram users still share photos they post there on Facebook, so it’s not that they don’t find the photo suitable for their Facebook graph – people liking and commenting on Instagram are often the same as on Facebook – but rather, these users find the focus and intention of the Instagram experience more appealing than the Facebook alternative. And knowing that they could automatically share their Instragram photos on Facebook as well, these users know that by choosing Instagram over Facebook, they’re not missing out on anything. It’s a win-win situation.
Some might argue that the additional value of more focused user experience is outweighed by the effort involved in setting up and maintaining yet another social network. That would have been a fair drawback a few years ago. But today, we can simply re-create our social graph on a new property within minutes, thanks to the prevalence of new features, like those that recommend people a user might already know, when they join the new service (the result of Facebook Connect, Gmail contact importers, etc).
The most successful vertical networks succeed in making the the maintenance and expansion of a user’s social graph on their sites as simple and painless as possible. Furthermore, the fact that content published on vertical social networks can be seamlessly posted to other networks, Facebook in particular, at the click of a button, eliminates the major drawbacks of using a more specialized tool for one’s social engagement needs. In the mind of a consumer, hopping aboard the next great social experience that caters to an important facet of life is an all-win opportunity.
Does such specialization hurt Facebook? Not in the least. As discussed, almost all the content published on vertical social networks flows into Facebook, which continues to own users’ “master” social graph. The development of vertical social networks is actually a great win for Facebook. And Facebook knows this, hence their continued investment in Open Graph and their continued support of the above mentioned vertical social networks.
An interesting parallel to this phenomenon was highlighted by Jay Jamison, of BlueRun Ventures, when he compared Facebook to broadcast networks and vertical social networks to cable channels. Even though I disagree with him on the assertion, that in his words, interest-based social networks are taking off because they allow creation of a different social graph on each network (see above), I really like his broadcast-cable analogy and feel it describes what’s going on here. Once we install a cable line in our apartments, the marginal cost of getting those special channels is further reduced, and we start to consume media from ESPN, CNN, and Comedy Central, ad infinitum.
So does this mean that we’ll end up with a large social network for every possible vertical? I believe that users will transition to the specialized social networks that cater to major facets of their lives. The obvious verticals will revolve around fun, food, love, sports, career, finance, and the like. LinkedIn has already built a successful public company focusing on just peoples’ careers. Zynga’s done the same, tackling gaming for our entertainment. There is still a huge untapped opportunity around sports. For love and romance, of course, we at Zoosk are continuing to build the romantic social network where consumers will create and share their romantic journey.
It’s important to re-iterate what conditions are necessary for such vertical social networks to take off, beyond simply creating a compelling user experience around something people care about in their lives:
Combining the above principles with a great specialized user experience can lead to successful vertical social networks. The successful vertical networks that already exist will help usher in the next wave of successful web destinations that are yet to come, if the opportunities are seized. Social is just getting started!
Simply put, the United States legislature was created to acknowledge the many problems and issues faced by people from all walks of life, and come up with sensible solutions that address the needs of most while preserving the rights of everybody. Then solutions are legislated into writing, in a way that’s consistent with past legislation.
If your job is to develop software, the above description may sound weirdly familiar. Software engineers build systems that address certain specific needs (problem space) within certain specific restraints, like the confines of our operating system (or various other restrictions), while maintaining backward compatibility with older solutions (most of the time).
These days, we hear a lot about the dysfunctional state of the legislative system, the burden of over-regulation on American businesses, and the problems of money influence in the political system.Perhaps the software industry can teach the American legislature a few valuable lessons on addressing some of these challenges.
As a thought experiment, try to imagine what software would look like if it followed the legislative system’s example. Following this analogy, our congressmen would be played by product managers, developers would play the role of bureaucrats who implement the laws, and the general public would be played by end users. Think about it. You’ll see how quickly everything would unravel.
If software was built like laws:
Every person involved with software at this point will be tearing their hair out! This description can actually be applied to almost every software project that has failed. And yes, lawmaking is mishandled in a manner even worst than this.
The inefficacy of lawmaking isn’t limited by Republican or Democrat party lines; both sides are equality to blame.
Congressmen – like product managers – should come up with high-level requirements and directions, leaving the implementation details to the regulators. This would lower the cost of implementing laws, and as regulators learn more about the system at the implementation level, it’d result in more agile adjustment of details. Plus, it’d even encourage analytical thinking and accountability, with the right metrics and KPIs defined.
Congress should also allow for resetting and refactoring every so often. Maybe automatically expire laws after a decade so we don’t end up with irrelevant legacy laws that make zero sense in the present universe. Believe me, we have the concept of “tech debt” in our legislature as well.
Lastly, when implementation details aren’t in the hands of product managers/legislators, it’s a lot harder to hide favors for special interests in between the million lines of code.
So, here’s to leaner legislation. Maybe we should start talking about minimum viable law!
Here is an interview I did recently with iDate team talking about a wide variety of topics including Zoosk’s progress, what is social dating, and online dating industry in general.
A question often posed to me as a startup founder is, “What will happen to your company — and others in the tech community — if the economy heads toward another recession?”
It’s a timely question. There’s a startling amount of evidence that the US (and global) economy faces a rough couple of years ahead. Fact is, even if the economy manages to avoid plummeting to what officials deem as ‘recession levels’, few will deny the upcoming years will see very slow economic growth overall. There is also a ton of macroeconomic evidence that the problem of high unemployment will remain unresolved regardless of GDP growth. From simply trying to remain afloat in tough times to seeking fundraising or some other exit strategy, there’s no shortage of available advice on how ones business might deal with rough economic tides.
But what I wanted to cover here is different. Rather than focusing on Basic Survival 101, I’d like to discuss how to minimize the impact of, or even thrive in, periods of slow economic growth. Among the myriad responsibilities any startup founder or CEO faces is the pivotal responsibility of how to economically position his/her business and product for longevity — which entails more than choosing the right markets to enter and the best products to offer, but includes ensuring that his/her business has a smart distribution strategy, a monetization strategy, internal team-building strategy, etc. And these decisions impact the business’s exposure (and response) to economic fluctuations.
Since I am most familiar with consumer businesses, I’ll limit the ensuing discussion to my area of expertise (certainly, similar parallels can also be made about B2B businesses — but I’ll leave that to experts 
).
At the risk of my macroeconomics professor taking huge issue with simplifications I am prepared to make here, let’s enumerate some of the things that happen when economy doesn’t do too well.
A few major patterns emerge in this situation. The most important one is that consumers have less money to spend. Consumers stop purchasing items they deem to be overall unnecessary, and for products/purchases that are necessary, consumers will seek less expensive alternatives, like using Kayak and other travel search sites to lower ones travel expenditures. If your company offers a product that is clearly discretionary (say, video games) you’ll see the negative impact when consumers play their old games instead of buying the latest versions or find cheaper alternative entertainment. On the other hand, if selling coupons — deals for food in particular — is your business, then you’ll see a positive uptick in demand, like Groupon did during the 2008-2009 recession.
And if your company provides a less expensive alternative to a basic human need, you’re also in luck. Take dating. If you compare the cost of going out to bars or clubs to meet new people with using online dating sites like Zoosk, the savings consumers can realize by choosing the latter is obvious.
Recession-era customer acquisition
As businesses cut costs overall, marketing budgets are significantly reduced. Both online advertising and offline advertising face budgetary restrictions, but more so in the latter because branding budgets get cut before performance budgets on the web. And the cost of offline advertising remains significantly larger in absolute terms. So, if your monetization strategy is based on selling ads (specially brand ads) your business will take a massive hit, whether you’re an international behemoth like Google or a tiny social gaming venture. In 2008-2009 we saw a huge shift from ad monetization to direct consumer monetization in variety of industries, particularly games. Unfortunately, while bigger companies can afford to weather a downturn (provided it’s short-lived), startups cannot.
In contrast, if advertising is a cost item for your business, then you might benefit from the phenomenon illustrated above, because the cost of acquiring free users falls during economic downturns. When the demand for ad space drops, so does its price — both online and offline – when decreased competition between bidders sets decreased prices. Insofar as potential customers are interested in paying you (see first part above), they can be acquired for cheaper.
To summarize, if your business can provide a cheaper alternative for something people will need regardless of economic performance (basic human needs such as food and shelter, including spiritual needs like love and companionship) and if your company has a large customer acquisition budget (like Kayak and Zoosk), then your business remains well-positioned to be recession-proof.
Better yet, if we avoid recession and the economy makes a recovery, everybody wins . Entrepreneurs should however seek to build healthy businesses well-hedged to thrive in both scenarios. I hope the entrepreneurs out there take this opportunity to examine the fundamentals of their business and locate any areas that will be impacted by boom/bust economic cycles. There are always ways to tweak your model such that you are better positioned in both situations.
In general, when we’re talking on the phone or chatting on the internet with another person, we don’t want that other person to ‘see’ us. In the visual sense. I know this is a very broad statement that many will disagree with, but my own experience releasing such functionality, as well as feedback I’ve received from others regarding their experiences, provide proof in favor of this theory.
I grant that video chatting with “people you know” can be useful in certain instances. The two most salient examples I can think of are (1) using video chat to keep in touch with family members, or (2) for work collaboration (e.g. video conferencing with colleagues remotely). But engaging in video chat with your social graph at large will not have a strong uptake.
At the bottom of this bias is a very basic human fear. Most of the time, people do not feel fully presentable to their extended friend list in video format. In instances where we communicate with casual acquaintances, social anxiety becomes even more of an issue. People attend to their physical appearance before engaging with friends in real world, and for many the process of ‘getting ready to go out’ is a necessary prerequisite before ‘going out’ is even a possibility. We can apply the same social psychology principles to video chat. And people, by and large, have zero interest in ‘getting ready’ to video chat. Text messaging and online chatting, on the other hand, can be performed at any and all levels of hygiene and physical disarray, hence the huge interest and uptake.
When MySpace integration with Skype failed, self-consciousness of users contributed to the failure. I predict that Facebook integration with Skype will similarly be limited by users’ self-consciousness. No chance will it usher in the era of video communication.
Zoosk has offered video chat functionality on Socialbox, providing video chat between Facebook friends, for a while, and consumer interest in this feature has been relatively low (compared to non-video engagement, which has been great). I’m sure the same is happening on Facebook+Skype right now. I’d venture the same will be true for Google+ hangouts, once the initial cool factor goes away.
Nonetheless, like I said, video chat can be (and already is) hugely relevant in a few categories:
. .There might be other categories that I am missing, but those cases must provide a compelling argument against some very basic human biases. And it would require us to overcome a deeply ingrained existential fear: confronting the eternal question of “No, really, how do I look?”
A few months ago, Jeff (one of our rockstar engineers at Zoosk) had an idea: that our learnings from building Zoosk Messenger could be applied to chat on Facebook. After examining the capabilities and limitations of existing off-browser Facebook chat experiences, Jeff and I believed we could build a better, improved user experience. And that’s what we did. Jeff applied his magic to this new domain and, in a matter of a few weeks, he and his team debuted a new application that incorporated our original ideas. Socialbox was born.
Not knowing what to expect, we rolled out Socialbox and threw some traffic at it. Boy, did it stick. Unsurprisingly, consumers really wanted easier ways to chat with their Facebook friends. In only 6 weeks, Socialbox grew to approximately 2M MAU (see chat below courtesy of AppData).
Seeing this burst of interest, we took it one step further and added video chat to the product. We beat Facebook to video chat functionality on it’s own chat platform by a couple of weeks, which was really cool to achieve. It pays to be agile!
Video Chat for Facebook on Socialbox
In short, Socialbox is still a side project at Zoosk — but as long as consumers show love for the product we will continue to do awesome things with it. Socialbox is an example of how we encourage our team to approach their jobs at Zoosk. We reward creative thinking and we give our people the resources and support to turn their ideas into reality. We need more people who embody this commitment to innovation.
Most of modern science is based on a reductionist framework and it’s no surprise that we, the students of this body of science, resort to reductionism in trying to explain almost anything. Reductionism can be defined as
Reductionism can either mean (a) an approach to understanding the nature of complex things by reducing them to the interactions of their parts, or to simpler or more fundamental things or (b) a philosophical position that a complex system is nothing but the sum of its parts, and that an account of it can be reduced to accounts of individual constituents.
Then, it’s no surprise that when first confronted with the question of ‘Why was product X successful or a failure’, we naturally put our reductionist hat on and and try to reduce the product to its basic parts (usually features or marketing strategy) and assign values to them in their contribution to the success or failure of the product.
This approach works very well for products that are more or less independent of other products’ or peoples’ actions. For example, we can apply this model easily to find out why a Dyson vacuum cleaner dominated the market at a particular time period. Or, why the Motorola RAZR exploded in the the cellphone market back in 2003.
Equipped with this great framework of analysis, we naturally use it to answer the same question about networked web products. Hence questions like ‘What feature(s) of Facebook helped it beat MySpace?‘, ‘Did MySpace lose because of the Google Ad deal?‘, or ‘Which feature of Zoosk makes it so much better than Match.com?’.
The problem with applying Reductionist framework to understanding social web products is that we can not capture complex interactions between different users of the same product in any simplistic way. And that’s where we usually turn to emergence theory. As wikipedia puts it
In philosophy, systems theory, science, and art, emergence is the way complex systems and patterns arise out of a multiplicity of relatively simple interactions. Emergence is central to the theories of integrative levels and of complex systems.
What we need to remember is that not all phenomenons can be explained using a reductionist framework. This is specially true for networked web products which social products are a great example of. So, maybe next time we want to analyze the rise or fall of the next social web product, we should not go straight for breaking it down into individual features. It might save us from drawing simplistic conclusions that can lead to bad decisions.
