Just a bit of a disclaimer: as an executive/blogger, I frequently get information way before many in the media do (not bragging, just stating common sense), but for obvious reasons I sometimes step away from my Wordpress account.
Does it eat me away sometimes? Yes.
I don’t publish things like “I have a major scoop on a huge company” cause that is lame, but the flip side is that what I do post is more representative of what is going on in the trenches, I like to think (and some people I respect and look up to seem to tell me so, too).
Anyway, after some reflection, I’ve decided to post this, because it serves the greater good, there was nothing to lead me to think that this is confidential and mainly, I would presume Facebook wants this to get out there asap to help them manage the matter better and move forward with the task at hand sooner.
So here goes.
At TC40, during Michael Arrington’s one on one interview with Mark Zuckerberg, the Facebook CEO announced that Facebook’s VC would be setting up a $10M fund and hand out grants to some deserving ideas and entrepreneurs.
The writer in me reported it live here, while the entrepreneur in me emailed FB about a potential working arrangement, specifically, for one of our units, at StreetMojo.com, which in short connects users looking for free stuff with marketers offering free stuff.
That’s the first sector we’ve deployed the application in, but with minor tweaks, I firmly believe that (along with our two search products at MetaMojo.com), these assets represent billion dollar opportunities… if they are on a larger network.
As a side note, from a portfolio management perspective, that’s why when it comes to StreetMojo.com and MetaMojo.com, I think it makes more sense to sell those assets and have them in a larger company; whereas WatchMojo.com - the web video unit - it makes more sense to remain independent and grow, grow, grow.
But (I promise this is relevant), since I’m investing my resources almost exclusively on WatchMojo.com, then it made a lot of sense to get a grant from Accel, Greylock and Meritech and grow those on Facebook. If Once they see what I have in mind for StreetMojo.com and just how huge it could be, then they are welcome to invest in Series A round (that’s assuming the VC that might be investing in Mojo Supreme mainly for WatchMojo.com does invest, and if they do, does not mind this little exercise in insanity). As I sat there in the Palace Hotel listening to Zuckerberg describe fbFund, it hit me that this would in fact help me realize my vision of having Mojo Supreme as an incubator and holding company with partnerships and joint ventures with different firms and backers…
Anyway… expectedly, FB probably got a lot of inquiries… I think it was great how Zuckerberg announced it, like Santa Claus telling kids that he had extra boxes to get rid of… but I was surprised at just how open it was: “send in an email”.
WTF?
If you think about it,
- VCs have clear legal statements saying that they can do whatever they want with your business plan, and that if you submit it, it’s your loss.
- Book publishers tell you don’t submit manuscripts for a reason.
- TV and film companies? Ditto.
So today Facebook realized that they had a potential situation on their hands with thousands of ideas coming in. I can imagine, judging by just how much the TC40 companies were similar, that a lot of the submissions were similar to one another, and to things that FB itself is planning to do.
==
Thank you for your submission for an fbFund grant and support of the
Facebook Platform. Our goal for this program is to encourage as many
developers as possible to write innovative and engaging new applications
on top of Facebook Platform. Additionally, we hope to enable an even
broader class of developers to become entrepreneurs by giving you the
financial resources necessary to pursue a new venture that relies on
Facebook Platform.
During this process, however, it has become clear that we will receive
proposals which contain similar or even identical ideas. As a result,
and in order to protect other developers and us from claims that we or
anyone else copied material without the creator’s permission, unless we
agree otherwise in writing, we can’t promise that any materials or
information you submit here will be kept confidential, or specifically
that we or others might not develop similar or identical products or
services. Accordingly, we ask that you not submit any materials or
information you consider to be confidential or proprietary to this
e-mail address.
This said, if you would like us to delete any materials you have just
sent us, please send us an e-mail within 48 hours instructing us to do
so with an email subject “DELETE”, and we will delete those materials
without review by anyone here. If we do not receive instructions to
delete your materials within 48 hours, we will rely on that fact as
indicating that you wish us to review your materials, with the
understanding that we accept no obligations (whether of confidentiality,
payment or otherwise) with respect to any materials, information or
ideas included in your submission.
Again, we are very excited to be offering this program and wish you the
best of luck whether or not you are an fbFund grant recipient. We can
only give a limited number of grants and not getting one does not mean
that we don’t believe in your application nor that it can’t be
successful - it simply means that we have a limited amount of resources
and weren’t able to give money during this cycle to you. You are
welcome to apply as many times as you like as each funding cycle
represents a new opportunity to receive a grant. Additionally, there
are other programs, if not ours, that can enable you as an entrepreneur
to find the initial seed funding you are looking for.
==
As another side-note, I particularly like the pre-emptive, potential “it’s not you it’s us” line in the last paragraph.
Classic, I presume FB’s lawyers are Seinfeld fans.
Anyway #2: I think this is smart and overdue for fbFund, I would suggest they set this message up as an auto-reply to people who emailed them about a project.
In fact, it’s reminiscent of how Facebook did not, in Zuckerberg’s own words “communicate the news feed launch properly or clearly” last year.
Bottom line, Facebook is maturing, so is Zuckerberg, and this shows that the company is keen on doing good things for the web ecosystem but understands that business is business. But, it also suggests that the company’s open platform and fbFund will backfire at times because invariably, no matter how noble their intentions are, VCs want to make money for VCs…
And, with Facebook’s business being a multi-billion dollar one, and Zuckerberg still being mired in a legal matter, it was natural for the Facebook VCs and management to realize that their excitement to move forward on the fbFund shouldn’t make them put the cart ahead of the horse or expose them to more litigation.
Subscribe:
September 21st, 2007 at 10:00 am
So the big question is, did you reply with DELETE? I’m still thinking about it.
September 21st, 2007 at 10:07 am
hey Mike.
No, I did not press Delete.
But that has a lot to do with the fact that the asset I invest in mainly is WatchMojo.com, StreetMojo.com and others are built, live, adding users and building up traction… but they need relatively few resources. I’d like to add a lot of bells and whistles and blow them up… but I also need to choose as a self-funded company CEO…
Technically there’s nothing stopping Facebook from ripping us off… but money is not a shortage in Silicon Valley, talent and engineering know-how is.
They’re doing this to get more traction on Facebook AND provide Accel, Meritech and Greylock with first right of refusal on things that they might otherwise not really consider… but once they see the uptick off FB, maybe would (or outright acquire you).
Don’t forget that entrepreneurs will try things on FB, and given the site’s sheer size, devoid of a fbFund, other companies might acquire these new applications. This gives FB and its VCs a good, smart way to lock up any upside.
Do I actually think we’ll get a grant, etc., and get a Series A deal with any one of those VCs, I do not know, I do not control that… but since what we do control is WatchMojo.com and that’s where we’re scaling, to me, net-net, it does not hurt to inquire and share some ideas.
Will keep you posted.
September 21st, 2007 at 11:21 am
You’re in slightly different shoes than many like me, I suppose, since you already have your startup somewhat established, and just need to built it out.
But for those who are looking for seed funding primarily to build and test a concept in the first place, handing of a business plans into able hands is a risky move.
While I highly doubt that it’s Facebook intent to use this program to harvest and coopt business ideas, it might be just to tempting to not let a really promising lead turn into an internal app.
I don’t know, maybe I’ve caught the influenza of paranoia around this issue. But I’ll probably risk it anyway.