Yes, I know that other VCs seem to find time to write long, expressive posts and still invest in a few startups along the way. Fred Wilson, Mark Suster, Bill Gurley, David Cowan, and Brad Feld (as well as a few others) have somehow figured out this work/blog balance. If you don’t follow them, I would encourage you to do so.

But fear not! I have not given up on blogging. Instead, I am changing the way I do it.

I have started a new blog at ataussig.com. Follow it on tumblr. Or, point your favorite RSS reader here, if that’s your thing. Even easier: follow me on Twitter at @ataussig, as I will tweet out new posts.

I think you’ll agree that the new blog is a bit sleeker and set up for me to produce wonderful bite-size knowledge nuggets for you all to consume on a more regular basis.

Anyway, I will post here from time to time, but please do follow me over to my new home at ataussig.com. Looking forward to seeing you there!

• Early radio broadcasts were self-promotions for department stores, who also happened to own the radio stations in an era before radio advertising or listener sponsorship.
• Early TV broadcasts were basically “radio with pictures.” (Check out Queen Elizabeth’s 1957 Christmas broadcast, her first ever.)
• Early music videos almost always featured the band performing, and even more often an extended closeup of the lead singer. (Watch “In the Air Tonight” by Phil Collins.)
• The first GUI-based operating systems featured desktops, folders, and windows — all metaphors drawn from the physical world.
• Some of the first websites were little more than online bulletin boards populated by hyperlinks to other parts of the web. Tim Berners-Lee himself called his site an Online Virtual Library in 1991.
• Who can forget that endearing “You’ve Got Mail!” sound that played when you logged into AOL from your 28.8k dialup modem? Your mailbox was, of course, a metaphorical one that helped bring email to the mainstream.
• Facebook’s initial UI was based on the traditional facebook given to Harvard College students at the beginning of their first year.

John Allsopp made this point elegantly in his canonical blog post entitled A Dao of Web Design, written when Web 1.0 was at its peak of the hype cycle in 2000. He drew a connection between the oldest and newest forms of media at the time — the written word and the browser-interfaced webpage, respectively.

Allsopp did not make this point nostalgically, however. He was instead worried that the web, still in its infancy, was headed in a dangerous direction, mainly due to its dependency (perhaps over-dependency) on its printed parent:

The web is a new medium, although it has emerged from the medium of printing, whose skills, design language and conventions strongly influence it. Yet it is often too shaped by that from which it sprang. “Killer Web Sites” are usually those which tame the wildness of the web, constraining pages as if they were made of paper – Desktop Publishing for the Web. This conservatism is natural, “closely held beliefs are not easily released”, but it is time to move on, to embrace the web as its own medium. It’s time to throw out the rituals of the printed page, and to engage the medium of the web and its own nature [emphasis added].

Almost 12 years later, we are experiencing a new revolution in the webpage, but this time the stakes are higher. Why? Because of an onslaught of mobile devices.

The growth of mobile devices in enormous, akin to the growth of the internet itself:

Morgan Stanley and Mary Meeker even calculated that shipments of mobile devices started to exceed those of PCs in Q4-2010. Accessing the web through a mobile device can still be a pain, however, because the last two decades of web development have been focused on the traditional internet browser. Apple invented the “app” to solve this problem by putting the web in a tiny walled garden, but the app world lacks much of what the true web has to offer.

The situation is further complicated by the presence of Android, which creates the opposite problem; instead of one restrictive standard, its ecosystem features many pieces of hardware of varying specifications and capabilities. Oh, and most are running old software:

This is a mess. To achieve internet nirvana on mobile devices, developers need to be able to, in Allsopp’s words, embrace the mobile web “as its own medium.” Standardization to HTML5/CSS3, the advent of Webkit, and growing practice of responsive web design are helping things along, but these advances just put a better wrapper on the web we all know and love.

I’m not sure what the mobile web will look like when it truly comes of age. We’re starting to see examples from the app world that show what may be possible (see Flipboard, Layar, or Infinity Blade), but only time will tell if these app innovations can make it over to the browser.

So, what do you think the mobile web will look like in 5-10 years? Feel free to leave a comment below.

Even after absorbing all I could, I found myself at a loss for words. The problem with saying something profound about Steve Jobs is that, no matter what you might say, Steve has probably said it already himself…and said it more eloquently.

My homage to Steve is therefore in his own words, not mine. The following is an excerpt from an old interview:

I read a study that measured the efficiency of locomotion for various species on the planet. The condor used the least energy to move a kilometer. Humans came in with a rather unimpressive showing about a third of the way down the list….That didn’t look so good, but then someone at Scientific American had the insight to test the efficiency of locomotion for a man on a bicycle, and a man on a bicycle blew the condor away.

That’s what a computer is to me: the computer is the most remarkable tool that we’ve ever come up with. It’s the equivalent of a bicycle for our minds.

Steve Jobs reminded us of our ability to improve the human condition with technology. That very ability to innovate, in fact, is what I believe makes us human. The world we live in is scary and uncertain, so the greatest legacy Steve left behind is proof that we possess the gift (perhaps individually, definitely collectively) to create new tools that move humanity forward.

Thanks for all you gave us, Steve. We deeply appreciate your time with us.

Moore was trained as a high tech marketer, so the guy has a particularly strong set of views on what actually constitutes a “market.” To most of us, defining what we mean by a market would seem like a useless semantic exercise, but Moore makes it tangible and useful.

Here is Moore’s definition of a market (p. 28 of 2002 edition):

• A set of actual or potential customers
• for a given set of products or services
• who have a common set of needs or wants, and
• who reference each other when making a buying decision.

He draws particular attention to the last bullet. Why is the connectivity of customers important in the definition of a market?

Moore goes on (pp. 29-30):

If two people buy the same product for the same reason but have no way they could reference each other, they are not part of the same market. That is, if I sell an oscilloscope for monitoring heartbeats to a doctor in Boston and the identical product for the same purpose to a doctor in Zaire, and these two doctors have no reasonable basis for communicating with each other, then I am dealing in two different markets….

The reason for this is simply leverage [emphasis added]. No company can afford to pay for every marketing contact made. Every program must rely on some ongoing chain-reaction effects – what is usually called word of mouth. The more self-referencing the market and the more tightly bounded its communications channels, the greater the opportunity for such effects.

I find it fascinating that Moore first made this point in 1991, before the internet made such information pervasive. Yet today, even with the connectivity that social networks and search provide, a lot of small markets does not equal a big market.

Some entrepreneurs fail to internalize this difficulty. They build a product for a small market segment and plan to turn it into a $100M+ revenue business by modifying it and selling incrementally different versions of the product to customers in other segments. As such, we often hear the phrase, “Well, it’s a small initial market; but, when you add up all the adjacent opportunities, you get more than $1B in market opportunity.”

I take issue with this line of reasoning since it ignores what Moore calls “leverage.” If you have to reinvest in a different marketing channel to reach a new population of customers, then you may as well be selling to two different markets. In more practical terms, you need to make an entirely new investment (read: cash!) in figuring out the new marketing channel, so you don’t get to amortize the cost of your prior market development over the new set of customers.

When startups try this “adjacent market” strategy, it often feels like starting all over again. Companies burn a lot of capital, product development cycles, and management bandwidth refocusing the company. Sometimes this multi-market expansion is the root cause of a company’s failure.

Entrepreneurs are therefore better off attacking a single monolithic market, instead of lots of small ones. If that single market is large, the possibility for venture returns exists. If it is not, that’s ok; but the founders should be realistic about what it takes to expand from there. If they’re not careful, they can spend their way into oblivion and ruin what would otherwise be an effective business in a smaller market.

1. I love technology and imagining how it will shape the future.
2. I love working with entrepreneurs.
3. I love doing lots of different things simultaneously.

Lately, I’ve been having trouble with #3. It supports the time I spend quickly evaluating hundreds of companies each year, but it undermines another crucial aspect of a VC’s job: performing deep due diligence on a select few of these. In fact, when I switch between “sourcing” and “diligence” modes, I often feel like I’m using two different brains — one that’s good at frenetic pattern matching, and another that’s good at pursuing hypothesis-driven investigation.

Running both brains simultaneously is difficult. They interfere with each other. The multitasking I so often enjoy (hence #3) can be downright annoying when I’m trying to build a complicated financial model, or construct a thorough competitive analysis. To the contrary, I find these otherwise monotonous tasks strangely relaxing and satisfying when I’m in diligence mode. It all depends on which brain I’m engaging at the time.

I suspect founders face this dichotomy as well, especially early on before roles are formally assigned to mid-level executives. Please leave your comments below, and answer the question, “Are founders dual-brained creatures, as well?”

The main theme of Thiel’s short speech was the distinction between two views of the future: the “definite” and the “indefinite.” The definite future is one in which we choose one future worldview and allocate resources against it. Thiel argues that the America of the 50′s and 60′s, in which science fiction novels and government spending on the Space Race were overwhelmingly popular, believed in a definite future, and that this was good for innovation. We believed that man would walk on the moon, that robots would live in our homes, and that scientists could engineer a pill that contained all the nutritional value of our three daily meals. We got only one of those right, but that’s not the point. The point is that aligning oneself around a common goal and believing in it, perhaps foolhardily, is the only way to achieve true greatness. Occasionally, one of those crazy dreams will come true.

In contrast, the indefinite future is one in which we accept our inability to predict anything useful and hedge our bets by putting our resources behind a portfolio of activities down the road. This philosophy best reflects the American psyche of today. How often have you heard our politicians say, “There’s no silver bullet. We need to approach this with a portfolio of solutions.” It is as if America no longer believes in its ability to invent the future. The concerning part of an indefinite view of the future, according to Thiel, is that technology plays no role in it. Instead of putting all our resources behind a panacea-like solution that does not yet exist, the indefinite futurist invests a little bit in every conceivable solution he already has. Thiel believes this philosophy, by definition, fails since almost every major problem we have would have been solved already by current solutions. Taking a portfolio approach to the future may feel intellectually honest and is more politically palatable, but it is doomed to fail the mission of advancing the nation forward through innovation.

Thiel applies this distinction to entrepreneurship in a fascinating way. By definition, entrepreneurs have a definite view of the future. If they don’t, they should get another job. Similarly, they shouldn’t raise money from VCs who don’t also have a definite view of the future. In his own words:

Investors should think in as definite a way as possible about the future. Don’t admit you don’t know and lean back. It’s obnoxious to entrepreneurs. Someone who says “it might work or might not work” is  not the kind of person you want to be working with [if you're an entrepreneur]. There’s room for actuarial science, but not everything is actuarial math.

I think this type of investor attitude goes beyond Eric Paley’s definition of conviction on a given deal. The definite future is a worldview — the belief that our own concentrated actions can actually invent the very future we seek. If you believe that, it makes the decision to support entrepreneurship a really easy one.

You see, I am a bit of a Singularitarian. Not that I believe that 2049 is the magic year when we will all upload our brains to the internet (the extreme version of Marc Andressen’s “Software is Eating the World“), but I do believe that the information content of the world will only become more organized and that our thoughts and intentions will only become more intertwined and connected. This tide cannot be reversed, especially when it comes to the proliferation of digital media.

Not everyone thinks this is a good thing. The last chapter of Chuck Klosterman’s Eating the Dinosaur tells the story of one well-known dissenter: Ted Kaczynski, a.k.a. the Unabomber.

The first bombs were sent out before I was born, so the Unabomber story is a fuzzy childhood memory. I was therefore surprised to learn that his terrorist acts were backed by an intellectual agenda, not just random acts of insanity. Kaczynski’s manifesto Industrial Society and its Future was published in 1995, and Klosterman finds its lamentations on the proliferation of technology to be creepily more relevant today than at the time they were written. Yet, while Klosterman finds truth in Kaczynski’s reasoning, he also recognizes his own inability to internalize it (p. 228):

Even though he deserves to die in jail, Kaczynski’s thesis is correct: Technology is bad for civilization. We are living in a manner that is unnatural. We are latently enslaved by our own ingenuity, and we have unknowingly constructed a simulated world. The benefits of technology are easy to point out (medicine, transportation, the ability to send and receive text messages during Michael Jackson’s televised funeral), but they do not compensate for the overall loss of humanity that is its inevitable consequence. As a species, we have never been less human than we are right now.

And that (evidently) is what I want.

I must want it. It must be my desire, because I would do nothing to change the world’s relationship to technology even if I could…I aspire to think of myself as an analog person, but I am not. I have been converted to digital without the remastering, and the fidelity is appalling.

What Klosterman is referring to is the oversaturation of media that so many technophiles are experiencing today.

Try this: picture a basketball game. Close your eyes and do it. What do you see? If you’re like most people I’ve asked, you are picturing a game you saw on TV, even though you’ve likely played basketball yourself in the past.

How often do you form images in your head based not upon reality, but upon a media impression? Whatever the answer is, I’m sure the number of affirmative responses has increased dramatically since Kaczynski moved into the woods and started mailing bombs to people. Just since 2001, the average daily time spent consuming media has risen from 6 hrs 50 min to 8 hrs 11 min, so today roughly half of our waking hours are spent consuming media.

We actually consume as much media as we do reality.

The big question is whether this realization somehow makes technology a devious endeavor. And, to that point, I say no. I disagree with Klosterman. I am closer to many people in my life because of the strong ties that email, social networks, and video chat have produced. My life is made better by the existence of Pearl Jam, Darren Aronofsky’s films, and the second and third Assassin’s Creed video games (not so much the first). I think digital media has the power to connect, not just to disconnect. A media impression may be less real than reality, but that doesn’t necessarily make it worse.

The same may be said for technology in general. Trains, planes, and automobiles may confine human beings to small metal tubes for extended periods of time, but at least some of those trips are to see loved ones they could otherwise visit only infrequently. Increases in longevity have produced senior citizens who have difficulty caring for themselves, but some of them live to see grandchildren they may not have otherwise. The atomic bomb is the most diabolical weapon ever constructed, and yet its mere existence has effectively rendered a global war entirely futile for any rational nation. (Ever seen War Games?)

Because technology comes from humans, technology can’t exist without a fundamentally human purpose. Even as the lines between reality and media continue to blur, we are ultimately in control of our own destiny. Why? Because we are creating the world we want to live in, and we’re using technology to do it.

1. We’ll give you more stuff (read: features/support).
2. You give us less stuff (read: money).

Often, when we meet companies who have made big concessions for a customer, we often hear the justification that Company X is a “strategic customer.” The word “strategic” here is taken to mean that, by virtue of signing up this particular customer, your company will be able to gain some proprietary advantage in the marketplace: greater legitimacy, a new sales channel, lots of PR, etc.

Calling certain customers “strategic” is dangerous, however. There are no strategic customers, only anti-strategic ones; and here’s why.

Let’s say the concession goes down path #1. A good example is a customer who asks you to build a special, but idiosyncratic feature into his implementation of your product. You spend lots of management attention and engineering resources to complete a feature that only one customer will ever use. Even if you charge for maintenance and/or services to make that extra work profitable, you are still stuck with the legacy costs of supporting that feature. Those legacy costs can seriously hamper the productivity of a startup with limited resources and a tendency to lose focus. Unless this feature is useful to a few other customers, you may be better off not taking this customer’s business at all.

Now, for concession path #2. We often see startups give deep discounts to their first few customers for strategic reasons. Discounts for startups are somewhat of a arbitrary distinction, since the pricing is still in flux anyway. That said, if you sign up enough customers at a discount, your discount will often become the upper limit on your price. Why’s that? Because the market talks. Customers will often call up one and other and ask, “Hey, are you using [your company]’s product? Did they budge on the pricing? How much? Oh good, thanks.” Once again, would you be better off lowering customers’ expectations of you in the future, just to make a few bucks today?

If you are tempted to treat a customer as strategic, ask yourself the following question: “If I treated all my customers this way, (1) would I still have enough resources long-term to scale my business, and (2) would I still be able to make enough money from a given deal?”

If the answer is no, then this customer is actually anti-strategic. Consider spending your time elsewhere.

Yesterday, I spent the afternoon at Harvard Business School, meeting with former professors and chatting about what the next year holds for the entrepreneurship curriculum. I’m admittedly envious of what faculty members like Tom Eisenmann have planned for the MBAs this year. You guys are so lucky!

My nostalgia got me thinking about what I wish someone told me before I started my first week of business school. Here are my top 3 pieces of advice.

#1. Use school as an excuse to develop relationships with really important people.

For some reason, whether it’s simple karma or #payitforward in action,  important people are more likely to return an email from a student than from your average cold caller. As long as messages are (1) well-written, (2) short [very important!], and (3) cite some sort of common connection, they tend to be well received and can be the first step in developing mentor relationships that will last throughout your career.

An old sage of venture capital once told me, “You don’t find a mentor; they find you.” But, I think he was referring  to the “convincing them” part of the process. Initially, you have to take the initiative to put yourself in front of great mentors, and school gives you a great platform to do that.

#2. Start the job search now.

I can’t stress how competitive really good jobs are. By the time you’re sitting in that interview chair in April of your second year, the statement, “Well, I think I would be a good fit for your company because I’m a good problem solver” won’t cut it. Sorry.

You need to be able to actually tell a company why you’re passionate about their industry and why you are the best person to solve a particular problem they have. To do that, you need to develop “expertise.” I put expertise in quotation marks because, of course, you won’t be an expert by the time you’re in your second year. Yet, for some reason, the magic of an MBA program is that it creates the illusion that you know what you’re doing, that is, if you can speak intelligently and passionately about a particular opportunity.

So, the search starts today. Start doing things that build your expertise over time: set up an RSS reader that follows top industry blogs, schedule coffee meetings once a week with classmates who have worked in your industry of interest, and cold call influential executives in your network. By the time the job search rolls around, you will have a leg up on everyone else.

#3. Dedicate time to develop a few lifelong friendships.

If you’re in business school, you probably have a “work hard / play hard” attitude. The problem with that philosophy is that it can leave little time to develop actual, deep relationships with your classmates. Some of my fondest memories in school were the long discussions over lunch, the trips we took together, and the hours we spent planning pranks to play on our sectionmates and professors in class.

Make sure you take the time to have real discussions and meaningful interactions with your classmates. You will learn a ton from them, but you will also develop a few friendships that will last a lifetime.

Here are a few other suggestions from my Twitter followers. Enjoy!

Ignore recruiting if it’s not for you.

@andrewrosenthal, HBS ’12

Travel. A lot.  Don’t get so caught up in rat race that you forget that this is your last chance to go everywhere, see everything.

@kcapelluto, HBS ’10 || GM Superchannels, AOL

Do the maximum number of field studies.

@bijans, HBS ’04 || General Partner, Highland Capital Partners
@ellwheeler, HBS ’11 || Senior Associate, Greycroft Partners
@joverdorff, Wharton ’11 || Associate, TechStars NYC

A non-traditional background doesn’t mean you’re behind. So don’t be afraid to speak up.

@cmwalla, HBS ’10 || Co-founder, Quincy Apparel

JFDI. Really, stop talking and posturing and do something…

@jamesreinhart, HBS ’09 || Co-founder & CEO, ThredUp

Listen more.

@davealevine, HBS ’09 || Investment professional, Paulson & Co.

Stay curious and humble. Experiment. Use the resources. Take risks. Fail. Blaze your own trail.

@vlgreen, MIT Sloan ’11 || Co-founder & CEO, OnChip Power

Last time on interview to venture, I sat down with Boris Revsin, co-founder & CEO of CampusLIVE. Boris is a first-time CEO in his 20′s and is building a consumer internet company that is transforming the way college kids interact with brands. This week, I decided to give you some exposure to the other end of the startup spectrum and sat down with Patrick Morley, CEO of Bit9 (a Highland portfolio company).

Based in Waltham, MA, Bit9 is an enterprise software company battling on the front lines of a multinational cyberwar. When you hear about Fortune 500 companies or U.S. government agencies getting “hacked” by foreign terrorists, you are hearing about a problem that Bit9 solves. While cyberwarfare may not be a top of mind issue for most Americans, Patrick is emphatic about one thing: what we are seeing today is “the biggest transfer of intellectual property that the world has ever seen…and it’s all occurring illegally.”

Patrick is also an experienced startup executive (Bit9 is his sixth VC-backed startup) with some wise words for younger entrepreneurs. Here are a few choice nuggets I’ve strung together from the embedded interview video above. Enjoy!

On the future of cybersecurity:

“I am continually stunned at how naive not only the public is, but also how naive executives and boards are of publicly-held organizations on how big a threat we have. We are seeing right now, today, the biggest transfer of intellectual property that the world has ever seen…and it’s all occurring illegally.

Every major organization in the United States, and the Western World, has been penetrated (and that includes the whole U.S. government). The only difference is those organizations who know they have, and those who don’t.”

On CEO skills learned at his first sales job at IBM:

“We had a year of training before we were allowed to see a customer. One of the big lessons we learned was about listening, which plays a critical role in running a company. The other element is having to quickly figure out where to spend your time.”

On running effective board meetings:

“Make ‘em fast! 2 hours is our average. Also, I don’t get my board very often, so when I do I have a few rules. I ask that no one be on their phones or iPads, and my reasoning is very simple: if I have you for 2 hours, focus on the business for those 2 hours, and then you can go off and be on your phone.

Also, if I can’t convey what I need to the board in 15-20 slides (my whole deck) and talk about where I need thoughts and advice from them, then I’m doing something wrong. The objective of my board meetings is not to give a complete operational update. When you limit yourself to only a few slides, it tends to make you focus on what’s really important.”

On managing the tension between engineering & sales:

“That tension is good, and having the debate around that tension is good. The way we handle it is straightforward: I make sure the executive team agrees on what our goals are for the coming year. So, then when you get into debates around what needs to get built vs. what needs to get sold, it’s relatively easy to line back up against the objectives.”

On best & worst moments as a CEO:

“The best moments are getting the team to do things that, when you first discussed it, seem impossible. That is very, very rewarding, when you see people grow and stretch themselves.

In the same way, that’s also probably the most stressful: when your team members haven’t gotten it done, maybe because you didn’t put them in the right place, or provided them with the right level of support or resources. Or, maybe you didn’t make the right hire. Those are the hardest.”