Twitter = Discovery

As you may have read, Stocktwits just closed its Series A round with True Ventures. Tony Conrad, of Sphere and WordPress fame, will be joining Howard, Soren and I on the Board. I am very excited about our new partner, and know that Tony's entrepreneurial IQ and product development expertise will be a huge asset to the Stocktwits team.

I have shared my views about Twitter in the past, and have only become more wedded to the ecosystem through my investments in TweetDeck and bit.ly. Given the passage of time and my greater intimacy with the medium, I decided to do a re-read of my "foundation" post of October 2008 titled Twitter: Monetize the Apps, not the Platform. Here is an extract from that post; it still accurately reflects my feelings about Twitter, its promise and its shortcomings:

I love Twitter because of its immediacy, the "one to many" concept and the fact that culturally, so many of those on Twitter monitor and manage their messages with a vigilance far exceeding that of email. This is its power at the most basic level. But when you think of creating communities around Twitter, be they related to companies, brands, entertainers, common interests, politics, etc., it is easy to see the massive power that can be harnessed pretty quickly.

So what do you need? Groups. Perhaps human-curated groups. With hierarchies and sub-hierarchies to help people best search and discover pockets of people they want to follow. Much as AOL, iVillage and the other major portals did to help organize and target their massive horizontal audiences. This easily helps new users get engaged and get busy, as they can simply wade in and find relevant groups with a few clicks. Further, groups are great targets for future advertising and lead generation, as they've self-selected into particular areas of interest.

You also need vertical applications. Investing. Shopping - cars, music, etc. Travel. And on and on. With a sufficiently robust API, the developer community can innovate in much the same way as they have for the iPhone. Create a Twitter App Store? Maybe. But the main goal should be providing the environment for developers to come up with great stuff that will be used, that ultimtely people will be willing to pay for.

Interestingly enough, many of my predictions have come true. There has been an explosion of applications built on top of Twitter, attempting to make sense of its vast and disaggregated audience. To this day, if I go on the native Twitter site and use its search functionality, I don't get much out of the experience. I get infinitely more value from the apps that have been built courtesy of the Twitter API. The problem then as now relates to discovery: how do I find people who care about the stuff I care about, find people from my past just as I do on Facebook, build a universe of people whom I follow that creates real community as opposed to a series of disjointed entities? These are still questions that remain to be answered. At the end of the day people want connectedness and relatedness. Yes, news updates and worthwhile and I follow a handful of bots to keep me current, but my follow list is largely comprised of people whom I like and respect, people who create interesting content that stimulates my thinking and brings me new perspectives. But I'm sure there are many more people out there I'd like to be following that I simply can't find, and vice versa. This is a mega problem that will invariably be solved, but it hasn't been yet.

Stocktwits is merely one answer to the profound question that is discovery. In its domain, it is a category-killer product. But we need many more Stocktwits to drive value to vertical communities - and affiliates and advertisers - across the Twitter landscape.

Happy New Year and Help Wanted

Happy New Year, everybody. I hope you all had a good break and are ready to get back at it in 2009. While I believe that the US public markets will generally suck this year, I continue to feel that we are the cusp of a historic opportunity in the early-stage investment arena. Fortunes will certainly be made in the liquid markets, but REAL fortunes and REAL value will be created through innovation, entrepreneurship and sheer will in the private markets. I intend to participate actively in this portion of the wave.

I was kindly (and unexpectedly) asked to be the keynote speaker at the 2009 SIIA Previews on January 26-28. Last year's speaker was my friend Kevin Ryan of AlleyCorp. I can see why they wanted Kevin; he is a serial entrepreneur with an impressive track record and one of Silicon Alley's brightest lights. Though I had a pretty successful career on Wall Street, in the entrepreneurial world I am probably best known for my role in the failure of Monitor110. So I figure I will discuss what we can learn through failure, and how we can ultimately turn negative events into positive outcomes. I think this will make for an interesting and topical discussion.

That said, I would be interested in other's thoughts on the topic of Learning from Failure. It could be quotes, cartoons, pictures, videos, whatever you believe would contribute to the presentation. I certainly do not corner the market on insight or have every relevant metaphor at my disposal, so any help would be much appreciated. You know where to find me.

Twitter: I Can See Clearly Now

Though a fan and a user of Twitter, I have had my doubts as to true value of the platform. However, a recent release by one of my companies has made me see more clearly how Twitter can be a powerful enabler and unleash a rash of innovation for the betterment of its community.

The latest StockTwits release, which through a Firefox extension provides a hot-link from stock-related messages delineated by a $ sign on Twitter to the StockTwits ticker page, highlights the power of the Twitter platform and the value that can be layered atop the community. Fred's post touches on other companies that might build their own extensions to extract greater intelligence from Twitter. VentureBeat has been focusing on Twitter's potential to link to other websites. These are both really good points, and the AVC discussion thread has other good perspectives as well. In short, Soren and Howard are making it happen.

What it all comes down to, IMHO, is the ability of Twitter users to find and build relevant communities both on and off the Twitter platform. In the case of StockTwits, the community is a bunch of people - professionals, skilled amateurs and voyeurs - who are interested in sharing views on stocks and the economy. If StockTwits didn't exist, it would be much harder to find people with similar interests where one could easily be inserted into the dialogue. This was my big knock on Twitter in the beginning. But as more apps are built that help people identify Twitters of like interests whom they might want to follow, and that facilitate the creation of communities that interact on Twitter but can dig in deeper elsewhere (like StockTwits), Twitter's power as an enabling platform is rapidly coming into view.

Just as the iPhone unleashed a wave of rapid, creative innovation that brought real value to its users, I expect a similar phenomenon with Twitter. Without a doubt, the best is yet to come.

Why I Left Seeking Alpha

I have allowed my content to be re-published on Seeking Alpha for a long time. Since I don't care about the money of blogging, I didn't get upset that they made money off my stuff (though I know several who get completely psychotic about this apparent unfairness). I always viewed it as a way to let more people who want to read about Wall Street, hedge funds, economics, technology, etc. find me. And that was ok - until now.

As I've become more broadly read both on Information Arbitrage and on Seeking Alpha, the number of comments I've received per post has risen dramatically. I recently started using Disqus for my blog comments and it has been a life-transforming experience. I love being able to respond directly to specific comments, and for others to continue to stay on a particular comment thread for as long as they want. I had no idea how emancipating such a change could be. The number of comments I receive has gone up a lot. And I've been more engaged in the dialogue since I can just check in, rip off some thoughts to a few commenters and move on.

Seeking Alpha has no such functionality. It is the old-style, newest-comment-on-the-bottom approach with no ability to insert onself in the midst of the dialogue. I didn't really care when I was receiving 2-4 comments per post, but as that number has climbed towards 20 and beyond it has become a problem. Further, the tone of the comments on Seeking Alpha are often pretty hostile, which really makes me want to call out specific people and give them a piece of my mind. But I can't do this because of their antiquated comment technology. So I decided to say goodbye.

I'd be interested to know if anyone really cares that I am no longer on SA. I'm still here. Where it all started.

Twitter: Monetize the Apps, not the Platform

I have spent a lot of time thinking about Twitter, and trying to figure out how it fits into the communications landscape. I've also given some thought to how it should best be monetized, and attempted to decompose the value stack associated with its presence. My conclusion: Twitter is akin to an open source utility, not dissimilar from Lucene, Linux and Apache. It is a platform, a base off which value-added services can be built. I am working on one, Stocktwits, but there are countless others that are built on top of Twitter by leveraging its API. I believe the real value of Twitter is in the applications, in the aggregation and monetization of vertical audiences that happen to use the platform as a medium of communication. But the question is: how can Twitter benefit from this innovation? Clearly there are analogies out there providing some guidance of what can be done, e.g., Facebook, but Twitter is a unique animal and requires its own analysis.

I wasn't an early adopter of Twitter. In fact, I was pretty cynical and dismissive at first. But since I joined, it has rapidly become a fixture of my communication process. I sometimes substitute email with Twitter, if I need a quick answer from a friend whom I know is constantly watching their Twitter feed. I find it useful for monitoring the banter around a particular thread, and for discovering interesting links shared by people I follow.

Starting out on Twitter can be hard, however, because unless you know lots of people using it how do you know who to  follow? And how do people become aware of you? I was lucky because I knew lots of active Twitterers to ping once I got on, and between that and blogging I built a rich community pretty quickly. Not everybody is so fortunate, however.

I love Twitter because of its immediacy, the "one to many" concept and the fact that culturally, so many of those on Twitter monitor and manage their messages with a vigilance far exceeding that of email. This is its power at the most basic level. But when you think of creating communities around Twitter, be they related to companies, brands, entertainers, common interests, politics, etc., it is easy to see the massive power that can be harnessed pretty quickly.

So what do you need? Groups. Perhaps human-curated groups. With hierarchies and sub-hierarchies to help people best search and discover pockets of people they want to follow. Much as AOL, iVillage and the other major portals did to help organize and target their massive horizontal audiences. This easily helps new users get engaged and get busy, as they can simply wade in and find relevant groups with a few clicks. Further, groups are great targets for future advertising and lead generation, as they've self-selected into particular areas of interest.

You also need vertical applications. Investing. Shopping - cars, music, etc. Travel. And on and on. With a sufficiently robust API, the developer community can innovate in much the same way as they have for the iPhone. Create a Twitter App Store? Maybe. But the main goal should be providing the environment for developers to come up with great stuff that will be used, that ultimtely people will be willing to pay for.

But the big question in all of this is how will Twitter get paid? Should it be the one to organize the user base, or will that put it in direct competition with those who would develop apps for the platform? And what about advertising? Ads in the Tweets seems pretty far-fetched, but ads targeted at specific users within specific applications seems much more acceptable. Should Twitter take a piece of the major vertical applications that emerge, letting competing apps duke it out until a clear victor emerges and then co-opting the winners in each key vertical? These are questions Twitter management and its investors will have to answer in due course.

I never really got the monetary value of del.icio.us. But I get Twitter. The problem is that when looking at the value stack, it seems that the stuff people might be willing to pay for resides largely on top, and not inside, of Twitter. In short, I believe Twitter needs a robust and well-resourced business development function to cut deals with leading applications and to get into the flow of the revenue. I can also see Twitter setting up its own Red Hat equivalent, offering institutional-grade service and support to corporate users - for a price. Because without these steps, I don't see what has become a viral and powerful service generating a return for its investors.

Learning from Scoble - Optimizing Attention

If there is one thing I am, it's overstimulated. Too many activities. Too many obligations. Too many e-mail. Too many social networks. Huge emphasis on my wife and two boys; coaching, playing, living, loving. Which leaves time for - recovery, maybe. Something has got to give. I love to read; I don't read enough. I love to write; I don't write enough. I love art; I don't see enough of that, either. I love meeting interesting people; I do some of that but would enjoy spending more time with really cool people I can learn from. Bottom line: my attention is very broadly scattered and I hold it all together (most of the time), but I feel like I should be happier and more satisfied given my tremendous effort in all areas.

I recently read a post by Robert Scoble that made me feel both crappy and hopeful; crappy because he is so much more evolved than I am and hopeful because he provided some concrete ideas for improving my lot. His post, aptly titled Attention thieves; keeping you from living a "FOOCamp life?", really struck a chord with me having just returned from Foo Camp myself. So, what is a FOOCamp life to Mr. Scoble?

I’d live a FOOCamp Life and have an interesting conversation every day, just like the one I had at FOOCamp that Friday evening at about midnight with my son and a bunch of interesting technologists.

What I get from this is that Robert wants to preserve an environment of lifelong learning, of constantly meeting and making the time to speak with bright, insightful people, and enriching both himself and his readers in the process. Good stuff. And what was it about FOOCamp that fostered this desire to live a FOOCamp life?

How did FOOCamp create that need? ...Soon an executive from AT&T walked in. Then Yossi Vardi did (his kids started ICQ). Then Linda Stone walked in (she gave me some heck for working for Microsoft which struck me as odd at the time since she was a former executive at both Apple and Microsoft). Then the two guys who started Google walked in. Then Tim O’Reilly himself walked in. That was the beginning of my FOOCamp experience and it only got better from there.

This is exactly the way I felt when I was at FOOCamp. Fascinating people at every turn, people with a host of different academic backgrounds, perspectives and experiences than my own. Intellectual nirvana, basically, with a fun, social twist. Though my brain hurt by the end, I didn't want it to end. After a decent sleep and a shower I could have certainly done another day with a small group of people, really digging in to topics of mutual interest without it being quite so overwhelming. Kind of like what Scoble is now doing in his every day life. So finally, Robert asks the salient questions:

What gets your attention off of your life goals? Or, in my case, keeping me from living a FOOCamp Life? For me, this post was conceived because I started up MSN Messenger and instantly got distracted by several conversations with my friends.

So, what is distracting you from your goals?

Twitter? Facebook? Email? An RSS Reader? World of Warcraft? Flickr? Phone calls? TV?

How do you manage attention? Er, how do you manage your attention thieves?

Right now I manage the attention thieves like garbage. I put out the milk and cookies and practically invite them to attack. I react to every buzz of my Blackberry. I hate getting behind in my email. I like to check Facebook and make sure I am keeping up. I recently started playing with Twitter because I was feeling like a loser for not engaging with what has become such a popular and ubiquitous communication medium (at least within my circles). I invest a lot but have done so as a lone ranger, which has taken a lot of time (when you consider the size of my portfolio and the degree to which I am active with some of my companies). Oh, and I've been working on a stupid house renovation for nearly three years that may well have taken a year off my life. All of these things tax me greatly. Could I do it better, prioritize in a much more brutal way and simply opt out of a bunch of current media? Sure. And I am going to give it a good think. Because I ponder Robert's priorities and the changes he's made and I am envious. Attention thieves pervade my very existence. I need to take back my attention. Now.

Microsoft: Your Potential is Exponential. So Why the Problems?

I've been bashing Microsoft for some time now. But I'm not sure if I've necessarily been fair or clear in my criticism. I take issue with a whole host of the company's strategic pursuits, financial decisions and the like, and I believe every single word I've written in my time as a blogger. At the corporate level, I think that Microsoft has made some tremendous blunders and continues to make countless errors of historic proportions. That said, Microsoft is filled with some of the brightest, most insightful, most forward-looking professionals I've ever met, so many that it is almost mind-boggling. A bunch of these people were my fellow campers at CI Foo, and I couldn't have been more impressed. These are people that, if given a chance, could give Yahoo, Google or anyone else a run for their money. They are on the bleeding edge, but the edge where there is money, not just science for science's sake. So what does this mean?

I'd say it is a good news/bad news story for Microsoft shareholders. The good news is that some of the human capital at Microsoft is likely among the best on the planet, and doesn't seem overly discouraged by the crazy stuff going on at corporate. If allowed to flourish, who knows how competitive this company could become. The bad, however, is that the decision-making process currently employed in Redmond has and is continuing to lead to simply awful strategic decisions on an increasingly large scale. The company is clearly trying to squander cash as quickly as it is making it, which is not the best formula for building shareholder value. So given this state of affairs, what should Microsoft be doing?

Get a cultural face-lift. As an outsider, I cannot begin to understand how decisions are made. But what I can surmise from the outside is that there has been a consistent string of decisions dating back to the late 1990s that defy logic, and that this is indicative of a systemic issue that desperately needs fixing. "Strategic" investments like AT&T, Comcast and Nextel. $25 billion+ sunk into the Home & Entertainment Division (H&E) over the past five years. Tens of billions in share buybacks at relatively high prices. What are we talking here? $50 billion, $60 billion, $75 billion of foregone shareholder value? Whatever it is the numbers are staggering. Something within the culture near the top of the organization is broken and it needs to be fixed - now. Because there is another $40 billion about to be pushed out the door that is likely better spent in any number of ways. But that I'll leave until later.

Allocate capital on the basis of stand-alone businesses. The character of Microsoft's three major business lines, and even the products within those lines, are very different. For instance, the operating systems business is a cash cow. A cash cow that given the dynamics of the mega-shift from desktop computing to web services, has the cash flow characteristics of an oil well. It has high current cash flow, cash flow that can be sustained and even grown somewhat through the use of technology (akin to using better drill bits, injecting natural gas and water to increase yield in the realm of drilling, but in the case of Microsoft means new releases, function upgrades, etc.), but that ultimately the cash flow will decline and then vanish. This part of Microsoft is far and away the most value on a present value basis. And this is not due to rapid growth. It is due to the magnitude of the fortress they've built in the operating systems world. But this fortress cannot and will not last forever. But in the meantime, they can use the cash from this massive annuity to establish a significant dividend and to fund high-ROI R&D, not the kind of far-flung investing they've done in the past.

What this also means is that they should strongly consider spinning off the Home & Entertainment Division, a business that has cost an enormous amount of money with a highly uncertain, long-shot payoff. That said, it has some strong brands and some solid technology. It just has never had to operate with the discipline of a real business since its losses are covered by corporate's seemingly boundless largesse. It is time for the young adult to move out and live as an independent being. This would likely have several positive effects for Microsoft's shareholders: (1) stopping the flow of cash that should be going into your pocket from subsidizing additional H&E losses; (2) providing you with ownership of a potentially high-growth business that is better able to attract talent and flourish due to its independence from Microsoft; and (3) offering you the chance to sell your ownership in the H&E business if you simply think it sucks and you don't want to play the gaming game any more. As a Microsoft shareholder, 1-3 are looking pretty good to me.

Invest in Live. For life. This is the bet to made given Microsoft's competencies and core franchise. Given the IP within Microsoft and their 30+ years of experience with desktop computing, they should be able to make a run at owning the web-services fueled computing environment. Ultimately, Microsoft is going to have to do to themselves what the market will ultimately do to them - kill their desktop franchise. But by then, they should be able to do the present value calculation of foregone annuity earnings from the desktop franchise versus the increase in breadth and long-term growth of a massive, ubiquitous web services offering. I'm not saying do this tomorrow, but senior management needs to acknowledge that this is where things are going. This is a big cultural shift for the company, but given the talent and IP already resident within Live they've go the raw materials to make this happen. I would much rather see corporate invest an incremental $5 billion in Live than as a down payment for Yahoo or some other stupid acquisition. If you want organic growth, invest in the areas you really understand. H&E? Give me a break.

This post is in direct response to my epiphany that as much as I've beaten up Microsoft, it is still one of the world's leading talent magnets. They've got it right in front of them. They just need to reach out and grab it. If they've got the vision, the stomach and the will necessary to make the cultural changes necessary to let it happen.

CI Foo - Day 2

Let me preface this post by saying that I'm fried. Having so many and such intense conversations over a two day period, overlaid with jet lag, leaves one feeling like a dishrag. That said, CI Foo was a huge success as far as I'm concerned and I got so much out of meeting so many bright, insightful people willing to share. Hopefully I was able to hold up my end of the bargain.

930am - sat in on a session discussing "bad actors" among the collective, i.e., those who put up false reviews, try to game the system, etc. Preston McAfee of Yahoo (on loan from Caltech) steered the bus for this discussion, but was heavily supported by John Riedel of University of Minnesota. Using Amazon as a benchmark, we talked about large vs. small comment forums and the likelihood and ability to game the system. The group pretty much determined that the "gaming the system function" is like a hump, with small sites and large sites less impacted by bad actors than those in between. Why? Because sheer numbers make large sites with large amounts of comments like Amazon hard to taint, while small, niche sites aren't often the focus of bad actors. Those in the middle, however, are clearly vulnerable.

10am - Dave McClure's big ideas around the concept of "securitizing happiness." In essence, Dave's goal is to try and use financial innovation as a vehicle for helping several under-served constituencies: lower-income individuals and families (to get better care in order to live longer, healthier, more productive lives); small businesses (to gain easier access to growth capital, akin to the role played by FNMA in mortgage lending) and others. While I'm not sure that some of his financial approaches are necessarily the right ones to address the issues, he is focused on critical issues that warrant additional brainstorming. And I am pleased to help him think through his noble mission.

11am - Identity, Ontology and Fraternite in the context of Wikipedia, facilitated by two smart dudes from Metaweb, Robert Cook and Kurt Bollacker and another smart dude, John Riedel (who was extremely active in countless sessions). After gaining a better understanding of the structure of Wikipedia and the underlying editorial process, we discussed the profiles and statistics of key contributors as well as bad actors and their impact on the overall corpus of data. Bottom line, the numbers are pretty small but rising. It gave me a much keener understanding of Wikipedia, its construction and the issues surrounding its growth and maintenance.

130pm - Prediction markets and elections, run by Eric Zitzewitz of Dartmouth. Eric ran though a slew of data looking at sports and financial prediction markets and compared it to election prediction markets. Bottom line, sports and financial prediction markets are highly efficient and closely track actual outcomes, while election prediction markets tend to systematically underprice favorites. This is the way it is in the US. In the UK, where election prediction markets have existed for over a century, they are much more efficient. Two explanations for the US election markets' relative inefficiency are low repetition vs. high repetition domains (sports and financials have large numbers of contests while elections have far fewer contexts), and that bettors in the US have far less collective experience betting on elections than their UK counterparts. Interesting stuff.

130pm - Modeling surprises by Eric Horvitz of Microsoft Research. I only caught the tail end of Eric's talk but from what we discussed following his presentation I was incredibly excited. I am all about understanding tail risk and also its converse, identifying tail opportunities. I will follow up with Eric in our post-Foo lives. This is one of the great things about Foo - you meet people whom you likely never would have met any other way.

Here is a smattering of other issues that were raised during CI Foo:

• Distributing big tasks among many
• Economies of scale in knowledge
• Parallel vs. aggregate knowledge
• Scale - need taxonomy, time and # of people
• Create an ontology of classes of CI problems
• Connecting opposite ends of the CI continuum - top down/bottom up and implicit vs. explicit
• Collective intelligence vs. collective will
• Reputation
• One person's implicit data is another person's explicit data
• Topology of community members
• Active vs. passive collective intelligence
• Mere parallelism vs. network effects in data

Cool stuff, no? In any event, it was a great few days and I've got to thank all of my fellow Foo campers for making this such an enriching experience. I know I always come out of these Silicon Valley, tech-heavy conclaves sounding like a stupid, fawning idiot, but I get so little exposure to these kinds of communities I am always amazed by the brainpower, the collaboration and culture of sharing and idea exchange. You take a New York boy, a Wall Streeter no less, stick him in Silicon Valley and if he loves technology, big ideas and deep thoughts his eyes will bug out. Like mine. Guilty as charged. Almost makes me want to work in the Valley or in Redmond. Almost.

Update:

1. See Greg Linden's post
2. See Matthew Hurst's post

CI Foo - Day 1

Being at CI Foo is a kind of an out-of-body experience for me. As a "Wall Street guy," my experiences, my mind-set and my DNA is a world away from most of these dudes. That said, given my experiences as an entrepreneur and as an investor over the past 3.5 years, I am in tune with the pulse of the conversation. It just feels odd being part of it and contributing. But I am and it is very, very cool. It is always a thrill being around so many super smart people whose intelligence is so different than mine. I love filling in gaps in my knowledge by being near people who are smarter than me. And there are plenty of those people here at CI Foo.

I sat in on three sessions today, presented at one, got to spend some quality friend with my friend Paul Kedrosky and had numerous conversations with people from Google, Microsoft, Yahoo, Amazon, MIT, Carnegie-Mellon and other equally impressive institutions of commerce and higher learning. Being at Google is cool as well. Larry Page stopped by to say hi and the environment at Google Ground Zero is simply terrific. One of the amazing things about being in such a setting is that people are very disclosing, far more disclosing than they'd be in "normal" life. And it is particularly impressive that top professionals from Microsoft, Yahoo and News Corp. can co-exist at this conference, participate in conversations, grab a beer, hang out, etc., without any strange feelings arising from the goings-on in M&A land. It is a tribute to Tim O'Reilly and his team for creating an environment for sharing, openness and safety. This is how great ideas are exchanged and foundations laid for future work. It is so different than Wall Street. It truly blows my mind.

10am - participated in a session led by Gary Flake of Microsoft Live Labs on the topic of editorial gatekeepers at the head-end of the distribution vs. long-tail recommenders, their dynamics and movement across the distribution. Paul Gould of Fox Interactive, Joshua Schachter of Yahoo, Dave McClure of 500 Hats and Paul Resnick of University of Michigan were all key participants in the discussion. Peter Bloom of General Atlantic, one of my Wall Street-to-venture investor heroes also shared his incredibly valuable two cents. We spent a lot of time discussing issues of reputation and how reputation is established, how to reduce transaction costs associated with reputation and how to quantify subjective/fuzzy recommendations. Search, music and job boards were all used as examples to tease out the ability of long-tail media and services to move towards the head end. I wouldn't say that the group emerged with any definitive conclusions, but he discussion was spirited and fascinating.

130pm - gave a presentation on Making Money from Collective Intelligence (CI). I dove into the issue of expert networks and proposed a third way of making money from CI (with prediction markets and conventional expert networks being the first two). I will work to put my slides up sometime soon. I was followed by Dave Leinweber of the Haas School of Business at Berkeley and Rob Passarella of Bear Stearns, with Dave speaking about applications of computational finance to different data sets and Rob proposing a model for making money from alternative data. Mike Kearns of University of Pennsylvania and Bank of America and Peter Bloom both had interesting perspectives on the issues. Mike, who is a brilliant guy and a hard-core quant focused on machine-learning and automated processes for parsing news, found our bottoms-up, research-oriented approach anathema to his data-heavy, readily quantifiable model. We agreed to disagree on the value of context-specific, non-quant data. I personally think both approaches can generate alpha; they just reflect two different ways of managing money. It was fun to so actively contribute to a discussion. I felt like I was now beginning to pull my weight as a CI Foo participant.

330pm - sat in on a session chaired by Paul Martino of Aggregate Knowledge. We spent most of our time discussing which data sets are most predictive, as well as the relative value of explicit versus implicit data. Super interesting, highly cerebral yet very pragmatic discussion. Andreas Weigand of Stanford/Berkeley/INSEAD, Peter Norvig of Google and Eric Zitzewitz of Dartmouth were big contributors to this dialog. There was a big battle as to whether explicit data was tainted due to Heisenberg's Uncertainty Principle and therefore less predictive than implicit data, or if the diversity of perspectives offered by explicit data far outweighed its potential corruption. I think the group ultimately agreed that both implicit and explicit data are extremely valuable and have their place, and that it is difficult to put the value of one above the other without the benefit of context.

5pm - participated in a discussion run by Paul Resnick of Michigan on the application of CI to solve big social problems. Many suggestions were tossed out ranging from collecting more granular data on our health, our diet and our environment in order to data mine and draw conclusions about ways in which people can live better and live longer; to prioritizing needs within communities involving government support; to bringing greater transparency to government. There were far more big thoughts tossed out than I am reflecting here but given my lack of sleep last night it is hard for me to pull anything more out of RAM.

In sum, it is great to be here. I know that I am getting a lot out of my fellow campers and the discussions we are having. I hope they feel similarly. I will report back after Day 2. It should prove to be a barn-burner!

The iEverything Thesis is Playing Out

Convergence is upon us in the device space. It is just happening faster than I expected. Today's awareness of Apple's patent application concerning a "Universal Device" is exactly what I was discussing with Chris Kohler of Wired Game I Life when he penned his article on iPhone and gaming last night. Once we get the hi-def screens of sufficient size in handheld devices, then the patent filed by Apple can really be leveraged into a category-killer set of work, recreational and gaming apps in one tight, integrated, easy-to-use package. This is what Apple does better than anybody. And a link-up with Google is a lightweight, highly flexible way to address the "virtual machines" back-end of the operation.

Needless to say this vision of an uber-device is a ways off - but clearly not as far off as I thought. Better keep an eye on those hi-def screen suppliers; at this point they hold the keys to the kingdom, IMHO.