Andy Boyer

Category: Big Businesses

  • Straight Talk from Costco’s Jim Senegal

    I’m not normally in the business of simply forwarding links.  But this FastCompany interview with Costco CEO Jim Senegal is full of common sense wisdom.  Read the interview and you’ll wonder why more companies don’t think like him.

  • Mark Cuban vs the SEC

    (Parts of post redacted due to learning new information)

    A friend asked me my take on the Mark Cuban Insider Trading allegations yesterday.  I realized I didn’t have an opinion yet, and agreed it would make for interesting blog discussion.

    If you don’t know the story, go read the report at the Silicon Valley Insider and come on back.

    So assuming you have a little background on the situation, I’ll dive right into the initial thoughts that came to mind.

    1) $750,000 sure seems like a small amount of money for Cuban to care about.

    2) It sounds like the CEO of Momma.com convinced Cuban to buy 6% of the company in March 2004, and then about a month later the same CEO was bringing in a private equity firm which would dilute the shareholders, including Cuban.  If that timeline is accurate, it’s a pretty shady move to pull on your investors, including one who is a billionaire.

    3) It also sounds like the CEO kept Cuban in the dark about the dilution until June 28.  So he had about 3 months of telling Cuban, “Oh yeah, everything is fine,” while working with the private equity firm on how to dilute everyone.  Then he calls Cuban on June 28 and said, “By the way, I’m diluting you in a week tomorrow.”

    4) Cuban sounds like he was pretty annoyed by this.  And you would be too.  After all, had the CEO not brought Cuban on board as a 6% investor, the equity group may not have been interested in financing the company.  So Cuban may have gotten used by the CEO, and then since the CEO told him about the PIPE, now Cuban was stuck holding shares that he couldn’t get out of.  In his mind, they screwed him going in and now were screwing him from getting out.

    5) So, Cuban’s decision at this point seems irrational and not well thought out.  He calls his financial guy and tells him to sell.  At this point, a good financial guy should look at his clock, see it’s late at night and ask why his boss suddenly wants him to stop doing what he was doing and try to unload 600,000 shares of stock in a company no one knows.  Some alarm bell should go off here.  There needed to be a, “Boss.  If the dilution isn’t for a week, lets take 12 hours and look at our options.” (Edit: The PIPE was announced the next day, June 29.)  But the financial guy should still advise him of the issues.

    So my analysis:

    • I think anyone who tries to compare this to Wall St fat cats screwing the American consumer in sub-prime lending, is pretty off base.  Just from reading a few articles, I think Cuban was actually the guy screwed by the Wall St guys (the private equity group) and tried to get out of it.  
    • Unfortunately the rules are a little different for people who have conversations with CEO’s than folks like you and me, and he should have just waited for the announcement and sold everything then, taking the $750k hit.  Then he could have used his conections and power to make sure that CEO never got another dime of funding the rest of his life, and the private equity firm was on a giant blackball list.  I mean, he’s probably made 50x that amount on tips and insights from cocktail party conversations with people you and I don’t get to meet. 
    • It does seem like a pretty trivial matter for the SEC to make a big deal of 4 years after the fact.  Anytime a federal or regional judicial branch of government in a hardcore Republican state, sits on something for this long, and then launches it on a guy who helped fund an anti-George Bush movie, I agree that it kind of feels vindictive.
    • In the end, I think Cuban should pay a fine, we should all avoid ever investing in or using Momma.com and someone should ask why it takes the government 4 years to prosecute something like this.

    However, this is only my first take, and if new evidence comes out, I’m willing to adjust.   Looking forward to some thoughts from you guys.

  • But What is his High Score on iPhone Bowling?

    Adotas brings us word that Barack Obama is bringing his presidential campaign to the coolest phone (and presumably most influential trendsetters) on the planet,  releasing an iPhone app that will enable supporters to easily reach out to friends and remind them to vote for their favorite candidate.

    According ot the story, the app,  “Call Friends,” organizes the user’s phonebook by state and gives each contact a status (called or not called).  You can also use the app to find out where he stands on issues – and of course – enables people to donate to the campaign. 

    I will tell you one thing.  I wouldn’t  trust a lot of politicians to run a company’s mail room, but if Obama doesn’t become President, he would certainly be a heck of a CMO.   

  • Nintendo Makes Great Use of YouTube Real Estate

    Adding video clips to YouTube is nothing new, and video game companies have been putting demos of their games up there for years. 

    But Nintendo has upped the ante with some real creative work on their channel.  Make sure to watch the whole video, then do some right clicking to see how they did it.

  • 2 Big Numbers, and How They are Related

    $20 Billion.  $16 Billion.  Two relatively large numbers that may be too hard to comprehend.  So here’s a funny comparison. 

    According to Valleywag, the entire newspaper industry is now worth $20 Billion.  I suppose that seems right for a 100-150 year old industry with papers everywhere from New York to Wasilia.

    But that number seems kind of small when you figure that Larry Page and Sergey Brin, Google’s cofounders, are worth nearly $16 billion each according to Forbes.  So 2 men who have made it easier to search for online versions of newspaper articles, could essentially buy the entire industry they are destroying.   Does that mean personal fortunes are a tad over inflated?

  • LeBron James Wants to Play in Europe? Why the NBA Should Make it Happen

    The caveat:  I think the NBA is kind of boring these days.  I don’t hate basketball, but the NBA just under-achieves in my book.  Now, if you only speak English and have never traveled outside the US, I can understand why the NBA might seem cool. Similarly, if you’ve never been to a city with more than 200,000 people,  I can see why Appleby’s seems like a real culinary treat.  But I’m not here to bash.  I’m here to push forward a ridiculous notion.

    Some background:     In European soccer, something called UEFA governs European football. Independent leagues in England, Spain, Italy, France, Germany, etc… participate in two European tourneys – the UEFA Cup and Champions League. – which make dump trucks full of money. So in the middle of their regular seasons, Italy’s best teams also play England’s best teams, etc….  It’s pretty cool – and more importantly it makes huge amounts of cash for the teams and leagues.  Now this works for European soccer because there are 3 dominant leagues, 2 or 3 second-tier leagues and about 20 third tier leagues that sneak someone into the later rounds from time to time. 

    The ridiculous notion: You could not replicate this in basketball today, because the NBA teams would win almost every game.  But this kind of International tourney could happen in just a few years if some recognizable US players headed to Europe.  Imagine this scenario:

    Your favorite team is the New Orleans Hornets.  Towards the end of last season,  with a playoff birth locked up, you had to keep battling to finish in 4th place, and a birth in next season’s Champions League.  You qualified, so several times next season, instead of hosting the Jazz or Bobcats, you are hosting teams from Greece, Spain, Russia or Italy.   Twice per year, the Hornets head out to Europe for a 3-4 game swing.  As a fan, you may even travel with them to Madrid or Rome.

    Now to make this happen, a few stars need to be playing for Olympiakos or Moscow or whoever.  If you are a true basketball junkie, what would be better than players and games that you care about playing across the globe starting at 9am your time?  There could literally be basketball on TV morning, noon and night.

    The rivalries could be intense.  And because of the extra games, you’d see more players on your own team playing important minutes.  Teams would really have to ration how many minutes they give their old guys versus how many to give their developing players, the same way Ronaldo and Rooney occasionally have to skip Manchester United games.

    So if LeBron wants to go to Europe, as this article implies, I think the NBA needs to gather the international basketball powers that be and figure out how to exploit it.  Prop up the Euro leagues and build an international championship that everyone owns a piece of.   Imagine  Lakers vs Moscow – Kobe vs LeBron – in Paris for the World Championship, with a TV audience of 100 million.   That’s real money. 

  • Big Move in the Scrabulous vs Hasbro Battle

    So, just when you thought Scrabulous was dead…..when you thought they had no letters left to play, the team of Rajat and Jayant came back with “Quartzite” for a Bingo Triple Word Score.

    It seemed like the war was over when the guys behind Scrabulous bowed to the legal pressure from Hasbro and pulled their wildly successful application from Facebook.   I stated that I hoped Hasbro would simply pay the guys what the game was worth and buy the application – and the users – from them.

    But instead, the tables have been turned and the guys from Hasbro must have the same look as the Seattle City Council Members who were shocked that Clay Bennett was moving the Sonics.

    In a Kasparov-ish type move, the Scrabulous guys have relaunched Scrabulous as “Wordscraper.”  Now at first look, the board and the game sucks.  Then you look at the rules, and you see that in Wordscraper, you have the ability to create your own board.  You can create ANY TYPE of board you want.  Maybe you want 20 Triple word score spots.  Or…….maybe you want the board to look just like a real Scrabble board…….In just a few minutes, if I wanted, I could make a board that looked like a real Scrabble board and use that for every game moving forward.

    This my friends, is what it looks like when 2 smart guys take a winnable battle against a board room full of people without a creative thought in their head.  Congrats to the Scrabulous – I mean Wordscraper – guys who just played the death blow in this silly Facebook battle vs Hasbro.

  • Facebook Jails Scrabulous, Worker Productivity Rises 4000%

    One of the most prolific time wasters on Facebook has been sent to Application jail.

    In a move that shouldn’t surprise many people, Scrabulous, the blatant rip off of the board game Scrabble, finally suffered the legal ramifications that everyone could see headed its way.  According to the report from Silicon Valley Insider:

    “Last week, Hasbro, manufacturer of the board game Scrabble, filed a
    lawsuit against developers Rajat and Jayant Agarwall, who founded the
    popular Facebook app two weeks ago. SAI’s Michael Learmonth says that a
    DMCA takedown notice likely
    ended the game’s two-year run. This is the same tactic Viacom used
    against Google’s YouTube last year.”

    Now, if a bunch of medium sized brains from Hasbro were able to sit in the same room, they would offer the developers the cash it would cost for them to redevelop the game themselves, plus some premium for every install they’ve already generated, and simply add Hasbro branding all over the place.  In my experience, while Scrabble is a tedious, obnoxiously long game for the dining room table, it is perfect for an online asynchronous world where you can take a few weeks to complete a match with a friend from across the country.  So here’s hoping someone makes sense of this whole thing before I find another similar way to waste a few minutes a day, like Chess or Risk.

  • Geek Out With Cool Sports Technology

    So, this “marketing” web site is about as cool as it gets if you are into sports and technology.

    Supporting their Olympic effort, Nike has launched NikeLab.com, a place to see all the latest gizmos and gadgets their athletes will be using at the games.In addition to product specs, you see interviews with the actual product designer.It’s a place you could get lost for a while in, so save your viewing for the evening.

    Some technologies you may want to check out include the following:

    • Precool Vest
    • Basketball Uniforms
    • Volleyball Zesti

    • Rowing Omada

  • Real Life Deal or No Deal for the Blogosphere

    So how much are 2,200 women bloggers worth?   According to NBC, about 5 Million Bucks in Series B investment, which nets out to close to $2300 per blogger.

    The deal includes the following:

    As part of the arrangement, iVillage, Oxygen.com and BravoTV.com will feature select BlogHer content, while BlogHer’s network is expected to return the favor to varying degrees.

    Reaching out to the BlogHer Network has been a common strategy of start-ups who don’t have $5,000, much less $5,000,000 for marketing.  The "Mommy Blogger," which as a term delights and disgusts different people, is an incredibly powerful evangelist for certain product groups.  The process involved digging through the network, finding the right email address, crafting a perfect message, sending an email, and praying. If it works, you get free promotion.  if it doesn’t, you burned a few hours.

    But now it will be interesting to see what kind of influence the NBC buy-in will have on this network.  For one thing, I don’t know how much each individual blogger gets from this deal, but I assume it’s a negligble %.  It will also be interesting to see what happens to bloggers in the network if they rip on NBC programming, or promote programming of other networks.

    Regardless, it’s a nice acknowledgment that the BlogHer network has become a powerful piece of the social media matrix.   Congrats on the investment.