Bambi Francisco

Slide's Levchin on self-expression 2.0, and engagement tricks

We’ve come a long way from scribbled x’s and o’s and characters that form little smiley faces. We’re even eons beyond e-cards from Blue Mountain, and yellow-faced emoticons. The current lingua franca of self-expression and communication is poking, nudging and winking. Slide is adding to this vocabulary with kicking, slapping, proposing, and throwing sheep - aka Superpoking. As Max Levchin, CEO and founder of Slide, said to me in this second-part interview, SuperPoke apps are “literary emoticons,” and basically the Hallmark Cards of this century. (Click here for the 1st part of our interview: How Slide plans to make a profit.

Slide is a social entertainment media company that’s attracted some 170 million unique visitors, sharing bits and pieces of themselves in a photo slide, or images with personalized graffiti. Think virtual scrapbooks gone haywire! But it's the SuperPoke (among other aimless apps) that's become one of Slide’s biggest viral applications, probably because of the simplicity of the action and mindset required. It doesn't take much thinking to fling a sheep when you're bored. 

On the San Francisco-based Slide platform, thousands of SuperPokes can often be measured in thousands-per-second. According to Max, more than 10,000 pokes were sent per second on Valentine's Day. And, McDonald’s wanted to run a campaign, called "Flip a burger with... " to connect people who may have flipped burgers together in their youth.

It’s a dizzying set of mind-boggling activities on the face of it. But the fact that people actively contact one another through such mindless sentiments shouldn’t surprise anyone. People – subconsciously or not - are constantly promoting themselves, or at the least, actively trying to be acknowledged. When I asked Max why people do what they do on Slide he said simply because they want to be noticed. “I’m really cool. In fact, I’m so cool, you should notice me and here’s my story,” he said, describing the motivation of his users. “That’s what we enable. At a very basic level, that’s what we help them do.”

Indeed, people want to be enabled to express themselves. And, it’s not that difficult these days to do so when you don’t have to handle the intricacies of editing tools and technology, such as a 35 mm camera (to the dismay of Eastman Kodak and Fuji Film).

In a recent Sanford Bernstein report, analyst Craig Moffett writes that the next major movie studio will be UGC – user-generated content.” He pointed to a recent eMarketer report that predicts “over the next 5 years, up to half of all Internet users will be posting their own movies, photographs, etc.”

Of course, quantity is one thing, quality is another. When you count up the plethora of post-its and scraps of mementos in your desk drawers, and add up the many digital images lost and forgotten in the gazillion digital cameras or phones you have, etc. – the inventory of personal production goes through the roof. Anyone can make a movie by fusing all these together. On social networks, the act of producing or creating is even more robust because of the simple nature of the creativity or contribution required.

As one person said to me the forms of expression online, particularly in social networks, are akin to modern-day bumper stickers, or personalized license plates. Indeed, as Max points out, the reason that 10% of Slide users create most of the content for the other 90% to view is that the content on Slide is easy to create. It’s a lot harder to create or add value to a Wikipedia article, he said. While 10% doesn't seem high, about 1% of the visitors to Wikipedia create two-thirds of the content. 

Why they stick around

Even more fascinating than how people express themselves is how that expression drives an audience. The phenomenon with applications made for social networks is their viral nature. Products couldn’t be viral unless they compelled and engaged people to take action and participate. To me that was the most interesting question I had for Max, after all, Slide - for all intents and purposes - was a lot like Film Loop back in 2005. They both had the same goal. One survived and one didn't. (Watch my interview with Max on lessons he's learned and why he thinks Slide won over Film Loop.) 

How do you keep people constantly engaged, given their fickle nature, and demands on their time?

As Max sees it, the lifespan of a social network is about 2.5 years. First Friendster ushered in this notion of a “social network,” giving way to MySpace and then Facebook. To this end, as far as he can tell, the stickiness of an application or network has more to do with the enablement of collaboration than it does with creation, paritucarly creation of a mere profile.

When friends or people contribute, they essentially create a new kind of shared experience, with much more meaning than the original piece of content on its own. That content is then enhanced to the point that the original creator and contributors cannot walk away with the same product. To this end, social networks consisting of profiles that live in isolation are of no value.  “The value of images dissipate quickly,” said Max.

Indeed, recently I moved to a new home, and realized that the boxes of sentimental “stuff” I used to collect is now mostly digital. For the past three years or so, my life has been pretty much documented online. And, there’s so much of it that I don’t really know, and more often than not, don’t care if I ever find it again. It can be stuck on a social network, or on a computer forever. Why - because I can create new memories.

But memories created with other contributions may be tougher to walk away from.

Content shelf-life aside, the bigger challenge for Max is convincing Madison Avenue that regardless of the shelf life of such content, the "activity" or engagement is worth being in front of. To this end, demonstrating that people will engage for several hours on mindless activities is as relevant as them tuning into a show. The trick is capturing that engagement and defining what is relevant engagement. According to Max, his team follows about 200 interactions, including how many people sign on as a "fan" for a widget.

It's a lot of data to capture, and certainly far more sophisticated than just counting up an audience of passive viewers. It's a lot of actions to capture, but maybe worth it.

No longer will x's and o's and smiley faces sent be just be a personal matter. Max is looking to monetize your feelings.

Vator Box opens the kimono (Zivity, 23andMe)

This week, the theme on Vator Box is transparency. We look at two women-started social networking sites that reveal who we are at some core level. The first one is Zivity, a $7-million-funded company that founder Cyan Banister describes in her video pitch as a beauty site that "sits at the intersection of MySpace, Playboy and American Idol and Playboy." This is not your mother's iVillage. We also looked at 23andMe, a personal genomics company with $10 million in funding from Genentech and Google, that hopes to create social networks around a person's haplotype. (Watch interview with 23andMe cofounder Linda Avey in 23andMe ushers in social 'DNA' networks.)

The high-profile startup lets people get access to their genetic information and learn their predispositions for health conditions, or get a better understanding of their ancestry and traits. Our guest host and Simon Cowell for this segment was Deva Hazarika, founder of enterprise software company ClearContext. Even though Deva applied 27 times and has been rejected for the Zivity beta program, he still gave worthwhile observations, like this one: "What we can do is use the genomic social network to get the early indicators of who's going to be able to be on Zivity later."

In all seriousness, the conversation around Zivity really zeroed in on whether the site - with 50% of all photos being in the nude - could maintain a level of integrity and standards around high-brow, tastefully-shot females. The jury is still out. To that end, it was unclear to us just how Zivity reaches its goal of having 100,000 subscribers paying $10 a month for a subscription. But one thing was agreed upon, it's pretty clear that most sites that show a little flesh are probably going to be popular businesses.

We then spent some time on 23andMe, one of the up-and-coming companies in the personal genomics field that competes with Navigenics. (Watch my interview with Navigenics CEO Mari Baker).

Even though we dove into the concerns around privacy and discrimination and health care, the big question for us was how much genetic testing improves people's health. Studies are mixed. One study on smokers conducted at Georgetown University Medical Center found that "giving smokers information about their genetic risk of lung cancer upped the motivation to quit -- but a year afterward, they were not more likely to quit smoking than people who received counseling," according to a Los Angeles Times article. Another study at Boston University tested people for Alzheimer's. According to the same article, people who were tested for high risk for Alzheimer's changed their behavior in favor of a healthier lifestyle, but it was unclear if that change in behavior could ultimately prevent the disease. We were mixed on the price point. Deva thought $1,000 was minimal for the information. Ezra and I were skeptical about whether that fee was low enough for the average person to pay. 

Overall, we liked both companies. 

Slide's Max Levchin on making money in social media

Social networking is undoubtedly a ubiquitous feature of our online lives. But whether these platforms can make a lot of money is a big question. To this end, the business models of widgets - Slide, Flixster, iLike, RockYou - built atop of these “social graphs” seem somewhat tenuous.

Max Levchin knows this all too well. He recently raised  $50 million for what many consider to be a widget company. That company – Slide – now has a market valuation of half-a-billion. With such a high bar, comes hard work. Max’s mission over the next year or two – besides continually finding more ways to iterate upon Slide’s popular SuperPoke -- is to get profitable. If Slide isn’t making money in a couple years, as Max puts it: “I’m really screwing it up.”

Before jumping into the “making money” question, first a refresher on what Slide is. Slide is a place where 18-to-34 year olds hang out and express themselves with photos and videos. It was only after Slide made an application on Facebook that it grew like a weed, much like the other popular Facebook apps, Flixster and iLike.

“So, how does Slide make money?” I asked, in this recent interview in the Vator studios.

Slide primarily makes money through advertising, though users also feel that to SuperPoke someone is worth paying some money for, said Max. SuperPoke is an offshoot of Facebook’s “poke” concept that allows someone to send another person a communication without actually communicating at all. Much like a poke in real life. It doesn’t mean anything. It just gets your attention. SuperPoke builds upon a poke by making the gestures more expressive, like a slap or hug, and adding icons. Think of SuperPokes as virtual Hallmark cards or fancier emoticons  - those fun yellow smiley faces on our IM. 

Max wouldn’t get too in-depth about the business model of Slide. But he did say that he needs to understand the world of Madison Avenue better. Indeed, he should. After all, without convincing Madison Ave. to consistently embrace new media companies like Slide, it may be difficult for Max to convince Wall Street that Slide is worth taking public. This exit - which is rather ambitiuous in this market-meltdown environment - is seemingly something Max is gunning for.

“It was a pretty zesty affair,” said Max to me in a recent interview in the Vator studios. Max was referring to the time PayPal, a company he co-founded, went public back in February 2002, and was sold within six months to eBay for $1.5 billion. "I wouldn't mind doing it again."

(Note: This is the first of a two-part series with Max Levchin. The next interview will be on the evolution of online expression).

Vator Box on voyeurism and brand control

We're back again with Drew Curtis of Fark.com fame. This time we looked at fast-growing FriendFeed, and the appetite for voyeurism and socially-produced content. We then look at Gorilla Spot, which lets consumers create video ad mashups. The company competes with MixerCast and Genius Rocket, and is part of the booming, video-ad-solutions industry drawing up-and-comers like ScanScout, BrightRoll, Digitalsmiths, VideoEgg for publishers, and HotPluto, Spotzer and Turnhere - video solutions for small businesses. advertising. Finally, we look at file-backup company Carbonite. It has nothing to do with the other two companies we looked. But it's a company with real revenue and a real value proposition. 

Let’s start with FriendFeed, an easy-to-use service that lets you see the content across the Web that your friends or people who randomly end up in your network are using. The content comes from services, like Twitter, Yahoo's Flickr, Netflix Queue and Google's YouTube. (Read and watch my interview and analysis of FriendFeed with Paul Buccheit, FriendFeed founder.)

Ezra Roizen – Vator Box regular guest – raised the point that it’s unclear what the demand is for other people’s “dribble,” though clearly it’s a fascination among those who Twitter and use Seesmic, a video Twitter.

Drew said that as a whole, socially-collected content and contributing commentary around them generate a lot of pageviews, but the “actual product sucks.” 

Indeed, FriendFeed’s traffic has exploded since March, according to Alexa. But much of the content shared (including some from yours truly) and comments offered belong on the editing floor, and definitely have a short lifespan. As Drew pointed out in a separate interview I had with him, of the 2,000 articles posted each day on Fark, only about 100 are deemed worthy of being showcased by the Fark moderators.

Now, Ezra did point out that there is value in creating “discussion around content” or a “shared experience.” I could not agree more. In a recent interview (to be published next week) with Slide CEO and founder Max Levchin, he tells me that the key to keeping fickle Web users glued to a particular product is to ensure that their content is mixed with other content that is not theirs.

In other words, a person can and will easily move his/her own scrapbook-like content from one social network to another. But if he/she cannot take the contributions of others, they’re more likely to stay put.

Indeed, I have had profiles on Tribe, Friendster, MySpace, and on social-activity sites, such as Kaboodle and Plum. I’ve not stuck around. I just moved onto the next site that lets me create a presence. There are no switching costs, besides lost photos (but given the abundance of such photos, I'm hardly emotionally attached to any digital content I've collected in the past. I'll just make new memories.)

But - to Max's and Ezra's point - in time, if my content mixed with others creates something even more valuable, and if I can’t take that finished or ongoing product with me, then I’d more likely stick around. Social-activity sites aren’t something to sneeze at. Soical-shopping site Kaboodle was purchased for $30 million by Hearst in August 2007. I remember when Kaboodle was valued at $9 million in 2006. (Full disclosure: Paul Buchheit is an investor in Vator.)

Speaking of mixed content, social sharing and mashups, Gorillaspot is a company that lets marketers involve their fans or customers in the promotion of products. In the Gorillaspot video pitch, you can see how Viacom’s Paramount Pictures used Gorillaspot to promote Sweeney Todd.  According to Athan Stephanopoulous, the company’s founder and CEO, those participating in the Sweeney Todd campaign spent an average of 30 minutes editing the movie trailer. I can definitely see this happening. Ezra's son Tanner spends about 30 minutes or more creating scrapbooks of Star Wars characters. I wouldn't doubt that the next step for him is editing an entire video.

But the challenge for such user-generated advertising services is getting marketers/advertisers comfortable with the unpredictable personal touches that can hurt brands. Advertisers are "scared to death," said Drew, who talked about a campaign he held on Fark. "You can't stop anyone from putting a big giant P.. (bleep)" on an ad, he said. "How do you get around that?" I asked.

"You don't," he responded. "It's a flawed concept."

The upshot is if consumers know that what they're viewing is a "derivative" product, a brand may not be tarnished regardless of the mixed content. You'll have to watch the video for our collective thoughts on user-generated ads.

Finally, we looked at Carbonite. Hands down, this company is worth taking a look at. It's not a cutting-edge,  sexy idea or business. But it makes money and it's growing fast.

Vator Box on predictive markets and college video networks

Drew Curtis of Fark.com fame is our Simon Cowel for this episode of Vator Box - our version of Siskel & Ebert meets American Idol. This time we look at predictive market company, Hubdub – which appears to compete with companies like Spigit, Inkling markets, NewsFutures.com as well as Younoodle, Pollection or Vizu. We also look at CrushTV and ask whether this social video site grows up to be YouTube or Girls Gone Wild.

We started with Hubdub, which calls itself "The World's News Forecaster." Essentially, the site lets members bet on the outcomes of real news stories. People post news columns and raise questions or make predictions. Questions range from “Will Mark Zuckerberg still be CEO of Facebook by end of 2008?” or “Will oil close below $100 before the end of March 2008?” to “Who will win the Pennsylvania Democratic Primary?”

The site uses a method of online research that harnesses the wisdom of the crowds.

Not one to hold back, Curtis said he’s not a big fan of the collective wisdom of crowds. “They’re (the crowd) pretty dumb,” he stated. Ezra Roizen, our regular Vator Box host, said it’s unclear what the real incentive is to get people to continually participate. “Is the incentive of being on a leaderboard enough to get you engaged?” he asked. Probably not, he surmised. Drew said that on Fark, the leaderboard incentive isn’t a driver of participation on Fark. Rather, his contributors submit humorous content for the mere enjoyment of walking away “with a gut laugh.” Fark.com is a site that lets people submit news items. It’s similar to Digg and Reddit, but is focused more on strange and funny news. If Hubdub can't offer the incentive of laughter, it may have to offer a monetary incentive. At NewsFutures, another predictive markets site, participants with high scores win several thousand dollars annually, NewsFutures CEO Emile Servan-Schreiber tells me.

Yours truly wasn’t sure if a site for predictions or a site to watch the results of crowd predictions was enough of a draw to be a destination. All three of us agreed that polling is a good way for news outlets to create news fodder or engage their audience. 

As for the business model, the three of us said it appeared the site was either going to license the polling system or take advertising. We failed to point out, however, that Hubdub could actually charge people to get involved. In fact, this is apparently a model CEO and founder Nigel Eccles is considering. The company “may adopt a business model like that of a fantasy sports league, where participants pay a fee to join and win rewards at the end of a certain period of time based on overall performance in the league," said Eccles, in an ABC News story. Whether that’s enough of an incentive, however, is also unclear.

CrushTV - the video social network

After discussing Hubdub, Vator Box looked at CrushTV, a college site that connects university students with their campus life. Los Angeles-based CrushTV signs up college students to be correspondents on topics like music, dating and sports. Perhaps I’m mistaken, but from the looks of the video pitch they submitted, the content looks a lot like MTV’s Real World meets Girls Gone Wild.  Ezra said he fears the site “devolves into some really crazy content” or grows up to be “quite a frightening derivative of MTV.”

Drew pointed out that it’s interesting that people would post their videos onto CrushTV rather than YouTube. I pointed out that unlike YouTube, CrushTV is far more narrowly focused, and thus can add a community element that YouTube can’t. I also like the “campus correspondent” aspect of CrushTV. It’s a great way to get students involved. That is, of course, if they keep it up, which is a point that Ezra raised.

Drew’s observation was pretty accurate. “If they’re lucky, they grow up to be YouTube. If not, they turn into Girls Gone Wild.” Ezra's was more probable. As he puts it: "Every person who will be on this TV station will regret 10 years later for being on this TV station. Yet at the same time for the immediately following three months, they'll be really cool."

Final thoughts

We're not experts on these sites. I invite Eccles or those familiar with Hubdub and predictive markets in general, as well as CrushTV's founder Mike Yepp to offer up any comments that might shed better light on their companies or their respective market opportunities.