Search, Smart Software, and Money
May 2, 2013
I participated in three telephone conference calls earlier this week. As I was thinking about each, I realized that the “metacontent” of the calls had little to do with the actual subjects discussed. On the surface, the participants were opining about search, smart software and money.
After I read “Buyouts – New Venture Aims at $100 Bln Zombie Fund Market” I wondered how much pressure these folks will put on the managers responsible for breathing life into the nearly dead? Here’s the passage I noted:
The new firm plans to act as a fiduciary to replace or complement general partners of funds; provide advisory services for limited partners; create successor funds by consolidating direct private equity investments into a fund structure; and shop for investment opportunities such as follow-on capital at the portfolio level. In a prepared statement, Kirchner said the partnership “provides tremendous validation” of his firm’s business model. “Now is the right time for us to scale up to meet rapidly increasing market demand,” he said, adding that the deal with Crestline Investors will provide “institutional infrastructure and access to capital.”
I don’t see many butterflies, fairies, or unicorns in this play. I then thought about the conference calls. Each of these focused on raising money from a willing source. My latest take on some key phrases which I jotted down during these calls appear below:
1 — “We have a breakthrough search technology.”
What I now think this phrase means is something along the line of:
I have an MBA, know nothing about search, but I think this new search system can become the next Google.
In my opinion, this is self delusion fueled either by ignorance or the prospect of getting paid when a person or persons puts money into the search technology. Is Google a search company? Is it likely that Google will be unseated any time soon? These questions are ignored by the participants in this call.
2 — “I have more than $500,000 in sweat equity in this breakthrough cloud system.”
What I now think this phrase means something like this:
I want to get funding so I can pay myself $500,000.
I, like many others, want to get paid. Is there another bankrupt mom in this $500,000? A new Corvette? Is it realistic to think that a person or persons investing in a start up will happily watch $500,000 disappear into the pocket of a sweat equity worker? I think not in most cases. Investors want revenue growth, profits, and a big payday for themselves. Others stand behind in the line at the pay window.
3 — “I am working 80 hours a week and juggling essential tasks.”
Here’s my translation:
I have replaced judicious action with doing lots of stuff in the hopes that something, anything, works.
What message does working really hard while juggling send. One misstep and the balls come down and bounce away. One or two could strike the juggler and knock him or her unconscious. Could that be a way to achieve entropy?
Has search, content processing, big data, and analytics been cracked? For me, no. Are these chestnuts roasting by an open fire? You bet. Get too close to the flames and there is pain. Companies which accept funding have to produce with or without the odd phrases which keep cropping up in conference calls.
Stephen E Arnold, May 2, 2013
Sponsored by Augmentext
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