Cook 'n the Books

Bloglines | Manage Claim

Link: Bloglines | Manage Claim.

<!-- ckey="2C653EF2" -->

Intelligent carpet can autodiscriminate - Engadget

Proof that there's value in "Measuring, Recording, and Reporting". So, tonight's exercise is to think of something else that would be valuable to measure and record so you can report it and sell it to someone.

Link: Intelligent carpet can autodiscriminate - Engadget.

Up From The Ground Came A Bubbling Crude...

Speculating on the health of Silicon Vallley has been a recurring theme among Silicon Valley circles and media pundits for many months.  It's clear to me that "we" indeed are back.  The risk/reward balance among entreprenuers and VC's has definitely shifted decidely toward the risk side of the teeter totter...and that is healthy for the startup community, Silicon Valley, and small business growth.

The recent proof points that Silicon Valley is healthy again?....

1)  E-commerce is back in a big way.  Several startups have been funded recently and the buzz is back.  Alibaba in China is the recent pinnacle of these valuations.  Even the Kozmo founder is going back "all-in"

2)  Online Advertising has risen from the dead and buried (thanks Google).   Pure Play media companies valuations are trading both publicly and privately at 6x-10x Revenues and +25-40x EBITDA.   About.com (+$400M), Then you have Baidu in China.

3)  Acquisitions Galore: In the first half of 2005, media/interactive M&A transactions totaled +$8B vs +$2B in the first half of 2004 (think Intermix/MySpace, AskJeeves, DoubleClick, Shopping.com, etc).    We hear of a new big M&A deal almost every other day (Skype, Siebel, Macromedia,  now talk of AOL..).   Ruperch Mudoch and Fox Interactive are out buying first asking questions later (Scout.com, Intermix, IGN combined $1.5B so far and counting)

4)  The big players (Microsoft, Google, Yahoo) are gobbling up smaller companies as fast as they can (Keyhole, Picasa, Dialpad, Teleo, Flickr, Snapfish, Konfabulator, Urchin, Dodgeball, and we are hearing Technorati and Facebook are next).

And finally to put an exclamation point on this "bubbling crude" theme (the return of Silicon Valley),  this week I was involved in 2 separate discussions with CEO's, VC's, and investment bankers in which I heard the following:

1)  Roll Up Funding Strategies are alive and well in today's very active M&A market.  Buy companies..roll them up....sell the whole package for more

2)  B2B is the next big strategy shift now that "all things consumer" has had such success in the past few years.  It's time to start selling products and services to businesses now.

Money and ideas are bubbling up...now the trick is whether we can refine them and into what "grade" (87, 89, Premium, or simply sludge)......

"...they said California is the place you oughta be so they packed up their bags and moved to the Valley.....Silicon that is.......stock option pools and internet stars"

EBay TV? or ESN (EBay Shopping Network)

"...Other potential synergies haven't even left the lab. Analysts say Skype may add video to its free PC-to-PC communication service. With video panes added to eBay pages, online sellers could get closer than ever to approximating live shopping, while buyers could well gain increased confidence from being able to see moving pictures of items for sale..."

As I read this today (Business Week article cited above - link below), I immediately thought EBay is going to try to out-Diller the king of hype himself - Barry Diller.   I had the fortune to work briefly for Mr Diller (1996-1997) as an executive of the Internet Shopping Network.  I've personally toured HSN headquarters in Florida and analyzed the back office operations in depth (incl. the shipping and payment processing logistics)

So, the Skype acquistion and it's opportunity starts to make more sense to me now.  EBay TV must be back on the priority list down in San Jose.   The EBay Shopping Network where small and large businesses will use EBay's platform technologies to create and store video commercials of their products, promote them, and then auction key time slots to the highest bidder.  No need for studio productions anymore like the old guard HSN and QVC now that podcasting and videocasting are the next wave.  The viewing consumer makes the final call with Skype and pays for it with PayPal.  EBay thus creates the first truly vertical supply/demand chain.   

Link: Skype's "Aha!" Experience.

NanoTubes: A Big Breakthrough to Watch

Link: U. T. Dallas-led research team produces strong, transparent carbon nanotube sheets.

Some excerpts from what could be a huge breakthrough on actually how to produce NanoTubes.....

"Rarely is a processing advance so elegantly simple that rapid commercialization seems possible, and rarely does such an advance so quickly enable diverse application demonstrations,"

The nanotube sheets are produced at up to 7 meters per minute by the coordinated rotation of a trillion nanotubes per minute for every centimeter of sheet width. By comparison, the production rate for commercial wool spinning is 20 meters per minute.

The nanotube sheets can be made so thin that a square kilometer of solar sail would weigh only 30 kilograms.

There are several thousand ideas for the use of nanotube technology from artificial organs to supercapacitors, batteries, fuel cells and thermal-energy-harvesting cells exploiting giant-surface-area nanotube sheet electrodes; light sources, displays, and X-ray sources that use the nanotube sheets as high-intensity sources of field-emitted electrons; and heat pipes for electronic equipment that exploit the high thermal conductivity of nanotubes.

But my favorite is  this one.  An extremely intriguing idea ... a Space Elevator!

http://en.wikipedia.org/wiki/Space_elevator

Stay tuned for more on NanoTubes and NanoTechnology....

Sidenote:  My gut tells me that Nanotechnology is very possibly today's "lightbulb invention" by Edison circa 1870.  Think of all the applications and technologies that resulted from that invention to present day which includes transistor technology.  Its important to remember that a transistor was simply another "combination technology" combining the technologies of a "transmitter" (sound waves) and a "resistor" (conductive electricity).  Transistors replaced Vacuum Tubes and performed the same functions by greatly reducing power and space requirements.  With Nanontubes, we are therefore on the verge of going even smaller, lighter, and even greater power reductions and thus being able to produce the incremental technology leap needed for the next century of applications.

 

Google 1 Year Later

What a difference a year makes!  Today (Aug 18th) Google filed to sell an additional 14 million shares in a secondary offering.  At the current price $280-$290 per share, that will add a few billion of cash to their current $3B warchest leaving them with $5-$7 billion of cash and growing.   While others in the media are reporting this offering will add $4B of cash (14M shares * $280 per share), I predict this will not be the case.   Usually, in these situations, the insiders  (Larry, Sergei, Kleiner Perkins, Sequoia, etc.) take the opportunity to unload/diversify a large amount of their holdings and thus the cash raised does not flow through to the company's bank account.

But the real story here is what a difference a year makes!  This secondary offering (exactly 1 year later) is the effective equivalent of a 33 million share offering at $168 per share.   When Google initially filed last year at their $135 range, they were scoffed out of the market by literally everyone (I was certainly on that bandwagon) and subsequently forced to drop their offering  (number of shares sold and their IPO price) all the way down to $85 per share (37% price reduction).

After several false starts and auction process communications bungling, they eventually limped out the door and sold 19 million shares at $85 per share on Aug 19, 2004 for $1.6 Billion of cash.    Since then, however, their exeuction and stock price have gone virtually straight up. 

Kudos to Google for making hay while the sun is shining.

Link: Google files to sell 14.2 million shares.

Link:  My Blog Series Covering Last Year's IPO

Full Disclosure:  I still own the original 7 shares I was allocated at $85 per share last year that I bought to simply be "part of the auction process. I laugh everytime I think of owning 7 shares of anything...but I'm no longer laughing at the +200% return on those shares.

And the Race is On....in China

Yahoo is reportedly bidding up to $1 billion for a 35% stake in Alibaba.com - China's leading e-commerce site. The $3B valuation rationalization must be based on "what other people are willing to pay". If historical trends are consistent, we are likely to see a very busy six-nine months of acquisition / investing activity in all things Internet in China....The Race is On!....

Link: Yahoo! Negotiates Stake In China E-Commerce Site - Forbes.com.

It's 1995 in China.

Chinese Search Engine - Nasdaq IPO - Soars 353% in First Day of Trading

It's 1995 in China.  They just had their Netscape.  The internet wealth creation engine just woke up in China.  The world goes to where the money is and the money is clearly in China.  Baidu is China's Google with Netscape's excitement.  Stocks simply don't IPO at 27 and close at 120 in today's market...but one just did.  This is a seminal event.  An event the historians can pin the following economic value creation on.  It will be written that way a few years from now.   That's what you get when you have 45% market share in a search website vs Google's 30% market share...it's the only country in the world that is besting Google.  Time to take notice.   The telltale signs will be all other Chinese based internet stocks having unnatural valuation increases.  Then comes all other Chinese companies purporting to have some sort of internet presence / product.  Then comes the internet portions of these businesss being worth more than the brick and mortar pieces.  We've seen it all before.  The bubble will expand..this time faster..and even after the eventual consolidation, China will be put on the map as an internet powerhouse and the technology world will have changed virtually overnight from a US centric world to a worldwide economic engine..and everyone (including the US) will win.

The stock trades under the ticker BIDU and though it's initial US Nasdaq prospectus price range was $19 a share, they priced it at $27, it opened at $66, and it closed at $120 today with a market value of essentially $4 Billion.  Wow!  not bad for one day's investment.  Not bad for a compan with $5M of revenue last quarter on a run rate of $30M of revenue for CY 2005 (that's only +130x Revenue).

Now all we need is the voiceover and the T.V. commercial.....B AAAA  D UUUUUU (must be screamed like Yahoo)

Hacking Nature - Hacking the Brain!

Link: Discovery Channel :: News :: Brain in a Dish Flies Plane.

The brain can learn, just as a human brain learns, he said. When the system is first engaged, the neurons don't know how to control the airplane; they don't have any experience.

I heard this on the radio this morning and I was stunned.  Goes to show you how far our current technology has to go.  The idea that single brain cells (neurons) immediately start connecting to eachother in a Petri Dish and then start instinctively start working together really makes you wonder.

To think these cells start learning how to fly a flight simulator level and straight with only 25,000 neurons is incredible.  Even more incredible is the knowledge that a common housefly only has about 200 neurons and look what it can do!  Try catching a housefly.  The fact that it's neurons react so quickly to outside stimuli makes you wonder where all this is going.

My first reaction to hearing all this are that brain cell neurons must by nature optimize for efficiency and for risk avoidance (flying the plane level and straight;  not getting hit) without really knowing what it's doing.  It's a react-first understand-learn-apapt system vs. our current technology of understand-first and program-react-perform system.   

Being the parent of a 4 yr old and 1 yr old, I see these neural network "systems" in action everyday....continuously learning and adapting to their environment.

I wonder what artificial neural networks will be controlling 10 yrs from now?  50 yrs from now?

Cisco-Linksys Buying Networked DVD Player

Today Linksys announced the purchase of Kiss Technologies, a maker of a networked DVD player designed to compete with companies/products targeting the in-home media delivery market (video on demand) like Akimbo The "networked" home is still in stage 1....the foundation laying and plumbing stage. Over the last 3-4 years, 2 major components of this plumbing have been laid - broadband connections (DSL and cable modems) and wireless (providing access to this connection from anywhere without having to lay cabling all over your house).

Now comes more plumbing hardware that will enable efficient usage of the broadband and wireless. The in-home media is at the same stage today as Wi-Fi was around 2001. It's hard to read technology news without reference to Windows Media Player/Hardware Edition, the Mac Mini - which I'm convinced is Apple's prelude to a consumer friendly mass market in-home digital hardware server (Music, Photo's, Video) - or anything Open Source/Linux based.

Now that Linksys has Cisco's investment powder, look for even newer consumer friendly all-in-one Home Media Servers. It's going to be a very short time before we start seeing Linksys' latest and greatest All-In-One Device of Wireless, Voice-Over-IP, and now a DVD/Music Player with a large harddrive.

We'll all be asking ourselves very shortly how we could use such a device and then we'll be asking our ultra geek friends how it works and within a few years, these kind of Home Media Servers will be proliferating our homes and serving up all our digital content (Music, Photo's, Movies) to any device we want (our TV's, our laptops, etc)

CNET News.com -- Technology news and business reports.

Linksys to buy consumer electronics start-up