Two Crunchie Nominees -- Very Cool!

As the Web 2.0 has become enamored with all things social media, I have increasingly lost interest in investing in the next Facebook clone.  So imagine my surprise this morning as I saw the Crunchies nominees.  My companies, Radar Networks (a.k.a. Twine) and Riya.com (a.k.a Like) are two of the five companies nominated in the category of Best technology / innovation / achievement. 

A few years ago when I decided to return to Web investing, I made a decision that I would invest in companies that had real technological advantage.  This is more capital intensive than lots of web investments and has a longer gestation, but I figured it would pay off in differentiation and, hopefully, a better user experience. 

These companies are not without their challenges.  The change at Riya as is moved from photo classification to e-commerce has been well chronicled by Munjal.  I am happy to say that the business is doing extremely well.  The daily graphs I get on CTRs, Revenue, and Revenue/Visit  all been consistently up and to the right on a monthly basis, all year long.  Congratulations Team -- a better user experience is paying off, literally.

Twine is the still gated-beta application from Radar Networks.  I have been using Twine for about 2 months now.   I can say the promise of better information management by the use of semantics is definitely there. We still have a long way to go.  The platform is very fast and very reliable, now we are tuning features to improve the workflow. Being a gated app, I doubt we have chance to  win the Crunchie Award at Twine, even if every beta user voted.  I guess it truly is "just an honor to be nominated."

There is no guarantee that this technology-focused investment strategy will really pay off in great venture returns.  That remains to be seen. But this is still nice.

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Well, earthmine won.

Comments

[Esfandiar Bandari]

On taking a long term view on deep IP development and investment:

Well, ideally one wants a temporal diversification. That is, bunch of quick exits, and some long term high multiple investments as well. Traditionally with R&D there is a risk of meeting schdules. But with the average exit being around 6.5 years these days, there will be at least two effects to look for. 1) the longer time to exit will have serious effect on the LP's returns (the time to exit goes into the exponential of 1+IRR to give the required multiple). Hence the need for more defence-able assets. 2) A longer exit will give IP development "some" time cushion. It also will mean that the IP of a company will start to play a more important role in future valuations.

Properly developed and used IPs (eg licenced) also work as a good insurance during a down turn. So will the temporal diversification :-)

Happy 2008. E

[Hedge Fund]

I think it will payoff though, firms like Microsoft have multi-billion dollar war chests to absorb quick growing tech companies. Acquisitions are made every day now in these areas.

- Richard