January 31, 2006

What did the accountant say to the billionaire?

Really very funny (when not depressing) documents recording Larry Ellison's financial advisor's desperate pleas for restraint.

The High Cost of Being Public

This recent New York Times article titled Public Companies, Singing the Blues reminds us that marketplace structures will modify to accomodate barriers -- be they legal, social, environmental, etc.:

Why can buyout firms take public companies private and make enormous returns, while the same type of returns seem out of reach for public companies and their shareholders? He went on to posit that private-equity firms were essentially arbitraging the public markets and "are appropriating profits that should belong to public shareholders."

The question drew scorn from most people in the room, but, then again, people also whispered at their tables that he wasn't so wrong. That's exactly what private equity firms do.

Incentives exist, and entitites respond to incentives: plants grow toward the light, making the strike zone smaller increases the annual salaries of home run hitters, and tolls reduce congestion in Londontown.

So whether we are talking about people, firms, or marketplaces, a change in the form or the structure of the incentives and influences that bear on that entity will lead to a concommittant change in that entity's behavior or situtaitonal outcome.

So the ultimate effect of Sarbanes Oxley punishing public companies is to create a much larger private market. The purchase of common equity will be decreasingly likely to occur through the action of an individual in the United States purchasing for their own account on a public, regulated market; and will increasingly take place through aggregated pools of capital of individuals acting as agents -- such as pension funds, supra-aggregated into principal pools of capital -- such as hedge funds and LBO shops -- in order to avoid the deleterious effects on company management and resources of government regulations.

The implications of this are mixed overall. On the one hand, no individual should be acquiring the undiversified asset that is a single common stock -- nowhere under any legitimate circumstances is this a wise allocation of resources. So to the extent that Sar-Ox successfully drives American shareholders out of indiviudal equities by drying up the purchase opportunities for those equities, it is a good thing.

On the other hand, private equity marketplaces, while ultimately efficient, have much, much greater transaction and information costs. Information is hidden for years at a time, which abets non-efficient behavior like "prettying up the asset for sale." And transaction costs for determining a market-clearing price are enormous -- investment bankers, not just the Devil, wear Prada. On the weekends at least.

So it is enormously fascinating to see (once again), the good intentions of legislation lead to the unintended consequence of transferring wealth from one group of stockjobbers (brokers, financial consultants, etc.) to another (LBO and private equity shops).

One would think Congress would have more rewarding areas in which to seek glory.

Home Depot coming to TheLadders' hood

Might not be big news for you suburban Stoners, but here in Manhattan, we are psyched to have

Indeed connects with New York Times

Well, that didn't take long. After asking "What will the boys at Indeed do to turn the tide back in their favor?" this morning, they've announced that Indeed.com Powers Job Search for New York Times.

Nice work Paul!

Thanks Jason!

Jason over at Recruiting.com notices the announcement of TheLadders Professional Network -- a new product that we have had in limited released for the past month and a half and officially launched to the world today. More on that later. (I suppose if I was a good self-promoting CEO I would have had that up here this morning already... ah well, I will just have to be more diligent on my Self Aggrandizement Exercises).

He notes:

Marc Cenedella who is the CEO of TheLadders.com has a great blog. The man moves in waves. Sometimes no posts, sometimes lots and lots of posts.

Well, Jas, sometimes I have lots and lots to say, and other times I remember keep my big trap shut!

SimplyHired Raises $8 mm

This news in today:

Simply Hired Inc., a Mountain View, Calif.–based operator of an online employment search engine, has secured $8 million of a $14 million Series C funding round. Foundation Capital led the deal, while return backers include Rajeev Motwani, Leslie Murdock and Guy Kawasaki.

Seems like the SimplyHired / Indeed rivalry will be kept alive and kicking by the venture community for some years to come. Both teams, with their "Google of the jobs space" approach to the online recruitment market, have attracted a lot of attention to our little industry.

In recent months, SimplyHired has seemed to pull ahead of Indeed in the traffic race, and I think this fund-raising gives them a big boost of energy in the momentum game.

What will the boys at Indeed do to turn the tide back in their favor?

Borrell Numbers Inflated?

David Manaster comments over at ERE Blog Network that these numbers "seem a little too rosy."

I'm still waiting to hear from Kip!

January 29, 2006

Resumix is really dead?

I was, unfortunately, present at the acquisition of Resumix by HotJobs, which occurred on my third day of work at the HOTJ.

I was just looking for the site and got a 404 error when searching for http://resumix.yahoo.com/.

I'd heard through the grapevine that this was really, really dead. But can anybody out there provide color? Are they still servicing legacy customers?

$100K+ jobs at TheLadders.com

100k Executive jobs in Human Resources, Sales, Finance, Operations, Law, Marketing, Technology and General Management at TheLadders.com.

What is Bristol Time?

Back before Greenwich Mean Time was universal, each city had its own "Bristol Time":

Before the railways (railroads) came, there was no particular reason why people in Bristol, England should keep the same time as people in London. At that time there was no practical way of communicating information about time over a distance. When the telegraph made such communication possible, it became necessary for people living in one area to agree that they would not keep their own local time, but would all keep a time based on the local standard meridian. Bristol is at 2º 35' W(est) of Greenwich, so when it is noon in Bristol is just past 10 past noon (twelve) in London.

There is still a relic of this change; the clock over the old Corn Exchange in Bristol has two minute hands. The black minute hand shows Greenwich Mean Time and the red minute hand shows Bristol time!

And it turns out Detroit didn't accept universal time until 1915!

Online Job Revenues Grow... but not this much!

Borrell Associates has released a report claiming Online Job Ad Revenues have tripled.

Having been head of corporate development at HotJobs, and cognizant of the fact that there are only six $10+ mm job boards today, I simply dont see how this could possibly be true.

The Newspaper Association of America shows a total growth in Newspaper recruitment spending (offline and online) of $433 mm through the first 9 months of this year, and Morgan Stnaley's Publishing Handbook 2006 asserts a 10.3% growth rate in total help-wanted spending at the newspapers in 2005.

Further, Morgan Stanley's estimates, which seem a lot more reasonable / in-line indicate online spending grew from $1.3 bn to $1.7 bn in 2005 while total help-wanted spending grew from $5.8 bn to $6.9 bn.

Other CEOs in the business I've blackberried this weekend find Borrell's number, while welcome if true, a bit boosterish and incredible.

I've e-mailed Kip Cassino, the report's author, for more data than is available in the skimpy Executive Summary, so stay tuned for more...

"Don't Be Evil"

Unless, that is, being evil by suppressing the evidence of a spontaneous democratic uprising against a totalitarian state provides your company with access to a billion-dollar market.

This great Paul Kedrosky post asks you to:

Compare two image searches, one in Google.com, the other in Google.cn: this vs. this. While it should come as no surprise in the censored circumstances, seeing the difference so starkly in images is striking.

Now, I'm no moral high roller and think that companies' engagement with China will lead to freedom for that populace sooner rather than later, but when you're the type that wears your moral pomposity on your sleeve and proclaim "Don't Be Evil" as your motto, it's pretty hard to swallow such obviously evil behavior.

January 28, 2006

"Do Less Evil" -- the best Bill Gates quote of the Decade

Newspeak comes to Google.

Very insightful little blog post from Davos following a Bill and Eric Panel:

"We even made an evil scale and decided it was more evil not to go in than to go in," Schmidt said.

On hearing that, Microsoft CEO Bill Gates muttered into his microphone: "That's do less evil."

It's not too hard to imagine the weenies at Google sitting around with a little evil scale to justify any of their decisions. That such cover for their cupidity is really a sign of profound fecklessness is not surprising. Gates' deadly accurate zinger is just the pinprick to explode the grandiose pomposity that has become the Google guys' moral swaggering.

The complete absence of maturity, perspective, humility, or even plain old common sense at the Googleplex these days has everybody -- everybody -- I know in the internet business rooting for the Fall.

Google's comeuppance, when it arrives, is going to be celebrated and feted on a wide, wide scale.

Priceline Throws Customer in Jail

Absolutely bizarre story, with Priceline's confusing UI leading it to throw its customers in jail:

A tough-looking cellmate asked him, "So, what are you in for?"

"Priceline refund," the musician sheepishly replied. It went downhill from there.

Read the whole thing.

January 26, 2006

What is Focus?

Great post from Matt Blumberg of ReturnPath on Buying Back Your Own Left Leg. You see this a lot where a big corporation drifts in its focus and ends up having to pay exorbitant equity prices for what could ahve been purchased with (relatively) inexpensive development dollars.

I think one of the toughest questions a CEO faces is:

"What is and is not in our business?"

For example, here’s Pixar’s most recent 10-Q:

“Our results for the quarter and nine months ended October 1, 2005 included worldwide home video revenue, continuing international theatrical revenue, television licensing, merchandising, and ancillary royalties from The Incredibles, as well as continued worldwide home video revenue, television licensing, and merchandising from Finding Nemo and our library titles.”

That’s a lot of different revenues streams, so it is not multiple revenue streams, per se, that lead to missed opportunities, but Disney’s (Eisner’s?) omnivorous appetitive and subsequent inability to marshal resources in any one of them.

One could argue that Pixar’s business is computer-animation and they should just stick to that, but more properly understood, their business is entertainment. And there is no hard and fast rule to tell them where to draw the lie – it’s much more difficult than that: it requires judgment – and knowing that they shouldn’t get into Toy Story branded soda but should get into Toy Story stuffed toys is a judgment call.

Every CEO, and management team, faces these difficult decisions on whether, and where, to allocate the company's comittment; based on existing resources, bandwidth, market penetration, and, very especially, management time.

January 25, 2006

Fire at a Fireworks Factory

Fireworks Factory Explosion via Kottke.

January 24, 2006

Highly Addictive Sand Game

Falling Sand Game

January 23, 2006

Achieving Inner Peace

Sent to me by, of all people, my Mom:

Hope you too find inner peace in your busy life by following the advice below received from a friend: "I am passing this on to you because it definitely worked for me and we could all use more calm in our lives. By following the simple advice I heard on a Dr. Phil show I have finally found inner peace. Dr. Phil proclaimed the way to achieve inner peace is to finish all the things you started so I looked around my house to see what things I had started but hadn't finished. As a result, before leaving left the house this morning I finished off a bottle of Merlot, a bottle of White Zinfandel, a bottle of Baileys, a bottle of Kahlua, a package of Oreos, the remainder of both Prozac and Valium prescriptions, the rest of the cheesecake, some Saltines and a box of chocolates. You have no Idea how freaking good I feel! Please pass this on to those you feel are in need of inner peace."

Seems like good advice... but, really, White Zinfandel?

January 22, 2006

Rand Appreciates Dramatically

Rand Appreciates Dramatically As Cenedellas Pay Off Their Vacation Bills....

Looks like my trip with my brother John to South Africa has affected international currency markets: as we scramble to find enough Rand to pay for our extravagant misdeeds, that currency is appreciating quickly.

3% Phone Tax To Pay For The Spanish-American War

USA Today reports that the 3% excise tax on your phone bill may be on way out, which is a good thing since it was imposed in 1898 to help pay for the Spanish-American War (did they have phones in 1898?)

NOw, I'm going to go out on a limb here and say that I don't think we should be at war with the Spanish. THey've given us paella, sangria, and really cool architecture. So it doesnt seem fair that we'd go and have a war with them.

It is interesting to note this as another example of the absurdities that result from the mismatch in the incentives and longevity of humans as compared to human institutions.

Humans, who evolved in relatively small population communities -- perhaps 150 or so neighbors -- subordinate rules to the smooth functioning of the social system. Hard and fast rules erode over time as actual human behavior dates and ages concepts and usage.

Institutions, on the other hand, have no "common sense", no ability to be flexible as events change, except to the extent that that flexibility is imparted by its human agents -- and even then rarely. (For which see the Helium Reserve -- designed to keep our nation's military blimps in the air in the event of an attack.)

Andy Loves The Stones

He caught on Friday the show I saw Wednesday. Great stuff.

January 21, 2006

The Expensive Lesson

I shorted the stock of United Airlines two years ago -- at anything over $0.00 I felt the equity was ridiculously mis-priced as bad management, a tough industry, and difficult operating conditions made any positive valuation ludicrous.

And in fact, I was proved to be right. Two years later...

But what happened in the interim is instructive for small individual investor.

Despite being a worthless stock -- the management put out a press release years ago that flatly stated the equity would have no value after the re-organization -- the market managed to continue levitating this issue.

Namely, UAL shot up as high as $3.00 (!), and not having the fortitude or the fortune to back up my bet, I folded.

So investing is as much about timing, resources, and of course patience, as it is about being right. Ouch, that was a costly lesson to learn.

The War For The War For Talent

Competition is heating up in the Online Recruitment Advice category. Upstart Recruiting.com is achieving traffic levels that are respectably within reach of industry stalwart ERExchange:

Competition's always a good thing, and especially so in this case as it will lead both gents to keep even more on their toes than they already in providing us with great insights, commentary and community connections. Jason's Recruiting.com has been bringing fresh thinking and renewed energy to the business. And David's ERExchange --almost a decade old! -- of course has so much more to offer than just their website -- the ERExpo comes to mind as just the most outstanding example of their service to the industry.

Overall, this bodes well for the business. The numbers have certainly been showing it these past few years -- online recruitment is back in a major way. And the presence of two great industry publications confirms it.

And just because David is the Goliath in this case doesn't mean the outcome is preordained -- "there's a lot of green in between" as they say in pool, and lot to watch for this year. So good luck to you both in 2006 Jason and David! May the best man win!

The GOOG crash

Ouch, what a day for Google!

Dropping almost 9%, Google shaves over $10 bn off its market cap in one day.

Will there be a further run on Monday as those who were counting their riches panic and decide to git out while the gitting is good?

January 20, 2006

Guinness Ice Cream

If Stoners try the recipe, can I have the rest of the can of GUinness? You only need 2/3 of a cup....

A Short History of Job Boards, Part 3

Josh Akers at DirectEmployers sends along a paper written by Daniel Marschall that includes this deep background on the history of internet job applications, of which I was previously unaware....

~~~~~~

The first phase, stretching from 1969 through approximately 1994, started with the founding of ARPANET. This was before the World Wide Web gained a critical mass of users. Internet use was restricted to a cadre of academics, researchers and government officials in a few centers across the country. Early Net users, especially after the invention of e-mail in 1972, experimented with the new communication technology for job search purposes. In May 1976, for example, Raymond Panko of Menlo Park, California, consulted his ARPANET colleagues about job opportunities by placing "An Electronic Want Ad" on the MsgGroup (Message Services Group), an electronic discussion group that Hafner and Lyon (1996) suggest was the first virtual community. Panko explained:

As often happens in this business, my part of SRI is suffering some lean times, and I will probably be looking for a job around July 1. If you a potential job opening or could point me in a promising direction, I would be grateful…. My paper on the outlook for computer message services, which many of you have read, indicates my current behavioral and economic interests…. My primary career goal is to understand and if possible improve human communication/collaboration. (Excerpt from Panko, 1976)

Exactly this sort of collaboration, however, turned out to be a controversial use of system resources. ARPANET was a government owned and operated system, guided by an ethic of public service, exchange of research findings, and productive experimentation (mixed with caution about how certain uses of the system would be perceived by the public). A few years later, an ARPANET official notified the MsgGroup community that the system was being used in an unfair manner:

There are two kinds of message that have been frowned upon on the network. These are advertising of particular products and advertising for or by job applicants…. There are many companies in the U.S. and abroad that would like to have access to the Arpanet. Naturally, all of them cannot have this access. Consequently if the ones that do have access can advertise their products to a very select market and others cannot, this is really an unfair advantage. Likewise, if job applicants can be selected amongst some of the best trained around, or if the applicants themselves can advertise to a very select group of prospective employers, this is an unfair advantage to other prospective employees or employers who are not on the net. (Excerpt from Feinler, 1978)

Feinler's missive sparked rapid rejoinders from others in the network who agreed with her about problems with advertising products but were more concerned about the negative effects of censorship. Could exchanging job information be really that unfair? One of her colleagues responded:

The amount of harm done by any of the cited 'unfair' things the net has been used for is clearly very small. And if they have found any people any jobs, clearly they have done good. If I had a job to offer, I would offer it to my friends first. Is this 'evil?' Must I advertise in a paper in every city in the US … all in the name of fairness? … So I state unashamedly that I am in favor of seeing jobs offered via whatever. (Excerpt from Stallman, 1978)

This exchange indicates that job hunting was considered by some to be a viable use of e-mail communication and listserv discussions from the early days of the Internet. Career and job-related information also circulated through computer Bulletin Board System (BBS) channels, a worldwide network of BBS systems (called FIDONET), and USENET Newsgroups such as misc.jobs.misc, misc.jobs.offered and misc.jobs.resumes (Hauben & Hauben, 1997). Colleges such as Rice University and the University of Illinois used their GOPHER servers to aggregate job postings from a variety of sources (Dolan & Schumacher, 1994). Founded in November 1993, the Online Career Center (OCC) signed up more than 100 member companies within a few months and offered more than 4,000 positions for review (Rosen, 1994); by late 1994 the head of OCC reported that more than 3,000 firms had used their services to hire new employees (Callaway, 1994). In New England, technical recruiter Jeff Taylor started The Monster Board in 1993 to help local employers find qualified information age workers.

Community-based networks as well began providing job-related services. The 1,584-line Directory of the Cleveland Free-Net, what Jay Hauben (1995) calls the "grandfather of the worldwide community computer networking movement," contained information on Jobs Wanted (under Community Services), cle.jobs (under Cleveland Area Special Interest Group), Jobs & Rehab. Resources (under The Handicap Center), and The Jobs Area (in The Computer Corner). Founded in 1984, maintained and upgraded by some 250 volunteers, the Cleveland Free-Net had more than 40,000 registered users during its fifteen-year life.

Proprietary computer networks also waded into this burgeoning field, led by the 1991 founding of E-SPAN by CompuServe, a site that focused on professional and managerial positions. Offering a service that would become a standard feature of these sites, CompuServe created a number of separate "forums" for specifics occupational areas (Rosen, 1994). America Online had its "Career Board" with 42 professional topic areas. Prodigy, the smallest of the proprietary services, offered a "Careers Bulletin Board."

Complementing the growth of these online job matching sites was the emergence of computer software packages to help assemble resumés, prepare for interviews, automatically enter resumés into computerized data bases, and automate a host of HR functions. As recruitment industry analyst Joyce Lain Kennedy (1994) marveled: "Employers have already boarded the e-train. They like electronics because it's cheaper to use computers than to employ people to sort through mounds of resumés and to keep track of everyone. The number of recruiting organizations that are substituting technology for labor in job-search screening will continue to accelerate…. A job-market revolution is happening before our eyes" (para. 7).

~~~~~

That's great deep history Josh! Many thanks!

Resume Spamming doesn't work

This fella-- Executive Options' Howard Nestler -- has started spamming my inbox with unsolicited resumes. I called him last week and he agreed to stop, but on he goes with the spamming.

I hope his clients know that this is really not going to get them a job.... at all.

Is Your Book Going To Be A Bestseller?

Type the title here to find out.

January 19, 2006

Where's the equator?

Trivia quiz of the day, Google not allowed:

The equator runs through Ecuador, Equitorial Guinea, both, or neither?

Short History of Job Boards, Part 2

• The number one and two players control over half the business (whether the open derision with which industry wags greet CareerBuilder's numbers is justified, we'll leave for another day)
• The combined revenue of players 3 - 6 is an order of magnitude lower than those top two
• And I'd be astounded if the combined revenue of all the other small fry equal that of #1