Is Union Square Ventures Changing Exit Strategies?
Robert Scoble hails HE is the one who knows what Google is really up to with Microsoft. Fred Wilson hails HE is the one who knows what Yahoo! should really be up to without Microsoft!
Union Square Venture’s managing partner Fred Wilson has a message for Web 2.0 entrepreneurs: Sell out to Yahoo!, Google, AOL at your entrepreneurial peril! Odd then, that his own portfolio companies have sold out, under Wilson’s guidance, to the Web giants Wilson warns may cause young companies to “die a slow death.”
Where are Fred Wilson’s Union Square Venture’s portfolio companies del.icio.us, Feedburner, Tacoda today? Under the “consolidation” of Yahoo!, Google, AOL respectively, despite Wilson now saying “We don’t need or want consolidation of services on the Internet.” Since when though, in the Union Square Ventures playbook?
“Web services don’t get better under the ownership of big companies. They get worse,” Wilson declares now, point blank. Wilson also has declared an inexorable Google search monopoly, no need for Yahoo or Microsoft to even show up for the search game anymore, suggests Wilson.
Wilson also knows what is “the right thing” for Yahoo to do for every Internet constituency: Sell off its Web services because, according to Wilson, Yahoo execs would “all love to be running Web services the way that the CEOs of our portfolio companies run their businesses. But they can’t.”
Nice plug for Union Square Ventures, but how is the CEO of Wilson’s portfolio company Twitter doing in running HIS business lately! Moreover, if Wilson was really so passionately against lovely little Web services “languishing” under heavy corporate hands, why does he do his darndest to make sure such sell outs happen?
“Consolidation of ownership of web services is not a good thing for the Internet,” admonishes Wilson. Why then is his own Union Square Ventures helping spur such a purportedly ”bad” Internet along?
What’s more, why is Wilson cheering a 100% consolidaition of search under one big $200 billion market cap corporate umbrella?
In cheering Union Square Venture’s portfolio company FeedBurner’s “consolidation” by corporate giant Google, Wilson underscored “It’s important to remember that starting companies and building businesses is ultimately about making money.”
Perhaps Wilson ought to remind his portfolio company Twitter of the lesson!
Despite Wilson’s current dire predictions for Web services that are “consolidated” by the likes of Yahoo! and Microsoft, Union Square Ventures applauded the sale of a portfolio company to AOL, underscoring how Tacoda is helped by the “consolidation”:
The combination of Tacoda’s seasoned management, technology, database, and experience with behavioral targeting and AOL Time Warner’s reach as a media company and (through Advertising .com) as an ad network, could become the foundation for creating the dominant display ad network on the internet.
Today, Wilson disses Yahoo!:
I suspect that many of Yahoo!’s best services will languish under Microsoft’s ownership and that users will leave. It’s happening already under Yahoo!’s ownership to services like Flickr and Delicious and MyBlogLog.
When Wilson helped push the “exit” of Union Square Venture’s portfolio company del.icio.us, thanks to Yahoo!, he sang a diiferent Web services Yahoo! “consolidation” tune:
Many of the users who contribute tags to Delicious do so because they believe they are making the internet more useful for everyone. We believe that Yahoo! understands this. The way they have handled the Flickr acquisition gives us comfort that Yahoo! will pursue Joshua’s vision of an open data architecture which will be the foundation for a whole new ecosystem of innovative web services.
“A VC” commentor Jeffrey McManus’ on Wilson’s about (Yahoo!) face:
Why would an independent Yahoo want to spin off a bunch of competitors? By what measure has Flickr gotten worse under Yahoo?
Wilson clarifies? “it’s not that Flickr has gotten worse. it just hasn’t gotten better”
The bottom line for Wilson, today:
big companies buy small companies and the innovation stops
REALLY? Poor Union Square Ventures portfolio companies Twitter, Wesabe, Zynga….then? After all, how can Wilson advise “exits” to “big companies” Google, Yahoo!, Microsoft… if such “big” sell outs will stifle Web innovation?
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