Over the past few weeks, we’ve highlighted some tips and tricks for polishing your elevator and email pitch. If a pitch is designed to deliver a succinct presentation of your product or service, then it may be that the 140 character limitation of Twitter makes it a great venue for a pitch.

Sponsor

Stowe Boyd is often credited with the idea of pitching via Twitter. He proposed the “Twitpitch” in order to help him schedule meetings with startups at the Web 2.0 Expo in 2008.

Twitter has grown in use and acceptance since Boyd’s idea for the Twitpitch, and the microblogging service can be a valuable site for entrepreneurs to pitch their ideas. But with the increasing level of chatter there, you need to make sure your pitch stands out. So if you do decide to use Twitter to pitch your ideas, here are a few things to keep in mind:

1: Pitch Publicly. If you target your message using the @ reply function, your conversations will only be seen by mutual followers and could be missed by others who might be interested in your idea. And if you use the direct message function, your tweet just ends up as an email would, without all the care and presentation of a full-blown email pitch. Of course, a public tweet runs the risk of being lost in the shuffle. And one of the drawbacks to pitching via Twitter is that, unlike the elevator or email pitches, you can’t really craft your pitch to suit your audience. If you want to have a bit more precision in your pitch, consider including a hashtag to link it with other conversations on the topic. (This is particularly useful when you plan to be onsite for an event, such as the Web 2.0 Expo.)

2. Complete your Twitter profile. Make sure your profile contains compelling and pertinent information about you and your company. Be sure to include your URL.

3. Include a URL in your tweet. If your tweet is a pitch, drive traffic to a webpage or blog post with more information about you, your company and your service. Consider linking to a page with a more elaborate pitch, not just merely to your home page. Whether you’re using a URL shortener (such as bit.ly) or not, it’s good to identify the type of link – a link to a blog post or a video, for example – so people know what to expect when they click.

3. Don’t use Twitter solely to pitch. There needs to be a compelling reason to follow you on Twitter and to pay attention to your tweets. If you only tweet self-promotional links and blurbs, chances are you aren’t going to maintain followers.

4. Don’t spam. While Twitter can be a great way to spread the message about your business, don’t repeatedly blast your followers with the same PR information.

5. Follow up. Twitter provides a real-time way to both monitor and participate in conversations. Do make sure that you aren’t just using Twitter to broadcast messages, but that you are actively engaging your followers as well.

There are numerous announcements you can pitch via Twitter: news, events, product launches, and employment opportunities, for example. But remember, as with the elevator pitch, it’s important to sell yourself, not just your products.

Discuss

Startup culture is continually growing in the greater public interest, and with that growth comes a sort of celebrity for the founders of the more popular companies. Mark Zuckerberg and Evan Williams are now household names, and in many ways, these entrepreneurs are like rock stars in the startup world. In fact, the journey of an entrepreneur through the startup experience is a lot like that of a musician seeking stardom and millions of adoring fans, and artist Shane Snow has a perfect infographic to illustrate this.

Sponsor

Snow, a graphic designer, freelance writer, entrepreneur and would-be musician based in New York City, saw his youthful aspirations of topping the rock and roll charts crumble as he and his bandmates went their separate ways after college. During that time he has been writing about technology, running a few startup sites, and designing websites and infographics. One such infographic was inspired by his dual experiences as a musician and an entrepreneur and shows that the path to success for both is marked by similar milestones.

For starters, rock bands assemble members of complementary abilities, create a rough-cut demo tape, network with similar bands and begin touring small venues. The same is true for startups, which gather a team of varying skills, produce their first prototype, and begin networking with other startups and investors. Rock bands “bootstrap” by selling merchandise at shows, and startups find themselves signed to an indie record label – also known as angel financing.

As the musicians travel thousands of miles playing gig after gig, the entrepreneurs code thousands of lines of code creating iteration after iteration. One day, as Snow’s infographic illustrates, startups could hit the big time with a major record label signing in the form of a venture capital firm investment. Finally, after the eventual superstars live up their popularity to it’s fullest, they retire and either become investors of their own, or crete their own record label to keep the money rolling in.

One comparison I would have included in the infographic is fact that startups and rock bands alike must stay abreast of their audience’s needs. Instead of churning out the same music over and over, bands evolve to keep their listeners interested and coming back for more. Just think of how different The Beatles were from their first to last album, and think of how different Facebook is from its early days.

“Starting a rock band is a very entrepreneurial experience,” says Snow. “I think being an entrepreneur is all about executing creative ideas — being the guy (or girl) who actually starts a band rather than sitting around with friends and talking about how cool it would be, or being the one who actually sits down and builds a prototype rather than just talking about it for years until someone else builds it.”

And just as there are no over-night successes in music, the same is also true for startups. They take enormous amounts of effort spread over a long period of time, so don’t get frustrated when your first singles aren’t instant hits.

Discuss

One of the newer startups in the Enterprise 2.0 community has been acquired by SuccessFactors, a SaaS provider that focuses on employee productivity.

SuccessFactors is acquiring CubeTree for $20 million in stock plus a contingent cash payment after three years, bringing the total value to $50 million.

Sponsor

CubeTree is a real-time collaborative work space that provides a platform for cross-functional productivity. When we looked at the company last Fall, CubeTree had just launched its social business platform.

Video is a bit grainy but the video I shot at Enterprise 2.0 lat Fall will give you a picture of what the company does.

Its core features came with its ability to easily create profiles for leveraging a company’s contact information. It also has a unique micro-commenting system that give users the capability to comment on power point slides and spreadsheets for instance, down to the cell on the financial document.

SuccessFactors will integrate CubeTree into its Business Execution software.

Discuss

With the 2010 ReadWriteWeb Mobile Summit just a few short days away we are working this week to put the finishing touches on the event. One thing we are really excited to include in this summit is the opportunity for innovative startups in the mobile space to show-off their products to our growing list of mobile experts and enthusiasts that plan on attending. This Friday at the Mobile Summit in Mountain View, California, we will be hosting a “speed geeking” session that will allow companies to present their products to as many people as possible, but we need your suggestions on who to invite!

Sponsor

Speed geeking is a lot like speed dating, but instead of eager singles rotating around tables hoping to find a match, groups of summit attendees will be moving from table to table hearing pitches from various mobile startups. We’ve already lined up some great mobile companies to attend the summit, but we are looking to include more startups, and that’s where you, the ReadWriteStart audience, come in!

We are looking for your suggestions of innovative startups in the mobile space that you think would make a great fit for speed geeking at the Mobile Summit. So leave a comment below with your suggestion and why you think they should be a prime candidate for the summit this Friday. We are looking to invite some startups to attend the summit and receive a speed geeking table free of charge, and we are counting on some top-notch suggestions from our audience.

Some of the companies that will be attending the Mobile Summit Friday include Skyhook Wireless, Orange, Alcatel-Lucent and SimpleGeo. Other large corporations, like Microsoft, Google, and Intuit, as well as investment firms like Storm Ventures and Blumberg Capital will also have representatives at the summit. The speed geeking sessions will be a valuable opportunity for startups to showcase their products infront of these investors and larger companies.

If you want to attend the event, register now at the summit’s homepage, and let us know who you think should be featured this Friday at the Mobile Summit in the comments below!

Photo by Wikipedia user Hyfen.

Discuss

It’s hard to believe that it is May already as a third of the year is complete and summer is almost here. With graduation season upon us, perhaps the entrepreneurs of tomorrow will want to take a look at the most popular startup stories from this week in our Weekly Wrapup. This week we’ve got more pitch deck suggestions, dealing with PR disasters and learning from failure. Also, we discuss some new data surrounding angel-backed companies, founders as long-term CEOs and how intellectual property effects innovation.

Sponsor

How to Avoid Making PowerPoint Your Enemy: Tips for Your Pitch Deck

The idea that PowerPoint is evil is not new. But on Monday, the New York Times rekindled discussions about the pitfalls of its use during presentations when it published a story on the U.S. military titled “We Have Met the Enemy and He Is PowerPoint.”

The article details both the complexity and the duration of the slides the military utilizes for its briefings, and contains the rather damning quotation from General McChrystal, leader of NATO forces in Afghanistan, who when shown a particularly convoluted graphic (see below) during one briefing said, “When we understand that slide we’ll have won the war.”

What to Do When a PR Disaster Strikes Your Startup

Thursday was a good PR day for the social buying site Blippy. They were featured in two New York Times articles. But Friday wasn’t so great, as the major technology blogs reported that credit card information from its users were found on Google. An hour later, Blippy responded with a post on its blog, explaining that the leak was months old and affected only four beta users, not current Blippy users. Later, they amended the blog post to include an apology. News of more credit card leaks continued on Saturday. Of course, Blippy is by no means the only startups to suffer from potential public relations disasters, and it remains to be seen what, if any, impact this has on the site.

Blippy’s response, including the need to re-edit its official announcement, demonstrates the importance in responding quickly and correctly to a crisis.

Learning From Failure: One Startup’s Story of What Went Wrong

Devver, maker of developer coding tools and TechStars 2008 graduate, announced last Monday that it would be shutting down after being active for nearly two years. News of a startup closing up shop is never a fun thing to hear about, but fortunately many lessons can be gleaned from the experiences of the entrepreneurs. Today, co-founder Ben Brinckerhoff provided just such lessons with an insightful blog on the Devver journey and why he and co-founder Dan Mayer are choosing to move on.

Angel-Backed Companies More Likely to Succeed, Says Harvard Study

A new study published by professors at the Harvard Business School shows that angel-backed companies are more likely to succeed and show more growth than those funded by venture firms alone. Researched and written by William Kerr and Josh Lerner, the report found that companies with angel funding see between 30% and 50% higher growth figures in terms of website traffic, are more likely to survive for four years, and are also in a better position to receive further rounds of funding.

For the Long Haul: Do Founders Make Better CEOs?

Ben Horowitz of the venture capital firm Andreessen Horowitz wrote an interesting piece Wednesday on why he and partner Marc Andreessen look for strong founding CEOs when investing in companies. Founding CEOs are the kind of entrepreneurs that run their companies from the early development stages and are not replaced by a professional CEO as the company grows and builds. In this lengthy but worthwhile read, Horowitz provides insight into what makes for a great founding CEO, and why he believes they are more likely to help a company succeed than a professional CEO.

Intellectual Property and Innovation: Who’s Got It Right?

Companies that rely on fair use generated $4.7 trillion in revenues and $2.2 billion in value added – roughly 16.2 percent of U.S. GDP in 2007. This is among the findings of a report released yesterday by the Computer and Communications Industry Assocation. The report based its findings on what it dubs “fair use industries,” which includes educational institutions, software developers, Internet search and Web hosting providers, and manufacturers of consumer devices that allow for the copying of copyrighted programming.

Discuss

Here on ReadWriteStart we are often providing resources and tips for young companies looking to raise funding from venture capitals and angel investors. This week’s recommendation for our Weekend Reading series, <emMoney Magnet: How to Attract Investors to Your Business by Jacoline Loewen, is a book aimed at helping entrepreneurs learn how to deal with financing and how to make their businesses attractive to investors.

Sponsor

Author Jacoline Loewen is a Canadian business consultant and strategy writer who has aided companies seeking capital and private equity. In Money Magnet, Loewen provides valuable lessons she has learned from her career on raising capital in a style that is “informative, relaxed and easy to understand,” according to book’s description. Though the book was published in 2008, and most of Loewen’s work involves multi-million dollar businesses, there are still some lessons startups can likely take away from the book.

Money Magnet is a bit like Fundraising 101. Loewen describes the various types of investors, how to meet and pitch to them, how to read term sheets and how to handle relationships with investors as companies grow. She also provides a run down of the important things investors look for from potential companies, as well as the “four brutal questions” they all ask. The first question most investors ask, she says, is “Are you the right people to make this happen?”

“The teams most likely to attract money will be those that demonstrate they will roll up their sleeves, get on with the unglamorous grunt work of operating plans and do things just a little bit better,” writes Loewen. “Anyone new to running a company who has a good idea and now wants funding, probably will not get the money, no matter how smooth they appear. No one, except your mom, is going to fund your learning curve.”

It’s interesting that she singles out all entrepreneurs with no experience and says they will most likely not get any funding for their idea. Depending on the VCs they seek out, this may be true, but there are plenty of opportunities for inexperienced entrepreneurs to get funding, though the odds are leaning against them. The other questions she says all investors will ask center around the investment opportunity, sustainability and return on investment – questions which will all essentially prove your readiness to get the company off the ground.

Loewen’s insider view into the investment process provides an unique perspective for startups looking to meet and woo potential investors. Most advice on the subject comes from either the entrepreneurs involved in the deals or the venture capitalists doling out the cash, so an angle from a consultant who has facilitated numbers of deals is certainly a fresh one.

Discuss

The hyperlocal news site Fwix launched a revamp to its service yesterday, allowing readers on its website to customize and socialize their news feed. Fwix users can follow local and hyperlocal topics, as well as follow other readers who share their interests. Taking advantage of Facebook’s recently released Open Graph API, Fwix now allows likes, comments and sharing of news stories. Noting that Facebook currently doesn’t “do location,” Fwix founder and CEO Darian Shirazi said that the updates to Fwix allow them to connect local data to the social graph, creating an ecosystem of real-time local and hyperlocal news.

Sponsor

“Linking ‘social’ and ‘news’ has been a goal since the beginning,” said Shirazi. “Now that we’ve built a robust and well-trafficked content network, we are making that goal a reality. The next step for local news is making it social, and we’re excited for this launch.”

Fwix aggregates local news articles and blog posts, and delivers content to readers based on their geographic and topical interests. The San Francisco-based company is less than two years old and in March inked a deal with the New York Times Company to deliver its content to its regional news sites. Initially covering 80 cites, Fwix now boasts a network of more than 200 markets worldwide.

While major newspapers have cut thousands of jobs, the rise of hyperlocal news services like Fwix, Outside.in, and EveryBlock demonstrate that readers are keenly interested in tracking local news, but want to be able to filter that information based on the topics and neighborhoods that matter personally to them.

As we wrote last week, the hyperlocal is already an important site for new startups. The updates to Fwix point towards more services that are not just acutely hyperlocal, but deeply socialized.

Discuss

Ben Horowitz of the venture capital firm Andreessen Horowitz wrote an interesting piece Wednesday on why he and partner Marc Andreessen look for strong founding CEOs when investing in companies. Founding CEOs are the kind of entrepreneurs that run their companies from the early development stages and are not replaced by a professional CEO as the company grows and builds. In this lengthy but worthwhile read, Horowitz provides insight into what makes for a great founding CEO, and why he believes they are more likely to help a company succeed than a professional CEO.

Sponsor

It is not uncommon in the world of startups and venture capital that when a startup finds a business model and market fit for its product that a founding CEO is replaced by a more experienced professional. Some entrepreneurs just aren’t cut out to handle the responsibilities that come with being a CEO, so they either step down or are replaced by the company’s board. But other times, the entrepreneur has enough skill to handle the CEO job, and as Horowitz points out, this type of CEO is much more likely to nurture a profitable business.

Dozens of large companies are thriving today thanks in no small part to a CEO who has been with the company since its inception. Examples of some of the most successful founding CEOs in the history of the tech industry include Apple’s Steve Jobs, Microsoft’s Bill Gates, Amazon’s Jeff Bezos and Sun’s Scott McNeely. Horowitz also points out that some of the hottest new companies, like Facebook, Twitter and Zynga are also run by founding CEOs, but not all founders are capable of this success.

So what qualities are needed in entrepreneurs in order to become the next Steve Jobs or Bill Gates? According to Horowitz, a winning founding CEO has “comprehensive knowledge” of all aspects of the company, the “moral authority” to go against the grain and “total commitment to the long-term” success of the company. Long-term commitment can often be the hardest quality to possess, but Horowitz notes that founder CEOs are placing themselves in the line of fire in the short-term for their belief in the long-term.

“Recently, we’ve seen Facebook’s founding CEO Mark Zuckerberg make a series of long-term bets. He’s radically revamped critical features such as the feed used by hundreds of millions of people,” writes Horowitz. “By committing to the long-term, he put himself under tremendous pressure in the short-term. The press broadly questioned his business acumen and Facebook’s ability to generate any meaningful revenue [...] We now know these critics were wrong and Zuckerberg was right, but would a professional CEO have taken these risks and endured such vicious attacks for unseen, long-term benefits?”

As Horowitz adds, not all founders are cut out for the role of CEO, and there are, in fact, professional CEOs capable of building successful companies that continue to innovate. Eric Schmidt, he says, adopted the philosophies of Google’s founders in order to help it continue to grow, and John Morgridge nearly singlehandedly turned Cisco into what it is today, Horowitz notes. Finally, he has this boiled down piece of advice for startups.

“If you hire a professional CEO into a company that has found a large product cycle, the professional will be able to maximize that product cycle, but likely won’t find the next one,” he says. “If you hire a professional to find the product cycle, get the jelly, because your company will soon be toast.”

What are your thoughts on this issue? Are professional CEOs largely incapable of being as innovative as founding CEOs? Let us know your view in the comments below.

Photos by Flickr users Kumar Appaiah and deneyterrio.

Discuss

Have you ever found yourself ignoring the directions of your car’s GPS in order to get somewhere faster or more efficiently than it can calculate? Me too. Chances are when leaving point A, you plugged in the address of point B, and a route was calculated on how to get from one to the other. The problem is, things come up on the route from point A to point B that may cause you to divert from your path such as construction, road closures, traffic, side trips you need to make or neighborhoods you may choose to avoid driving straight through.

Sponsor

Startups make similar diversions, but the directions they are straying from are those of a product roadmap. Roadmaps are projected out for months, if not years, to give a company a strategy to most effectively grow its product. But just as there are reasons we ignore our GPS, there are reasons for startups to alter their roadmap.

Spark Capital partner Bijan Sabet has worked with dozens of startups on project roadmaps, and recently he wrote about the importance of driving off course when necessary. Sabet recalls and example of this from his experience working with Boxee’s Avner Ronen.

“I remember our first board [meeting], Avner shared a product plan for the next twelve months. Then, before the very next board meeting he shipped a bunch of new things that weren’t on the roadmap,” writes Sabet. “He would see opportunities in the market, listen to his users and then create and launch. And that approach paid off and continues to pay off.”

If startups come up with a product roadmap and proceed to put their heads in the sand while they follow it unwaveringly, they will more than likely fail. So much is learned from testing products and receiving feedback that being unwilling to change the plan is a death sentence. This quality is so important for entrepreneurs that Sabet says he looks for it specifically when investigating possible investments.

“I’m more interested in learning if the founders have the talent and desire to move, innovate and create quickly,” he says.

The lesson here seems obvious, but there have been cases where startups are devoted to their roadmaps and revenue projects to a point where it affects the success of the company. Like some driving directions, there is no route that is most optimal for every startup to succeed. The willingness to turn left when your GPS says right is an important decision to know how to make as an entreprneur.

Photos by Flickr users Marcin Wichary and sporst.

Discuss

For a long time, technology has been touted as a force that can help us connect globally. But the urge to stay connected locally remains. And the same technological innovations that have facilitated global commerce and communication now seem to be turned towards helping us (re)connect to our neighborhoods, communities and local businesses. As buzz around location-based networks and services grows, “the local” is poised to be a place that’s increasingly the emphasis for innovation and entrepreneurship.

Sponsor

People want to know what’s going on locally. People want to shop locally. People want to network locally. And hyperlocal services make it easier to engage in and market to a local community. Technology need no longer be feared by local businesses as something that would drive their customers elsewhere – namely online.

Although location-based social networks such as Foursquare and Gowalla have received significant attention as part of this trend, they are far from the only services. Hyperlocal search and news sites are two other services that have seen recent growth.

Last week, Milo.com, a website that enables shoppers to research products online but then make their purchases locally, added products and real-time inventories for over 100 independent, mom-and-pop stores across the country. While Milo.com has served the “big box” stores for some time, this move to incorporate smaller retail outlets marks another way in which the local is starting to take advantage of online opportunities.

“Smaller stores that once viewed technology as a threat, now see the benefit it has for reaching potential shoppers and attracting new customers into their actual brick and mortar locations,” says Jack Abraham, Milo.com founder and CEO. Abraham says that Milo.com helps local businesses address the classic problem of how to get new customers in the door, but offers the best of both worlds – that is both an online component for reading reviews and the assurance that if they drive to their local store, they’ll find the item in-stock, ready to “touch, feel, and buy.”

The hyperlocal can offer both geographic and content granularity – the ability to focus on a very specific location and subject matter that might otherwise be too small to be served. By merging the local and the online, businesses can respond quickly to meet the needs of their customers.

Startups have long used local communities as a testing ground for both marketing and business models before opting to expand. The increasing interest in the hyperlocal might make it more than just a launching point.

What do you think of the potential for expansion of more hyperlocal startups?

Discuss

Thursday was a good PR day for the social buying site Blippy. They were featured in two New York Times articles. But Friday wasn’t so great, as the major technology blogs reported that credit card information from its users were found on Google. An hour later, Blippy responded with a post on its blog, explaining that the leak was months old and affected only four beta users, not current Blippy users. Later, they amended the blog post to include an apology. News of more credit card leaks continued on Saturday. Of course, Blippy is by no means the only startups to suffer from potential public relations disasters, and it remains to be seen what, if any, impact this has on the site.

Blippy’s response, including the need to re-edit its official announcement, demonstrates the importance in responding quickly and correctly to a crisis.

Sponsor

As Jacob Morgan writes in a post on “The Social CRM Process,” it’s important to have both a macro and a micro response to this sort of situation, addressing both the individuals involved and the public-at-large. “Remember the whole Southwest Airlines and Kevin Smith debacle, where they kicked him off the flight for being too fat? Southwest Airlines took both a micro and a macro response. They interacted with Kevin Smith directly via Twitter, email, and telephone; a micro response. In addition Southwest Airlines also wrote a public post on their blog which addressed their community as a whole, a macro response.”

Some advice:

Of course, sometimes companies opt to do nothing, and hope that the bad press is quickly forgotten. Others hope that it’s true that all publicity is good publicity.

Nevertheless it’s best to try to cultivate some good publicity, as trust and credibility are vital for a startup’s success. Transparency and openness are important, even if it means riding out a difficult news cycle.

Discuss

As an avid podcast subscriber I have dozens of audio and video programs feeding into iTunes daily, but one recent submission from the TED Talks video podcast caught my eye because of its parallels to lean startups. Tom Wujec, author and fellow at Autodesk, presented at TED 2010 back in February, and his talk, “Build a tower, build a team,” is now available online. Wujec conducted a team building experiment with all types of people, from business execs to kindergartners, and the results he presented were surprising, to say the least.

Sponsor

The activity, known as the marshmallow challenge, was borrowed by Wujec from Peter Skillman, VP of Design at Palm. Small teams are given 18 minutes to build a free-standing structure made of dry spaghetti, one yard of string, one yard of tape and a marshmallow, which must be placed on top. The team wins by creating the tallest structure of all the groups participating. What Wujec discovered is that this simple game revealed some fascinating insights into how groups collaborate.

Wujec has conducted this experiment with over 70 groups of “students and designers and architects, even the CTOs of the Fortune 50,” he says. Most teams quickly break into roles and plan their structure, and then spend the remaining time building it before quickly and gingerly placing the marshmallow on top as time expires. More often than not, the structure pitifully fails as the marshmallow is added, leaving the team with a pile of spaghetti and no time to try again.

“So there are a number of people who have a lot more ‘uh-oh’ moments than others, and among the worst are recent graduates of business school. They lie, they cheat, they get distracted, and they produce really lame structures,” says Wujec. “And of course there are teams that have a lot more ‘ta-da’ structures, and, among the best, are recent graduates of kindergarten.”

Wujec says that business school grads are taught to seek out and execute the one correct solution their challenge, while kindergartners practice the iterative prototype and refine process, much like the methods of lean startups. The kids would build, test and repeat until they found a structure that worked, and most times, he says, they built the tallest and most interesting structures.

Another interesting fact uncovered by these experiments is that incentivizing the teams didn’t improve their structures, it actually made them worse. When Wujic offered the winning team a $10,000 software prize, not a single group was able to create a standing structure; however, when we returned to the same students later, they understood the need for iteration, and produced structures well above the average height.

What startups can take away from the marshmallow challenge is that bigger teams and higher incentives are no substitute for having the right skills and the right process in place. Wujec found that larger teams performed increasing worse than smaller teams, and incentivizing them with a reward did not make up for the fact that they were not using the right process.

As Wujec adds, every business challenge has its own “marshmallow,” so consider bringing some kindergarten-minded people onto your startup team.

Photo by Flickr user John-Morgan.

Discuss

It’s been a given for some time that businesses, including startups, should have a presence on and connection with Facebook. With over 400 million active users, chances are your potential investors and customers are already there.

Fan pages have been a simple way to generate interest and engage customers, and Facebook Connect has quickly become a standard in signing up and signing in users. In his keynote at f8 yesterday Facebook CEO Mark Zuckerberg actually mentioned startups in his opening remarks, stating that they “are requiring that their users use Facebook Connect. We want to make it simple to create these personalized experiences.”

Sponsor

Whether or not Facebook is a “requirement” for startups, there are some things new businesses should think about based on yesterday’s announcements.

“Facebook Connect On Steroids”

Facebook announced a major overhaul to its API and introduced three new components yesterday: social plugins, the Open Graph protocol, and the Graph API. By using the tags specified in this protocol, any website can now become part of the Facebook ecosystem.

If a Facebook user visits your site and Likes your page, you have the ability then to publish information into that user’s stream. In addition, implementation of the code on your site will give you access to administrative tools and analytics just like any Facebook fan page owner. As we wrote yesterday, this will take analytics to the next level, providing an incredible amount of demographic data about users who like and link their profiles to your site. However, this information will reside with Facebook, not on your own website, making them a de facto owner of your visitors’ social data.

Applications & Virtual Currency: Where the Money Is?

While many businesses will likely integrate their websites into the expanding Facebook ecosystem, there is likely still room for growth within the platform itself, namely with application development. There are over 550,000 applications on the site, a number that continues to grow – and to encourage return visitors.

To coincide with the growth of the application market, particularly in the area of social gaming, Facebook also announced the expansion of its official virtual currency, Credits. Last year Paypal processed over $500 million in virtual goods last year, with social gaming company Zynga becoming Paypal’s second largest merchant (following eBay). Clearly Facebook seeks to stake a claim in the virtual currency market.

Facebook Credits are currently in beta with over 100 applications, and will roll out to the entire network soon, Zuckerberg said yesterday. Credits will allow users to purchase one currency for all transactions on Facebook, rather than have to enter their credit card information with each purchase. By facilitating online payments, Facebook hopes to increase the percentage of users willing to purchase virtual goods to between 8% and 20%

David vs. Goliath?

Despite repetition at f8 yesterday that these changes were meant designed “for developers,” it remains to be seen how the announcements will play out for developers and for users alike, the latter of whom are notorious for protesting changes to the site. In particular, continued concerns about privacy might not be well received, particulary given Facebook’s past history with opening user data.

Privacy concerns might not be the only thing that gives some businesses pause about Facebook’s direction. Facebook also announced yesterday “instant personalization” yesterday, giving three “preferred partners” – Yelp, Pandora, and CNN – instant and additional access to Facebook profile information when users visit their sites. For startups in these areas, namely restaurant recommendation, music sharing, and news delivery, the “preferred partner” program might make industry in-roads more difficult and could adversely impact user adoption. As the “preferred partner” program expands beyond the three selected for launch, it remains to be seen the effect of being sanctioned – or not – by Facebook.

The buzz yesterday was that Facebook had just “seized control of the Internet.” Comments on how you think the f8 announcements might play out for startups welcome!

Discuss

If you failed to notice Google’s lovely new artwork this morning, today is Earth Day. The purpose of the day in recent years has been to reflect on our energy consumption and to raise awareness on how to better preserve our planet, and startups can play a significant role in that preservation. Seedcamp, arguably the largest and most influential incubator in Europe, is teaming up with IBM and other organizations to host SmartCamp, a series of networking events across the globe designed to uncover the hottest early-stage companies with an environmental focus.

Sponsor

Throughout the remainder of 2010, SmartCamp events will be held in Paris, Tel Aviv, San Francisco, Boston, Stockholm, London and Dublin. 5 companies from each city will be chosen to attend the event to network with 25 global entrepreneurs and investors, and one will eventually be invited to SmartCamp Week in Dublin where a winner will be crowned the “World’s Smartest Startup.”

We don’t normally talk about environmental technology too much here on ReadWriteStart because a lot of it focuses around biotechnology and other applied sciences, but the SmartCamp events will be a little different. According to Seedcamp’s Stephanie Zari, the companies they are looking to include intersect with a lot of Web and software startup trends.

“SmartCamp is focused on start-ups who are active in areas like energy, water management, transportation, health care, etc. Anywhere software and technology can be used to make our systems more intelligent,” writes Zari on the Seedcamp blog. “Think about how technology can reduce energy waste, improve traffic flows reduce water leaks, or improve public safety in your city. These are just some examples, however these solutions based on software, sensors and cloud computing can apply to many areas.”

There are plenty of other categories related to web technology that can provide a service to help make a smarter planet. SmartCamp says they will consider enterprise software apps, Internet and SaaS companies, Cloud and IT infrastructure, and many other sectors. Of course, they are also looking for traditional “green” innovations, including the areas of health care, energy efficiency, carbon and water management, transportation and several others.

According to IBM, 80% of last year’s participants either secured or were offered funding for their company, and along with the networking included in the events, the event is a ripe opportunity for startups that want to help save the planet. To apply for the program, startups can go to the application on Seedcamp’s site. The Boston and San Francisco-based events will be held June 3rd and September 8th, respectively.

Discuss