SJF Headline News

I like the question “If you could invite any six individuals to dinner, who would they be?”  I also like one of the responses that I have seen to this question:  “I would get a bunch of wine and invite Jon Stewart, Bill O’Reilly, Stephen Colbert, Glenn Beck, Keith Olbermann, and Ann Coulter.”

On my short list of the individuals I would invite is Kevin Kelly.  Kevin is the founding executive editor of Wired Magazine and a fascinating author.  His 1998 book New Rules for the New Economy was tremendously helpful to me in navigating the boom and bust of the Internet market while I managed an Internet mutual fund.  His newest book, What Technology Wants, is considered by many, including me, to be brilliant.

So, it was a special treat for me when I was given the opportunity to take a walk with Kevin on a beach today in San Francisco.  I was able to ask him some questions that I knew he would have a special take on, such as his view of Singularity.

Regarding topics that are relevant to our work at SJF Ventures, Kevin had never heard of impact investing, and he doesn’t follow the venture capital world.  But Kevin has given a lot of thought to the relationship between technology and “good.”  So, I was eager to hear his thoughts on this matter.

I started by explaining that in the world of impact investing, the positive impact elements of cleantech are fairly clear and readily acceptable.  He politely inserted that he believes that over time some of the technologies that we deem to be clean today will be seen less clearly as clean in the future.  (Another topic for another day.)  And then we turned to more traditional technology, which many individuals struggle to associate with good or bad.

So, which kinds of technologies did Kevin consider “good”?

Kevin believes that technologies that increase choices for individuals tend to be inherently good.  The Internet is a prime example, for it greatly increases the opportunities and choices presented to individuals.  As part of this theme, Kevin noted that we all have unique qualities that are special.  So, technologies that provide us more choices and open opportunities to connect with that which is special about us are inherently good.

Kevin also cited technologies that expand dimensions of participation, increase common wealth, and enhance qualities of relationships.

Kevin further noted that he associates “good technologies” with those that are convivial, or breathe life into the world and our experiences.  Weapon technology would be the opposite.

Finally, Kevin noted that the type of technology, or the species of a certain wave of innovation, can be important.  For example, a smart phone like the iPhone or Android was inevitable, according to Kevin.  But it matters which choices the developers made when creating the phone.  Is it an open system like Android or a closed system like the iPhone?  How damaging to the earth are the materials that are used?

I am still digesting Kevin’s comments.  Our view at SJF Ventures on the fit between impact investing and technology-enhanced services is that we look at the output of the service to determine if it passes the sniff test of creating a positive difference.  Some specific examples, such as an online community that brings together diabetes patients, are clear fits to us.  Some verticals, such as education software, are clear fits to us.  And some horizontal themes, such as services that yield strong employee engagement and empowerment, are clear fits to us.  There are also some themes that we deem to be positive, such as tools that democratize access to information, that might not have been captured by traditional views of socially responsible investing.

The fit between technology and positive impact is one that we continue to ask ourselves and push ourselves to define or frame.  I am very thankful for people like Kevin who have thought deeply about the relationship between technology and “good.”  It helps provide some fantastic fresh thinking on what that marriage between technology and impact investing should look like.

Alan

Congratulations to Bob Stern and all of the other team members at MedPage Today.  The company has been acquired by Everyday Health, Inc., resulting in a successful outcome for all shareholders, including Bob, the investors, and a good number of employees.

MedPage gathers information from conferences, medical journals and others sources.  It then quickly converts that content into news that is written with a medical sophisticated and brevity that is appreciated by busy doctors.  News is distributed by the company’s website, mobile apps and emails.   The MedPage organization draws on a unique combination of deep medical knowledge and news-room-like production capabilities.  We think the staff are some of the best reporters and writers in the medical world, and that belief is supported by a number of industry awards that MedPage has received.

The MedPage story has many interesting elements, but let me highlight just a couple.

First, while MedPage is a sophisticated digital media company, some of its primary competitive advantage reminds me more of a bricks-and-mortar company than an Internet company.  MedPage has put together a talented team and developed a well-oiled news machine that would be difficult for even well capitalized competitors to emulate.  While many investors including me tend to focus on network effects, data assets, and other competitive advantages that are digitally oriented, MedPage built something defensible through superior processes and talented people.  MedPage is a great reminder that competitive advantages for Internet company can be derived in a number of different ways.

Second, MedPage is a fantastic example of a capital-efficient company.  MedPage required only $2.1 million of capital to become profitable and generate a very successful outcome for its founders and investors.  The company’s decision a few years ago to not pursue more capital has paid off very well for its shareholders.

We wish Bob and the rest of the MedPage team well in this next chapter.

I was excited to see Yahoo open its inventory to real-time bidding through MediaMath and other demand side platforms, providing further evidence that demand side platforms provide a key layer of intelligence to the advertising exchange value chain.  See Yahoo’s announcement for more detail.

The news comes on the back of a nice award recently received by MediaMath:  AlwaysOn’s 2010 category winner for advertising networks and exchanges.