BW: OMG, Like, Totally, Digg
Updated below: In what has to be the most fisk-worthy Web 2.0 story ever written, BW does a cover story about Digg’s founder and other young entrepreneurs in Silicon Valley. The problem is not the subject, Digg, and the founder/team, who deserve credit for what they have created, but BW’s treatment of the whole story. It is riddled with so many inanities, without any sense or logic, or journalistic norms, it sounds like a parody of a parody. Their idea of getting street cred among the tech-savvy/early-adopter/blogger crowd is this, and it sounds like a desperate ploy to stay relevant, even when they don’t have to. It does away with all the hard work writers like Heather Green and Stephen Baker have done there...seriously you two, what were you doing when this story was being written?
I don’t have the stomach to listen to the cover story podcast, which, by the way, is a nice BW feature where they have interviews with the writers about the cover story and the backstory, so to speak. I’ll try tomorrow, in a more relaxed weekend frame of mind..maybe that’ll help.
Updated: Judging from the comments below, I think there’s some confusion. I don’t have any problems with the style, neither do I care. It is about the hype and the treatment that the story is being given. Factual errors, false deductive reasoning, and the general lack of awareness of the dynamics of Internet M&A.
Secondly, the writer Jessie Hempel writes and asks in the comments below: what would we have done? The honest answer: we wouldn’t have done it. Simple as that. It is about having a bullshit detector. Some people have it, some people don’t.
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Comments (1)
Aug 6, 2006 6:10 PM
Adding to what Mike writes above, here’s my mini-fisking of the story:
—“At 29, Rose was on his way either to a cool $60 million or to total failure.” Completely wrong…as others have pointed out.
— “It is now the 24th-most popular Web site in the U.S., nipping at the The New York Times’ (No. 19) and easily beating Fox News (No. 62), according to industry tracker Alexa.com”. Alexa? Plueeze…it is a webmaster’s tool. Everyone knows that. That is no barometer of popularity. Read this post for some reality check on this: http://blogs.zdnet.com/micro-markets/?p=209
—“Of the free labor that is the ‘Digg Army,’ 94% are male; more than half are IT types in their 20s and 30s making $75,000 or more. It’s a demographic advertisers lust after.” Since when did it become that simplistic?
—“That’s why some smart money is on Digg to become an ad magnet à la MySpace.com”. Even a high school kid on MySpace would tell you that simile is the wrong comparison completely.
—“So far, Digg is breaking even on an estimated $3 million annually in revenues. Nonetheless, people in the know say Digg is easily worth $200 million”. Wait, it is spending $3 mil annually? Why? It is not as if it spent a million on the new design? And the valuation, as has been said, is completely bunkum, much like the $2 billion Facebook valuation BW write about earlier.
—“It’s not as dot-com déjà vu as it sounds. YouTube, the enormously popular video site, posts similarly fledgling revenues, but some experts say it could easily fetch $500 million.” Very different dynamics: news vs entertainment….both work on different multiples. Ask any VC, they’ll explain you.
—“A rumored $40 million offer from Yahoo! Inc. (YHOO ) surfaced in January, which Yahoo denied.” I’ll be less harsh on this one, even though it was a rumor, and very wild one at that.
—“For their big stakes of, say, $15 million for 20% of a company, venture capitalists received board seats, control of the management levers, and most of the equity.” What does this mean? I think the writer got confused, or this is an editing error: if a VC holds 20 percent of the company, then they don’t own most of the equity. They own 20 percent, right?