But the job of a business development executive is changing. You have to be more product focused, more technical, and focus on making deals where there is already user level integration happening.

 In a previous post, Fred described how the public api’s published by Web 2.0 companies not only allow them to effectively partner without all the overhead of a business/legal deal, but also to do so much more quickly.  Nevertheless, as a commenter on that post observed:

The BD guy has always been the guy who sees how two companies can play together. Today’s smart (good) BD guy simply works more with his in-house API guru and less with his Rolodex.

Even if Joshua and company built del.icio.us only for resale, they created real value in aggregating users and creating a folksonomy – a user defined categorization and ranking of web content.  They did a brilliant job of solving the dilemma of all network-value businesses – how do you get to critical mass when there is NO network value for the first users?

Real estate analogy holds, but lots more to it – risk, sub-market knowledge, etc.

Remember Metcalfe’s Law that the value of a network scales with the square of the number of users.  This implies that big networks have huge value but also that small networks have almost no value at all,  Makes it hard to get started.

Del.icio.us had value for user #1 even if it wasn’t “network” value.  Tagging is a good way to remember all the web pages you may want to find again.  That use doesn’t depend on any one else doing any tagging.  So more and more people used del.icio.us to bookmark web pages for later retrieval.

Network value – build it and they will come?

Since the tags are public, anyone can use everyone else’s tags as a way to find information.  So, as soon as enough people tagged for their own selfish purpose, their tags became useful to other people looking for web content.  Moreover, there is information in how many people tagged a particular web site or blog.  Popularity means something although it’s not always clear what.  Soon del.icio.us had real network value and was off to the races.

First to market – ?

Del.icio.us got to a critical mass of users before its competitors.  That’s crucial to a network business because this lead kicks off a virtuous circle. The network service with the most users has the most value to each new user.  Other things being anywhere near equal, the larger network therefore gets more than its share of new users and grows faster than its would-be competitors.  Aggregating users faster than anyone else is why Skype succeeded and it’s why del.icio.us succeeded as well.

It is true that there is a huge "overhang" of venture money left over from the 1999/2000 fundraising binge. But that money can’t go into early stage deals because those deals take 5-6 years to turn into realizations. So this "overhang" is going into later stage deals. Look at $75 million going into Fastclick or $108 million going into Webroot. That’s where the overhang money is going to go. The early stage market may also be entering a "furious investing cycle" but that’s not being driven by the overhang from 1999/2000, its being driven by Web 2.0 and the realization that we have entered another wave of innovation around the Internet that will result in a lot of interesting companies being created, built, and sold over the next several years.

PrimeRevenue is the key to a financially optimized supply chain.  For Buyers and Suppliers.

Our program is an innovative and unparalleled solution that brings the benefits of information technology to the financial supply chain.  Our services deliver greater working capital efficiency, cost savings, and revenue growth opportunities for both Buyers and Suppliers.

With our program, Buyers provide Suppliers with transaction visibility and payment certainty around trade payables to their Suppliers, reducing the amount of cash tied up in the order-to-cash cycle.  Our services streamline AR/AP processes, link the flow of funds to the flow of transaction data and, by creating visibility into future cash flows, give corporations access to a variety of transaction level financing options at very attractive rates.

Simply stated, PrimeRevenue helps companies do more business with less working capital.

Although apparently not a new concept (there’s a link on their website
to a fairly sophisticated vision of it in an article written in 2000),
the integrated communications and software infrastructure for implementing it are
only now reaching the maturation to support it.

On another Web sojourn, I encountered Wells Fargo’s Commercial Electronic Office (CEO), a proprietary financial portal that claims to provide "cash management, credit, international, and trust and investment services all in once place with a single sign on".  Maybe so, but my experience with banks suggest that would be something of a stretch.  (Wells had even applied bankers’ bureaucratese to the term e-commerce, turning a concise word into a mouthful of multi-syllabic mush.)  My instincts and experience with online media content tell me that a proprietary business model will not stand.  For the same underlying economic reasons that it would make no sense for Yahoo, MSN or AOL to limit their available market to that of one communications company (as in cable or telco), it would make no sense for a true financial portal to limit its market to the available market of a given depository institution (even if owned by that institution). 

This is worthy of futher "focused" Web wanderings, thought and conversation.

"the message is pretty clear to me: eventually, and probably sooner than later, someone is going to pull together all these diverse angles on telecom/internet/media/hardware/applications/chips, incorporate some hard financial and technical analysis, and build a cross-sector investment research platform incorporating realtime tools (I mean blogging, IM, video conferencing and collaboration) rather than .pdfs and spam.

There is a business model here, and whether it’s the financial media who seize upon it (Reuters and Bloomberg have the infrastructure and a lot of data, but are trapped in a walled garden mentality and put their journalists in the same sector-coverage silos that the brokers do), or the brokers (I’m skeptical, because I think they tend to be dismissive of alternative points of view, risk-averse, organized in sector and region silos, and anyway are focused on trying to kill one another), or a newcomer (CNET or something that doesn’t currently exist), I feel certain that it is going to happen."

Makes sense to me.  Furthermore, if true, it would seem to follow that almost any research-intensive business would be open to similar disruption.  Wonder if Gardener, Forrester, Yankee, et al. have thought of that?