Masterclass - the business of blogging

Last week, we had the first 'live' session at our 'managing tech startups' class. We had Julio Alonso talk about bootstrapping, the attention economy and the importance of analytics in the attention economy.

JULIO ALONSO and WEBLOGS SL

A brief bio. Long story short, in 2005, Julio left a successful consulting career to start Weblogs SL, a privately owned co. running 40+ vertical blogs in Spain and Brazil. He's doing quite OK, and for the last two years, he's been featured in El Mundo's list of the 25 most influential people on the internet in Spain.

SO WHAT'S SPECIAL ABOUT IT: BOOTSTRAPPING

Personally, the most interesting bit about his story is the part about bootstrapping and making it a self-financing venture. Partly, it was an attempt to avoid the excesses of the crazy internet bubble that burst not so long ago. Partly, it was a goal to remain EBITDA positive, every single year, even if it came at the cost of slower growth. But I think the biggest factor was this idea of being in it for the long haul, not just to make a quick buck (which is what VCs want). This takes a lot of guts, and self belief.

THRIVING IN THE ATTENTION ECONOMY : STICKING TO THEIR ROOTS

Weblogs is sustained by advertising revenue. And advertisers pay for ads shown to readers when the content of the blog is relevant to the ad. So the more the content, and the more the readers, the more the revenue. Simple enough?

Maybe not that simple. A key asset and differentiator for Weblogs is their regular and knowledgeable reader-base. You can't mess around with these people by taking them for granted and bombarding them with ads, or even worse, ads irrelevant to what they're reading. The balance between commercializing the content and retaining the reader's attention is a fine one.

Weblogs' policy has been to stay true to their roots, prioritize content over ads, and where possible, enmesh the content and the ads together. Julio talked about a pretty interesting idea 'content going into advertisements', as opposed to 'advertisement going into content', which is the norm. They did this by embedding their (pre-existing content) recipes into an ad campaign they conceptualized for a food chain.

Their superior (i.e. more relevant) content is what'll ultimately keep them safe from the new threat posed by content-farms. Moreover, this is where Weblogs' bootstrapping comes into the picture in a business sense: they are free from any investor pressure to maximize revenue by plastering ads all over the place, or to increase page-views by directing the creative bloggers to "follow" a trend.

ANALYTICS:

One thing Weblogs could do better is to capitalize on their prime asset, their loyal reader-base. With their drilled-down analytics, they can charge advertisers a premium fee for ads shown to their loyal readers, as against a standard fee for ads shown to the one-time users.

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Second Term - it's over

Back after a bit of a hiatus...
Had been busy with the exams and final presentations and whatnot.
First, the presentations. We had a bunch of presentations to make this time around. Economics, Marketing, Entrepreneurship, Strategy, and Operations...phew !! The class is getting really good at this stuff now. There were a good number of presentations that really rocked ! Well, that's one aspect of being an MBA that the class seems to have nailed, ha ha.

Now for the exams. The second term is supposed to be the toughest in terms of the workload. Easy to see why, seeing that there are seven subjects to cover. And all of them except for Cost Accounting and Finance had a groupwork element. Some people were pretty burnt out after the presentations, and by the time the exams came around, they couldn't care less.

The thing with groupwork is, it can make your life, well, interesting, to say the least in the run-up to the presentation week! Even if you have a great group. Which I did.
So what's the problem? Time-management. Everybody has dual commitments, to the new group and the old group. Both groups want to meet right after class, and then get out ASAP. And it's not just you, it's each person in the group, juggling timetables. Something the planning department should give some serious thought, I'd say.

Now for the good news. It's all downhill from here. Terms 3, 4 and 5 are all much easier !!

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Age: just a state of mind, or something like it...

Last term, one of the more interesting exercises the class did was in O.B. We were on the eye-roll inducing, but easy, stuff, like 'what do you want out of life', 'long term goals' and how these things evolve with time. The professor then asked us to chart out the amount of time, as a percentage, we'd like to spend on 4-5 aspects (the usual suspects, personal, professional, family, social etc.), and do this in chunks of 5 or 10 years, from now, till the time we'd like to live.

Then we were to compare it with the people around us.

The class was quite for about 5 minutes, and then it became a fish-market. On a side note, methinks the only reason I enjoyed O.B. was that every second OB class was bound to end up in a fish-market !!

The most interesting thing was the huge difference in our thinking. Not in our allocation of time. No, if you knew the other person, you could make a fair guess of his/her allocation. What really stood out was how long we wanted to live !!

I was ready to call it a day at 60, another at 65, but most Europeans went on till 80 or 85 !! We weren't asked to influence each other's points of view, just understand them. Oh boy, did this take some understanding, ha ha.

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Value addition, or Filtering?

Unanswered questions always come around, don't they? About two years ago, when I was midway through the thoroughly unpleasant task of applying to B-schools, I wasn't really sure whether B-schools really add value to students, or they simply select a bunch high-fliers, hand them an MBA, and let the world know that these guys are the works.

A full term has gone by here at IE, right in the thick of the action, and I'm not quite sure of the answer, yet.

Maybe the first term was largely introductory in nature. But I don't think there was SO much to be learnt. Economics was great, and Information Systems was an eye-opener, and that's about it. Other than that, lets see...
* I've learnt not to be unduly impressed the next time I see a consultant presenting something with a two-by-two matrix.
* I've learnt that even smart MBAs ask the dumbest of questions.
* That many of us MBAs (and their professors) can't resist cliches (I might jump out of the window the next time I see an "iceberg" slide in a presentation).
* That if inclined to do so, you can make a bell-curve or an S-curve for just about anything.
* That people can give fancy names to the most basic, common-sense ideas and get published (ABC's window of XYZ), so-and-so's 5 forces, 4 Ps of marketing, 3 Ds of whatever....

But it's not all cynical. Many of the people around are genuinely interesting blokes. Quite a few of them talk sense. Most of them are equally at home in at least 3-4 countries. They have some really 'different' interests. And not everyone is out to join M/B/B or GS. A fair number of professors do actually try make the class relevant and interesting. So yes, you can emerge from the year at IE as a newer, improved version. But it's upto you !!

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Buy Low, Sell High

Some time towards the end of last term, one item popped up on our calendars- CIA debriefing.
No, our 'intelligent' class has nothing to do with the 'intelligence' agency. We were up for 'Change In Action' (CIA), something that we'll be doing for a week after every term's exams.

The best part of the entire CIA sequence was an oil-trading game we played. Basically, we were all given ten million Euros to spend in an online simulation. We had to invest a million at a time, based on some vague news clips, and at the end of it, we got to see whether our investment made money or tanked.

This was the most fun Demand-Supply example in economics, ever !!
Buy low, sell high !!

Needless to say, it became a race to the top. Everybody made more money than they lost. Not surprising, a friend of mine who was a trader before his MBA made the most!! He wasn't a commodities trader, so he had no undue advantage over the rest of us, but that doesn't matter. The "trader's attitude" did it!!

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Over and Out !!

We're done !! Done with the first term, 5-6 subjects, and a whole lot of fun. The exams were just the way I prefer, quick, short tests, one each day, for five days. No need to learn any formulae, no mugging... just go write down whatever you could retain from class!!

An exam can tell you a lot about what a professor thinks about the class. If he/she treat you like adults, you'll be asked to think, if not, it'll just be rote application of the 3Ps of marketing, formulae for NPV or some such nonsense. Thankfully, none of this stuff happened. Only thinking. Analysis. Much respect!!

PS: Financial Accounting was the exception. Straight out of the book, like in school. But I think that was just out of pity for the class, ha ha.

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Bring it on

Done with the posts/assignments on Tech. !!
For the non-IMBA readers, those were our assignments. They're over and done with, and I'll be back to yakking about everything under this fine Spanish sun ...
These assignments were fun, to the extent that homework can be fun... on to the exams now.

I'll go out on a limb here, and say this now, before giving the exams...
The IE IMBA is hectic, no doubts about that.
Yet, the pre-exam stress is just not there!!

It's not even a patch on the prep-leave mania that I'd seen all around me, and to a lesser degree, experienced, while in college.


This shouldn't be interpreted to mean that I'm not worried because I'm all set to top the exams.
I'm not worried. Stop.
A big difference is the last minute cramming that we did back then. Now, apart from 'Financial Accounting', there's not much last minute work required.

Thank god for small mercies !!

PS: This is a personal observation.
There are a few going totally loco. That's OK. It's expected.

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OST : the rise and fall of the wannabe MBA

The beginning of an MBA
when everybody's out to change the world, get filthy stinking rich, "give back", whatever !!
I want it all,
We are the champions,
We will rock you....

Sometime later, when the deliverables start piling up......
Under Pressure !!

Very soon, when the exams are around the corner....
I want to break free

The exam results roll in
Another one bites the dust

PS: There I was, working late into the night on a submission. A "Queen" playlist on.
And since I was thinking of everything under the sun other than the submission at hand, I came across this particular selection (If this were a hollywood flick, this would be the genius seeing patterns in coded messages/symbols)....

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Hitting the roof

Today, I had a class that was the best I've attended at IE, as yet. By far, it was the most intellectually stimulating one.

We just went through some basic 'supply and demand' curves, and saw how simple things can be, and yet people get them wrong time and again. The shocking part was that this stuff is so elementary, and yet governments the world over mess it up with their ham-fisted attempts to control markets & prices. And going by the reactions of the others around me, I wasn't the only one shocked !!

We went through two cases of Govt. price controls messing things up in a big way.

We studied how Price Ceilings invariably cause shortages, hurting the very people they're intended to benefit. We took the example of Venezuela, how Hugo Chavez's price ceilings on essential commodities gave the poor people the illusion that it was good for them, whereas it actually left them facing massive shortages.

It reminded me of this WSJ article, which I'd recently read and discussed incredulously with a Venezuelan friend at IE. There is also this video, in which a farmer discusses the exact same points we went through in class, only more specific to his case, how he was driven out of his coffee business. Amazing !!

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Using technology to increase effort !

In my eco class in school, we are using an online tool called Aplia to turn in our assignments. It's a pretty cool tool (hey that rhymes, unintentionally, though !). There's all sorts of geeky stuff to play around with... Price elasticity of demand, income elasticity of supply, curves that shift, but don't move, and still more curves that move, but don't shift. Anyhow, you get the drift.. Stuff that can keep an economist up at night !

The website is pretty neat. Another one of the cool things we're doing here at IE. But what really beats me (as opposed to all the problems that are posted on Aplia, that also beat me) is this : "Aplia is a learning solution that increases student effort blah-2".

What ? Double check !! Did I get this right ??

On reflection, it appears so. As they'll teach us in some Marketing class in the future, this website is targeted at the academic community, not us, the end-users.

Increasing student effort ? Awesome !
Just kidding here ... the website is pretty cool !!

PS: Pardon me, but in plain and simple English, if a thing 'moves' or if it 'shifts', aren't these one and the same? These things should've been simplified a long time ago !

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Ad-Coms - Getting Gamed

Fact : Almost all applicants to B-schools dedicate a good part of their application to proving how 'different' they are.
Fact : Each of the top B-schools claims to handpick a 'diverse' student body, diverse in their backgrounds as well as their career plans.

Inference : There should be a good amount of diversity in the jobs taken by MBA graduates.

Fact : The top B-schools place the bulk of their outgoing classes in Consulting and Finance. Industry, Marketing, and Entrepreneurship are pretty much looked down upon.

Doesn't really make sense, eh?

The most important reason would be that most people graduate from B-school laden with debt. Finance and Consulting are the best paymasters (a generalization, but fairly true). Ergo, these are the easiest way out to financial independence.

Another reason, many applicants have their hearts set on joining Consulting/Finance, but they mask their true intentions in their applications. Just long enough to get admitted. Interests in entrepreneurship, working for a non-profit materialize overnight, only to be cast aside on the first day in college.

Having seen so many of such frauds making it to B-school, I wonder, why don't the admission commitees chuck these applications out! They're fairly easy to spot too!

Such stinkers can be spotted from miles off. There are always a few tell-tale signs -
* social service undertaken just a year or two before applying
* unverfiable claims of holding leadership positions in organizations
* tall claims of leading large teams with little experience/qualification
* interested in Finance, yet unable to tell buy-side from sell-side
* unable to give a convincing reason for choosing one post-MBA career path

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