[Commercial]

Introducer: Technology Evangelist Podcast for May 24, 2007. Search Thursday with special guest Robert Cringely, recorded live with audience participation.

Benjamin Higginbotham: My name is Benjamin Higginbotham and with me is Cariann Higginbotham.

Cariann Higginbotham: Hello.

Benjamin Higginbotham: Both with technologyevangelist.com. We have a special guest on the line Robert Cringely!

Robert Cringely: Yo.

Benjamin Higginbotham: Welcome to the show. We are talking about…

Robert Cringely: I am dancing.

Benjamin Higginbotham: Are you dancing to the music?

Robert Cringely: Did you see the Google buys FeedBurner for $100 million?

Benjamin Higginbotham: We did see that.

Robert Cringely: I predicted that, I said that was going to happen.

Cariann Higginbotham: Of course you did.

Benjamin Higginbotham: There was kind of no brainier one for them though, just about everyone.

Robert Cringely: I specialize in the no brainier one. The trick is to be the first one to call the no-brainier one.

Benjamin Higginbotham: Well, they control the RSS feed for just a bazillion websites out there, even Technology Evangelist included, so what a great move on Google’s part.

Robert Cringely: Yeah, they are well on the road.

Benjamin Higginbotham: I think they already do, we just don’t know it yet.

Robert Cringely: I guess so. I guess only they and Bill Gates know.

Benjamin Higginbotham: Yesterday we talked about Web 3.0 and a bit about the future, but today I thought we take a look at the past and the Excite and where they started, for those who don’t remember Excite was kind of pre-Google as we are talking, it is Altavista days and whatnot. While I remember it, you were there Bob?

Robert Cringely: And whatnot?

Benjamin Higginbotham: And whatnot?

Robert Cringely: And whatnot, yes I was there, in fact I come into the Excite story, before it was called Excite, the company was called Architext and it was before Altavista.

Benjamin Higginbotham: And they were three founders?

Robert Cringely: So this is a very long time ago – I think it was in 1992.

Benjamin Higginbotham: A lot of people say that 1996 is really when the Internet took off, so that’s really early on where they too early in the market?

Robert Cringely: Well, it is not that they were too early to market, it is that when I met them, they weren’t even thinking about the Internet.

Benjamin Higginbotham: What were they thinking? Well, first lest backup. What was Excite for those who don’t remember?

Robert Cringely: Well, Excite was one of the first both search engines and photos, they in a sense competed both with Google and with Yahoo and what happened was that I got a call one day, as I wrote a book many years ago and in it said “I am cheap date take me to lunch” and I use to get all of these lunch invitations, from would-be entrepreneurs and I would say probably, conservatively they started 40/50 billion dollars worth of company, those people, and who invited me for lunch and that was like six guys and the rest of them you would never heard from them again, but one of the guys who called me up was Joe Crouse who was the one of the six founders of Excite which at that time was called architext. He was the suite, they were the five nerds and one suite and Joe was the suite, he was the polysymage of course and they were all students of Stanford University in Polysy or Symantic Systems which was version of linguistics or computer science and they were six of them and they lived together in a house in South Colorado and they started their company in the garage and I went to a lunch with Joe and then went to the – I was invited to the garage, I went to the garage and I saw their demo and their demo was searching on newsgroups and it was searching on newsgroups, because that was something that they could gather inexpensively into a database and search on. The thing that they wanted to do was, they wanted to be able to search on a search term and have it generate responses that did not have the search terms in the titles. This was considered like the holy grail, you wanted to find the meaning of things, rather than the literal thing. So, they had developed this form of multi-dimensional analysis that was strictly linguistic and took a sentence and of the search terms in it and the thing they wanted to search on was “Cariann’s beautiful eyes” and it would take Cariann as a word and beautiful and eyes and each one would be assigned a vector and then they would be placed in this multi-dimensional space that was the sum of the vectors of all of the documents in the corpus and they would find out which vector was closest to the combined vector of “Cariann’s beautiful eyes” and at that time they thought it might be a way to find information on your computer. They thought it might be a way to one of the hot ideas that they have, which was really probably good one, was that it would be a good way to sought through with automation through resumes, where people who were looking for people to work at companies, because you could essentially take an entire resume as a search term and apply it against the corpus and come up with people who were most like the person that in the search from the using is your best worker. So, you say “I want more of this guy or this girl”, so you run them through in all this 17 million resumes you have gathered and out top 16 other people who in theory are just the same as the one you love. So, this was the idea that they had and I saw it and I thought that it has some value, but clearly they needed money at that time, they had $7,500 and because each kid putting 2,500 bucks and at that point they had spent $1,800.

Benjamin Higginbotham: On the garage?

Robert Cringely: Yeah, exactly and the funny thing was that, it seemed to me that they needed an introduction into the market place, they needed to probably find a venture capitalist, because that was actually the days of good venture capitalist and so I started introducing them around and I found them their first customer, which was my employer at that time The International Data Group and then I found them when they used it to just search 250 computer magazines simultaneously and I found them the first venture capitalist who was a guy named Steve, I can’t remember Steve’s last name, who was at the Charles River Ventures in Boston and he came in and he saw it and he got it and he understood the value of this thing and immediately he want to do something about it, but came from this very conservative venture capital firm that wanted to feed in groups and so they needed other VC’s to come in and by that time they have been introduced to Vinod Khosla through Steve and Vinod saw this and Vinod really wanted – this is interesting, Vinod really wanted to test. Vinod Khosla is a partner of Clientele Perkins got few other buyers, one of the mega VC firms on St. Eroding in Minolta, California and Vinod had been the first CEO of Sun Micro Systems. So, he was the founder of that company, he very quickly moved into venture capital, he is very, very sharp guy, but his question was can this thing scale. They had no way of knowing because they couldn’t get a big enough data set together to study, because they didn’t have enough disk space and so Vinod had someone go out and buy them a 10 gigabyte hard drive.

Benjamin Higginbotham: Put then in perspective, how much was that back in those days?

Robert Cringely: $10,000.

Benjamin Higginbotham: Wow.

Robert Cringely: 10 gig hard drive was $10,000 and they had, it was like clientele-perkins petty cash went out and bought this hard drive and brought it in and they were running, they ran the original code they were using a Mac clients and their server was Sun4  and they hooked up this Cozee  drive and they over course of some period of time loaded with lot more newsgroup stuff and they loaded with a 10 gig database and the whole point was they had, had 500 megs and this is now 20 times the size, does it take 20 times as long to search? That was key question.

Benjamin Higginbotham: Did it?

Robert Cringely: Answer was, it took no longer. So, that two things they did was they found lightning fast searching capabilities and they also built an index which is the thing they were really searching that was incredibly compressed. So, they were actually representing much more than 10 gigabyte of space. Now, one point in there, it seemed obvious to me, that this was the future of everything and so I said “well, perhaps I should become one of you” and I offered to buy in, I had $2,500, I could do this and they said “well, Bob how are you at coding enpro?”

Benjamin Higginbotham: How did you answer?

Robert Cringely: I said, “if it will support the children I don’t have, I can do almost anything, but how good is Joe at coding enpro? And they said “well, Joe is adequate, but he has other uses”, then I said “well, Joe came to me because I had other uses” and the funny thing is that it just went nowhere and we sought of split apart at that time and I had no-hard feelings of any sort, but we maintained contact on a periodic basis and of course I shot interviews with them over the years for various TV shows and that was very useful, but I will tell you that interesting that happened.

Joe later on sent me a very nice note sort of basically thanks, “thank you for giving us careers”, but there was no check enclosed.

Cariann Higginbotham: Not even 5 cents?

Robert Cringely: Nothing, I think it came postage due, but there was a point where it very shortly after they got going, they got $2.5 million Clientele perk-ins and they hired this guy who was an editor and they hired all these people who were supposed to look at websites and review them and analyze them, sort of like Yahoo Ask thing and I had a lunch with them or dinner or something, we went to Fresh Choice, I took them all out for, because they were all vegetarians and I took them all out for salad and we went out and I attempted to have a come to Jesus meeting with them, because it appeared to me that they were in word “in sane”, because even though Yahoo was making a go of this, Yahoo didn’t at that time have a real search technology. All Yahoo was doing was compiling lists of cool websites and describing them and I said “look, they are doing that – you are doing this thing, you have real technology, they don’t have real technology. Lean him to the search, the search will set you free, you know the search is where the value is” and they were in the sway of a node and the venture capitalist want to tell you that you always need more money, which means you always have to give up more equity. So, it wasn’t going to go that way, but years later, I remember Graham Spencer, who was the chief nerd and just a brilliant, brilliant guy and he did the Jackspot which was just sold to Google, a few months ago.

Benjamin Higginbotham: Yep.

Robert Cringely: And Graham said “we just didn’t know what we had, we didn’t realize the power of search until Google showed us”. Google of course came in with a couple little linguistic tricks of their own, but basically it was page rank was everything and that took over from all the multi-dimensional crap that Excite had been doing. Now, eventually Excite went public and it was eventually bought for $6.7 billion in cash which converts actually in today’s dollars to $3.12, but for a while these guys were immensely wealthy, Altavista came and sort of went in that time period as well, as did any number of searches and then Google stepped in and then there was another company Northern Lights was another big one at that time, that they are still around, but obviously, Google dominates today and because Google figured out the page rank and they figured out where they willing to copy the idea of paid advertising. So, the rest is history and Excite at home which is what it came to be called, which was literally the Internet connection for all of the cable TV companies in it’s era and so if you had a cable modem, you basically went through Excite at home to get your stuff, they got stuck in a fix price scheme where they were not – they were revenue short and they didn’t understand about the advertising market and it wasn’t going well and they blew up, they imploded so…

Benjamin Higginbotham: I believe that was 2001, I think they filed for bankruptcy, if I remember correctly?

Robert Cringely: Yeah, I remember that, well did everyone filed for bankruptcy.

Benjamin Higginbotham: So, that was about 10 year run for them?

Robert Cringely: 9 years and the time that I knew them doing that. Joe and Graham are still working together at Google, two of the other guys became venture capitalists and two just playing retired and at the time I met them actually one had graduated and he was working at Oracle, so he is the venture capitalist now.

Benjamin Higginbotham: Could they become the next Google or they are first Google actually, did they have everything they needed, if they had missed up to be what Google is today?

Robert Cringely: Technically they never got the page rank idea, which is really Tom Sawyer white washing the fence and getting the users to do the work forum, which if you think about it is a great theme in Web 2.0 is, user generated everything. Get them to do work for us and other people pay us, they never got that and so I think in retrospect Google is always going to clean that clock. The interesting thing that did happen was, almost a merger between Excite and Yahoo, it came down to Jerry Yang making a decision that he just didn’t like being pushed around. Jerry Yang being that one of the co-founders of Yahoo and they were that close to doing that deal which would have been instead of that one and the combination of Excite – Yahoo would have been pretty powerful, but Jerry said, “I don’t think so”.

Benjamin Higginbotham: Which is interesting, because then didn’t they go with Google for a while?

Robert Cringely: They went with Google for search, but Excite was a portal, so they would have been buying something that was very similar to them. If one is the Mercedes, the other is the Subaru or vise versa and so they would have had a two engines and more sellers, there is more users and more of everything that was valued at that time. Just at that time that Google was coming into being. I remember, I did the first TV interview with Google boys ever did, in 1998 and they were still at Stanford in the Gate’s hall and the thing that they said I thought it was really funny was they talked about when Bill Gate’s came to the Gate’s hall and looking at that computers and saying “isn’t this great, what I have done” and they all snickered because they were all running Linux.

Cariann Higginbotham: I love it.

Robert Cringely: Yeah, so those. So, that was happening all of that time and so Excite was $6.7 billion and at that moment when I interviewed them the Google guys, Sergey and Larry had received the $100,000 check from Andy Becrosign, Founder of Sun. Andy saw them, understood, got it, Andy is the best Angel investor in the history of Angel Investing and Andy saw it and got it and wrote a check for a $100,000 on the spot and wrote it out to Google Inc., or Google Corp and they couldn’t cash it because the company didn’t exist. So, it forced them to incorporate, so they could cash Andy’s check. So, that’s my experience with search, a long, long time ago and I don’t know that’s useful, but now you know everything I know.

Benjamin Higginbotham: Well, absolutely this is something that actions that they took, is this something that a lot of companies do and kind of do this misstep at startups, where is this specific to Excite, is there something that other startups can learn from this?

Robert Cringely: Well, most startup fail, 95% of startups fail, but most of them fail free funding. So, most of them fail on their mothers and mothers-in-law money, rather than some investor, some non-emotional investors money. But, even the ones that finally get funding probably 75% of them still fail and they fail for variety of reasons. They guess the market wrong, they are stupid, or they come along in the duck-calm bubble, you could fund almost anything. You could fund an idea they would say “web enabled frozen custard” and say “wow, yeah”, but there you go at frozen custard machine needs in order to have a modem in it and there you would be, you will get your million dollars in seed funding and then, if I would have been there, I would immediately leave the country. So there was a lot of stupid investing, but as far as companies goal, there are lot of mistakes that they can make. Sometimes things don’t scale, that was the thing that the node what I didn’t know, “this looks very good, but will it work big” and a lot of things that works small don’t work big and so that’s a huge thing. He was very smart to test that before he put any real money in and other things that happened, there is an awful lot of, if we look on the dark side of the venture capital world, there is a awful lot of companies that are stuffed with money, so that they the founders give up more equity, there is an awful lot of king making and jerking around and evil daring do and that’s done by DC’s because they just feel like it and it is little like not-see scientific experiments where people are forced to meet against their will and a lot of people end up together and there are an awful lot of jaded former high tech executives who are out there used as slave labor in these things, where the VC’s stuff you full of middle rank executives that have worked for them before in oral, so they may not to you and so you have to be very very careful and a lot of companies, especially in that bubble area and shortly thereafter, they just got blown away, whether their ideas were good or bad. One of the interesting aspects of that of course today is that, there were lots of good ideas at that time. They have still good ideas today and in fact, they may be better ideas today because now we have more bandwidth and computing power is cheaper and some of the things that we are going to do, broadcast.com that Yahoo paid $5 billion for was an insane idea. I remember, you guys are too young, but I remember in that era attempting to even watch this stuff that Mark Cuban said he could see at his house and I couldn’t see it at my house and I had DSL, so the routers were holding it up and it just was – frankly bullshit, but it was $5 billion for the bullshit, so but today we see all these video things coming up and it is clear that broadcast.com would work for just fine today. It was only nine years too early.

Benjamin Higginbotham: I mean we are proving that a little bit with YouTube, I mean there is a little bit different business model, but same thing, at least you can get all the video and it works at home.

Robert Cringely: Yeah, sure. YouTube video quality I don’t think it is very good either, but it is OK and YouTube – we had moved from a streaming metaphor that at download became everything. Bit-torrent came along download was everything and it actually took quite a load off the network, in fact the people weren’t trying to stream anymore and then YouTube comes along with streaming, they empower Flash and Macromedia and Adobe. Adobe is a much more powerful company today, thanks to YouTube then Google is. Adobe owes more to YouTube than Google owes to YouTube at this moment and I think that’s interesting. So, we are in a moment where streaming has returned even though it doesn’t make technical sense, but we just got off tracked anyway.

Cariann Higginbotham: That’s OK.

Robert Cringely: I just wandered.

Benjamin Higginbotham: That happens in every podcast and that’s beautiful thing about podcast. We can go wherever we want, we don’t have to stand on topic.

Cariann Higginbotham: It is close enough.

Benjamin Higginbotham: Close enough, yeah.

Robert Cringely: All right.

Cariann Higginbotham: You said Google a couple of times were good.

Benjamin Higginbotham: Bob, it was fascinating story with Excite, that’s interesting stuff, watching the raise and fall of a great empire essentially.

Robert Cringely: You sound so formal, Ben.

Benjamin Higginbotham: I try to.

Robert Cringely: You know I have seen you naked?

Benjamin Higginbotham: Oh, yeah I know. We have spooned before.

Robert Cringely: Yeah, woo.

Cariann Higginbotham: Hey, where was I?

Benjamin Higginbotham: Minnesota, I don’t know I think is in California at that time. All right, Bob thank you so much for your time.

Robert Cringely: Are you sending me away now?

Benjamin Higginbotham: I am sending you away now. Unless you have something fun and interesting to say.

Robert Cringely: Jordan Sparks won American title.

Benjamin Higginbotham: Yeah, the chat room is like “no, you told us, you have ruined it”.

Robert Cringely: Yes, I did, I did ruin it.

Cariann Higginbotham: Come, visit me Bob.

Robert Cringely: I will.

Cariann Higginbotham: Thank you.

Robert Cringely: Thank you folks, bye.

Benjamin Higginbotham: Right, have a great night. Thank you everyone for joining us we will be doing Freestyle Friday, tomorrow at 10 – Eastern, 9 – Central, 7 – Pacific. That will be live on Ustream.tv and we may be doing it on Stickam, depends on whether Ustream is paving it or not, we will send those links in the Ustream ISC chat room at that time. We do like to default to Ustream, I frankly believe it is a better center. So, thank you everyone else for joining us and you have a great time.