Here is an interesting stat:

last year, add up all the venture capital put in companies in continental Western Europe (Germany, France, Spain, Italy, Portugal, Belgium, Netherlands, Denmark, Switzerland, Denmark, etc).

add it all up.

it was less than the venture capital put in companies in tiny Israel

This week meebo announced its 500,000th user account. and that is doubly amazing since you do not need to have a user account to use meebo.

congrats to elaine, sandy, seth, and the rest of the team.

when i invested in meebo i had no idea it would be this big. i loved the team (the three founders are incredible and are model entrepreneurs) but i don’t think i really understood the potential. meebo is an amazing company.

here are some stats on their usage from their blog:

How many times do people login every single day? 950,000!! You may ask how many of those are “unique?” About 670,000. It turns out most of you happen to log in about 1.4 times per day. Oh, and here’s another interesting one… how many network accounts do you all log in with on average? Also 1.4…which means 1.35 million network ID are logged in daily.

Over 3.5 million unique individuals log into meebo every month, and on a daily basis you’re all sending and receiving a mere 57,000,000 messages. If you aggregate all of the time everyone spends in meebo on a daily basis? 64,000,000 minutes which calculates to approximately 122 years! WOW! (click here to see a graph) It turns out you’re all sending and receiving a message just about once/minute, and you’re staying on meebo an average of 70 minutes/session. Those are some pretty active IM sessions.

And how about meebo me, meebo’s latest twist on web IM? For being just two months old, you guys sure are using it a lot! You all have embedded 42,000 unique widgets. These widgets have been seen on 600,000 unique URLs by… (drum roll please)… 6,000,000+ unique people. Holy cow… that’s a lot of web-embedded IM chattering!

i finanally gave in and bought an ipod. yeah … it’s awesome. until it crashed three days after i bought it (a combo of upgrading to itunes 7 and unplugging it from my computer too fast). well … many hours later after trying a gazillion different things to no avail … i finally tried defragging the ipod’s hard drive and that did the trick. now it connects just fine (at least for the next few weeks)….

i did a second stint as a guest columnist at VentureBeat.

see: The oncoming video ads movement

Snip:

And an ad in the video, even at the end of the video, has your complete attention. Complete. The only ad medium that captures a greater percentage of your attention are urinal ads…especially after a few soy caramel macchiatos.

what i’ve found out is that Matt Marshall is not only a great writer (everyone knows that), he’s also a great editor.

(and special thank you to Vivek Sodera at Rapleaf who edited this piece and gave it voice and life)

Rojo was acquired by SixApart yesterday.

Rojo is a great company that has been extremely innovative. Rojo is, in my opinion, the best blog newsreader.

and Rojo also pumped out the NooZ service which is really cool and an extremely interesting idea.

Rojo has a small but outstanding team. Its two chiefs, Chris Alden and Aaron Emigh, are true visionaries. I met Aaron in 1999 when I tried to hire him to be the VP Engineering at BridgePath (he turned us down to start his own company).

I met Chris about a year later and we became close friends — through a shared love of politics, free markets, and technology. We serve on the board of Lead21 together and also on the technology advisory board of the Pacific Research Institute.

last year (in 2005) I introduced Chris and Aaron and they became quick collaborators with Aaron joining Rojo as CTO shortly thereafter.

SixApart is now lucky to have two of the smartest guys in technology working for them.

So congrats to Rojo, Chris, and Aaron — and good move by SixApart.

Matt Marshall’s new blog is up — check out VentureBeat.

Matt is a real journalist who is a terrific writer. Matt is also a super nice guy. and he’s put out a great new blog with the launch of VentureBeat. it looks fantastic.

I was fortunately enough to be a contributing writer to VentureBeat … you can see my post on the Black Hat Tax on consumer Internet businesses.

Peter Thiel, Rapleaf’s biggest investor, made an interesting remark to me the other day that 4 of the 6 founders of PayPal had built bombs while in high school (and Peter was not one of them).

that is an amazing stat.

at the Founders Brunch yesterday i polled some of the top entrepreneurs and found that quite a few of them had also built bombs while in high school.

which concerned me because i was never adventurous to build a bomb (my only street cred is playing Dungeon and Dragons) …

So like every person running a business, I get a lot of salespeople calling me. sometimes they are recruiters … or people trying to sell me Internet hosting … or financial services … or commercial space … or, when i walk home at night in San Francisco, i even get people trying to sell me illicit drugs…

i actually like salespeople (for a long time, i was a salesperson)

of course, like every entrepreneur in this frothy market, we get VCs making sales calls … i wrote about that a few weeks ago in a tale of two VCs …

so it was my pleasure that I got a cold sales email from Elizabeth Hart (Liz Hart) from Cornish & Carey (a commercial real estate firms helping companies find space) today. she gave me permission to republish her email to me here:

Auren,

After reading, Tale of 2 VCs I am aware that you receive many unsolicited emails, so I’ll attempt to make mine brief and quasi-interesting.

I focus on the real estate needs of growing technology companies and have read very positive things about RapLeaf in the various tech blogs. (By the way, great job campaigning AGAINST yourself on Valleywag). I signed up for RapLeaf today and have been bumping around the site. I can definitely see the benefit to something like this, but have a few comments about how to make it more accessible to non-tech people (like myself). The benefits of a service like this would be fantastic tool for my career, because so many of my prospects would be interested in hearing about my reputation in an easy and accessible way.

Would you be interested in meeting for coffee sometime? I’d love to chat about RapLeaf and see what’s going on with your office real estate on Mission Street. If the thought of talking real estate bores you.. I love to read and was a political science major at CAL, so I’m sure we’ll have a lot in common.

Hope to hear from you soon,

Liz

(first stop coincidently is someone you know – Stewart Alsop. I just finished his deal in the North Waterfront for Alsop Louie.)

of course, we can’t use Liz right now (we’re in an office that we love and we’re not moving for a long while) … but i am going to when we do look for bigger office space. and i am going to recommend her to others … because she’s a great salesperson (who sends great cold emails) and she makes the sales target feel very special.

summation: hire Liz Hart from CORNISH & CAREY COMMERCIAL.

so, even though we’re not raising money right now, we’re getting a lot of calls and emails from VCs at Rapleaf. we got 6 unsolicited emails this week. we got 8 last week. these are mainly from VCs i don’t know.

the typical email is “I love Rapleaf … great service … you have a brilliant idea … let’s meet”. but … but … i check and they are not even Rapleaf members. maybe they signed up under a different email address … maybe …

before a VC approaches a consumer Internet company, they should first become a member and use the product. invite a few friends. and give input to the company on how they can improve. that way, the company management team sees some value from the VC.

i had lunch today with a great VC. a guy i never met before … we went to a cheap chinese place for lunch (my favorite) and he gave me THREE great ideas. THREE! he obviously spent a lot of time thinking about Rapleaf. i felt bad when he paid for lunch because i really owed him. guess what?? when he calls me again i’m going to rush to answer him. and i am going to refer other entrepreneurs to him. and i really look forward to seeing him again.

then, after lunch, i got another email from a VC. Here is the email:

Hello . My name is [first last] — I am part of the [removed] investment team at [very large VC firm], a global venture capital fund with over [a lot of money] under management.

I have read a little bit about Rapleaf and, while I only have very basic information at this point, am interested in connecting with you for a few minutes to learn more and to assess whether there might be an opportunity for [very large VC firm] to be helpful to your firm as a potential investor. To the extent that you may be interested in a venture partner, could you please tell me a little bit about the company’s vision, and financing history / status. If you would prefer speaking directly, please let me know when you could be available for a brief phone call over the next few days and we can arrange.

while this email is very nice and professional, it shows that this VC did little homework on the site. i did not see that he is a Rapleaf member (and he made no mention of it). if i was in his shoes, i would have sent a different email:

Rapleafers — I love what you guys are doing. if you are successful, you will actually make it “more profitable to be ethical” (i love your tagline!). I signed up and rated a few people. and they rated me back (my Rapleaf score is X at the moment). of course, i don’t fully understand what you are doing but have some ideas on marketing and I know the CEOs of CommerceSite1 and BarterSite2 I can introduce you to (if you don’t already know them). i’ll be in SF on Aug 11 — want to grab coffee?

[and added his Rapleaf score to the bottom signature of his email]

(this is someone I would cancel meetings for). can you feel the energy and enthusiasm? the willingness to help? this fictional VC would win every deal.

oh, it is a tale of two VCs…

Cam Reilly from G’Day world talks about the Black Hat Tax (amongst other things) on his podcast…

Chris Tolles and I were having dinner this week. Chris, if you don’t know him, is the VP Marketing at Topix and all-around brilliant guy. he pointed me to a great blog post on the Topix blog about craigslist’s ambitions and their UI.

for all those web two dot oh companies that think a simple google-esque search bar is the only way to go, it may be worth reading this article. sometimes there is a real paradox of choice. but sometimes more clutter is actually better.

I am a big fan of James Currier. James was the CEO and founder of Tickle (formerly eMode) — one of the top social networking companies (and now a part of Monster.com). so when James says something, I listen.

A couple of months back we were grabbing a smoothie and I was going on and on about consumer internet, how it is so great and easy, yadda yadda … when james chimed in with something very interesting and profound … and something I have not been able to shake since:

Most consumer Internet sites today have an inherent tax of about 25% on them due to scamming, phishing, hacking, and government requests. That 25% is based on time and mind-share. And the 25% is only going to get worse. This is troubling.

I’m calling it the Black Hat Tax. And we’re certainly facing it at Rapleaf.

Since james and I spoke I spent some time talking to a bunch of consumer internet sites — from start-ups to establish companies. these companies, especially those in the dating or social networks space, are increasingly spending their time thwarting bad guys.

A great example is PayPal. The book PayPal Wars details an intense battle the engineering team and even the CEO fought against fraud. This was one of the consuming issues of the company.

Now PayPal is a financial institution, so you would expect lots of fraud. But dating?

After surveying most of the dating sites, I have found that one of their top three issues is fraud. A frequent scam is to contact an unsuspecting middle-age man from a profile of a good looking woman saying “my husband is beating me here in Moscow, please send $2000 so I can buy a plane ticket and escape.” The unsuspecting chap sends the money only to never hear from the person again. Apparently there are scam factories in the Philippines and other places that have thousands of people, paid on 50% commission, working to scam unsuspecting dupes in this way. And one success a month is $1000/mo which compares well to many countries where the avg salary might only be $200/mo.

And this is in addition to people actually hacking into your site. That is a whole other cat-and-mouse game.

James thinks the Black Hat Tax is 25% for most consumer Internet companies right now (with some approaching 40%). I think that is a fair assessment. That means that 25% of your engineering time and 25% of your management team is about preventing fraud. That is a really onerous tax. And James believes this is even getting worse.

Another strain on time is government requests. I talked to an IT person at a social network that was consumed for three days with a government request for information on someone promoting pedophilia. Not only did this person have to get a bunch of information to the federal authorities, but then he had to ensure that the information was backed-up and cannot be erased for at least three years. not to mention that the work was disgusting as the person had to sift through some horrible pictures.

The nefarious characters are getting more sophisticated too. And while thousands of sites are working feverishly to implement best security practices, the bad guys only need to find one hole.

So while my originally point (that launching a consumer internet company is really easy) is still correct, maintaining that site over time is becoming increasingly difficult. More and more mind-share from the engineering team and the executives are going to thwart the bad guys than to actually improve the offering.

This is a really big problem. Really big. The Black Hat Tax is costing consumer Internet companies Billions and billions of dollars. And it is a much higher percentage tax than off-line brick-and-mortar shops invest in security and anti-fraud matters.