Episode 3: Chris Fralic: Partner at Innovative Early Stage VC First Round Capital, Former eBay and Del.icio.us Exec Tells All

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Susan interviews Chris Fralic, VC who "gets" the media industry, makes insightful and edgy investments, hangs at the TED conference and loves podcasts. He has investments with Josh Kopelman from First Round in Buddy Lube, RockYou, Eventful, SnapVine and MyYearbook as well as Scan Scout where the mutual friend, Jed Savage who introduced us, currently works. In the show, we play the jingle from Buddy Lube - worth a listen to the show just for that! BuddyLube is a company that sits between artists and fans on a social network. Check it out. Chris is happily married to Irma, whom he met while getting his MBA at St. Joseph's University. He re-enacted his proposal to her on the TED stage and apparently it was a good luck charm. They have a son, Max (7) and live in an artists' colony in New Hope, PA. Chris shares his love of running and recent marathon schedule and explains how the Nike+iPod combo keeps him going. If you've been impressed, as I have, with the BMW sponsorship of the TED Talks interviews you can thank Chris for making that happen. He put the deal together and those TED Talks have been downloaded over 8 million times. Let's hope this episode of DishyMix has that kind of luck! Suz and Chris move from a discussion about AWS Amazon Web Services where we agree that Mechanical Turk is the perfect combo of man and machine to sheer amazement that BazaarVoice took only 14 months to hit profitability to widgets to biz dev to working for Bill & Melinda Gates. Listen to this episode to hear someone very supportive of innovation in the industry, a great man, a great husband, a great dad and just the kind of guy you'd want to hang out with.

Transcript

Chris Fralic: Partner at Innovative Early Stage VC First Round Capital, Former eBay and Del.icio.us Exec Tells All

Announcer:  This program is brought to you by personallifemedia.com.

[Music]

Susan Bratton:  Welcome to “Dishy Mix’.  This is your host Susan Bratton.  And I'm really glad you downloaded me or streamed me today because I have a great guest, a really fun guy.  His name is Chris Fralic and he's a partner at a venture firm in Pennsylvania called First Round Capital and you will get to meet him.

On today's show we are going to talk about everything from running to widgets to podcasts to eBay to TED.  We're going to talk about BMW.  We are going to talk about Buddy Lube, Amazon Web services, Mechanical Turk, Bill and Melinda Gates and what it's like to be in VSDA.

Chris Fralic:  I started bookmarking webpages that I was interested in and tagging them, putting my own little one-word descriptions of what those sites meant to me.  And then after I had a dozen sites or so I started organizing my websites by my tags.

I literally had a feeling in the pit of my stomach like, “Oh my God, this is how the Internet will be organized going forward.”

Chris Fralic:  The one you mentioned is called Mechanical Turk and what they essentially do is harness the wisdom of crowds.  They allow you to request a task to be done.  It could be anything from the menial to simple but things that, you know require a human being rather than a machine to do.

Susan Bratton:  I really wish I could outsource my laundry to Mechanical Turk.  [Laughs] I've got so many piles in my washer room right now.  God!

Susan Bratton:  Tell us about it.

Chris Fralic:  You've got this little thing in your shoe and you attach this other little thing to your iPod and it tracks your runs - the day, the time, the distance, the speed and it uploads it after every run. You can see graphs of how you have gone and when you complete a particularly good run, a little voice of Lance Armstrong pops in and says, “Congratulations, that was your best time for a mile!”

Susan Bratton:  [laughs] I love that.

[Music]

Susan Bratton:  Hi Chris.

Chris Fralic:  Hi Susan, how are you?

Susan Bratton:  I really good.  Are you in New York today or Philadelphia?

Chris Fralic:  I'm in New York City today.

Susan Bratton:  You are.  All right.  Well, I really appreciate you calling in to do the show.

For those who may not know you, you were most recently before First Round Capital, Vice President of Business Development at del.icio.us, which was acquired by Yahoo.  Before that, and at the time that you and I met, you had spent six years at eBay, which was actually a rollout from your VP of Business Development position at Half.com, which was acquired by eBay.

So you have been through a couple of acquisitions.

Chris Fralic:  I have.

Susan Bratton:  Before that, Vice President of Business Development at Nextron, which I think was early Web services business, before that, Internet Account Manager at Oracle and before that you started out as Senior Sales And Management in consulting companies like The Computer Factory, and Business Land and Computer Land.

So you started out on what I would consider the hardware side and moved into Web services, right?

Chris Fralic:  That’s true.  I think I have been lucky to be at the dawn of a few phases, the first being the personal computer back in the early 80s when I was still in college.  My first job out of college was selling PCs on a retail floor in 1984.  And I caught the Internet bug pretty early in ‘95 and had my first job at Oracle selling early Web servers and database connections to the Internet for Oracle back in ‘96.

Susan Bratton:  You’re a sales guy.  You are a sales and biz dev guy.  That's kind of what is in your blood.

Chris Fralic:  That is correct.

Susan Bratton:  One of the things I wanted to ask you was how business development has changed since you started out, you know 20 odd years ago in sales and biz dev and how that has metamorphosed over the years.  Is it the same or has it changed?

Chris Fralic:  I think it was less visible of a profession before and, you know there were lots of salespeople always in technology.  I think it evolved more into business development, which I think of more as finding ways to exchange value between two companies.  It may involve dollars but it may not.  And it has clearly grown into its own specialty in the Internet world.
Susan Bratton:  Do you think that people in biz dev have been paid as much as people in sales?

Chris Fralic:  I think they generally have at least in the startup world.  We work and a lot of the compensation ends up being in the form of equity and the hope for an exit at some point.  But I have also seen comp packages both salary and bonuses rise to kind of off-line levels.  And I think they have kept parity from what I have seen.

Susan Bratton:  So I want to skip over to del.icio.us.  It's a product that I have certainly signed up for and I have bookmarked a few pages and I could see the application being good if you are researching a particular thing or tracking a particular thing that you needed to keep track of a lot of websites.  But it never really connected for me.  Where is the sweet spot on del.icio.us and is it something that’s important today in the industry or is it something that never quite took off?  Did it take off and I just didn't know it?

Chris Fralic:  Well, I think, I'm not surprised that if you haven't worked at it, its appeal isn't obvious to you.  In fact, the first time that I ever looked at the site del.icio.us - and it was my business partner Josh Kopelman here at First Round that was also an investor in del.icio.us - and after I left eBay he said, “You should look at this company del.icio.us.”

And I literally went to the website and couldn't figure out what it was about.  I came back and he said, “Try it again”, and I did and I started bookmarking webpages that I was interested in and tagging them, putting my own little one-word descriptions of what those sites meant to me.  And then after I had a dozen sites or so I started organizing my websites by my tags.

I literally had a feeling in the pit of my stomach like, “Oh my God, this is how the Internet will be organized going forward.”  And part of that was informed by spending a lot of years at eBay.  And I can tell you we spent a lot of effort trying to categorize all of the tens of millions of items on eBay.  And it was hard and you never got it right and not everyone agreed. 

And tagging is just this elegant way of remembering things you're interested in in words that mean something to you.  And it's a very useful tool for you as an individual when millions and millions of people who are now using del.icio.us all start describing the Internet and what's important to them in the words they use.  It becomes really fascinating.

Susan Bratton:  I feel like the Internet is requiring me to do way too much work right now.  Like everybody wants my contribution and my intelligence against their open opportunistic platform.  And it's kind of irking me.

Chris Fralic:  I think you're dead on to something that we see a lot with a lot of the business plans that we look at where if everyone contributed –

Susan Bratton:  Right.

Chris Fralic:  To the way that the company wanted them to it would be a wonderful experience.

Susan Bratton:  If 1% contributed.

Chris Fralic:  Right.

Susan Bratton:  Imagine how big it would be.

Chris Fralic:  The only thing I would point out about del.icio.us, which is a very important feature, is del.icio.us is useful if you are the only person in the universe using it.  It's a better way to manage your bookmarks and sites that are important to you and they are on the Internet so you can get to them from any browser anywhere in the world and you can find things easier than in any filing system.  So right there it is useful.

But it becomes way more useful when lots and lots of people are using it.  And I think a lot of companies missed that point.  They have things that are only useful if you have spent a lot of time putting something into the system and then everyone can get something out of it.

Susan Bratton:  And you are saying that in the case of del.icio.us, you can get out of it even if you haven't put in?

Chris Fralic:  Yes.  Well you can - well I'm saying with del.icio.us is it’s useful just for yourself if no one else in the world uses it.

Susan Bratton:  Ah, I got you.

Chris Fralic:  It can also be useful if you have some folks who are in search marketing and such that listen to this show.  There is an incredibly useful feature on del.icio.us if you have the little bookmarker installed.  You can go to any website in the world and say, what's the term here?  “Show related tags and users”.

And once you go to that it will show you all the people and how many people have bookmarked this site as a measure of how important it is.  And also it gives you all the main tags, the words that people use to describe it.  It becomes very interesting either way.

Susan Bratton:  Oh yeah, so you can mine that for keywords?

Chris Fralic:  Correct.  It's a very interesting way to find out what a site is about without having to even visit it, to see what people will actually describe it as.

Susan Bratton:  Mmm hmm, got you.  Well I want to switch to another company that you and Josh have invested in.  It's a company called Bazaar Voice.

Chris Fralic:  Yeah.

Susan Bratton:  And that's our friend Brett Hurt and I just read on Josh's blog, they've achieved profitability in 14 months post-investment.

Chris Fralic:  They have.  They are an incredible company.  Josh works with them from First Round but I haven't had the chance to meet Brett and see the updates they are executing.

Susan Bratton:  They’re on fire.

Chris Fralic:  They are on fire.  And they are providing - what I find very fascinating is - a very simple, you would think a simple service of reviews and ratings.  But they do it very well and they charge for it and their customers pay for it and it has gotten them the profitability in a short time.

Susan Bratton:  Yeah, it's a system for allowing an e-commerce site to inbed reviews and ratings systems that can scale to the business.

Chris Fralic:  Exactly.

Susan Bratton:  Instead of trying to create it themselves.  So everybody wants what Amazon has.  Essentially Bazaar Voice provides that to everyone else, right?

Chris Fralic:  Yeah.

Susan Bratton:  Yeah, yeah.  It's beautiful.

Chris Fralic:  You know, it's interesting.  I think you could look at Amazon and what they do so incredibly well on their site and what maybe a handful of other sites do that well on their own.  But by and large most sites have not done reviews and ratings terribly well.

They've got another company that is similar in what it offers, which is recommendations.  It's called Aggregate Knowledge.  And all it does is offer recommendations based on the click stream of visitors who came before you.  And that single function, they have built a great business on and have got a lot of customers as well.

Susan Bratton:  Well, let's keep talking about Amazon.  I want to talk about Amazon Web Services.  You just did somewhat of a review of that vertical.  I'm fascinated and absolutely in love with Amazon's Mechanical Turk product.  Talk to little bit to our listeners about that and remember that, for the most part, my listeners are in media, in advertising, in marketing, brand marketing.  They are publishers.  They are people who are doing Web 2.0 products and services or using or leveraging them to market their company.

Chris Fralic:  Yeah, well I'm very impressed with what Amazon is doing.  And it's interesting.  I competed with them for a lot of years at eBay.  And so it's fun to now look at all the great things they are doing and a lot of our companies are taking advantage of it.

But the one you mentioned is called Mechanical Turk and what they essentially do is harness the wisdom of crowds.  They allow you to request a task to be done.  It could be anything from the menial to simple but things that, you know require a human being rather than a machine to do.

And they will connect you with people who are willing to do it.  And they provide a payment mechanism for it.  And they take their cut off of the top.  But it provides a terribly efficient way to get work done by people dispersed across space and time at very cost-effective rates.

Susan Bratton:  It's like a global outsourced micro-payment interface.  Isn't it?

Chris Fralic:  Yes.  One example I gave in the blog post was a company in Seattle that was called iConclude.  And they needed this service done, they called getting a script done, you know, an IT, technical thing that needs to be done inside of big corporations.  And they had estimated it would cost between $1000 and $2000 each to have these hundreds and hundreds of scripts built to build their business.

And they started using Mechanical Turk and found people who loved to do scripts in their day job and when they went home at night, and all the time and all over the world.  And they were able to get scripts built for between $5 and $10.  And so it really changed the whole economics of their business.

Susan Bratton:  I really wish I could outsource my laundry to Mechanical Turk.  [Laughs] I've got so many piles in my washer room right now.  God!

Well, I want to switch to something else, which is that you are a Philly boy.  So your offices are on West Conshohocken on the Schuylkill Expressway.  You live in Newhope.  I didn't realize that about you because I met you when you, for a very brief time were actually living out here in Monte Sereno.  So tell our listeners about beautiful Newhope and what it's like where you live.

Chris Fralic:  It’s beautiful.  First of all, I know you are from Philly.

Susan Bratton:  I’m a Philly girl.

Chris Fralic:  And you were able to pronounce Conshohocken and Schuylkill correctly.

Susan Bratton:  Right.  I was showing off.  I was showing off.

Chris Fralic:  You know, Newhope is a beautiful town in Bucks County, which is about an hour north of Philadelphia, right on the Delaware River across from New Jersey and a little more than an hour away from New York where I am now.  And it's just got a great community and combination of arts and crafts stores and restaurants and bikers and yuppies and it's just a great place.  My wife and I have lived there for over a dozen years, except for our California jaunt.

Susan Bratton:  It’s a beautiful artist colony.  And a lovely -

Chris Fralic:  That’s how it started really.

Susan Bratton:  I mean, it's a place that people go to visit on the weekends because it's so beautiful and you live there all the time.

Chris Fralic:  I do.

[Music]

Susan Bratton:  Hey, we are going to take a short break to thank our sponsors.  I've got some new sponsors and I want to give them all the time they need to tell you about what they do.  So if you’ll hang on with me, we'll be right back.

[Commercial]

[Music]

Susan Bratton: We are back.  I'm your host Susan Bratton and I have Chris Fralic.  Chris is with First Round Capital and we have been having some fun talking about the Web 2.0 world and also about what it's like in his personal life.

I want to stay on the personal life thread a little bit with you Chris.  So you’ve recently done some marathons.  How are you fitting in the time for that?  You are trying to raise - you have a little boy.  He's seven, right, Max?

Chris Fralic:  Yeah.

Susan Bratton:  And of course your wife, Emma and - Irma, it’s Irma isn't it?

Chris Fralic:  Irma.  Correct.

Susan Bratton:  Irma.  And, you know you've got a very busy schedule.  You travel a lot.  How are you fitting in the time to manage the practice that you need for marathons?

Chris Fralic:  Well, I've done three marathons.  The first two my wife Irma did with me.  That was the Marine Corps in Washington and the San Diego marathon in San Diego.  That was a cool marathon.

Susan Bratton:  Oh yeah, that's a good one isn't it?  Did you like that Rock 'n Roll Marathon?

Chris Fralic:  And then the New York a couple of years ago.  I tend to run well when there is a goal like I actually sign up for the race so I know I have to train and that works pretty well for me.  And it's something my wife likes to do so we can do that together fairly often.

I also am a fairly geeky guy and I like technical toys.  And I have discovered recently this thing called Nike plus iPod.

Susan Bratton:  Oh yeah.

Chris Fralic:  Have you heard of that?

Susan Bratton:  Yeah, it's the shoe thing.

Chris Fralic:  Yeah.

Susan Bratton:  Tell us about it.

Chris Fralic:  You've got this little thing in your shoe and you attach this other little thing to your iPod and it tracks your runs - the day, the time, the distance, the speed and it uploads it after every run. You can see graphs of how you have gone and when you complete a particularly good run, a little voice of Lance Armstrong pops in and says, “Congratulations, that was your best time for a mile!”

Susan Bratton:  [laughs] I love that.

Chris Fralic:  Yeah, it's pretty cool.  I have actually listened to a “Dishy Mix” while training for the Broad Street run.

Susan Bratton:  Oh, great.  I know you are a podcast lover.

Chris Fralic:  I am.

Susan Bratton:  Do you remember which episode you listened to?

Chris Fralic:  I listened to several.  Rich LeFurgy was one that I really –

Susan Bratton:  Rich did a good job.  We were –

Chris Fralic: Enjoyed.  He was very good.

Susan Bratton:  Yeah.  And it was fun because we played that word game.

Chris Fralic:  Yes.

Susan Bratton:  Everybody loves that.  People tell me about that all the time.  They love that word game one.

Chris Fralic:  And Kimball Musk I know.  And I heard his.

Susan Bratton:  Yeah, Kimball.  He's amazing with his eco-restaurant.

Chris Fralic:  Yeah, that was fascinating.  In fact my sister was just in Denver visiting a cousin and I told her to go to the kitchen.

Susan Bratton:  Did she go?

Chris Fralic:  And I heard about it on Dishy Mix.

Susan Bratton:  Nice.

Chris Fralic:  I haven't listened yet but I know you had Scott Kliger from our portfolio company 800 Free 411.

Susan Bratton:  Yeah.

Chris Fralic:  And I heard Rashad.  So I have listened to several.

Susan Bratton:  Good for you.

Chris Fralic:  I really enjoyed them.

Susan Bratton:  Thank you.  Thank you.

Chris Fralic:  So it's great to be here.

Susan Bratton:  Well, you were the person who - you are involved in TED.  You and I see each other at the TED conference every year and you have been going since Ricky Werman was the person.

I want to ask about how you got BMW to sponsor the TED talks, because of course anyone who listens to podcasts is probably podcasting themselves and so it is interesting to us to see how those deals are getting done.  Tell us as much as you can about that.

Chris Fralic:  Well, as you alluded to, I have been attending TED for over 15 years.  And after del.icio.us was acquired by Yahoo and I was figuring out what I would be doing next I ended up actually doing two things.  I was part-time venture capital with First Round and I was part-time running Strategic Partnerships for Chris Anderson and the TED group.

One of the things that the team had been working on was TED Talks essentially to unleash to the world all these great conversations and presentations from the TED conference.  And along the way the decision was made to make them free and to look for a visionary sponsor to underwrite and also help promote TED Talks. 

And along the way we were lucky enough to meet BMW and we worked with first their agency all the way up to key folks at headquarters up through the VP of Marketing and they got it.  They had been appealing to the idea class and it just fit into their whole campaign and really ended up being a great partnership that was successful on pretty much every level you can imagine.  And I just learned BMW re-upped.  They signed up again for another term.  So everybody seems happy.

Susan Bratton:  Initially, how did you price it?  Did you price it on a per download basis or did you price it on a flat fee?  How did that work?

Chris Fralic:  It was priced on a flat fee basis.  And, you know we had made some projections about how many downloads we might see in those were all exceeded.  Honestly the agency was really trying to get their arms around what the right metrics were to measure this by.  And in the end it was I think partly a gut decision.  This was the right thing to do in the right way to do it.  And all the dollars ended up making complete sense.  But it's still as you know an emerging platform and marketers are still understanding the right metrics.

Susan Bratton:  So I want to stay with TED and I want you to tell me about how you reenacted your marriage with Irma on the TED stage.

Chris Fralic:  Yeah, this is a funny one not too many people know about.  But my wife and I had been dating for years.  We met in business school.  And she was working for Merck at the time and we were both actually attending TED and I surprised her one evening with a ring right by the Monterey Bay.  And she was surprised and thrilled and said yes, I'm glad to say.

Susan Bratton:  Did you get down on one knee?

Chris Fralic:  Yes, I did in fact.

Susan Bratton:  Nice.  I knew you would.

Chris Fralic:  I remember the bench and where it is.  We go out and visit it whenever we go back.

Susan Bratton:  So the ocean was there.  She was seated on the bench.

Chris Fralic:  Yes, she almost slipped in the ocean she was so surprised.

Susan Bratton:  She was seated on the bench.  And then what happened?  Did you - you got down on one knee so she knew right away or were you nervous?  Did you say, “I have something I want to ask you”?

Chris Fralic:  No, you know what, I actually forget some of the exact details of that.  But I know it was a very happy moment and a big surprise for her.  It was a great event.  There were some other people watching and it was kind of fun.

And we walked in afterwards to the party that was going on and we told Richard Saul Werman what just happened and he said, “That’s great.  We're going to get you up on the stage tomorrow to do it.”  And he did.  He called us up and I asked her in front of the crowd and she said yes and everyone clapped.

I think most people think that was actually the real, live proposal.

Susan Bratton:  Do you have that on video?

Chris Fralic:  I have an audio of it.  So I don't have it on video.

Susan Bratton:  An audio.

Chris Fralic:  But I do have an audio.

Susan Bratton:  That’s nice.  That's really romantic.

Chris Fralic:  Yes, it is nice.  Yes.

Susan Bratton:  So what do you do now after what, probably seven or eight years?  How long have you been married?

Chris Fralic:  Over 10 years.

Susan Bratton:  Over 10.

Chris Fralic:  And we’re very busy with our first grader, Max.

Susan Bratton:  Yeah.

Chris Fralic:  And he's a great kid and having fun finishing up his first year of school and getting ready for camp in summer and football in the fall and all that.

Susan Bratton:  So what do you do to make an intimate connection with Irma?  You know, you are busy, she's busy, Max is around.  What do you do to create and keep that deep connection going in your marriage?  Do you have any little things that you two do that are special?

Chris Fralic:  Well, I think we try and keep connected and we have got a date night is Friday.  We don't have it every week but we try and have them as often as we can and make the time that we are together as - you know, make sure we are there in the moment as much as we can be.  That's part of what we are doing, definitely, always trying to stay that way.

Susan Bratton:  Nice.  Well, I want to make a transition then.  I'm not exactly sure how to go from intimacy and connection with your wife to my next subject, which is Buddy Lube but I think I just made the transition.

So, on your blog - we have not said the name of your blog.  Your blog is called “Nothing To Say” of course.

Chris Fralic:  Right.

Susan Bratton:  And if I go to www.firstroundcapital.com I can link to your blog off of there, right?

Chris Fralic:  Yeah, all you need to go to is just www.firstround.com.

Susan Bratton: www.firstround.com and I'll find it?

Chris Fralic:  And it's there.  Yes.

Susan Bratton:  Good.  OK, great.  So, one of your recent postings was about widgets.  I am fascinated by widgets.  And I think everybody in marketing and anybody with a brand is thinking about the world of widgets right now.

Chris Fralic:  Yes.

Susan Bratton:  In the remaining time that we have, I want to talk about widgets and then I want to talk about, I want you to explain Buddy Lube to me.  And we are going to play a jingle from this absolutely adorable company so you can enjoy that too.

So, first start with widgets and the concept and then let's move into Buddy Lube.

Chris Fralic:  Yeah, well widgets have gained incredible popularity, initially as being one of the ways that people customize their MySpace page, another social network.  And it essentially allows a regular user without a whole lot of technical skill to be able to see some thing that they like, whether it is a slideshow or an audio tool or some kind of functionality that they would like to have make their page look better and cooler and personalize it.

And they just essentially copy and paste HTML code that brings that functionality in and lets them customize it, add their pictures, etcetera, etcetera.  And they have been just wildly popular.  I think they are part of the reason why places like MySpace have done so phenomenally well. 

And they are, I think, an involving advertising platform.  I think people by and large aren't clicking on the banners up above MySpace pages, at least not in huge numbers.  But to the extent that marketers can be on the widget itself that someone is using to show their prom pictures or play their favorite music I think is a terribly important trend.

Susan Bratton:  So let's - you know, I want to mention that Blue Lithium just did a - they do a quarterly white paper and they just did a piece of research and they said that the acquisition costs are significantly lower in the advertising that is done in social networking sites than in more brand - if I say more branded sites, non-user generated content sites.

Chris Fralic:  Yeah.

Susan Bratton:  And that, although the clicks are lower, the cost of the media is so low that if you buy enough of it, the actual cost per acquired customer is significantly better in user generated content.

Chris Fralic:  Yeah.

Susan Bratton:  So when I read that, of course I said, “Blue Lithium please meet MySpace.”  Introduce the researcher to the researcher, you know because MySpace has just come out with a lot of new research about the right way to do brand advertising in social networks.  So I am really interested in the space and tracking how marketers can best leverage both the media and the medium of social networking.

Chris Fralic:  Right, I think that you are seeing forward leaning marketers really trying to figure this out.

Susan Bratton:  Yes.

Chris Fralic:  And in many cases, the success that has been seen with these widgets has been with zero marketing dollars.  It is literally viral and that's a word you hear thrown around a lot, particularly in the business plans from the entrepreneurs we meet with every day.  And very few I think actually understand the metrics of it and what it means or have seen it happen first-hand.

Essentially what it boils down to is when one person is exposed to this widget or say, this service, they, themselves caused more than one more person to sign up.  And the difference between that metric being .98 people sign up for every one versus 1.11 people sign up is huge.  And once you get on that growth curve, we have seen companies grow from zero to millions of social network users displaying and interacting and using their widgets in 60 days.

You're seeing that kind of growth rate that is hard to get from traditional marketing and they have done it with no marketing dollars.

Susan Bratton:  Do you have a good example of that?

Chris Fralic:  You know, we've got two companies in our portfolio that are good examples.  One is called RockYou that does slideshows on MySpace and the other social networks and another is called Snapvine, which allows you to put a voice on your MySpace or any other social network page.  You can leave a voice message out the world and everyone can call a regular phone number and leave it back to you and it all appears on everyone's MySpace page.

And it's funny, I hadn't thought of the connection but Snapvine was where I first heard about Buddy Lube.

Susan Bratton:  OK, then there’s your transition.

Chris Fralic:  There it is.  So Snapvine worked with this firm out of Brooklyn called Buddy Lube and through that relationship got their voice player on 50 Cent’s MySpace page.  So the rap star 50 Cent left a message.  You know, he was sitting in his hotel room just shouting out to his fan base and saying what he was up to in about a one-minute message.

And by that weekend, thousands of his fans had signed up for Snapvine and gotten their own voice players and put them on their own MySpace pages.  And it was one of the important early moments in the virility and growth of Snapvine.

I asked the CEO to introduce me to the Buddy Lube guys and that's how I met them.  So they essentially sit in between artists and their fans on social networks.  They on one hand manage the social network presence of dozens or hundreds of musical artists and get paid to do that.  And then they also work with companies like Snapvine and EventPull and dozens of others you can see on their website to help those folks get their widget distributed across the social networks.

So they help both sides of the equation and bring a ton of built-in distribution through all the networks they are on and all the friends that their artists have in your and it's a great way to get distribution.

Susan Bratton:  That’s hot.  And I can't wait to do something with it.  Right now, we have to play a clip, an audio clip from the Buddy Lube site because it is so cleverly done.  So we are just going to take a second and play that clip.

Jingle:   If you’re looking for a widget that’s cool, www dot buddy lube.

If you’re MySpace page needs some more attitude, www dot buddy        lube.
You don’t have to know web 2.0
Just click on the eye and you’re ready to go!
It’s fast, it’s fresh, it’s easy to do, www dot buddy lube.
Buddy Lube comes with everything you see here each sold     separately.
Buddy Lube! More eyeballs.
Susan Bratton:  I love that.  How do you like that Chris?
Chris Fralic:  I loved it from the minute I heard it.  Jonathan Cohen, the founder said that his girlfriend did that for him.
Susan Bratton:  Oh, really?  Oh, she did a great job.  What's the thing with the eyeballs?

Chris Fralic:  That’s what they deliver - more eyeballs.

Susan Bratton:  Oh, geez!  Right, right, right.

Chris Fralic:  It’s come a full circle.  We used to talk about that a lot back in the early Web days, right?

Susan Bratton:  Right. I remember.  This is so funny.  I always hated this damn thing.  Narrative Communications Enliven - the Rich Media Company – Scott Kliger’s company, right?  He’s the Free 411 guy.  So his first thing he did in the Internet marketing space was Narrative Communications, which became Enliven.  And their very first, I don't know logoy advertising thing was this glass full of eyeballs.  And it was so bad.

Chris Fralic:  That’s better than a Lava Lamp.  I love it.

Susan Bratton:  It was like the classically distasteful, horrible marketing icon of all of Internet advertising.  It was just these hideous eyeballs, you know in this jar.  And every time I think about it it kind of makes my spine go blah.  You know?  It was just such a funny thing.

Chris Fralic:  Well that's funny.  And I think it's really funny that Buddy Lube has kind of embraced the eyeball and has kind of a retro song going on there.

Susan Bratton:  Yeah.  Yeah, it's all retro isn't it?

Chris Fralic:  It is.

Susan Bratton:  Oh shit, we've been in this so long we’re retro.

Chris Fralic:  It has such a unique place in the ecosystem now and I really enjoy working with those guys.

Susan Bratton:  Well, you're working with some really, really fun companies – Bazaar Voice and Snapvine – God, good for you.  You are doing, as always, fabulously great.

ScanScout - our friend Jed Savage - that's your deal, right?

Chris Fralic:  Yes, I was with Jed last night.

Susan Bratton:  Yeah.

Chris Fralic: And I have to tell a funny story.

Susan Bratton:  Tell us.

Chris Fralic:  We were at a –

Susan Bratton:  Tell everybody who Jed is, just in case somebody doesn't know Jed Savage.

Chris Fralic:  Jed Savage is I think maybe the first person I met you through.

Susan Bratton:  Yeah.

Chris Fralic:  And Jed was a long time online marketer and was running the east coast for MSN for years.  And he and I opened up the New York office of eBay when he joined and I moved back from the West Coast.  And he's just a good guy and he's now working at one of our portfolio companies, ScanScout.

And last night we were at this fundraiser that Google put on.  It was for a cause called Matt’s Promise.  And Ron Conway, a prominent Silicon Valley angel investor was the honoree and the Steve Miller band played.

Susan Bratton:  Nice.

Chris Fralic:  But MC Hammer was in the crowd.

Susan Bratton:  Oh, he's a lovely man.

Chris Fralic:  He is.

Susan Bratton:  Yeah.

Chris Fralic:  And I walked out of the party at the end with my wife and we were looking for the car and there were Jed and Waikit and Doug and the rest of the ScanScout team there in a deep conversation with Hammer.

Susan Bratton:  Yeah.

Chris Fralic:  About the future of music and embedding of commerce and content and then, you know, disintermediating the record labels.  It was pretty funny and amazing that that's how I saw Jed last night.

Susan Bratton:  Well, and MC Hammer has a really good blog.

Chris Fralic: Yeah.

Susan Bratton:  His soulfulness definitely comes out in his blog.  It's one of the things I love about blogging, you know?

Chris Fralic:  Yeah.

Susan Bratton:  You can really see the person behind the entity, which is exactly what I hope to do with “Dishy Mix”.

Last question and we've got to close this off because people are busy and they are only going to listen to us for so long, Chris.

Chris Fralic:  Right.

Susan Bratton:  But I wanted to just ask you quickly about this advisory board that you were on for this Library Portal Project, which was part of the Bill and Melinda Gates Foundation.

Chris Fralic:  Right.

Susan Bratton:  I’m just so impressed with what Bill and Melinda are doing for the universe.  Their hands are in so many things but I hadn't heard about this idea of the Library Portal Project.  Just tell us about that.  I like to end on an inspirational note and I leave it to you.

Chris Fralic:  Sure.  Overall I think Bill and Melinda Gates are doing some of the most important work in the world right now that it's quite an amazing shift to see the wealthiest and smartest people in the world trying to put their resources to work for the world.

But this project, when I was running the book business and all the entertainment categories at eBay, I got invited up to Seattle to meet with the team that was putting computers into every library in the country that needed it.  And one of the things I loved was that they thought they would prioritize by starting with the lowest per capita income regions of the country and working their way backwards.

And they had a program that gave libraries computers and networking and training and installation for, I think it was a two-year period, after which time the libraries had to, on their own, manage their computers that they had gotten from the Foundation.  The portal project was really a website designed to help the librarians and everyone involved teach each other best practices, learn how to do upgrades, manage and make best use of these tools and the Internet with each other.

Essentially, to start out, I guess you would think of it as a social network of these librarians and the users of the library.  And so I helped them on a small level look at best practices and gave them some insight from what we had done with those kinds of things at eBay.  It was a great project.

Susan Bratton:  Nice.  Well I really appreciate your coming on the show today.  It was fun to get to know some of the tidbits about you.  Thanks for sharing all of that.

Chris Fralic:  My pleasure.  Thanks for having me.

Susan Bratton:  Absolutely.  So, we'll check in with you in a few months and see what's happening and we will check out all of the companies with which you are involved.

Chris Fralic:  Great, thanks a lot Susan.

Susan Bratton:  All right Chris, thank you.  This is your host Susan Bratton.  Thank you so much for listening today.  I hope you had a fun time and you learned a lot.  And I will see you next week.  Have a great day.

[Music]

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