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Shortest.Post.Ever

Wow.

All right, I lied, though a short post would be fitting for my first ever Twitter post.  Brad Burnham and that “other guy” Fred Wilson’s USV invested an undisclosed sum in Twitter today. 

For once, I’ll abstain from commenting. 

All right, I lied again.  I think what I meant to say is I’ll hold off judgment on this for a couple of reasons.  Notably, while many VCs have yet to show off any tangible returns from their Web 2.0 investments, USV has Delicious, Feedburner and Tacoda to show off as investment of the second wave of web investments, if not Web 2.0 related per se (Tacoda?).  And, of course, Wilson also got a exit - albeit small - on his personal Wallstrip investment.

In fact, even Valleywag, that has been known to grill VCs on their lifestyle and investment, this week gave a glowing review of Fred’s philosophies and moves.  In fact, this 2-year old article in Business 2.0 has proved might prescient.

To his credit, on the VC’s blog, they admit that much like the investment in Delicious, they did not know what the business model - if any - would be.  Of course, Delicious’ business model was selling for $20-30M to Yahoo! and then seeing Yahoo! muck it up to some extent by missing out on the video tagging boat (what - along with flash video and embed codes - partially made YouTube become a $1.65B exit, by the way). 

That being said, since I did clearly lie about not commenting… one has to wonder what the rationale is on this one, because while Delicious had built a lead in tags etc., Twitter remains a tool by the few for the lessor.  Sure, by the early adopter crowd it has caught on, but by and large do you really see that many people twittering and others really caring?  And, did Jaiku and Pownce not practically overnight duplicate their respective version of Twitter on steroids?

I don’t know,

- on the one hand, yes: Wilson and USV really have proven to be in a league of their own in terms of exits, but this one does remind me a lot of a given era that shall remain nameless when the more uncertainty existed around an idea’s business model, the more welcome it was by the investment community.  I’m not alone there, by the way, since a member of said community chimes in and seems to agree, here.  Wilson himself, conceded in 2005: “Looking back on [Flatiron’s portfolio] now, Wilson offers a blunt assessment: ‘Yeah, boy, we really screwed up a bunch of things.’” 

- on the other hand, I’m a believer that any business model can win online if you have a good team and you can execute.  It’s early enough that no one can predict user - and consumer - behavior.  In fact, I’ll add this: that same B2.0 article quoted Wilson as saying three fields would be most impacted by the Web, the three being a) media, b) marketing and c) finance.

Wilson made and exited several investments in a) and b).  Perhaps in Twitter’s future Wilson sees an answer few others do, d) which is all of the above.

Time will tell.  Like I said, the jury’s out on this one…

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Posted By: Ashkan Karbasfrooshan | Jul 27th

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