Welcome to another edition of Business Twitter, where we collect the best tweets to come out of Silicon Valley so you don’t have to. This article is part of a newsletter — if you want a weekly Business Twitter roundup sent to your inbox every Friday, subscribe here.
This week: Ali Partovi shares how a blunder cost his startup a $125 million deal with Yahoo, who ended up buying Paul Graham’s Viaweb, Jason Kint’s insightful threads on Facebook’s PR nightmare, and a look at how NFTs work using the Mona Lisa as an analogy.
1. How to lose a $125 million deal
Ali Partovi, CEO of VC fund Neo, has been one of Silicon Valley’s brightest for years. He was there in the early days of the internet and even had a chance to work with Yahoo founder Jerry Yang. Unfortunately, a few comments — that Partovi called “too honest” in a thread — cost him a $125 million deal with the tech giant.
In 1998, 25-year-old Partovi was building a startup called LinkExchange. He and his co-founders had a plan to get acquired by Yahoo, which would mean a lot of money and the ability to work with tech’s finest.
Partovi had a backup plan in case the deal fell through: LinkExchange would partner up with another up-and-coming startup, Viaweb, whose CEO was none other than Paul Graham. On the eve of signing the Yahoo deal, Partovi got too ahead of himself and told Yang how great Viaweb was, which did him no favors.
“I’m not sure what compelled me to speak,” he wrote. “Maybe it was that I already considered myself on Jerry’s team and wanted to help Yahoo. Maybe it was that I knew Viaweb’s people were incredible, and I couldn’t let a mistake go uncorrected. Maybe it was the alcohol.”
Then Partovi spoke the words he’d regret for years. “‘Jerry, your guys are wrong: the Viaweb team is amazing. Their engineers are probably better than yours,’ I said. Then, I stupidly added, ‘They are hands down better than us.’ ‘Interesting,’ replied Jerry Yang. ‘Maybe we should take another look at Viaweb.’”
Yahoo ended up buying Viaweb weeks later.
“One lesson I learned: a deal isn’t done until it’s closed,” Partovi wrote. “No matter how much you want to be on the same side of the table as the other party, don’t show your cards until the game is over.”
2. A reference guide to Facebook’s PR morass
When isn’t Facebook in hot water these days, whether it’s bad press, government investigations, or just general distrust from its millions of users?
Many have pointed out that Facebook shifts into PR mode pretty quickly whenever something goes wrong (which is often, to say the least). Jason Kint, CEO of Digital Content Next and Big Tech critic extraordinaire, compiled a thread of every investigation, lawsuit, and subpoena being brought against Facebook.
Meanwhile, the company announced a rebrand to position itself as less of a social media company and more of a metaverse-related company. (Horizon Workrooms, anyone?) Kint also tweeted that Facebook was “rightly desperate” for a rebrand.
This week, he retweeted his thread while adding a message for reporters: “If you’re chasing a “Facebook re-brand the company” story generated from inside of Facebook, please read this list...and know from the Facebook PR thread on Monday they don’t respect you or your role.”
Check out Kint’s other threads, like the one he alluded to from Monday, which goes into detail about Facebook’s PR strategy.
3. If Mona Lisa were an NFT
If you’re still wondering what an NFT is but were too afraid to ask, you’re not the only one. Non-fungible tokens, once thought to be a crypto fad, are becoming a mainstay in the community. In fact, $11 billion in NFTs have been traded in Q3 of this year alone.
To help explain how NFTs work, one Twitch streamer shared a recent Tumblr post that likens buying an NFT to buying the Mona Lisa.
“Imagine if you went up to the mona lisa and you were like ‘I’d like to own this’ and someone nearby went ‘give me 65 million dollars and I’ll burn down an unspecified amount of the amazon rainforest in order to give you this receipt of purchase’ so you paid them and they went ‘here’s your receipt, thank you for your purchase,’” the post reads, poking fun at the colossal energy required to create new NFTs.
The post continues with an explanation of how NFT ownership works: “And you went ‘can I take the mona lisa home now?’ and they went ‘oh god no are you stupid? you only bought the receipt that says you own it, you didn’t actually buy the mona lisa itself, you can’t take the real mona lisa you idiot. you CAN take this though.’ And gave you the replica print in a cardboard tube that’s sold in the gift shop.”
The post ends with these wise words: “Unfortunately, if this doesn’t really make sense or seem like any logical person would be happy about this exchange, then you’ve understood it perfectly.”
