With social networks being all the craze lately in our web 2.0 boom or bubble depending on which side of the fence you stand one has to wonder what plans the top social networks have to bring their revenue in line with user growth as there is only so much VC money out there that anyone of those guys can get.

In the next 24 months we should see alot of cleanup happening on the web as companies either die or consolidate their efforts to generate revenue and look at either becoming profitable or breaking even , especially VC backed companies as the VC crowd don’t do 10 or 20 year plans.

Google Adsense is definitely not a business model, as that will not generate the revenue you need to keep pace with high growth.

Alot of companies will need to seriously go to the drawing board and come up with some really clever ways to make their apps profitable. I think it will really be hard for the feature apps that only focus on one thing.

Seeing that I am in startup stealth mode I will as well need to be thinking around the same plan for generating constant revenue.

I was just reading an interesting article on Forbes about the best paid tech CEO’s and to no surprise Larry Ellison ,Chairman of Oracle is the best paid.

Click here to read more

After Microsoft pulled back the offer Yahoo got a trashing in the markets and seems to be on a losing streak. I see Yahoo retreating back to around its previous price before Microsoft made the offer. I think at this point the share price should be the last thing Yahoo should worry about, as it has bigger problems on its hands like increasing revenue and search market share.

 Check out the share price below.

YAHOO INC                                   

(NasdaqGS: YHOO)

Last Trade:	24.26
Trade Time:	3:57PM ET
Change:	4.41 (15.38%)
Prev Close:	28.67
Open:	23.02
Bid:	24.27 x 28000
Ask:	24.28 x 29000

I read an interesting article on webpronews about a study conducted on entepreneurs and what their average ages are. Well it seems that your 10 year old is not part of that demographic.

The common belief that all entrepreneurs who start tech companies are in their 20s or teens is being challenged by a lengthy study that started in 1995 thru 2005 which found that only 1 percent of American founders were teenagers.

The study by Ewing Marion Kauffman Foundation and researchers at Duke and Harvard found that most U.S. born technology and engineering company founders are middle-aged, with the average and median age of 39.

The majority (92%) of founders had bachelor degrees, 31 percent had master degrees, and 10 percent had PhDs. Close to half of the degrees were in science, technology, engineering and mathematics. One third was in business, accounting and finance.

“While education clearly is an advantage for tech founders in the United States, experience also is a key factor,” Vivek Wadhwa, lead researcher, Harvard Law School Wertheim fellow, Duke University executive in residence, said.

“That a large number of U.S.-born tech founders have worked in business for many years also is important in understanding the supply of tech entrepreneurs.”

Close to half (45%) of the tech startups where started in the same state where the founders received their education. Of the tech founders receiving from California, 69 percent later went on to create a startup in the state, 58 percent did the same in Michigan, 53 percent in Texas and 52 percent in Ohio.

The top universities were tech entrepreneurs were most likely to earn their degrees include Harvard, Stanford, University of Pennsylvania, MIT, University of Texas, University of California-Berkeley, University of Missouri, Pennsylvania State University, University of Southern California, and University of Virginia.

“Because entrepreneurship is an indicator of economic vitality in regions and across the country, this study raises important policy questions about how to foster greater tech entrepreneurship to boost economic growth,” Robert Litan, Kauffman Foundation VP of Research and Policy, said.

I read an interesting article on how to use stumbleupon as a marketing tool to drive traffic to ones site.

 Have a read, maybe it could help you with your new startup to become a StumbleUpon SuperStar

Well looks like Microsoft has come to its senses and decided that the best web strategy is the one where it goes it alone and via partnerships then by buying other web giants that will come with bagage. For the shareholders of Yahoo this will be a blow for those that wanted to cash out and look for other viable investments. They are now going to have chug along with Yahoo as the company tries to get to grips with its business and competing with the other giants.

I think Microsoft can as a long term strategy break into the web space and gain greater market share, but they have to rethink how they do things. The web is consumer based ,not like the current space they play in so they need to start really thinking like a consumer and not a corporate

For Yahoo I think a deal with Google is bad as in the long term it will be their demise. I see it the same as doing a deal with the devil and hoping not to get short changed later. Yeah Right. I hope Yahoo has not based their decision purely on the “Don’t be Evil” marketing ploy Google uses, although I have seen decisions made by large corporations based on less.

Well here is the transcript of the letter that Steve Ballmer sent to Jerry Yang

May 3, 2008

Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089

Dear Jerry:

After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.

I first want to convey my personal thanks to you, your management team, and Yahoo!’s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.

I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.

In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.

Also, after giving this week’s conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.

We regard with particular concern your apparent planning to respond to a “hostile” bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:

- First, it would fundamentally undermine Yahoo!’s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.

- Given this, it would impair Yahoo’s ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.

- In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.

- This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.

- It could foreclose any chance of a combination with any other search provider that is not already relying on Google’s search services.

Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft’s proposal to acquire Yahoo!.

We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.

I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.

But clearly a deal is not to be.

Thank you again for the time we have spent together discussing this.

Sincerely yours,

Steven A. Ballmer
Chief Executive Officer
Microsoft Corporation