Miles To Go.

Epic Cover from Popular Mechanics c’94

Ever wonder what goes on behind the scenes when you pull up some information on your mobile device or tablet like today’s Weather Channel outlook or last nights scores on ESPN? Ever been annoyed by the ad intruding on what you want to look at, or if it’s behaving but not being relevant at all. What goes on behind the scenes, in about 1/1000th of a second, is a remarkable battle for the right deliver a message from someone who wants to engage you.

Flattered? Well you (and about 6 billion other people) are one of the two pillars that anchor a giant eco-system that is defining our times. Congratulations.

But the pipes that run between the brand that wants to reach you and the mobile device you are looking are new, not fully developed, filled with billions of dollars, and clogged with FUD. For the un-initiated, that’s Fear-Uncertainty-and-Doubt. When it gets solved, it will mean more and better content supported by relevant and timely ads that actually add to the experience.

In the meantime, let me (try to) explain what we (the businesses behind this) are working on to bring you to that point…

The pipe is all the different ways a brand can reach a consumer on a mobile device (explained below). The hold up revolves around people’s natural resistance to change, and their comfort with the familiar. I’m not immune to that, and I can remember a turning point about mid-way through the dot-com era when I lamented to a few of my old school buyout friends “remember when we used to be able to buy a company and phone it in for 5-10 years without anyone messing with us”?. Thomas Friedman got that right in his World is Flat, stating that our ability to learn and adapt will become the greatest skill set for the modern world. As markets and models change overnight, those that resist change and evolution will inevitably become a smaller and smaller island, if not altogether sunk. And who’s to blame for all this?

The information super highway for one. And for two, creative destruction went from Generational to 140 characters. Which brings us back to mobile ad-tech.

For an outsider, there is nothing more exciting than the tectonic shift of time spent from TV and PC to Mobile and Tablet. Though I write this on a PC (Mac) there are fewer and fewer tasks that get completed in front of this screen. And the brands that want to reach me are beginning to figure this out: the ads are getting smarter, more relevant, less intrusive and – dare I say – value ad on occasion. And this is done without cookies (on mobile) but with many more interesting parameters. But, like the internet’s early days, it’s still got a long way to go.

Segue here for first timers: my theory remains that as consumers get access to more information faster, they want more information, faster. And, like the internet, they will not like to pay for any of that. So the brands who want to access those consumers will subsidize that content with advertising support. And one way or another, that’s how we’ll roll for a while here.

So why do outsiders and first timers make such a big deal about the complexity and fragmentation of the mobile ads ecosystem? FUD. Listening to the CM Summit – thanks Google for the live stream- Luma’s Terry Kawaga  (start at 1:17:45) uses a showman’s flair for ridiculous sound effects and funny mash-ups while drawing out the following truth: there are only two pillars in digital media, consumer and brand. Everyone else is an enabler to that connection. If you get confused while looking a LumaScape, just repeat the preceding sentence. Here are the rest of the players, per Terry:

• Publishers create content of interest, where consumers flock like birds of a feather.
• Agencies create interesting ad units, and control lots of ad buys
• Networks buy and sell the remnants the publishers can’t sell themselves
• Exchanges automate the process
• Data targets users for more unique ad delivery

My world. Welcome.

And if you are gazing upon the Mobile LumaScape for the first time, you might say I guess I won’t be able to phone it in for 5-10 years without anyone messing with me. So this is where it gets interesting, as Terry again point out. Those enablers between the consumer and the brand tend to welcome the newbies with the following line

Oh, yes it’s very confusing. Give me your money and I’ll make it better.

Which is a lazy way to look at it. Yes, there’s a bunch of logos up there but he has the basics in the right place: Consumer and Brand. In between, there are a bunch of petri dishes founded by innovators, funded by vc’s, helping find better solutions between the two. But playing the game of fear (this is so confusing) and hero (but I can save you, give me your money) will not advance any of the said petri dishes. What will advance and differentiate them is seamless integrations between the petri dishes such that a brand can plug-in and gain the benefits of any and all of the innovations that allow it to best reach the consumer at the best time with the best ad.

And all this will normalize into something pretty logical I think. Just look at the same video at 1:28:00, about pop-ups. They were hated online, and they eventually receded or were trimmed back. They are no less hated in mobile, and likewise they will not win by dominating the screen. They will win by being relevant and timely and reaching the consumer when they need it most.

So that’s what’s going on each time you pull up a page on your mobile.

~~

While not mentioned directly, I’d be remiss if I did not disclose I founded a mobile ad-tech company that powers several logos above: Mocean Mobile.

Xin’s Thoughtful Gift: PBJ and Ramen 2

Being an entrepreneur is a lumpy business at best. And while I’ve written extensively about the mortality rate (95%), I’ve never written about how hard it is along the way for those 5% destined for greatness.

It ain’t easy, and it ain’t easy on everyone.

This is a basket of Ramen Noodles and Peanut Butter, presented on my Birthday by a very appropriate, thoughtful entrepreneur I backed; Xin Chung. Xin certainly has the moral authority to present the gift: he was liberated from Saigon as a child, spent time in an internment camp, and grew up in Valdez Alaska before settling in to SoCal and pursuing his dreams as an entrepreneur. He is now Founder and CEO of TrustCloud which has emerged from a “walk in the wilderness” with 10k passionate users and a growing number of interested clients in the social check space.

The Ramen and PBJ is our shorthand for being capital efficient, a must for start-ups.

My system at Vaux usually provides $250k of less for a team to develop a product that addresses a meaningful market problem, and do it within 90 days or so. This means most for the proceeds are dedicated to product. The next $250k usually goes to determining if anyone cares. The numbers vary, but either way the Founders and early employees do not get rich in salaries off of angel money. Frankly, they have to be prepared to barely eat, and when they do eat for strength. This is part of the ugly underbelly – and not a full underbelly! – of the dedication it takes to pursue your dreams. Every dollar you don’t waste can go to a better product or a better viral coefficient.

And of course, stuff takes longer than you expect. And costs more money than planned. This puts tons of pressure on the entrepreneurs as they debate the next crucial steps, often on an empty stomach. Probably once in my last 10 start-ups has a company got it right, right out of the box and kept doubling down all the way. Most try with a product, revamp, try again, tweak, and try again until there’s no track left. And it leads to some very difficult conversations about where to invest precious resources: make the product better and more people will come… or tell more people about the product and they will spread the word. Development vs. Marketing vs. Biz Dev. It often provokes difficult conversations, and sometimes desperate measures (these guys slept in a van on a Biz Dev road trip that lasted months).

And so the entrepreneurs themselves, while pursuing their dreams of autonomy, making a mark on the universe and yes winning riches, have to absorb the vagaries of what precious resources to assign where… including their own sustenance. I get queasy when I hear comparisons to the comp someone could make in the corporate world, which simply doesn’t apply in start-up-ville. And I get nauseous when I hear debates about how deep down the rabbit hole start-ups should go pursuing the next pivot (which is another term for fail and try again). Luckily  angels don’t have that much patience or that much capital for endless restarts. Which is why, when interviewing prospective partners I always look for that unique combination of resourcefulness, willingness and mental toughness that will see us through. And a dose of reality to know when to put a fork in it.

Entrepreneurship is not a straight line to the summit, it’s a jagged ascent and we have to be prepared for the whole ascent not just the sprint at the top.

~~

Save runway: TrustCloud’s sample T&E guidelines

Use personal credit card; expense every month with invoice. Avg trip: 2nts/3days, $800, $1000max

1. Air: economy $250

2. Ground:  $25/day

3. Lodging: Airbnb $50/nt

4. Entertainment: $75/day

5. Badges: pre-approved

6. Big dinners: pre-approved

Krish, Miles, Dan (who is in a rare moment of overdressed) in 2008

This past month marked the fifth year of working together with my two co-founders at Mojiva: Dan and Krish. If I were a DJ spinning vinyl to sum up those days, I would drop the needle with Bob Seger’s Against the Wind. With a few edits…

It seems like yesterday
But it was long ago
[Mobile] was lovely, she was the queen of our nights
There in the darkness with the radio playing low
And the secrets that we shared
The mountains that we moved
Caught like a wildfire out of control
Till there was nothing left to burn and nothing left to prove

Call it founder bias, nostalgic, or just plain sappy but it is amazing what’s has actually gone down in sixty short months. No one has been in mobile very long- old timers can claim ten years, most likely five is when the early scouts hit the beach. Apple was just about to launch the iPhone and end the carrier’s dominance of the “deck”. Premium publishers that took down minimum guarantees were not getting repeat business. Android didn’t exist. There were no apps, and no tablets either. No one knew the difference between online ad-tech and mobile, and how soon they might converge. Wow, that world was simple! It’s now Flintstones vs. Jetsons!

First thing we did, of course, was to name the damn thing. It may sound like a whim, but we actually worked hard to craft a name that had meaning- at least to us three. MoJiva was a mash up of jivan, which is a Hindi god (we favored the elephant Ganesh) and Mo for mobile of course. The good thing about crazy names is they are always available at register.com. And everyone has remembered us since.

We gave Krish $300k and 3 months to build the mOcean platform (he’s had a bit more budget lately!). In light of what developed, that amount just seems ridiculous. But that’s how it went down, and build it he did. We served 3M ads a day by month 3, and we felt like we were on fire. Three months later, we raised Series A from a strategic VC and hired a rock star CEO. Dan got going on Biz dev, and we went on a run. I can’t even begin to list the milestones along the way: often it seemed like we were on a runaway train, fixing the front wheels even as we were shoveling coal, painting the cabins and losing luggage out the caboose. Such is the world of start ups and technology. It takes a strong stomach and a keen eye for the rewards at the end.

And I remember what she said to me
How she swore that it never would end
I remember how she held me oh so tight
Wish I didn’t know now what I didn’t know then

Against the wind
We were runnin’ against the wind
We were young and strong, we were runnin’ against the wind

Amazing what you can accomplish when you don’t know any better. Everything we did was against the odds, let alone the wind. And now its five years on and we just completed another monster milestone year. We are now part of one of the best teams in Mobile ad-tech, over 100 strong. We’ve booked 100% growth for four straight years, and we now serve over 1,000,000,000 ads a day. Yes, that’s a billion ads a day. I had to write that out. In the December rush, we were serving 35,000 ads per second in virtually every country in the world.

But what makes me most proud is the team that we have built and what THEY have accomplished, sometimes by adding people, sometimes by subtracting. From day one, folks walk into our office and universally say Wow! This place is cool- I’d love to work here. Yeah, it’s packed now and someone needs to do the dishes. But we have a wonderful HR effort that backs it up with training, 401k, healthy Mojiva, Core values we live by, peer awards, leave bonuses, flex time, A Player recruiting… and a very open environment where every suggestion to make it better is heard (ok, not all are actionable), and we truly believe in the value of their equity, cause we all own it.

It’s flattering and humbling to consider this came from our DNA, and that vision we cobbled together 5 years ago is still going strong today. There’s more to the song of course, and there’s more to the story to be told. But I want to stop here and tip my hat to my two co-founders and say wow: we helped build that!

Nice job guys!

Gate is actually the basis of the Vaux Logo

Despite focusing most of my writing efforts on my blog, and keeping up with the world via my twitter the year-end letter to Vaux angels is a tradition well worth continuing. I’ve cribbed the best of it here…

 Discover. Develop. Deliver.

These three words are scrawled across everything I do for Vaux. They are three parts of my personal mission to success as entrepreneur and angel investor, which I had the honor of mapping out in a 2012 white paper for the Family Office Association  “Angel Investing for the Family Office” . I took a hard look at the process of building a foundation on the long journey from inception to exit, and nowadays I plan my week based on these categories. I color code each meeting in my outlook. They might as well be scrawled on my bathroom mirror in lipstick. They are the cycle of life for Vaux les Ventures and the angels that have supported these endeavors for nearly 10 years. Here’s what these simple words mean to me:

Discover is about being very focused on what you can do well, and what markets will have an impact that can generate angel returns. Big market trends that people don’t yet see, or are unwilling to accept. Trends that will obviously converge, but no one knows exactly when. It means being early and brave, but it also means being patient to find the right mix that can sustain the long march. This is where the DNA of the business is set: habits formed early are virtually impossible to break. Many people in the business call this “deal flow”, and I did too for a while but I soured on the term as too many IB ‘s and VC’s (both of which I have been) over-use it. Having a well know criteria for how to invest and who to invest with seems to do very well in attracting the right types of people. So does being a good guy. But it’s about discovery as much as it is about network. And that discovery includes markets and their real problems as well as solutions and the best team to build them.

A recent example of this would be my work on WellAware, the mobile health solution. I’m as committed as ever to the trend of mobile devices having profound affect on health and wellness. And I truly believe that very simple data can have tremendous impact on lives. The Wellaware team did a tremendous job developing the platform for this theory to play out, but certainly overshot the MVP standard. What we need in 2013 is more cycles with large user bases to refine our solution, likely in the mobile environment.

Develop is where the entrepreneur (in anyone!) takes over: translating a vision for a product solution into a product itself, and testing it with users to see if the darn thing works. It takes tremendous amounts of courage, persistence and luck. Some attempts are ridiculously off the mark. Ironically, more often there are overshots than undershots when going for the minimally viable product. And users are rarely the viral dream everyone hopes for- more like a block-by-block struggle to get to a vantage point where people notice you. But more than product and users, the team is the big part of the develop picture. Entrepreneurs have a passion for building things are not always Schwartkoffs when it comes to leading people. And that is where the coaching and mentoring foundation is laid. Capital begins to show up at this point, as we have baked enough of the risk out of the opportunity for larger sources of capital to begin to show interest. That too is a major challenge in this phase, and if you grow fast enough, it never ends.

[Major edits here from the angel letter. Sorry, that's not public.]

The poster child for the develop phase is certainly TrustCloud, which just 9 months ago had product solution in search of a problem, no user base, and a team that had already endured a few pivots. Such are the risks of being early! But the saving grace was each of the founders used the sharing economy and saw what it could deliver, as well as its limitations. Something had to give, we thought.

And 2012 was full of such breaks, as TrustCloud found its core team, delivered a product and began building users at an impressive clip  (10x from July to December) after the Wall Street Journal picked us up. Check out the product here, or the very impressive Facebook TrustCloud user group (which tracks bugs and promotes the product passionately). The Company rolls into the New Year with a new Peer Protect insurance product to couple with it’s ever growing number of sharing networks.  Kudos to the indefatigable and imminently coachable CEO Xin Chung, who details the year here:

 I shared keys to my NYC apartment on Airbnb, rides through San Francisco in a Sidecar, and my workload with TaskRabbits. I’m not alone– people worldwide are sharing more than ever with millions of room-nights booked, cars rented, and dogs walked by reputable strangers. The movement is called The Sharing Economy, Collaborative Consumption, or as Mary Meeker calls it, living Asset Light. (this is a great read! Don’t miss it!)

 Flush with VC funding, the movement scaled fast in 2012– but not without growing pains: A quick look at recent sharing history would give anyone pause before sharing with a stranger. Home sharing market leader Airbnb had a redux of its 2011 EJ incident with the so-called airbed & brothel snafu where a Swedish apartment was literally pimped-out. Carsharing had it’s own collisions with the luxury carsharing service HiGear shutting down due to thefts, car sharer RelayRides’ liability issues with a fatality crash, and regulatory fines for on-demand ride-sharers.

 These events highlighted that trust between strangers in peer-to-peer marketplaces must keep pace with their own rapid growth. In the offline world, hotels have long adopted star ratings, rental cars are licensed and insured by brands spend billions to give consumers confidence to buy. Since online, peer to-peer marketplaces powered by micro-entrepreneurs don’t have time to brand themselves or vet strangers, they are much less efficient as buyers and sellers waste time sizing each other up, figuring out a schedule and even haggling over price before committing. Trust can make these transactions much faster, and insuring the risk is something we look forward to. Read more at TrustCloud’s Blog.

Deliver is where all the hard work pays off. That would seem like a triumphant moment, and I’ll allow myself a few. But as I have matured it has become a little more bittersweet. Here are companies we have built from scratch, communities that started with a handful of people, angel capital that came in for under $1M pre money. And despite some intermittent liquidity opportunities, in some cases these companies have futures that remain bright(er). We have seen large that we turned down; we may see 2x-3x-4x from here (or of course, we may not). So parting with some or all of the ownership isn’t as easy as “see ya later”. It’s an asset, with a value that has to be managed detachment that is at arms’ length, hard as that may be. We also live in a world of high risk, so those precious few windows of liquidity opportunity have to be considered when they are open.

[More major edits here from the angel letter. Sorry, that's not public.]

In summary, I guess I feel every venture I have been involved with has contributed to the next. Things I have learned about the Discover phase have allowed for better Develop results. Those few short peeks at liquidity in Deliver have been viewed with a paradigm that allows the whole group to consider individualized risk and reward before deciding on liquidity. And of course, the success through the process has allowed us the opportunity to feed the beast, return to what we do best, and further diversify with another opportunity.

I am extremely grateful for the opportunity to work in the field that I do, side by side with talented entrepreneurs, backed by caring and value adding angels that ask good questions and have the patience to help realize the vision I had almost ten years ago. We’ll see great opportunities in each of the three key Phases in 2013. Drop me a line and we’ll discuss which ones best fit your criteria in the days ahead.

All my best in the New Year,

The Social Network is a hell of a movie, but the real people upon whom the characters were based have stated that the film’s version of the founding and growth of Facebook was overly dramatized. And appeared way more fun than it actually was.

Face it, entrepreneurship is hard. Angel investing is doubly hard. While we read about spectacular successes, one can hardly keep up with the many outright failures preceding them. The thin veil  can really only be perceived once you are on the right side of it-it’s practically see through! But if you are on the wrong side, the thin veil might as well be a brick wall.

Someone once said the two best traits an angel investor can possess are a strong stomach and a sense of humor. The strong stomach will tolerate its share of quick deaths from being too early, too late, poor execution or leadership, lack of funds, or just tons of competition. The sense of humor will come into play when you attempt to tell your God which element of your portfolio is going to be The Big One. God will invariably laugh and throw at least one thunderbolt, wreaking havoc with your “sure thing” — but turning your also-ran into a winner. (No kidding, it’s happened. But to protect the innocent, we won’t name those we feel were luckier than they were skilled.)

Other sources of angel heartburn include those frustrating periods of illiquidity…the fast pace of technology which upends business models and proprietary positions quicker than at any time in history… the global markets bringing competition to one’s door on a massive scale… the high valuations of exposed deals,…the lack of influence when part of a syndicate…the competition with other angels (and now, VC’s). The list goes on.

The angel game can be summed up in the words of the “advert” placed by explorer Ernest Shackleton (1874-1922) ahead of his Antarctic expeditions (none of them successful, by the way):

“MEN WANTED FOR HAZARDOUS JOURNEY.

SMALL WAGES, BITTER COLD, LONG MONTHS OF COMPLETE DARKNESS.

CONSTANT DANGER, SAFE RETURN DOUBTFUL.

HONOR AND RECOGNITION IN CASE OF SUCCESS.”

And yet, we do it.

EO: Great Group of Entrepreneurs

This excerpt is serialized from a whitepaper titled Angel Investing for Single Family Offices (SFO’s) by The Family Office Association and Vaux les Ventures. For a complete copy, visit the FOA website. 

Any SFO considering allocating a portion of their assets in venture toward angel investing has to acknowledge the significant risks in the market. One sobering take from the US Small Business Association is that roughly 80% of small businesses fail in the first year, 10% in the second and 5% in the third, leaving a paltry 5% of new ventures that even qualifies to deliver a return for investors. I am a member of EO (logo at left), a global organization with 8,000+ members that fosters entrepreneurs, and the odds are just slightly better there I think.

Sticking with the digital media businesses discussed in the last section, here’s a brief summary of the early stage venture risks associated with this sector:

Operational Risks are legion in startups. First out of the gate is execution on the development of the product. Many products and services simply fail to launch, whether due to poor specs, loose design
concepts, or from just plain misjudging a market need. Another common problem is never solving the cold start challenge and acquiring users. Assembling talent, accessing sufficient capital, maintaining differentiating advantages over competitors, and a go-to-market strategy are a few more risks to consider.

Timing Risk — also referred to as Luck. Often, an entrepreneur’s vision has merit, but market conditions have not yet gelled to support it. Frequently, capital is wasted on development and/or marketing in
anticipation of a developing market. When the tide doesn’t rise in time, the company is left high and dry. One example? The many mobile/ social networks that tried to deliver hyper-local advertising audience and failed. In the meantime, Gowalla and FourSquare entered the market just as mobile and social converged, and were propelled to higher and higher market caps. Likewise, any mobile/social solution launched now with similar attributes would be too late and face heated competition.

Funding Risk can be mitigated by an SFO in the early stages of the company, but in our digital media example, additional capital will be needed — or at least easy to acquire –in order to scale the business. A good example of funding risk affecting returns would be the inability for mobile ad networks/ platforms to raise capital before mobile was “proven” viable (see AdMob’s sale to Google and Quattro’s sale to Apple within a 6 week period). Before those landmark deals, funding sources constantly questioned whether there was a “real” market in mobile, citing the struggling networks who hadn’t succeeded, despite $250,000,000 of combined capital. Several early stage companies faltered for lack of capital, and several other investors suffered dilution from large downdrafts in valuations. An SFO can, of course, prolong the agony by continuing to fund (Fred Wilson’s famous quote here is “I have a 0% mortality rate- I just keep funding!”) but the effect on returns when others do NOT fund, or fund at lower prices, is undeniable.

So, if you are considering angel investing with your SFO be sure to match the risks with the rewards. There are more of the former than the latter!

 For a complete copy of the complete paper, visit the FOA website. 

Look ahead! Everything is mobile (M.Mitchell)

Don Draper and the Mad Men gang from Sterling Cooper return Sunday on AMC’s four-time Emmy Award winner, after a seemingly interminable 17 months away.

But a lot has changed in the 17 month hiatus. Not with the sixties, in which the show is set, but the ‘teens in which it is viewed. The Mad Men of the show were trying to grapple with the new medium of TV, which was a big departure from how people were spending time, and how advertisers spent money. They had a raw take on manliness, and a pretty much anti-PC bent to everything that transpired. I’ve written about it before (relating to another Vaux investment). They also wear pocket squares.

But in the here and now, the M’ad Men are on the scene (that’s Mobile ad men, and I’m among them) and there is another mass transformation in process.

Let me try to explain it this way: there is a scene in an early episode where John Hamm’s character driving upstate, listening to the radio (speeding, with a drink and no seat belt but that’s considered period charming). He hears a traffic report (backup on the bridge), and dismisses the information (ending up in a caught in the same). It was just the beginning of how ad-supported media would become capable of delivering information that is both timely and relevant, if not always used.

Today, a larger and larger audience will hear of Don Draper and Mad Men, watch his show, and comment on his show through mobile devices. It is the harbinger of the greatest transfer of time spent since the TV entered Don’s creative agency: out of no-where, people are now spending 10% of their total screen time on a mobile device. People are starting revolutions, looking up recipes, avoiding disasters, and of course watching MadMen videos on mobile devices. It’s going to get a lot bigger, at the expense of most other media out there. There are a few billion mobile devices in the world today, and it’s still growing.

I believe it will set off the greatest traffic jam of all time, in a digital media sense, anyways. Heres how it happened, in grossly oversimplified terms only I could dare to paint!

The publishers may have figured this out first. Companies like Time Inc, ABC, NBC Universal saw their audiences begin to shift. As their inventory of available pages evolved (aka circulation, or eyeballs in digital media speak), their mobile strategies got serious. They monetized through ad networks (see below), then other point solutions (see below also), some even tried to get online ad-networks to work in this new medium. Finally, they concluded that they needed a platform to run and maximize the yield on their entire mobile inventory. Lucky for them, there was one that served their needs.

The Early Mobile ad Networks were the first prospectors in this brave new worked of mobile, and they did well, stringing together exchanges of advertisers and publishers and taking a cut for matching them up. Though a hard business to differentiate in, the early winners were great exits. Enpocket to Nokia for a couple hundred. Third Screen to AOL for a little under fifty. Quattro to Apple for almost three hundred. Admob to Google for over seven. There are several more.

But a funny thing happened in almost all of those acquisitions: I truly believe the buyers really thought they were getting a technology platform that they could scale across their larger organizations, so they paid up. We’re talking billions of dollars in the hopes there was some tech under there somewhere that could give them a commanding lead in mobile.  But when I look at what those buyers are doing with the assets, I have to conclude they all didn’t get that. Not even the recent S-1 filings are all that impressive when it comes to ad tech. Facebook even acknowledged it as a risk- 122 times in their filing.

The point solutions came next into the market, trying to get attention (from anyone!) with their latest idea that would revolutionize mobile. Mobile Thumbprint (the equivalent of an internet cookie), video, full screen takeovers, SDK’s, app networks, real-time bidding and every other feature and business process under the sun has launched, and maybe saw Series A funding. Some were just too early. Most of them tried to give away the farm to get clients, and the VC money won’t last long with that model. Many are starting to top out, and will soon realize they have to bolt onto an enterprise with scale and relationships. It’s not going to be a pretty story as they get caught in the rush.

The Social Networks and social gamers have grown large and influential, but they too are noticing a problem- their audience is spending more and more time on mobile. Facebook is a game changer of epic proportions (here’s my take on a portion of that story) and they have massive advertising revenue from their online sites, but most of the leaders in the field have not figured out how to monetize mobile. If the trends continue (doubtless they will), they will be lined up at the mobile bridge in no time.

The Online ad networks may be themselves facing a rude surprise soon enough as more of their audience bolts to mobile. Online ad servers didn’t translate to mobile for a few very simple reasons, none of which I am about to give up here. But it doesn’t work, or it hasn’t until now and the bigs have been losing customers left and right because they could not get some basic mobile parameters to work. They need a bridge to mobile, and they will need it soon. Tailoring the existing online platforms hasn’t worked. They will need a bridge.

And so, the traffic jam begins to form at the bridge to mobile ad serving. Hundreds of online ad networks have to deliver on a mobile solution, but theirs have not worked to date. The remaining large publishers, and indeed the mediums and the smalls will have to finalize a sophisticated mobile strategy in order to compete as well. The point solutions who have entered the market will have to seek out scale. And they look across that yawning chasm to those that have made the move to mobile and are beginning to ramp (some thirty mobile ad networks, and about thirty of the largest publishers by my count) and they are thinking oh shit, if this trend continues I’m gonna get killed on this side of the divide.

It looks to me like there is only one bridge, and people are going to want to cross it sooner than later. Even a one-hand driving, seatbelt-scoffing, scotch-in-hand Don Draper would see that signpost up ahead.

Note: I founded, with Krish and Dan, and financed Mojiva, owner of the Mocean Mobile Ad Serving Platform. That is the bridge, IMHO.