About Me 0003: January 2011

Monday, January 24, 2011

Making Money Without

Editor’s note: The following guest post is written by Phil Libin, CEO of Evernote, which is currently the No. 5 app in the Mac App Store. It also didn’t hurt that the app has been prominently featured by Apple.

We just finished our first week on the Mac App Store and it might have been the most important week in Evernote’s history. Here’s how it went and what we learned:

1. Meritocracy is sweet

I remember one of the first computer articles that I ever read (maybe it was in Byte Magazine in the early 80s while I was in junior high). It had a little survey aimed at my fellow nerds. “Do you buy software for your computer?”, was the first question. The choices were, “A) Yes, frequently. B) Yes, sometimes. and C) Rarely, I prefer to write my own.” The fact that C was a viable choice pretty much sums up the early euphoria of the consumer software industry. You just had to make something great and the rest would follow. That was a long time ago.

The following twenty or thirty years brought us monopolies and barriers to entry and this happy state of affairs became a dim memory. Then came the mobile app explosion.

Over the past year, about 70% of Evernote’s new users came from mobile app stores, mostly iOS and Android. This led us to the understandable conclusion that mobile was the crucial thing that made a platform attractive to independent developers. Last week made us realize that the reality is a little bit more nuanced. It isn’t mobile that’s overwhelmingly important, it’s the app store. Until a week ago, all the good app stores just happened to be on mobile devices, but someone with a shiny new Macbook is just as eager to get the best apps as someone with a shiny new iPhone.

A platform without a well-formed app store presents a huge challenge to developers. To succeed on such a platform, the developer has to spend as much time and money on channels, logistics, partnerships and advertising as on actually making a great product. Once an app store takes hold, the software market on a platform starts moving towards a meritocracy. This is imperfect, of course, but focusing on building a great product is the best strategy for succeeding on an app store. This is a huge boon for software nerds of all types, and has resulted in the explosion of mobile apps and services in the past two years. It’s about time that desktops joined the party.

2. Desktop software is viable again

It took a few weeks of non-trivial effort to get our existing Mac application ready for the app store. There’s never a convenient time to take a few weeks out of a busy development schedule, and December is as inconvenient as it gets, but Apple’s developer relations folks were helpful and the approval process itself worked reasonably well once we’d worked out the kinks.

The results speak for themselves. About 320,000 people downloaded Evernote in the first week of the Mac App Store. Of this number, about 120,000 had never used Evernote before, and created new accounts. This represents more than 50% of all the new Evernote accounts created last week. The Mac platform—which used to be in fourth place for new user registrations behind iOS, Android and Windows—has now jumped to first.

It’s obvious in hindsight, but the presence of a well-formed app store is the single most important factor for the viability of a platform for third party developers. If you want to take this a step further and say that a robust third-party software market is the most important factor for the success of the platform overall, well…

I hope Windows gets a good app store soon.

3. Multi-platform users are the best kind

Not only is the Mac App Store getting us new users, it’s making our existing users more valuable. Neat, but how?

So 320,000 people downloaded Evernote in the first week and 120,000 of them became new users. What happened to the rest? Well, about 80,000 people were either switching their Mac client from our direct-download version to the app store version or had simply downloaded the app and didn’t complete registration. Another 100,000 people were existing users who had previously used Evernote from other platforms (mostly the iPhone) and added the Mac version for the first time.

This is both interesting and important. Interesting because the vast majority of these people must have (1) already had Macs, and (2) known about our Mac version from previous interactions with Evernote but hadn’t bothered to install it until the Mac App Store appeared. Important because people who use Evernote from multiple devices are much more likely to stick around and to eventually pay for the premium version. This makes intuitive sense and the data is clear: in a Freemium model, people choose to pay for what they love and the more devices they use Evernote from, the more likely they are to fall in love with it.

The Mac App Store effect works the other way as well: many of the new users who first found us on the Mac App Store went on to also download Evernote on their mobile devices. Our iTunes downloads for iOS devices were up by 54% during the same week that the Mac App Store came out and that’s without any new versions or noticeable change in iOS app visibility.

4. A strike against lowest common denominator

If Evernote’s desktop clients were written in Adobe AIR, I’d be worried right now. The immediate popularity of the Mac App Store, and the iPhone App Store before it, reinforces my belief that in a world of infinite software choice, people gravitate towards the products with the best overall user experience. It’s very hard for something developed in a cross-platform, lowest-common-denominator technology to provide as nice an experience as a similar native app.

As the CEO of a software company, I wish this weren’t true. I’d love to build one version of our App that could work everywhere. Instead, we develop separate native versions for Windows, Mac, Desktop Web, iOS, Android, BlackBerry, HP WebOS and (coming soon) Windows Phone 7. We do it because the results are better and, frankly, that’s all-important. We could probably save 70% of our development budget by switching to a single, cross-platform client, but we would probably lose 80% of our users. And we’d be shut out of most app stores and go back to worrying about distribution.

Does this mean that web apps are doomed? Not at all, but the most successful web apps will be the ones that emphasize unique benefits—sharing, communications, integrations—that are better implemented on the web than in native code. This is the main design goal for the next version of the Evernote web client, by the way.

Lost among all the gloomy economic news of the past few years is the fact that there’s never been a better time to be in software. Sure, the emergence and inevitable dominance of app stores will permanently disrupt existing industry practices—I’m glad we’re not in the business of preventing people from making copies of bits, shipping shrink-wrapped boxes or charging people for periodic upgrades—but a company like Evernote simply could not have attained a fraction of our current momentum even three years ago. App stores, cloud services, cross-platform users and Freemium economics made it all possible. The download numbers are certain to decline a bit as the excitement of the first week finds a sustainable steady-state, but the launch of the Mac App Store will have a major, and permanent, positive impact on developers.

It was worth the wait.

Beer Money. The team of Robert Roode and James Storm have been tagging together since 2008, and are currently enjoying their fourth reign as TNA World Tag Team Champions.

Each man came from a successful tag team to form perhaps the best tag team that TNA has ever seen. But where do they rank among the best of all time?

Despite fans’ many criticisms of TNA, including my own, it appears that historically the company does seem to care more about its tag team division than WWE does.

Roode’s former faction Team Canada, Storm’s former team America’s Most Wanted, along with Team 3D, LAX, The Voodoo Kin Mafia, The British Invasion, Generation Me, and The Motor City Machine Guns, have all vied for TNA tag team gold in recent years.

The division has thrived since the beginning of the company, and has been featured on TV and pay per view.

Then there’s WWE.

We all know that the current state of tag team wrestling in WWE is virtually non existent, with the championships currently held by Santino Marella and Vladimir Kozlov.

Bound together by necessity, which is a polite way of saying that WWE creative didn’t really have anything for either guy to do, Marella and Kozlov have actually looked pretty good since winning the straps.

Now, everyone calm down, I didn’t say they were The Road Warriors or anything.

But, for the WWE, we can’t really hope for much more than the tired old formula of two mix-matched guys thrown together for the sake of a lousy, half-hearted push. When it comes to their tag team division, it’s par for the course.

My, how things have changed in this business.

Once upon a time, the National Wrestling Alliance not only featured the greatest singles wrestlers in the sport, its tag team division was second to none with The Rock n Roll Express, The Road Warriors, The Russians, The Midnight Express, The Minnesota Wrecking Crew.

These guys perfected the art of tag team wrestling, and gave Ric Flair, Dusty Rhodes, and Ricky Steamboat a run for their money when it came to the best match on the card.

Man, where’s the Wayback Machine when you need it?

Of course, WWE hasn’t always neglected its tag team division.

Arguably the greatest era for tag team wrestling in WWE was 2000 to 2001. Three teams came together for a tag team war the likes of which had not been seen since the 1980’s NWA. Three teams redefined tag team wrestling in the business with three little words: tables, ladders, and chairs.

Edge and Christian. The Hardy Boyz. The Dudley Boyz. Three of the best tag teams of all time, blowing the roof off of arenas all over the country every week, each team pushing the other, bringing out the best in every man involved.

This was, without a doubt, a tag team renaissance, a great time for fans who yearned for a revival of the division.

These guys all understood their roles in the company, and fought to carve their names into wrestling history, next to the greatest teams ever. They also wanted to steal the show, and give fans something to remember.

Mission accomplished on both counts.

But with the focus shifted away from tag team wrestling in WWE, and TNA looking to grow as a company, the art of tag team wrestling now has a new pair of Rembrandts. Beer Money.

Yes, that was impossible to say without a smile.

The truth is, Beer Money works on a couple of different levels. One, because of Roode, who brings an intensity and ice-cold determination to his character and approach as a heel. Two, because of James Storm, because he’s funny as hell.

I love this guy. He is a riot, and every time he opens his mouth, or for that matter, just smiles at someone, it’s comedy gold. He makes the team, gives them a bad-boy edge that would make Jake Roberts jealous.

James Storm’s gimmick works so well because it’s so normal. He’s just a guy with a cowboy hat and dark glasses with a beer in his hand.

He looks less like a wrestler and more like the lead singer in a Lynyrd Skynyrd cover band. He plays the part so well, and is more comfortable in his gimmick than perhaps anyone in the promotion.

For me, Storm would be a star in either company, on any level.

Fortunately for fans, right now he is one half of TNA’s biggest tag team, Beer Money. I have to say, I thoroughly enjoy this team and their work in the ring.

Aside from Storm’s comedy, the guy can work, and he is a great fit with Roode. Beer Money, in a lot of ways, is a throwback to the classic heel teams of the NWA.

They have the tough streak of The Minnesota Wrecking Crew, the finesse of The Midnight Express, and the swagger of Arn Anderson and Tully Blanchard.

And much like these three teams had memorable feuds with The Rock n Roll Express, Beer Money has had a momentous run against The Motor City Machine Guns.

The pace and tempo of the Guns, matched up against the fierce ground and pound of Beer Money, have made for some great moments in TNA. Both teams are working hard to own the night, every time they set foot in the ring.

That’s what tag team wrestling is all about, and I for one am glad to see it happening again. The only question I have is, how long will Beer Money stay together, before TNA creative, such as it is, decides to split them up?

It would be a shame if their run as one of the best teams in the company lasts only three years. Beer Money deserves to have a legacy, an opportunity to be considered among the all-time greats. But perhaps that is not meant to happen in TNA?

Considering that WWE gave up on its tag team division years ago, the chances of seeing Storm and Roode work for Vince appear to be slim to none.

But, if given a chance, I have to believe that not only would Beer Money make the best of it, they would do what they continue to do every week in TNA: steal the show.

It’s an interesting bit of speculation, when it comes to debating Beer Money’s place in tag team history. Perhaps it’s too soon for that. Perhaps as Storm and Roode continue to build their reputation week in and week out, we should just sit back and enjoy the ride.

Let the renaissance begin…again.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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DETROIT -- Four Detroit police officers, including a commander, were shot Sunday afternoon inside a station in the department's Northwest District. Monday, January 24, 2011.

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Tuesday, January 18, 2011

Making Money Internet

California’s SB 1411, which adds a layer of criminal and civil penalties for certain online impersonations, goes into effect starting today. The consequences include a fine of up to $1,000, and/ or up to a year in jail. So don’t go and do something crazy like impersonate Google CEO Eric Schmidt on Facebook. There may be consequences.

The full text and a summary of the bill are below. There’s a good overview and analysis of it as well, on ZDNet. The state has created a new crime, and a new section is being added to the penal code.

There has to be intent to harm, intimidate, threaten, or defraud another person – not necessarily the person you are impersonating. Free speech issues, including satire and parody, aren’t addressed in the text of the bill. The courts will likely sort it out. Hopefully without my direct participation.

SB 1411, Simitian. Impersonation: Internet.

Existing law makes it a crime to falsely impersonate another in

either his or her private or official capacity, as specified.

Existing law also makes it a crime to knowingly access and, without

permission, alter, damage, delete, destroy, or otherwise use any

data, computer, computer system, or computer network in order to

devise or execute any scheme or artifice to defraud, deceive, or

extort, or wrongfully control or obtain money, property, or data. For

a violation thereof, in addition to specified criminal penalties,

existing law authorizes an aggrieved party to bring a civil action

against the violator, as specified.

This bill would provide that any person who knowingly and without

consent credibly impersonates another actual person through or on an

Internet Web site or by other electronic means, as specified, for

purposes of harming, intimidating, threatening, or defrauding another

person is guilty of a misdemeanor. The bill would, in addition to

the specified criminal penalties, authorize a person who suffers

damage or loss to bring a civil action against any person who

violates that provision, as specified. Because the bill would create

a new crime, the bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local

agencies and school districts for certain costs mandated by the

state. Statutory provisions establish procedures for making that

reimbursement.

This bill would provide that no reimbursement is required by this

act for a specified reason.

THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

SECTION 1. Section 528.5 is added to the Penal Code, to read:

528.5. (a) Notwithstanding any other provision of law, any person

who knowingly and without consent credibly impersonates another

actual person through or on an Internet Web site or by other

electronic means for purposes of harming, intimidating, threatening,

or defrauding another person is guilty of a public offense punishable

pursuant to subdivision (d).

(b) For purposes of this section, an impersonation is credible if

another person would reasonably believe, or did reasonably believe,

that the defendant was or is the person who was impersonated.

(c) For purposes of this section, “electronic means” shall include

opening an e-mail account or an account or profile on a social

networking Internet Web site in another person’s name.

(d) A violation of subdivision (a) is punishable by a fine not

exceeding one thousand dollars ($1,000), or by imprisonment in a

county jail not exceeding one year, or by both that fine and

imprisonment.

(e) In addition to any other civil remedy available, a person who

suffers damage or loss by reason of a violation of subdivision (a)

may bring a civil action against the violator for compensatory

damages and injunctive relief or other equitable relief pursuant to

paragraphs (1), (2), (4), and (5) of subdivision (e) and subdivision

(g) of Section 502.

(f) This section shall not preclude prosecution under any other

law.

SEC. 2. No reimbursement is required by this act pursuant to

Section 6 of Article XIII B of the California Constitution because

the only costs that may be incurred by a local agency or school

district will be incurred because this act creates a new crime or

infraction, eliminates a crime or infraction, or changes the penalty

for a crime or infraction, within the meaning of Section 17556 of the

Government Code, or changes the definition of a crime within the

meaning of Section 6 of Article XIII B of the California

Constitution.

Source:http://removeripoffreports.net/

Movie News Quick Hits: First 'Spider-Man' Action Shots and More ...

Darth Vader's other son from another mother [via GeekTyrant]-- A simple post on the official Tumblr for Rian Johnson's time travel movie 'Looper'

Soap News: 'AMC's' Debbi Morgan Has Lyme Disease and More

A few weeks ago we reported that 'All My Children's' award-winning actress Debbi Morgan would be taking some time off from the soap. This week.

Small Business News: Social Entrepreneurship on the Rise

In recognition of Martin Luther King Day, we present a roundup about an important new trend, the rise of social entrepreneurship. Instead of profit, the.

Friday, January 14, 2011

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The situation is a bit different if what is in dispute is a house. Obviously, the house cannot usually just be sold to repay a Legal Aid bill (it may be home to children) so what happens therefore is that the board will attach what is known as a "Statutory Charge" to the house in respect of monies owing. This means that when the house is sold or re-mortgaged then the Board will get their money. It is not a free loan however. Interest attaches to the charge and continues to accrue. It is rare for the board to agree to postpone their charge in the event that the house is eventually sold or is perhaps re mortgaged in the interim but they will consider it. As I stated earlier, there is no "free lunch".

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Talk with your local branch banks. Credit unions are another great route to take and you should explore membership with a credit union to have more options open to you. The small, local branches are often more inclined to work with someone who has credit challenges. There is something special about the small-town effect when it comes to your relationship with the bankers.

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Harvard Undergrads Launch Newsle To Find News About Your Friends ...

Social news has many flavors. Twitter and Facebook function as social news feeds with your friends pushing out stories they find interesting. But what about news about your friends or other people you care about? Two Harvard sophomores ...

No, your zodiac sign hasn't changed – This Just In - CNN.com Blogs

Tattoo parlor owners must be salivating. An assertion in a Minneapolis Star Tribune article that our understanding of the zodiac is off by about a month -- and that therefore people have been identifying themselves with the wrong sign ...

Terrific ABC News story: “Raging Waters In Australia and Brazil ...

That's from an ABC News story posted last night, whose headline and subhed I repeated above. The actual ABC evening news story from Thursday is one of the best climate change stories ever to appear on a major network's evening news show ...

Thursday, January 13, 2011

Making Money With a Website

Twitter Chairman and Square founder Jack Dorsey sat down with Charlie Rose last night to talk about Dorsey’s unique position of being responsible for two technology startups based on the idea of simplicity: Twitter and Square. Watching this interview you realize that Dorsey’s accomplishments have little to do with luck, and more with his focus on creating the purest products by throwing away any unnecessary flourishes. “It’s really complex to make something simple,” he tells Rose.

Dorsey describes himself as an “editor” who edits technology and teams “so that we have one cohesive product that we tell the world.” In the clip above (provided by the Charlie Rose Show), Dorsey talks about how he got the idea for Square and how hard it is to make mobile payments no more complicated than swiping a credit card.

Dorsey believes the most powerful technologies are those which disappear, like the iPad disappears:

“When you’re using the iPad, the iPad disappears, it goes away. You’re reading a book. You’re viewing a website, you’re touching a web site. That’s amazing and that’s what SMS is for me. The technology goes away and with Twitter the technology goes away. And the same is true with Square. We want the technology to fade away so that you can focus on enjoying the cappuccino that you just purchased.”

In the clip below, he talks about how he got the idea for Twitter from his obsession with cities and dispatch systems, but how he felt those systems were missing one thing: the people, his friends. Now Twitter is not just about status updates but about pointing to, and carrying via short links, other media on the Web. He boils down the essence of Twitter into this: “Any media that you can imagine it can point to a carry in real-time. And the only other technology I know that’s done that well is the web itself.”

Dorsey also pegs the number of registered Twitter users at 200 million (when I checked with Twitter to confirm this number, I was told it was very close, but not quite there yet—so chalk that up to rounding). Also, asked at the end whether Twitter is making any money, Dorsey said the company has revenues but it didn’t sound like it’s got any profits yet.

You can watch the full interview here or read the full transcript below (courtesy of Charlie Rose).

TRANSCRIPT

CHARLIE ROSE: Jack Dorsey is here. He is the chairman of Twitter. Since its inception in 2006, the site has become a powerful tool of information and communication. Almost 200 million users worldwide tweet every day.

That has allowed Twitter to become a real-time news feed. It’s also reshaped how public figures from celebrities to politicians communicate. The company is now working hard to monetize its popularity. Dorsey started Twitter as a side project in 2006 with Evan Williams and Biz Stone.

His latest venture is called Square, which can turn your mobile phone into a credit card reader. Pleased to have Jack Dorsey at this table for the first time. Welcome.

JACK DORSEY: Thanks for having me, Charlie.

CHARLIE ROSE: Good to have you here.

Let’s just talk about Square and go back to Twitter. How did that come about?

JACK DORSEY: It came about because my cofounder is a glass artist and he sells these beautiful glass faucets and he was selling one for $2,000. And all he had in his pocket was his mobile phone. He couldn’t accept the credit card from the woman who wanted to buy this faucet and she didn’t have a checkbook and she obviously didn’t have $2,000 of cash, so he lost the sale.

And we were discussing this and we have these general purpose computers next to our ears and yet –

CHARLIE ROSE: The iPhone-4.

JACK DORSEY: Or an Android phone, or a blackberry, whatnot. But yet he wasn’t able to accept that credit card. So we wondered why that was, and we answered it by building this system.

CHARLIE ROSE: You write code, yes?

JACK DORSEY: Yes. I wrote code.

CHARLIE ROSE: And that’s what you do well?

JACK DORSEY: Yes.

CHARLIE ROSE: That’s what you’ve been recognized for since you were 14 or 15 years old.

JACK DORSEY: Yes.

CHARLIE ROSE: So you immediately set out to do what?

JACK DORSEY: My goal is to simplify complexity. I just want to build stuff that really simplifies our base human interaction. Twitter was around communication and visualizing what was happening in the world in real-time. Square was allowing everyone to accept the form of payment people have in their pocket today, which is a credit card.

So we have built the simplest way to accept credit cards. It’s a little tiny device that we give away for free, and you just download some so wars from the app store and plug it in to your mobile phone or iPad and suddenly you can take credit cards. So if you’re a tax accountant or a lawyer or doctor or even a hair stylist, you can now accept credit cards.

CHARLIE ROSE: And you monetize this how?

JACK DORSEY: We take a cut of every transaction. So we charge 2.75 percent and 15 cents on the transaction. which we then pay the credit card companies out of. So the user only has to pay that 2.75 percent. They don’t pay any credit card fees. They don’t have to have a setup charged. They don’t have to pay for the hardware or even the software.

CHARLIE ROSE: Hardware’s free, software’s free.

JACK DORSEY: You just use the phone you have in your pocket.

CHARLIE ROSE: OK, so this sounds to me like a win-win for everybody. Small businesses like it . . .

JACK DORSEY: Yes, they love it.

CHARLIE ROSE: Somebody has a credit card and wants to pay with a credit card likes it.

JACK DORSEY: You can pay everywhere now.

CHARLIE ROSE: So you who created this with your partner like it. It seems so fundamental. Why hadn’t someone done that before?

JACK DORSEY: It turns out it’s really complex. It’s really complex to make something simple and especially when you started addressing the financial world.

We have a number of things — in order to accept credit cards you have to talk with a bank. Normally when you’re a small merchant or a business or individual you have to get a merchant account, which means you have a one to two year relationship with the bank, and then there’s always these fees and setup costs and monthly minimums. It’s a mess.

And it’s never really been designed in a beautiful way and that’s what we’re good at. That’s really hard to do.

CHARLIE ROSE: How do you minimize fraud, because that would be a concern?

JACK DORSEY: Right. So we actually have a lot of benefit in using the credit card system itself because a lot of the protections are on the payer side. When someone issues you a credit card, when your bank issues you a credit card, they assume that that card is going to be lost or stolen. So all of the protections are watching the payer.

So if we get a swipe or if we get a signature on those card payments then a lot of the risk is off us because we know the payer was in that location. And apart for that, there’s a lot of information in these phones. There’s GPS. We know where the transactions are taking place. People are putting in their Twitter accounts. They’re putting in their Facebook accounts. They’re telling us about themselves and we can use that to build a reputation for how they will interact in the world.

CHARLIE ROSE: Did I read that you were involved in some kind of lawsuit because of somebody else?

JACK DORSEY: We — so we worked on this system which actually was prior art. So we built this little credit card system with another individual who we worked very well within the past. But unfortunately we were not included on the patent we both created together. So it’s just a minor thing. We’re not independent on this IP, it’s just something nice to have.

CHARLIE ROSE: And this is the future of mobile payment, in your judgment?

JACK DORSEY: I think so. I think — the biggest thing we’re trying to address is let’s simplify this entire world. Let’s speak what people are using today. A number of people in the United States, almost everyone, is using plastic cards to pay for things, but it’s extremely difficult to accept these cards. So let’s make it’s easy and take more and more of the friction out as we can.

CHARLIE ROSE: And what’s the global response?

JACK DORSEY: The global response has been really good. You need to tailor these technologies to each market. So we’re starting on the U.S., but we want to be completely payment device agnostic. Different countries use different methods. So in Japan, for instance, they’re using a lot of near-field communications, obviously. In places like Kenya they’re using SMS, they’re using phone credits.

So all these markets have their own technologies to pay for things and exchange value, so we need to make sure that Square can accept every for of payment that is in the payers’ pocket. In the U.S. it’s the credit card.

CHARLIE ROSE: And how do you divide your time between Square and Twitter?

JACK DORSEY: I have a really fortunate situation. I’m now in the midst of I think two of the great et cetera companies in the world. I’m chairman of the board of Twitter so I go in when I’m needed, I point out what I think is moving, what technologies are interesting, things we may need to fix and things that we’re doing really well at. And when I’m not needed I get ou of the way.

CHARLIE ROSE: And how did Twitter get started?

JACK DORSEY: Twitter has a long story. I’ve always been fascinated by

cities and how they work. And I taught myself how to program so I can understand how the city works.

CHARLIE ROSE: You taught yourself to program so you could understand how cities work?

JACK DORSEY: I wanted to visualize them. I wanted to see them. I wanted to play with them. I was inspired by New York City and just — if you consider New York City, all these entities roams about the cities, taxicabs, ambulances, fire trucks. And they’re always reporting where they are and what they’re doing. And if you can visualize that you can see how the city is living and breathing and what’s happening in the city. So I started building dispatch software. And that’s the software that runs these entities, always reporting where they are and what they’re doing. I’m in an ambulance at Fifth and Broadway taking a patient in cardiac arrest to St. John’s Mercy, a very, very simple model.

In 2000 I realized that I had this beautiful picture of all these verticals in the city that make the city work but I was missing the citizens. I was missing the people. I was missing my friends. So what if I could just take my phone and — we didn’t have mobile phones that worked that well in 2000. I had a very simple Rim device which was the precursor to the blackberry. What if I could be anywhere and share what’s happening and I could get everything in real-time? What if we did that?

And it turns out it was just the wrong time. In 2006 SMS got really big in this country. I met my cofounders Biz Stone and Evan Williams who had worked with blogger to build blogger. So they understood the importance of self-publishing. And I just added this real-time aspect, this SMS aspect and we said what if with just SMS and the web I can go anywhere I want and report what I’m doing and see what everyone else is doing in real-time, a very, very simple start and users have taken it from there.

CHARLIE ROSE: Was there a conversation that took place to make you do that or did this take place in your head?

JACK DORSEY: We were — you know, we were working –

CHARLIE ROSE: Because it was Odeo what was the company?

JACK DORSEY: We were working at a company called Odeo, which was a podcasting company, and I joined as an engineer. And the interesting thing about Odeo was that no one in the company was really that excited about podcast. So we weren’t –

CHARLIE ROSE: So it was a business you didn’t care a lot about?

JACK DORSEY: Yes. I just wanted to work with Ev and Biz. I saw them from afar as my first real job, the first time I had to write a resume. I wanted to do more consumer facing stuff because I had always been back in the real-time transactional systems, and they presented that opportunity.

So I joined, I worked on this podcast, it wasn’t that interesting. And then iTunes came out with the podcast directive which kind of took Odeo’s business model and potential off the table. So we started trying to figure out what we’re going to do and how we make audio more social, how we have group communication.

And during this time SMS was coming and being used and the first time you could send a message from Cingular to Verizon and it was amazing. I fell in love with the technology and the rest of the company did as well. And one day Ev said “Go out, think of some things to do, come back, we’re going to present to the company.” And I took a group of two other people and we talked about this very simple idea of being able to report where I am and what I’m doing and go out in real-time over our phones and the web in 160 characters. And we were on the playground and we presented to the company.

It didn’t really go anywhere, but then a week later we talked about it more and we decided I would take two weeks and Biz Stone and my other programmer Florian, and we would build the system. And we built in the two weeks and we took more and more resources. And the first tweet that was actually written by a human was by me and it was inviting co-workers.

CHARLIE ROSE: Inviting co-workers?

JACK DORSEY: That was the start.

CHARLIE ROSE: and how did you decide on the responsibility between you and Evan and Biz?

JACK DORSEY: Well, I was leading a lot of idea and the vision for where the product was going. Ev was funding and supporting what we were doing. He put the shelter over our heads. And Biz was just an amazingly creative guy. And he was helping come up with words like “follow” –

CHARLIE ROSE: He’s the marketing –

JACK DORSEY: He’s a marketing genius. He’s amazing and fun to talk to.

CHARLIE ROSE: So where is it evolving to? Because some have made this point — it’s more information than social, social being Facebook.

JACK DORSEY: Yes. I think that is a great point. I think we’ve put a lot of emphasis on tweeting when a lot of the value is actually following people. And anything you’re interested in the world whether it be Charlie Rose or JetBlue or a public figure or your local coffee shop, they’re on Twitter and broadcasting what is interesting to them. They’re broadcasting about the organization, what they’re doing. So I can go and get immediate value from these things that I care about. And that’s the most important thing is being able to get in immediately and being able to follow someone I love, like Kanye West or like Barack Obama or any politician serving my particular state. I can see them immediately.

But then there’s another hook — you can actually participate with. You can reply to them, and they may reply back. They’re human again. And we spend so much time putting these organizations and public figures on this massive, massive pedestal, but we have to remember they go through all the small details of live that we do. And you can make them human again and you can interact with them.

And it’s not just humans, it’s a social movement. It’s seeing what’s unfolding in Iran. It’s seeing what’s unfolding in Moldova or Arizona or anywhere in the world.

CHARLIE ROSE: And so it has political implications?

JACK DORSEY: It could.

CHARLIE ROSE: It did in Iran. It was about the only way people could communicate.

JACK DORSEY: It was one way. There were multiple ways. I think what was really important in Iran was that the first time people were really using these tools to be on the ground and show what was happening. And that alone created an international conversation.

To a lot of people in America Iran and what’s happening in Iran is a black box. It’s hard to understand what’s happening. But to be able to instantly see video and to see man on the street accounts of how things are unfolding in real-time as they’re happening is amazing and I’ve never seen that before with any other technology.

CHARLIE ROSE: What I don’t understand when you look at your penetration around the world, you’ve done really well in Japan, and Facebook hasn’t. What does that say?

JACK DORSEY: We’ve had massive success in Japan. And it wasn’t just recently. It was very early on. It was within our first year. People just took to it right away, and we really couldn’t figure out why. But we found all these amazing things. People would actually put these automated tomogotchis onto Twitter and you could follow the tomogotchi patterns.

CHARLIE ROSE: What does it say about culture?

JACK DORSEY: It’s a very engaged culture and they’re very, very focused on constantly iterating technology. And Twitter is a very, very fast way to do it. In Japan, it’s not 140 characters, it’s 140 words. So you could write a little mini-novel. This is a whole story in the universe.

CHARLIE ROSE: And in China?

JACK DORSEY: In China it’s the same, very much the same. So people are writing non-stop about what’s happening within the country, what’s happening around the country. So it’s a very, very interesting peek into these cultures.

CHARLIE ROSE: So there’s these two ideas. One is Twitter is the next big internet success story. I would expect you to say yes, but if you had to say yes, why would you make the case?

JACK DORSEY: I think it’s huge. I think it’s huge because never before have we had such access to that immediate information. And once we have that information we can participate and interact with it. It spans at the intersection of every single media. It’s a great way to point to video, to images, to text, to web sites. Any media that you can imagine it can point to a carry in real-time. And the only other technology I know that’s done that well is the web itself. So I put it on the same league as the web.

CHARLIE ROSE: When was the last time you wrote an e-mail?

JACK DORSEY: I write one every day.

CHARLIE ROSE: More than one? Do you write many or do you mainly use text messaging?

JACK DORSEY: I use text messaging a lot more.

CHARLIE ROSE: Than e-mail?

JACK DORSEY: More than e-mail.

CHARLIE ROSE: And do most people you know who are — have the same affinity for technology follow that rule, follow that practice?

JACK DORSEY: I think so. As we go to a younger generation that’s definitely through because it’s more instantaneous. I use e-mail as a reference. E-mail is a great reference. It has a subject line. It titles what the e-mail is about and I can refer to it, I can search.

But it’s not great for communication because it’s not focused on the most important thing. The subject is the message, and that’s the message. The subject is in the message in the IM. It’s bringing the content to you right away.

One of the things I love about the iPad, for instance, is when you’re using the iPad, the iPad disappears, it goes away. You’re reading a book. You’re viewing a website, you’re touching a web site. That’s amazing and that’s what SMS is for me. The technology goes away and with Twitter the technology goes away. It’s so easy to follow anything you’re interested in. It’s so easy to tweet from wherever you are. And the same is true with Square. We want the technology to fade away so that you can focus on enjoying the cappuccino that you just purchased.

CHARLIE ROSE: Your CEO has said that Twitter has cracked the code when you advertise. What did he mean by that and how have you cracked the code?

JACK DORSEY: It’s not just the advertising but the human behavior. It’s a new way to communicate which is to spark interaction. One example of this is one of the first entities that was using the promoted products that Twitter has was Disney and “Toy Story.” We naturally have when toy story three came out people were going the theater and they were tweeting they were going to see “Toy Story 3″ and some would tweet during the movie. Then they would come out and say “This is amazing.” And it just naturally trends to the top. And Disney used that as a way as an opportunity to capture that natural trending ability and then also point to content that they want to surface to their consumers and to their customers.

So it was just a very natural and easy way to again point attention and direct attention to something that the advertiser wanted to see. But you’re going to see that anyway, because it was trending.

CHARLIE ROSE: The relationship between Evan, Biz, you, and where there’s tension and where there’s not tension and where one — and why there have been so many different executive changes since Twitter was founded, what’s the answer?

JACK DORSEY: For any Silicon Valley company, the most important thing is the company. And any great founders need to get out of the way of the company. We presented a spark with an idea. We saw a lot of the direction being driven by our users, and a lot of what we have to do now demand very, very specific management. And we know our strengths. And that’s mainly it. This company is bigger than any individual. It’s bigger than Biz, bigger than Ev, bigger than myself.

CHARLIE ROSE: Do I get this then? So Biz’s strength is marketing?

JACK DORSEY: He’s a great communicator. He’s a great protector of the brand.

CHARLIE ROSE: Evan’s strength is product strategy and that kind of thing?

JACK DORSEY: Yes, he has a great way of thinking about the user and how the user’s coming to the technology.

CHARLIE ROSE: And your strength is writing programming?

JACK DORSEY: My strength is programming. I also think my biggest strength is simplification. That’s what I love doing. I love making something complex. I love taking everything away, taking all the debris, the conceptual debris from a technology away so that you can just focus on what’s most important.

So I see myself as a really good editor. That’s what I like to be. When I edit a technology, I want to edit a team, I want to edit a story so that we have one cohesive product that we tell the world.

CHARLIE ROSE: Meaning what? What does “edit” mean?

JACK DORSEY: There’s so many ways Twitter could go, there are so many features Twitter could build. There’s so many features that Square can build. But there is only one or two going to bring us to the next level. So edit that to one, to get rid of all those inputs and edit to one cohesive story, one single thing we’re saying to the world and that’s what we do with product.

CHARLIE ROSE: Are you by — at the core, primarily a software programmer or are you primarily an entrepreneur who’s simply wanting to ask the right questions which will lead you to the next business?

JACK DORSEY: I think I’m a mix. I love building technology, I love programming. I love building teams. And I also love building beautiful things. I love art, I love design, and I love seeing that intersection of technology and the teams that work on it.

CHARLIE ROSE: But once you build them are you thinking about the next thing?

JACK DORSEY: No, I’m thinking about how to scale what we built, how to bring it to a global audience.

CHARLIE ROSE: So what do you have to do to scale Twitter?

JACK DORSEY: We have to get it everywhere. We have to make it easy for people to use.

CHARLIE ROSE: How many, 200 million users?

JACK DORSEY: Yes, 200 million people are using Twitter.

CHARLIE ROSE: Facebook has 500 million plus.

JACK DORSEY: So we have a long way to go.

CHARLIE ROSE: Do you think you can reach 500 million.

JACK DORSEY: We can go well beyond that. And I think the important thing for Twitter is that it works on any technology. The mobile phone itself, like anyone in the middle of — we have a short cut in Iraq, for instance, Twitter has a short cut in Iraq, and 60 percent of the population of Baghdad has a cell phone in their hands and they can use SMS. And they can send a tweet for free to the short code in the middle of Baghdad and then also receive these tweets in real-time. That is amazing. That is just unheard of. And that’s why I’m so excited about this technology because it speaks to the lowest common denominator, every technology.

CHARLIE ROSE: Would you argue the most exciting agent of change in the world today is the number of mobile devices? I mean by that one smart phone, that an increasing number of people in the world have it, that that’s the agent of change, how many people get put in their hands a device that has such power?

JACK DORSEY: I think it’s a — I think it may be — it’s a single spark. I think it’s a good way to further our understanding of what it means to be mobile and what it means to have technology around us all the time. But the iPad is mobile as well. Laptops are mobile. So all these devices we can take with us and interact. But I think the important is what does that mean for these technologies? What does it mean for communication when a device like those knows where it is, when it can accept the forms of payments that we use and we can build it into address whatever we want to address.

CHARLIE ROSE: So what is your counsel inside when the subject is the following — we ought to merge with Google or we ought to follow the Facebook pattern and stay independent and go public?

JACK DORSEY: I think Twitter is so unique that we must stay independent. We must continue to build what we dream of having in the world. And we’re just barely started, that’s the thing. Twitter’s been an amazing success, but we’ve just gotten started.

CHARLIE ROSE: Just gotten started because of what it can do or just gotten started –

JACK DORSEY: Because of what it can do.

CHARLIE ROSE: Lay that out for me, finally, what it is you think you can do.

JACK DORSEY: So we’ve built this very easy way, no matter where you are, to put content in, to share what’s happening around you. But it’s still very difficult to find meaning and relevancy in real-time. How do we get people to discover what’s most important? How do we surface what’s happening right now that someone should pay attention to? And that happens within your social network. It happens in the things you care about, within the country or even the world. But how do we in real-time bring that to people? And this is not just a challenge for Twitter. It’s also a challenge for the technology industry because we have all of this information just swirling about. How do we make sense of it? We need to do a much, much better job in making sense of it.

CHARLIE ROSE: Is Twitter making money?

JACK DORSEY: It’s making money. We have revenue.

(LAUGHTER)

CHARLIE ROSE: I know you have revenue. Making money has to do with profit. Making money has to do with a positive cash flow.

JACK DORSEY: We have a long way to go.

CHARLIE ROSE: That’s yes, or no? I’m not sure?

JACK DORSEY: We have revenue. We have revenue. You’ll have to speak to Dick.

CHARLIE ROSE: Everybody has revenue.

(LAUGHTER)

Thank you for coming.

JACK DORSEY: Thank you so much.

CHARLIE ROSE: Jack Dorsey, Square and Twitter. Thank you for joining us. See you next time.

END

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Last night just before 12 a.m., Twitter began exploding with the news: Facebook had raised $500 million — from Goldman Sachs. Bolstered by a $50-million stake from Russia’s Digital Sky Technologies, a previous FB investor, the Wall Street behemoth had slapped down $450 million to snag the Internet behemoth — now valued at a cool $50 billion. As if on cue, the internet noted that yes, that was cooler than a million dollars.

Notes the NYT’s Dealbook, which broke the scoop: this makes Facebook “worth more than companies like eBay, Yahoo and Time Warner.” It also doubles Mark Zuckerberg’s multi-billion-dollar worth. It also makes Goldman Sachs the gatekeeper to who now gets to invest in the super-hot Facebook, and to the inevitable Facebook IPO. According to Dealbook’s Andrew Ross Sorkin and Evelyn Rusli, Goldman is “planning to create a ’special purpose vehicle’ to allow its high-net worth clients to invest in Facebook, which would allow for max investment while circumventing disclosure rules for companies with 500 or more investors. Clever, that.

So: This is a big deal. Everyone’s already saying that this is putting Google even more on the ropes (seeing as now Facebook is the most visited website in the land) and that Goldman couldn’t be sitting prettier. Here are a few other things it means:

(1) Facebook hiring spree! To paraphrase Antoine Dodson, hide your startups, hide your engineers — Facebook’s a-comin’. Snapping up Hot Potato and Drop.io? Poaching Foursquare’s Nathan Folkman? That’s nothing compared to what Facebook’s got coming. Rumor has it they’re about to close on purchasing the Sun Microsystems campus in Menlo Park from Oracle. That’s probably not just for the scenery. They want to stock up, preferably with talent – and, importantly, companies – that will help it integrate across every platform possible. (I’m guessing one of the new buzzy photo apps will be snapped up.) If you think people are complaining about a developer shortage now, just wait.

(2) China! Mark Zuckerberg recently returned from a trip to China. Innocent pleasure jaunt for the Mandarin-speaking Facebook founder or connection-making relationship-building fact-finding mission to the land of 450 million potential users? China is certainly not an easy place to do business — they just kicked out Skype — but in a globalized, connected world, it’s certainly tough to ignore. Approximately 33% of its massive population is online and as we all know from the rest of the world, that is growing. It’s an insane market to ignore and smart, Mandarin-speaking audacious visionary CEOs probably aren’t going to shy away from trying. Facebook China. It’s gonna happen.

(3) Goldman’s PR Whitewash The Vampire Squid just attached itself to the buzziest, growing-est, Oscar-nominated-est, Person Of The Year-iest tech company around. Who will remember their year of scandal and record bonuses and how everyone hated Goldman Sachs (sample Gawker headline: “Who do you hate more, BP or Goldman Sachs?“). Goldman’s not there for you to like them, people, they’re there to make money — lots of it. But they did have a bruising year and being attached to the shining future-makers at Facebook (never mind the gatekeeper to the Facebook IPO) will certainly help. This lets them offer something shiny to their clients, and bask in that reflected glow. (And guaranteed cashola.) That doesn’t fool the people who know — I like Howard Lindzon’s take:

For Goldman Sachs, this is a no lose situation. If it works, they get the IPO and make some money. That is their job. They got off so easy with the government that this is like Vegas money they probably thought would be the taxpayer’s at some point a year back…The only thing I DO know is that Goldman could give a rat’s ass about the social web and sharing. If they are the top in social web, it’s small potatoes. The war in bonds, currencies and commodities is where the real money is at. This is play money. I hate that Facebook is letting them in.

This is not a coup for Goldman Sachs, this is a shame for the social web.

Okay I lied. I love Howard Lindzon’s take. So, maybe Goldman’s got an uphill PR sell. But — they’ve also got Facebook. Watch the narrative change.

(4) Bigger Players, Bigger Bets When Lindzon points out that this is small potatoes for Goldman, he’s not kidding. But now the bigger fish are sniffing around and what started as mutterings about a bubble somewhere in the late fall now seems to be turning into a gold rush. (Doesn’t Google and their adorable $6 billion offer for Groupon seem so quaint right now? Never mind Twitter’s recent $3.7 billion valuation.) These are billion-dollar figures, and they are actually now starting to sound…eensy. As Ray Kurzweil points out, when technology advances it does so exponentially — so it makes sense that the explosion of tech startups would chicken-egg in conjunction with an explosion of investor dollars — not just the usual (and educated!) suspects, but people on the sidelines reading about Facebook in their Time magazines and deciding that maybe the Internet’s not a fad, after all. (Yes. These people do exist, and many of them have a LOT of money.) High valuations, big deals, young companies getting scooped up — it’s gonna be a dizzying year.

(5) Sympathy For The Google. It’s official: Facebook has gone from underdog challenger of the mighty Google to the top social-tech dog. So watch for everyone to start rooting for Google again. After a wave of backlash (see here and here), the pendulum will swing back around to rooting for the loveable search giant with the cuddly name. Google can take your pity – its market valuation is almost four times Facebook’s at $190 billion, and its current year revenue is about $22 billion to Facebook’s $2 billion. Back to Lindzon: “I think that Google has to buy Twitter and that will start to be a meme soon. It’s a chess game and nuclear war now in the social space.” That sound you hear is the sound of the tech press collectively wetting itself. Ew. But still — everyone likes to root for an exciting matchup. Expect to see some bold moves from Google, soon — if they’re smart. Big “if” (RIP Google Buzz). But isn’t that how underdogs like it?

(6) New Facebook Ad Models. All that said…Facebook has made a big point about how it hasn’t really focused on the silliness of “making money” yet, despite that $2 billion annual rev and nearly 1 trillion display ads per year. I believe them — can they really not do better than targeted ads for Jewish singles in your area? You bet they can: They also make a point about knowing every little bit of information about you for the ultimate in micro-targeting. The online ad industry is evolving and innovating right along with the rest of the web (see AdKeeper) and the key to dominating going forward will be data — using it wisely to convert your users into dollars for advertisers. This is where smart technology will take user data and figure out how to map it on top of shopping data, so that purchasing intent can best be harvested. The stigma about buying online has now pretty much disappeared. With more people using the web, and mobile devices, more often do run more of their lives, there are big bucks at stake. And I’m not even TALKING about how Facebook is looking to horn in on search.

(7) New Facebook Business Models. They have all these users. All this data. They’d be crazy just to stick with what they’ve got. Hell, now they’ve got fun money just to fling up into the air and see where it goes. They’re poaching the best and brightest who all gush on and on about how “exciting” and “creative” and “free” it is. Clearly these people are getting to work on some fun stuff. So far Facebook has shown itself as adept at replicating the innovations of its competitors (see: Foursquare –> Facebook Places). But with all the resources at their disposal and innovations happening across every industry on every platform, they’d be nuts not to at least test the waters. Hey, that car’s not gonna drive itself. Oh, wait.

(8) People Generally Freaking Out This has already started to happen. First Groupon (“What? But they AREN’T EVEN A TECH COMPANY!!!”) and now Super-Sized Facebook. Entrepreneurs and founders and people with fledgling ideas that are half-built that they’ve been slaving over at night are obsessing about all day are suddenly freaking out that they have to get to market NOW before the bubble pops and the money dries up. Chill out, dude. (And, ladies!) If you’re making something of value, it’ll take. Just focus on it, be smart, and don’t let Twitter and TechCrunch freak you out. (Here, take some advice from these people.) Just a moment of Zen amidst the craziness. All right, now – onward! It’s 2011 and YOU’D BETTER NOT SCREW THIS UP. Haa, just kidding. Mostly.

Well: It should be interesting. Happy New Year, everybody!

Related:

Goldman’s Facebook Coup [Felix Salmon - Reuters]

The Social Web Index … All-Time Highs in Pressure and Price and Shame on Facebook [Howard Lindzon]

Was Goldman wise to invest $500m in Facebook at a $50B valuation? [Quora]

Goldman Sachs Just Bought The Facebook IPO [Business Insider]

Follow Rachel Sklar on Twitter here.

Illustration of Mark Zuckerberg as Avatar-ized Time Person of the Year from Sandbox World (via Boing Boing) (hat tip: Bnter).