The E-mail Heard 'Round Silicon Valley
Each day, Inc.'s reporters scour the Web for the most important and interesting news to entrepreneurs. Here's what we found today:
Hats off to Ron Conway. Angel investor Ron Conway, whose prolific portfolio has included Google and PayPal, wrote a scathing e-mail to the super angels involved in what's now being referred to as "Angelgate," and, yes, TechCrunch got a hold of it. When Michael Arrington crashed a secret meeting of angels this week and later wrote that they could be conspiring to cap startup valuations, he mentioned that "a couple of the attendees are saying they were extremely uncomfortable with the direction the conversation was going." Apparently, a partner at Conway's investment firm, David Lee, was one of them. In the e-mail, Conway calls fellow investors "driven by self serving factors around ego satisfaction and 'making a buck.'" He goes on to basically kick ass and takes names ... or rather, drops names. He writes that some fellow investors' actions are "despicable" and specifically calls David McClure out for blogging about the ordeal and causing "embarrassment" for Silicon Valley. Conway also defends David Lee, saying he was "uncomfortable with both gatherings." Conway drives the point home, writing that he wants to disengage, with all the e-mail recipients. "Lets agree to disagree and not have to even engage in any idle chit chat or discussion of any sort….ever." Wow.
Ciao to unlimited data? Verizon recently announced that it expects to start charging wireless customers on the amount of Internet data they use. Robert Chang, writing for the The Wall Street Journal, notes that "the wireless industry has struggled to balance the increasing demand for data capacity with unlimited plans that limit how much revenue carriers can generate from their subscribers." In other words, corporations like Verizon are having a hard time squeezing pennies from the unlimited monthly data plans. The announcement follows Apple's decision to halt sales of unlimited data plans to new customers, and replace it with two service plans that have monthly caps. Customers who go over their limits are charged. But could Verizon be shooting itself in the foot by reducing smartphone Internet use, which could be potentially tapped for revenue streams itself?
Is Obama's small business program falling on deaf ears? The $30 billion in federal lending the president pledged yesterday was supposed to aid struggling small businesses with easier credit and other incentives to grow and hire new workers. But what if businesses don't want the money? Today the AP reports feedback from a number of small businesses and community bank that show reluctance to participate due to concerns about expansion and heightened scrutiny. "We have taken a strategic decision not to have our primary regulatory, the government, also be a partner in our bank," said William Chase Jr., CEO of Triumph Bank in Memphis. Many businesses have also frozen plans to expand since the recession in 2008, and don't intend to borrow until customers and revenues grow as well. Additional fears arise from the strings attached to TARP funding, when participating banks had to later cut dividends to shareholders and limit compensation. While the government has promised fewer regulations this time around, many still balk at the program's ability to change the rules at any time.
Five myths about Facebook. As The Social Network premieres in New York, and Facebook does damage control in Silicon Valley, David Kilpatrick, author of The Facebook Effect: The Inside Story of the Company That is Connecting the World writes in the Washington Post about common misconceptions. Before you get too excited, remember, these are myths, not secrets. Example: "Facebook keeps changing to help sell advertising." Sure, there are tweaks over the use and display of personal data, but it's more about staying nimble than pleasing advertisers, Kilpatrick writes.
Need a job? Just text it. Fast Company reports on Assured Labor, a MIT offspring company that connects low-income job-seekers with employers over mobile SMS. The employment service, created by Harvard and Sloan School of Management students, launched in Mexico this week. Check out what the company's founder and CEO has to say here.
U.S. seeing rising discrimination complaints from Muslim employees. Even before the dispute over the planned construction of an Islamic center in Lower Manhattan erupted, more and more Muslim workers were filing religious discrimination complaints with the Equal Employment Opportunity Commission, The New York Times reports. "Although Muslims make up less than 2 percent of the United States population," the Times writes, "they accounted for about one-quarter of the 3,386 religious discrimination claims filed with the E.E.O.C. last year." The Times says that Islamic groups expect the 2010 numbers to set a new record. Complaints range from verbal taunts from co-workers like "terrorist" and "Obama," to employers prohibiting Muslim women from wearing head scarves.
The classy way to handle rejection. On his blog, venture capitalist Fred Wilson has some advice for any young company dealing with the anger and frustration of being turned down by investors. Rather than sending an expletive-laced e-mail to the firm that turned you down, Wilson says it is better in the long run to handle the rejection with class. "You need to thank the investor for taking a look," he says. "You need to keep the relationship intact for the next time you want to raise money." Wilson admits that it isn't easy to maintain composure after being told no, but he says, "I always make myself feel better by saying to myself 'this deal is going to be huge and the best revenge will be when they are kicking themselves for saying no.'"
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CHRISTINE LAGORIO-CHAFKIN | Staff Writer | Senior Writer
Christine Lagorio-Chafkin is a writer, editor, and reporter whose work has appeared in The New York Times, The Washington Post, The San Francisco Chronicle, The Village Voice, and The Believer, among other publications. She is a senior writer at Inc.