David Gildeh

I am David Gildeh, an IT/Business Expert who is founder and Director of SambaStream, an online software company specialising in Document Management and Online Collaboration.

This site contains my blog, interests and CV to hopefully connect me to other like-minded people. Please get in touch here if you want to speak to me directly.

Startup Business Models that rely on advertising will die!

First of all I want to share this excellent book I picked up a few months ago in the airport on my way to India, "Smart Start-ups" by David Silver of the Angel capital firm Santa Fe Group. While the book is really about how the online communities we've seen such as MySpace and Facebook are nothing compared to what will come from online communities in the future, the theme I want to take from this book is how he dismissed online communities built using online advertising to generate revenues.

It seems to me, there are too many online start-ups out there that have no clear business model outside advertising. If you're thinking of doing a start-up built solely around this business model you're basically creating a business that will only succeed if its a hit! And who, apart from Steve Jobs, can predict hits? I don't even think the founders of Twitter could have possibly imagined that such a simple service which just lets the world know what you're doing in 140 characters would have become such a hit. Without high volumes of traffic to your site, you won't be able to generate significant revenues solely through advertising.

It's created an interesting conundrum. Consumers are now so used to software and services being free on the net, supported by advertising, that now any service offered to consumers has to be free because they won't pay for it! I appreciate that online advertising is a huge and fast growing market, and I'm sure the online advertising networks will make a lot of money, but that's because they spread their bets across thousands of sites to generate the traffic they need to get significant revenues. If you just have a normal site or service that is aimed at consumers, how can you hope to generate enough revenue to keep your business going if customers aren't willing to pay anymore and your traffic isn't high enough to get significant advertising revenues?

That's why I don't think this current Web 2.0 "bubble"will last long and why I concentrate on online services to businesses who are willing to pay a monthly subscription for good services. The numbers are fantastic! Lets say you rent a server for £150 a month to host your service, all you need is 15 businesses paying £10 to break even, and most businesses will pay far more if you can deliver good value to them! So what would you prefer? Creating a service that you only need 15 customers to break even (remembering I'm considering the most basic of start-ups without staff and other expenses!) or pay far more than £150 a month to support a high volume of traffic that may or may not come to generate the advertising revenues you need to cover your expenses...and when advertising networks like Google AdSense don't publish how much they pay publishers for advertising on their sites you can't even predict it until you have the money coming in!

This presentation by David Heinemeier (creator of Ruby on Rails and Basecamp) I think puts it best. Enjoy ;)

Intelligent Spamming?!

If you've ever left a comment on my site, you may notice that it doesn't appear right away. I like to approve them before they get put up for everyone to see and the main reason for that is not for flaming (I think any good blogger should be able to accept some critisim and I've even published one from a redneck American who didn't agree with my views on Obama) but for spamming.

I thought I had fixed the problem by installing the Captcha module for Drupal that everyone must fill out before submitting a comment, but I'm still getting these new comments that don't seem quite right. They ARE subject related, but the way they are written is like an advert for services. For example, my Google blogs have got some comments saying something along the lines of "Yes Google is a great service but if you don't want them to rip off your big idea visit...." with a link to a website on pushing up your Google page rank. However, some comments appear very legitamate but point to a random site that looks like spam and I've put a couple up because I'm honestly not sure if its a real comment or spam!

So my question is have spam bots, the plague of the internet that got hold of my email address ages ago when I nievely used to put it on this site and now send me Viagra adverts several times a day, become so intelligent that they can read my Captcha images and post subject related messages with adverts in them? Or are there people who sit around posting these spam comments on random blogs for companies? I would really like to know!

I would also like to point out that if you are a legitimate commentor on my blog, please do no put a link to some random site that looks like spam in your website field or comment or I will assume its spam and delete it. If you have some need to put it in there, please mention why in your comment and make sure its subject related!

A new chapter in my life

When I found this cartoon many years ago while bored in St. Charles training (at http://www.bigtimeconsulting.com) I kept it on my desktop for the day I would quit Accenture. Now after 3.5 years, today is my last day in Accenture, and to be honest I put the cartoon up not because I feel this was my experience with Accenture, but just because I've been holding it so long for this day!

How to make friends in a new place when you're a lonely business traveller...

After over one year travelling for my work (S. Korea, US, Thailand, Dubai, Hong Kong, US again and now India!!!) by myself I've got used to going to a new place with no friends or contacts and having to go out and make friends or face sitting around by myself every-night in my apartment/hotel and missing out on really getting to the know the country and culture I find myself in (which was a big driver for me to go and live around the world this past year!)

Arthur C. Clarke sadly passes away

Today, one of my favorite authors, Arthur C. Clarke, passed away. The guy was a creative genius and inspired me to take an interest in space technology and the space industry.

Famed for his book (later turned into a film) 2001, he wrote numerous books which I still keep on my bookshelf today.

May he rest in peace.

Back in the US of A and the Political Drama!

You know you're back in the US when people don't understand you saying "tomato" anymore...

I got back yesterday to Baltimore after my week home in the UK and will be here for another 3 weeks. However I have noticed some disturbing developments in the US Democratic Primaries since I've been away. Its getting nasty! Its really an all out fight between Obama and Clinton, and to be honest any outsider looking on from the side probably wouldn't want to vote for either of them after all the cat fighting going on - especially around the race issue!

Whats particularly disturbing is that everyone else (the rest of the world) does not want to see another republican President, they want a democrat with more open minded views about the rest of the world who doesn't intend to fight a 100 year war in the middle east and perpetuate Bush's dismal policies! However, while the democrats look "certain" to win, how can they effectively lead a country if both of the main candidates reputations and abilities have been tarnished - by their own party! This type of in-fighting led to the conservatives in the UK losing the elections a few years back and potentially split parties and the people making it impossible for any progress to be made on key issues.

While having "primaries" to decide which candidate will run for president is democratic, allowing the people to vote instead of party members, maybe the public shouldn't see all this in-fighting? It damages the reputations of the candidates and the party itself. In the UK the parties themselves choose who will lead - long before the general elections, so while we do get to hear about the in-fighting in the news, a lot is kept out of view and it is long decided and forgotten by the time the general elections come up (if they time it properly) when the people then vote for who to lead the country. No systems perfect, but surely that's a better system than putting all the potential candidates on stage for everyone to see them fight neck and teeth to run for president for that party? There's enough fighting against the other parties let alone between themselves. What's particularly nasty about this in-fighting is because there is no obvious difference in policies between Obama and Clinton, the fighting is taking the low ground on character, ability and race, all things that will potentially harm both candidates, even the one that wins will look bad for stooping to such low levels, not really the quality of a world leader...

Anyway, I would still like to see Obama as president (as mentioned in previous blogs) but I'm worried that he won't be as effective after all this in-fighting, and the people who need to follow his visions for the country will be disillusioned by the whole process.

Creating a World Without Poverty

A couple of months ago I picked up "Creating a World Without Poverty" by Muhammad Yunnus. I knew who Muhammad Yunnus was, but I'd never read a book by him. However it was the title that grabbed my attention and the overview talking about his idea for Social Businesses. And yes - it took me this long to read it with everything else going on!

After working in the NGO sector for the past year, using my skills in Portal & Content Management to help large global NGOs collaborate and share information effectively, I have to admit its had a big impact on how I think about business. Its no secret that I always wanted to start my own hi-tech enterprise and while that hasn't changed, my motivations have. As Kofi Annan once said: “It is the absence of broad based business activity, not its presence that condemns much of humanity to suffering.” Working in the NGO environment, and seeing the poverty in Thailand, and in a few weeks time, India, has opened my eyes to a whole new world, and why it is imperative that the world generates more wealth by creating new businesses and innovation. I still think my first start-up will be a hi-tech enterprise to make money, but I think that my long term motivations have changed dramatically. I see myself learning the skills to successfully start businesses and accumulating the wealth needed so I can have a positive impact on the world, by creating social businesses in the future. One of my role models, Bill Gates, has shown the way by changing the world with technology and then giving almost all his wealth away to help make the world a better place. Even Google.org is an inspiration on how newly successful companies can have a positive impact on the world.

While I've always thought about "Social Entrepreneurship" as a business that does good but making money for its investors, Yunnus takes it further saying that the business should only return the initial investment back to the investors, keeping all money in the business to improve and expand its services, thus creating a truly social business not measured by return on investment, but impact on social goals it sets out to address. I really like this idea, and I can see how the whole idea could turn into what he describes with social stock markets, social auditing firms and a whole social business news industry around it.

The Future of Space Tourism

This evening I went to the IET's main headquarters in London, Savoy Place, to listen to a presentation by Robert Lainé, Chieft Technical Officer for EADS Space (part of Astrium), as part of the IET's Kevlin lecture series. The presentation was on EADS Space's new launch vehicle designed for sub-orbital flights to 100km, designed specifically for the space tourism market that will be kicked off soon by Virgin Galactic.

Whereas Richard Branson is building his own custom plane for his own space tourism company, EADS Space is creating a re-usable launch vehical that will be produced for other space tourism companies to buy. They are looking to become the "Airbus" of the space industry, whereas Virgin is looking to become the Thomas Cook of the space industry. Virgin will get there first as they are well along in their plans, planning to launch the first commercial flight in 2009, but EADS Space believes there is room for a second entrant in this market. Here are a few of the figures from the presentation:

Is Global Warming Really An Issue for the US?!

I'm finally back in London after 2 months away in the US, albeit briefly as apparently I will need to return to Baltimore next week again...

So I just went downstairs in our London office for lunch in the canteen, and picked up The Guardian, not my favorite newspaper but the only one available, and on the front page a leading article on global warming and how experts are predicting conflicts over the arctic circle as resources become scarce over this century. Next page, smaller article on the UK government wanting to introduce new green taxes to reduce CO2 emissions in next years budget, another page, another story on global warming and its affects on the rest of the world that will cause a north/south divide as the richer northern countries who produced the majority of CO2 emissions causing global warming do OK while the southern poorer countries suffer the brunt of the devastation. Last week, I blogged on another UK paper, the Financial times, reporting on the UK government's strategy to build more nuclear power-stations in an effort to meet the UK growing energy needs and meet lower emission targets over the next 50 years.

It seems global warming is big news in the UK, but what I realised when reading through the paper, is I have yet to see any major newspaper or news source in the US that has the extent of coverage on this subject! Yes, you can find news about it in the US, but the top stories appear to be the presidential elections, Iraq and the economy, global warming seems to be a much lower priority!

Already, the US, the largest producer of CO2 emissions in the world, has failed to take the lead in global warming, by failing to ratify the Kyoto protocol 8 years ago (thanks to Bush administration) and as a result the US has lost the moral high ground for pushing China and India to clean up their acts as they soon become the largest CO2 emitters in the world during this century. I was happy to hear Obama talking about global warming as one of his key issues, but he won't be president until the end of this year (if he wins of course!), and from what I'm seeing with all the latest reports and data we may have already crossed the "point of no return", we really don't have time to waste!

I will pay more attention to the US papers when I return next week to see if this is just my perception or really a big difference in the priorities of each country's news, but I have a feeling that the US is still way behind in making sure this issue is dealt with as swiftly as possible!

Finally a new-clear strategy!!

This week the British government announced they were full steam ahead for building more nuclear power plants to meet the UK's growing energy needs and reduce our CO2 impact in the world. This is after a decade of indecision!

While I understand the risks inherent with nuclear reactors and nuclear waste disposal, this is long overdue. There is no other CO2 free energy source that can produce the amounts of power nuclear can, and the latest breed of reactors are long overdue! As long as the government pursues a parallel strategy to invest and grow our renewable energy sector as well, this seems like the most viable way of reducing our dependence on fossil fuel and is one all developed nations should wake up to and start investing in!

I would actually say organisations such as Greenpeace who have actively fought against nuclear power in favor of renewables have probably caused more Global warming by delaying the decisions the governments need to make on this issue than they would have if they kept their mouths shut! Imagine if this had happened 10 years ago like it should have, we'd already be starting to build the new reactors and be able to generate even more of our energy from this source in the future, as opposed to now, where the reactors will come online just as the old ones are starting to be decommissioned!

Anyway, good news for the UK. One comment the government made was that most developed countries were competing for limited skilled people to design and build the new reactors, I hope a bottle neck does not prevent the developed countries for ramping up nuclear energy use across the world!