Oh, wait. Scratch one more idea off the list. Now seeking funding via a just-launched Kickstarter, CatLand would give users the chance to care for a Tamagotchi-esque pet by sending check-ins to a location-aware mobile app.

So, if your cat is hungry, you can check in at a restaurant, and if it’s bored, you can take it to the park. CatLand’s creators said they’re still uncommitted to any one business model, since their first priority is just to get funded and get users. But it might eventually offer the ability for local businesses to sponsor special check-in hotspots that reward one’s digital kitty with more virtual points than check-ins at other, non-paying locales.

Silly? Yeah, a bit. But this piqued my interest for two reasons:

1. Foursquare, the former mayor of location-based gamification, is backing away from check-ins and moving toward local discovery; since it’s targeted at teenage girls, CatLand may be an interesting test case for check-ins as a niche product as opposed to a broad “Yelp-plus” service.
2. With the exception of a few apps like Quadstreaker and — more notably — Google’s alternate-reality game, Ingress, mobile games haven’t yet embraced location as an important element of play, either because it’s hard to implement or maybe because it’s just not fun for most types of games. So that’s two trends this silly Kickstarter project is bucking.

(And — unofficial third reason — just because this is about cute animals. We’re definitely gonna win that Webby next year, guys!)

CatLand’s Kickstarter page is here, and a video explaining the app in a bit more detail is below:

Basically, this covers search labeling and scraping, as expected. It’s trying to set a more level playing ground for how Google treats its competitors, and to address some of the ways it may have abused its power in the past — like by including Yelp reviews in its own local search in a way that discouraged people from ever visiting Yelp.

You can see in the illustrations here that Google will include a little lowercase “i” with a circle around it next to results from its own properties, and will also sometimes encase them in a “sponsored” box:

As part of the agreement, Google also conceded some limitations it had put on its advertisers, similar to the deal it made in the U.S. The commitments don’t include anything related to concerns about use of patents.

Competitors now have a month-long “market test” to comment, then Google has to implement the changes for five years throughout Europe.

So why is this different and stronger than the mild hand-slap that Google received in the U.S.? Well, first of all, European laws are stricter, and Google is much more dominant than it is in Europe, with search market shares above 90 percent.

But, second, competitors are already saying that this won’t go far enough.

ICOMP, an organization representing Google’s competitors, immediately fired off a round of comments today about how labeling something as wrong doesn’t fix the fact that it’s wrong.

“If the proposals don’t clearly set out non-discrimination principles and the means to deal with the restoration of effective competition, plus effective enforcement and compliance, it’s very difficult to see how they can be satisfactory,” ICOMP said in a blog post. “[I]t is clear that mere labelling is not any kind of solution to the competition concerns that have been identified. Google should implement the same ranking policy to all websites.”

Said a Google spokesperson, as usual, “We continue to work cooperatively with the European Commission.”

Embedded below is the text document of Google’s commitments, which contains a bunch of images showing how the proposed labeling will look:

Google’s EU commitments for competition market test

Rename the company to something like ‘Yelp.’

– No. 9 in a series of nine things that Andrew Goodman suggests for the future of Yahoo, No. 1 being “Acquire Yelp”

One question unanswered: How much do investors think Foursquare is worth? We don’t know, exactly, because this round is all debt: Silver Lake is giving the company a multiyear loan, and the other investors — Andreessen Horowitz, Union Square Ventures, O’Reilly AlphaTech Ventures and Spark Capital — are all buying convertible debt.

Why does that matter? Because “by taking on debt, rather than giving investors equity stakes, Foursquare delays a public debate about its true worth,” said Bloomberg Businessweek, which has the details on this one.

Here’s even more detail from investor Fred Wilson, whose Union Square has been a longtime Foursquare backer, on the logic behind the debt round:

Valuation is somewhat immaterial to us as our stake in the company is not going to increase much in this round of financing. But valuation is very material to the Foursquare management team because $41mm of capital is going to be dilutive at any valuation that would make sense here.

So the optimal structure is convertible debt. That means this round is not dilutive to the Foursquare management at this time. But it will be dilutive when the debt converts into equity, most likely at the next equity issuance. For the investors, we get the comfort of knowing that eventually our investment will become equity and we will not have to price it. Someone else will.

My educated guess, though, is that Silver Lake, et al, still believe that Foursquare is worth something close to the $600 million the company was pegged at in 2011. Yelp, the company’s obvious public comp, has a market cap of $1.6 billion.

Whatever the valuation is, it’s not going to be based on a multiple of revenue: The company brought in just $2 million last year, Businessweek said. Not unrelated: Yesterday, the company rolled out a redesign that is supposed to emphasize local search, a market that digital guys have been trying to monetize, without much success, for a very long time.

Those currently using Foursquare’s app are used to a three-tabbed main screen, where you’re always greeted with a home screen of your friends’ check-in updates. From there, users can navigate to the “explore” tab, essentially a feed of business recommendations based on your location, time of day and regular check-in habits. (There’s also a third tab, which leads you to your profile page.)

“Explore,” however, is the direction Foursquare wants to go in for the future. Over the past year, the company has slowly moved away from its heavy emphasis on badges, mayorships and “gamification” (my least favorite word in tech), instead moving toward a mobile discovery service somewhat akin to the space Yelp currently inhabits.

“Years ago, search queries were more high-level, for ‘food’ or ‘drinks,’” said Andrew Hogue, Foursquare’s head of search and data. “But now people are starting to treat ‘explore’ with a bit more depth. And as people search more often, there will be a lot more exposure to ‘explore.’”

This has been a long time coming. Foursquare CEO Dennis Crowley has said in the past that the search function should have been on the front door of the app from early on, calling it the company’s biggest mistake, in retrospect. He has also said that there should be fewer friction points in navigating the apps.

That’s what we should expect from Wednesday’s app update. Fewer taps, heightened emphasis on local search, and little bells and whistles like autocompleted suggestions in the search box to serve up recommendations for places to discover.

Ostensibly, that’ll be better news for Foursquare’s paid products, as well. Local updates — or business suggestions inserted into a users’ feed at the paid request of an advertiser, based on location and time of day — will now receive more prominent placement in the app by default, as users won’t be forced to make those few extra taps to navigate into the “explore” tab to see those suggestions.

An important thing, considering that Foursquare is feeling the pressure to monetize, four years in.

Expect the update to roll out Wednesday morning.

Aspen Photo / Shutterstock.com

1.) ESPN’s Cunning Plan to Stream March Madness: Head to Bill Simmons’s House

2.) Foursquare’s Yelp Problem

3.) BlackBerry CEO Says iPhone Is Passé

4.) Seven Questions for the Man Shaking Up HP’s Operations, John Hinshaw

5.) Samsung Galaxy S4: Bigger Display and Bolder Software — But Is It Better Enough?

6.) Hey, Remember How Awesome the iPhone Is?

7.) Looking East to Predict the Next Billion-Dollar Mobile Company

8.) Jerry Yang Is Back (And Investing More Than Ever)

9.) Global Platform Head Carroll Departs Yahoo for Go Daddy, While Yahoo News Head Leaves for NBC

10.) Mossberg on Apple’s Rivalry With Samsung and Why the iPhone Is Like Switzerland

For more of the week in review, please follow us on Facebook and Twitter.

So says Boston Consulting Group, out with a new report that shows only 3 percent of small-business ad dollars going online.

The numbers come from a survey conducted last fall of 550 small companies, and shouldn’t come as a complete surprise to anyone who has watched the Web guys try to break into the market for many, many years.

With the notable exception of Groupon and other daily deal companies, most of the Internet guys like to advertise their advertising on the Internet. And their platonic ideal for a transaction is the self-serve model, where humans never have to talk to each other. Meanwhile, lots of traditional business still gets done in analog form, via phone calls and feet on the street.

When small businesses do spend their money, Google still gets the most, says BCG, which ranks the popularity of other outlets this way: “Other search engines, Yelp, Facebook, Yahoo! Local, YP.com (formerly yellowpages.com), Twitter, LinkedIn, and Superpages.com.”

(Image courtesy of Shutterstock/Artens)

Asa Mathat / AllThingsD.com

My hunch is that TechCrunch got this one right: Foursquare is going to get some more money soon, and the terms won’t be awful — not a down round, but not an exuberant one, either.

The last time Foursquare raised, back in June 2011, it was reportedly valued at $600 million. You can debate how far the company has or hasn’t come since then. But beyond its own issues, it is now dealing with another set of factors when it asks big investors for money: The public markets.

There was the Facebook IPO, of course, which let the air out of many consumer Internet companies’ valuations. But for Foursquare, the most important IPO of last year was Yelp.

The good news is that the local reviews service has held up, price-wise, better than just about any other recent big-name Web IPO except for LinkedIn. The bad news for Foursquare is that, as far as the market is concerned, Yelp seems to be worth something in the $1.5 billion range, and not much more. At $25, where it opened today, it’s worth $1.6 billion.

CEO Dennis Crowley might bristle at the Yelp comparison — “location layer for the Internet” sounds much more ambitious, and a good way to slay those haters — but until he can prove otherwise, most check-writers are going to view Foursquare as Yelp with badges. (Pretty sure the Yelp guys do.)

So if you put money into Foursquare at $600M two years ago, and its public comp is trading at 2.6x, you probably feel okay about that. But if you go much higher than that, it’s a different story.

Last week, the fight between Apple and pugnacious hedge fund investor David Einhorn of Greenlight Capital went all flat when he withdrew a lawsuit after the company yanked a proxy proposal that would have allowed shareholders to vote on eliminating preferred stock from the company charter.

But the real issue at the core of the fight — the massive mountain of $137 billion in a cash hoard that Apple holds and that Einhorn wants it to distribute in some fashion to shareholders — still remains.

It’s not clear what Apple will do now, especially since a lot of it is overseas. But execs have indicated that they are evaluating what to do to best serve nervous investors, who have bidded the stock down 40 percent since the fall. While it’s not clear what that will be, it’s also pretty likely Apple will do something.

Until the company decides, though, I have some good ideas for CEO Tim Cook to consider:

* Apple could purchase 1,567,506 Tesla Model S Performance vehicles with 85 kWh battery and a carbon fiber spoiler at $87,400 each, which would effectively allow CEO Elon Musk to buy the New York Times (a bargain at $1.42 billion!) and use it as his own personal blog.

* It could buy 17.9 houses for each Yahoo employee located near its Sunnyvale, Calif., HQ, so they could be super-close to work, per CEO Marissa Mayer’s wishes. That breaks down to 206,015 overall homes for 11,500 workers, at a median sales price of $665,000 for the area.

* Apple could acquire a big chunk of the Internet all at once, including Groupon ($3.36 billion), Yahoo ($25.95 billion), Facebook ($61.7 billion), Twitter ($10 billion), LinkedIn ($18.32 billion), Yelp ($1.47 billion), AOL ($2.81 billion), Pandora ($2.09 billion), Zynga ($2.69 billion), OpenTable ($1.32 billion) and, finally, Pinterest ($2.5 billion). Phew.

* It could pay Andrew Mason’s $378.36 severance after getting jacked as CEO of Groupon 364,013,179 times over.

* Apple could pay for 97,857 parties for Yammer’s David Sacks’s 40th birthday (at $1.4 million each). Snoop Dogg included.

* It could foot the bill for the budget cuts to save the U.S. government $85 billion this year, so Americans could stop having to say “sequester.”

* Apple could buy $329 16 gigabyte Wi-Fi iPad minis for 416,413,374 people — everyone in the U.S. (315,429,318), plus France and Spain.

* Or it could just give the 7,069,909,686 people on the planet $19.38 each, and call it a day.

* Apple could use $1 bills to carpet an area of 560 square miles, which would more than cover Silicon Valley.

* Finally — and I think this would be a nice gesture to make up for calling his efforts a “silly sideshow” — Apple could give Einhorn 15.56 times the value of his $8.8 billion fund.

Or, of course, not.

Keith Rabois, the former Square COO who left the company in the midst of unproven allegations of personal misconduct, is weighing an offer to join Silicon Valley venture firm Khosla Ventures, according to sources close to the situation, and is currently leaning toward accepting the job there.

But, that could change. In an interesting twist, the longtime entrepreneur and investor has also been in discussions with Airbnb CEO and co-founder Brian Chesky to become COO or president there.

Both the VC and the startup have been doing reference checks on Rabois, news of which has gotten out in the ever-chatty Silicon Valley scene. The Wall Street Journal reported earlier today that Rabois had been in talks with the San Francisco-based online housing rentals company.

But sources with knowledge of the situation said that Rabois — who has played the No. 2 to a string of high-profile entrepreneurs, including Peter Thiel at PayPal, Max Levchin at Slide and, most recently, Jack Dorsey at Square — seems “99 percent” ready to move into a more formal investing role.

Of course, there is still that one percent chance he might not, underscored by the eternal lure of the hot startup for serial entrepreneurs like Rabois. That said, he has also been an active angel investors for many years, with a wide-ranging portfolio, and is on many boards, including Yelp’s.

The choice of two very attractive alternatives is in stark contrast to the more tense situation for Rabois just a month ago, after accusations of sexual harassment arose related to a relationship he had with a Square employee.

Rabois has denied the allegations aimed at him and at the San Francisco payments company, which have not yet turned into a lawsuit, and has thus far been backed by Square. Rabois called the accusations by the employee “fiction” and a “shakedown.”

That said, due to the controversy around the serious workplace issue, he stepped down from his job as COO.

“At the end of the day, this is personally embarrassing to me, because when anyone’s life is exposed to a public forum, it creates quite a damaging situation,” said Rabois at the time in an interview with me. “As we looked at it, it was going to become a distraction that was going to hurt the company.”

This is how Nextdoor, the private social network focused specifically on the neighborhood, was built. Users communicate with one another to form tighter bonds around their community, only sharing identity information directly with those inside their area, usually spanning no more than a handful of blocks.

But Nextdoor needs to expand faster, before another startup moves in on its turf (or evicts them, if you’ll pardon the analogy). And the company aims to do just that with Nextdoor 2.0, a revamp of the site with features aimed at jumpstarting growth while focusing on the startup’s strongest areas.

The biggest area of change: Instead of restricting users to their previously cordoned off districts, they’re able to post information to nearby neighborhoods, those bordering the area a user resides in. That’s different from before, where users were made to keep up with the Joneses only in their immediate vicinity.

Philosophically, it’s about crossing boundary lines where it makes sense, and posting information about local activity and goings on with those still close enough to care about it.

“It’s powerful,” CEO Nirav Tolia told AllThingsD, “because it begins to let groups emerge that transcend neighborhood lines.”

From a business and growth standpoint, however, it’s a jumpstart in increasing engagement (in theory, at least). Move folks past just keeping in communication with their closest neighbors, and you increase the potential for engagement and activity on the service itself. Sustaining that just begets more growth, and for a young startup with ambitions as high as Nextdoor’s, growth is good.

But is growth at the cost of the company’s value proposition too much? When I spoke with Tolia in the past about Nextdoor, the biggest selling point on the network was the company’s built-in constraints; it’s more private than Facebook, LinkedIn or Twitter. And it’s supposed to be.

To that point, it’s worth noting that Greylock Partners led a new funding round of $21.6 million, adding managing partner David Sze to the Nextdoor board. Sze’s history involves early work on both LinkedIn and Facebook, helping both companies grow into what they’ve become today. (Shasta Ventures, Bezos Expeditions and Google Ventures all also participated in the round.) Perhaps Sze’s influence, among others, convinced Nextdoor and Tolia that it needed a kick from a growth perspective.

For what it’s worth, Path — another private social network at which Sze is an adviser — also made major changes to its app, all aimed at kickstarting growth and engagement. Perhaps a growth rate that burns too slow isn’t enough in what Tolia described as a “winner-take-all market” such as the one he sees Nextdoor competing in. Move fast, or get usurped by someone even faster.

In that vein, Nextdoor’s 2.0 user interface has seen some tweaking, and Tolia says it has been optimized for mobile phone and tablet use, bringing feature parity across platforms beyond the desktop. We should expect mobile apps sometime in the next year or so, as well.

I imagine that when those apps do come out, they’ll sync up with Nextdoor’s third major emphasis, crime and safety. It’s one of the biggest use cases for those on the Nextdoor network, so the startup is playing to its strengths. Urgent alerts sent through the service can reach users by SMS, and Nextdoor eventually plans to integrate police and fire department notifications as well.

Time will tell on the company’s future plans. My best guess is that after cooperating with local government and now institutions focused on safety, the site will likely aim at other obvious community pillars. Churches? Or perhaps schools?

Whatever it has in mind, it certainly has the money to do it. With upward of $40 million raised and Tolia saying most of that is still in the bank, the company has plenty of room to grow.

We’ll have to wait and see if everyone in the neighborhood agrees.

Yandex launched the app in beta form last week to U.S. users, but only hours after the app debuted, Facebook snipped Wonder’s access to the API.

“We discussed the issue with Facebook, and it was confirmed that Facebook views the application Wonder as something that violates the Facebook Platform Policies (section I.12) and that the access to Facebook’s Graph API will not be restored,” a Yandex spokesman told AllThingsD. “Since this access was revoked, we decided to put our application on hold for the time being.”

According to section I.12, outside sites and applications are not allowed to use Facebook’s Graph API if they are search engines or directories and don’t have Facebook’s express written consent. (Microsoft’s Bing, for instance, would fall into the “consensual partner” category.)

Why does an app like Wonder get shut off so fast? Well, for one thing, Wonder aims for the exact space Facebook looks to dominate in the coming years — social discovery. It’s essentially a voice-navigated social search application that lets users see the types of local businesses their friends have visited, the food they’ve eaten, the photos they’ve shot and the news and music content they’re taking in. That’s all valuable data to take from Facebook.

And with the recent Graph Search and updated Nearby mobile feature, it’s obvious that social discovery is one direction Facebook wants to dominate (much to the chagrin of others in the space, I’m sure, like Yelp and Foursquare).

Facebook tried issuing a statement last week detailing just why it shut down API access to Wonder so quickly, as well as other recent shutdowns of apps like Voxer and, separately, Twitter’s Vine app. But the company’s statement wasn’t entirely clear on which apps encroach on the social giant’s territory, or what specific factors make Facebook decide to go after some apps but not others.

What’s next for Yandex’s app? “We will be considering partnership opportunities with other social networks and services to offer our users a richer internet experience via Wonder.”

Good luck with that, guys.

In a major exec departure, Square COO Keith Rabois will be leaving the San Francisco payments company.

Square gave no other information about the sudden management change, but sources said disagreements between Rabois and CEO and founder Jack Dorsey were part of the reason for his exit.

It’s not clear if there were more serious issues between them, or whether the parting was related to a specific business problem. But the departure of the No. 2 exec is significant, so definitely more to come on what happened.

In a statement about the move, Rabois only said:

It is amazing what Square has accomplished since August of 2010. When I joined, there were 17 engineers all reporting flatly to Jack. The local coffee shop served as our interview room. Leading our amazing crew has been the most rewarding professional journey of my life. I am forever grateful to Jack, for his confidence in me and to each and every member of the team for allowing me to learn from them.

But every day matters. And it is better at this point for me to be doing something different every day.

As a result, I’ve decided to resign from Square. I am very excited about what lies ahead for the company. Square could not be better poised for greatness.

I will have more to share about my next opportunity soon.

Said Square’s Dorsey:

Today I accepted Keith’s resignation from Square. When he joined, we had fewer than 30 employees and under 1000 active merchants. Today, over 3 million individuals and businesses are able to accept credit cards with Square, processing over $10 billion annually. We couldn’t have done it without him and we wish him well in his next opportunity.

Square CFO Sarah Friar will become acting COO, Square said. It’s an unusual move to put an exec without a lot of deep operational experience in the second-most-important slot at Square, though the former Goldman Sachs analyst and Salesforce.com finance exec is clearly familiar with the heart of the company’s business.

The change in top management comes at a time of fast growth for the three-year-old Square, which completed a $200 million funding round in the fall that valued the company at $3.2 billion. At the time, the company said it had more than 400 employees and would grow by 100 more by year’s end.

Square is best known for allowing a range of small businesses, such as taxicab drivers, to accept credit and debit cards using their mobile phones. But it has also branched out into other mobile payments areas.

Besides his stint at Square, Rabois is a well-known angel investor in Silicon Valley, and serves on several boards, including Yelp’s. He has worked at many startups, too, including PayPal (acquired by eBay) and Slide (acquired by Google).

Image copyright pupunkkop

The IPO is the lifeblood of our stock markets; it’s the vehicle that helps bring capital, liquidity and a sense of optimism to the U. S. economy. In the late 1990s, we had a market that was flush with technology-related IPOs. Today’s IPO market has been a series of stops and starts compared to then, and notably tainted by highly scrutinized, extremely volatile offerings.

While there have been recent successful IPOs like Eloqua, FleetMatics, Palo Alto Networks, ServiceNow, Splunk, Workday and Yelp, the investing public and the media are still skeptical. We keep seeing headlines like “The Other Tech IPO that Just Faltered,” “IPOs Remain Out of Kilter,” and “Lofty Gains Lift Gloom in IPO Market.” I have yet to talk to anyone who thinks much is going to change. It’s unfortunate, because I believe if you step back and look from a broad perspective, the elements are in place to bring the IPO pipeline closer to what it once was. It’s time to stop bashing it and look forward.

Throughout my years as a securities lawyer, investment banker and now venture capitalist, I have been intimately involved with over 100 initial public offerings. Most of them have been venture-backed companies in the technology sector. Many who have tracked my career would say I have worked on more technology IPOs than any other venture capitalist out there, with my first rodeo being with Four Phase Systems in 1975 all the way to FleetMatics, which went public in October.

I spent almost 20 years as a technology investment banker, eight of which were spent at Montgomery Securities, where I ran technology investment banking. It was there that I saw our IPO deal pipeline — at its peak — larger than Wall Street’s entire venture-backed company today. I came to this stark realization only recently, when I looked at a half-page sheet of upcoming public technology offerings from all the investment banking firms. It’s shocking to see. Our own deal sheet at Montgomery would always run onto a second page — and we were just one of the major firms at the time.

I am a firm believer that things can change. We can boost the pipeline of attractive offerings in today’s market by looking at it as a three-legged stool so that we start to fill more pages.

Three-Legged Stool Beneath the IPO Ecosystem
I view the IPO market as a three-legged stool that needs to be supported by a specific triad of parts to stay stable. Two of the three are already in place. The first leg is represented by a huge crop of strong attractive growth companies. The second is based on a favorable regulatory environment due to the recent passage of the Jumpstart our Business Startups (JOBS) Act. The third leg involves the investment banking system, which is the leg that needs adjustment. Once the three are aligned together, I believe the market can be ripe for recovery.

Leg No. 1: An Abundance of Venture-Backed Innovative Growth Companies
From what I am seeing right now, there are an incredible number of entrepreneurs creating compelling growth companies. While there were significantly more IPOs in the 1990s, the number of private companies currently being built is about five times what it was during that time. For example, in 1991, there were 319 venture investments in the core areas of the technology we know today. In 2011, there were 1,825. Yet there are far fewer IPOs.

Today’s entrepreneurs are defining massive, fast-growing markets that hardly existed 15 years ago, such as enterprise mobility, social marketing and big data analytics. They are also disrupting large established industries like travel, transportation and legal services. Compared to the 1990s, technology companies today have more sustainable, scalable models that can result in successful public companies in the long-term, where as we all know, only the strong will survive under the scrutiny of the public markets.

Companies today are vastly ahead of those I saw 20 years ago — stronger management teams, less capital intensive, bigger markets and better business models. An abundance of venture-backed innovative growth companies exists today. From this perspective, it is the best time ever. Therefore, the first leg of the stool is in full effect.

Leg No. 2: Favorable Regulatory Environment
Much of the previous regulatory clampdown (e.g., Sarbanes-Oxley and the Spitzer settlements) has been relieved under the JOBS Act. Now a smoother path exists to guide growth companies to go through the IPO process. This regulation has the potential to significantly affect the IPO process for smaller companies in a number of ways:

• Creating an IPO “on-ramp” for emerging growth companies (EGCs) with reduced SEC filing requirements
• Providing for realistic scaled disclosure, governance and accounting obligations for EGCs
• Relaxing restrictions on research analysts
• Allowing “testing of the waters”
• Allowing confidential IPO filings

Although there is now more flexibility, companies are not taking full advantage of the actions that are now allowed under the JOBS Act. While there are still some elements where the SEC needs to issue fuller guidelines, companies could be bolder and take advantage of the new laws.

Two of these areas — testing the waters and confidential IPO filings — are huge changes that companies should embrace. I’ll explain.

Testing the waters offers a huge advantage to young companies trying to gain an understanding of potential market reception. Historically, a company had to rely on feedback from its lead investment bankers as to what the likely reaction of the institutional buyer would be. While the bankers offer a reasonable proxy, they are far less informative than real life dry runs with a few institutional buyers. The bankers, having sold hard to get the business, have a natural optimistic bias and a tendency to support the company’s existing positioning. Testing of the waters is a terrific opportunity to explore the receptivity of the institutional buyer to the company, its positioning and target valuation. This can mitigate the risk of a disappointing or failed IPO. Amazingly, not everyone is doing this.

The confidential IPO filing is probably the most important change. Historically, EGCs were understandably concerned about showing their hand to competitors, suppliers and customers in an IPO filing unless they were quite sure that the IPO was going ahead. This created a certain caution by management teams. Now, companies can file confidentially and avoid these issues. They can get the clock rolling, work out any disclosure or accounting issues with the SEC, and only when they are ready to market the IPO do they need to show their hand. And this doesn’t preclude the “dual tracking” of an IPO and an M&A exit. A company can announce that it has filed even though the contents of the filing are still confidential. Nothing wrong with having your cake and eating it, too! The confidential IPO filing is a no-brainer that should be embraced and will allow companies to file that otherwise would have been on the fence and waiting.

Leg No. 3: The Investment Banking System
And now for the area in need of the most improvement: The investment banking ecosystem, which will require some changes and adjustment to reach its full potential and further drive our IPO pipeline.

The healthy IPO market of the 1990s was in large part created by the “Four Horsemen” of the technology investment banking world: Montgomery Securities, Hambrecht & Quist, Alex Brown and Robertson Stephens. Along with the well-known “Bulge Bracket” firms, those four boutique banks drove most of the technology IPO business during that period. These firms were small, nimble and not afraid to take risks. While those specific firms no longer exist and there have been many changes to the investment banking landscape, there is still top talent at both large and boutique growth-oriented investment banks.

Those people who have the skills and knowledge to bring value to growth companies exist today, and I can think of a number of firms fully qualified to be the next “Four Horsemen.” But even though we have the banks and the talent, the banking system still needs the economic incentive to get the banks more involved and motivated to bring companies public.

Currently, underwriting syndicates are being created in a way that dramatically limits the economic incentives to small firms. In the 1990s, the economics, or banking fees, were more favorably divided among the lead banks and the co-managers of the deal. In the current environment, a co-manager receives only 5 percent to 10 percent of the economics compared to 20 percent to 50 percent in the past. Therefore, most investment bankers are more incentivized to work on an M&A deal, because the fees are there. More money.

In addition, we have seen six to eight firms underwrite each of today’s deals. I believe companies should hire one firm as lead and between two to four co-managers, and give all participants the economics to incentivize them to develop a great deal. We have the investment banks that can provide research and trading support, but better deal flow and attractive economics are required to make the engines run.

Finally, the banking industry needs to make adjustments in pricing strategies. During my career, I have learned that the psychology of maintaining momentum is essential to complete a successful IPO. At pricing, the perception is that you need to price at least slightly above the range or revised range to prove it was a “hot” deal. Just look at all the headlines of recent IPO pricings and you’ll clearly recall who did well on day one.

Unfortunately, with some of the large IPOs that priced in 2012, the size of the deal and the price range was set too high. This has been problematic. It sets unachievable expectations and the deal becomes viewed as a failure and disappointment when it fails to meet those expectations. This is true not only for the IPO, but for a company’s early future as a public company.

I believe not every deal needs to be huge and highly publicized, and changing our viewpoints toward this will help. We used to have a higher frequency of smaller-sized IPOs. In recent years, all the offerings have been viewed as either great or horrible, which creates a huge perception gap. It ultimately discourages institutional and individual investors alike from taking a position in a new IPO deal. But in the past, there was more of a bell curve and most IPOs were considered “moderately” successful and many went on to become great public companies. Today, we have a bimodal distribution.

The smallest category as we see in this chart is the “well-priced” deal, up modestly (up to 20 percent). Rather, the bigger categories are big winners or big losers.

Source: Dealogic

So what now?
While things are not going to change overnight, we can create a more fertile environment when the venture capital industry, investment banks and growth companies begin to collaborate and drive changes in the IPO ecosystem and get deals flowing again. My experience tells me it’s possible. I’ve seen it before, and it can happen again, at an even greater scale, to become the most robust IPO market in history. We have been complaining for years that the IPO market is dead, but with a few small tweaks, it’s here for the taking.

Sandy Miller is a General Partner with Institutional Venture Partners (IVP). He focuses on later-stage venture and growth equity investments in technology, Internet and digital media companies. He was recognized by Forbes Magazine as one of the top 100 venture capitalists in the world by his inclusion in all of the Forbes Midas Lists since 2007.

But the market made up its mind very quickly yesterday, and you can see it illustrated quite nicely below: It wanted to see more from Facebook, it thinks Google is just fine and it’s not worried about LinkedIn. But it thinks Yelp could see real competition from Mark Zuckerberg and company.

It’s pretty obvious in these Yahoo Finance charts, but just to be clear: Zuckerberg started speaking around 1 pm ET yesterday. The markets open in a few minutes, so we’ll see if anyone has rethought anything overnight.

Problem: One of Facebook’s main ways of serving up relevant content is based on the “Like” button. Think of the stuff in your news feed — much of what flows through it comes courtesy of the types of items you’ve “Liked” in the past.

This is not to say Facebook only relies on the “Like” button. Things like profile visits, things you’ve listend to and photos you’ve viewed all serve as signals. But to serve up the best search results — especially in terms of places — Facebook needs far more signals to return the most pertinent stuff to its users.

In other words, “Liking” isn’t enough to cut it anymore.

That’s why the company will begin to lean heavily on a greater number of signals, emphasizing new ways of collecting data from users inside of Facebook. As Mark Zuckerberg said at the press conference this morning, check in to a restaurant, for example, and Facebook will now prompt you for a little bit more insight on your feelings on the place. It’ll ask you to rate the restaurant from one to five stars, for instance, and prompt you with a question on how much you like the place.

The other hope is that users will begin to check in to more Places using Facebook’s location services on their mobile phones and discover other points of interest using the new “Nearby” tab — also on their mobile phones. So not only will you be able to use the services to open up local discovery, but your history of check-ins and visits can help refine the types of places you’ll search for and are likely to visit in the future.

This is well-trodden territory from competitors like Yelp, which relies heavily on ratings, and Foursquare, which is the go-to mobile application for checking in to places. Both of these services are essentially local discovery engines, aiming to make it easier to navigate the world.

But if Facebook can rely on its powers of suggestion to get people to enter more data — like ratings of places and check-ins — the more signals will feed into Graph Search, and ostensibly, the better the results will be.

Potential roadblocks: Right now, Facebook isn’t known well for either check-ins or ratings — those are verticals owned by Foursquare and Yelp. But again, Facebook is far, far bigger than the 30 million-user Foursquare, and has potential for many more place ratings if the company can convince users to dole out their judgments.

Beyond check-ins and ratings, there are a number of other signals that Zuckerberg wouldn’t get into onstage (my guess is that they’re nerdy to the extreme). But one thing is for sure: If Facebook wants to own relevance, it’ll need to go far beyond our willingness to “Like” things.

At its Menlo Park headquarters on Tuesday, Facebook unveiled its take on search, the social giant’s major push into helping its users find content from within Facebook.

For as big as Facebook has grown, something like this has been sorely needed. More than one billion people are on Facebook’s network, with upward of 240 billion photos and more than a trillion connections within the social graph. For anyone looking for a specific topic of information, place or person, that’s a lot of stuff to sort through.

“Indexing all this content and making it so you can find it easily is a really hard problem,” CEO Mark Zuckerberg said. “Graph search is designed to take a precise query and return to you the precise answer.”

What does that mean? Essentially, Facebook wants to make it easier for users to find stuff from within a user’s network of social connections, without having to exit the site. A search box topping the page prompts you to enter a search string that returns information relevant to your network.

The thesis is this: Web search is about returning links to keywords and phrases. Google made its impact serving up the most relevant Web sites based on Page Rank. But Facebook’s Graph Search is built on the idea that you’re better served by finding content that’s been shared within Facebook. It’s your network of social connections, after all, and the philosophy is that you’d rather see things from that network.

The search paramaters are all about the stuff that circulates inside of Facebook — namely, content. Games, videos, pictures and people. Enter a phrase like, “games my friends play,” and you’ll get a list of content spit back out at you based on the connections that you’ve already made within Facebook.

Sound familiar? That’s because it is — Google is trying to do this exact same thing with Search Plus Your World. The way that Google+ works, if you or your friends +1 content on Google+, it’ll show up within your Google search results. The idea is, adding that social element into the mix makes users more apt to click on the content.

But Google’s problem is that Google+ isn’t as widely adopted or used as much as Facebook is. Facebook has the one-billion-strong network of users to suggest content to one another.

This also bodes ill for companies like Yelp, Foursquare and even the small startup Path, all of which aim to serve up recommendations to users based on their history of ratings, “Likes,” visits, etc. That’s problematic for these smaller companies, all of which work on vastly smaller data sets than Facebook’s gigantic network.

Looking for something that isn’t on Facebook? There’s an answer to that, too. Facebook has partnered with Microsoft’s Bing search engine to serve up any Web content that isn’t shared within the social network. Yet another slap in the face to Google there.

But ultimately that isn’t Facebook’s goal. Facebook wants to keep users inside Facebook to find things. The more stuff we share, use and look for inside of Facebook, the less often we’ll have to leave the network.

Good luck with that, Mark.

]]> http://allthingsd.com/20130115/graph-search-facebooks-way-of-keeping-you-inside-of-facebook/feed/ 27 http://allthingsd.com/20130102/court-says-negative-yelp-reviews-shouldnt-be-censored/ http://allthingsd.com/20130102/court-says-negative-yelp-reviews-shouldnt-be-censored/#comments Thu, 03 Jan 2013 01:02:02 +0000 Liz Gannes http://allthingsd.com/?p=281937 A Virginia court late last week lifted an injunction against a woman who left negative reviews about her home contractor on Yelp and Angie’s List.

The reversal was important because the previous decision had effectively censored Jane Perez’s Yelp review of contractor Christopher Dietz without a court finding that what she wrote was actually false and libelous.

Previously, a judge had told Perez that she had to rewrite her posts to remove a reference to jewelry missing from her home, and to recharacterize the dispute between her and Dietz over nonpayment.

But an appeal by Public Citizen and the American Civil Liberties Union led to the court determining just two days later that “the preliminary injunction was not justified and that the respondents have an adequate remedy at law.”

“It shouldn’t be easy to take down speech that you don’t like,” said Paul Alan Levy, an attorney for Public Citizen. “You can’t get injunction against defamation. If it’s really defamation, you get damages.”

Yelp and Angie’s List were not directly involved in the case in their role as online forums for user content. However, Yelp provided the following statement:

Consumer freedom of speech provides an important public service, protected by law. Yelp provides a valuable contribution to this dialogue by providing a two-way platform for consumers to share their experiences and for businesses to respond to their customers. Courts have consistently ruled that consumers have the right to share their truthful experiences. As a result, businesses that choose to sue their customers to silence them rather than address their comments, rarely prevail and often bring additional unwanted attention to the original criticism.

]]> http://allthingsd.com/20130102/court-says-negative-yelp-reviews-shouldnt-be-censored/feed/ 0 http://allthingsd.com/20121224/paths-personal-take-on-social-discovery/ http://allthingsd.com/20121224/paths-personal-take-on-social-discovery/#comments Mon, 24 Dec 2012 17:00:07 +0000 Mike Isaac http://allthingsd.com/?p=280402 Path, the small-scale “personal network” that limits users to 150 friends, released a much-lauded feature last week, a slick search function that allows users to comb through the history of their network to find different items of interest.

It was widely praised, mostly because, hey, search is fun! And the user interface is pretty slick.

Perhaps lesser noticed, however, was a side effect of searching through your Path history — a social discovery mechanism.

The “nearby” search option lets you find your past entries on locations, well, nearby. So if you’re a San Franciscan who last checked in to a restaurant in, say, Los Angeles, about a year ago, you can run that nearby search next time you’re down in Los Angeles to rediscover and potentially revisit said eatery.

Or, as Path CEO Dave Morin told me, it “reduces the friction of remembering an event.”

That’s all well and good if you like to eat at the same places all the time. But competing takes on discovery from the likes of Foursquare, Yelp, Spindle, Facebook and Google offer other, more feature-rich signals, and the ability to discover new experiences rather than rediscover old stuff you’ve already done.

Moreover, almost all of those competitors draw on far larger data sets than Path currently offers with its five million users. Mining the history of activities of of the masses serves up many more potential opportunities to visit new places.

Here’s where Path deviates: Using search, we can scan back through the history of our friend’s experiences, browsing some of the many places they’ve checked in, and sorting it by city, by keyword, by theme. Within that history, Morin’s philosophy goes, we’re able to find some of the best restaurants, bars, or areas of interest — not, mind you, due to the many signals that the other services rely upon, but because our network of Path pals have visited them.

“Maybe the question isn’t necessarily, ‘Is this the best data set to find a restaurant?’ Morin said. “Maybe the question is, ‘Have my closest friends’ — you know, the ones you’ve befriended on Path — “‘decided to go to these restaurants?’”

It’s a curious approach, and a bit charming, considering it’s somewhat backward from most of the other sites working on discovery. The sample set, by the nature of the network, is smaller by design. And less choice, in Morin’s opinion, makes for better results in the context of Path.

I’m not sure I totally buy that quite yet, however. I wonder, between the Paths, the Foursquares and the Facebooks of the world, just how many folks remember to check in to locations via Path. As always, it runs up against the problem of “Do we need another social network?” by perhaps not being the go-to app for checking in.

Still, it’s novel. And the search function works quite well. Now we’ll see if it keeps users active, engaged and checking in.

]]> http://allthingsd.com/20121224/paths-personal-take-on-social-discovery/feed/ 1 http://allthingsd.com/20121217/facebook-push-into-crowded-territory-again-with-local-discovery-update/ http://allthingsd.com/20121217/facebook-push-into-crowded-territory-again-with-local-discovery-update/#comments Tue, 18 Dec 2012 00:00:36 +0000 Mike Isaac http://allthingsd.com/?p=278665 If at first you don’t succeed … well, you know how that goes.

As does Facebook, which is pushing hard into local discovery territory with Nearby, an updated feature inside its mobile app that offers suggestions on businesses and places of interest you may want to check out.

Nearby functions best by taking cues mined straight from your Facebook account — stuff you “Like,” stuff your friends have “Liked,” places you’ve checked in to, etc. The relevance argument here is that Facebook has a wealth of user data to draw upon for recommendations, perhaps more than Yelp or Foursquare.

It’s not entirely new ground. Facebook tried this sort of thing more than two years ago with Places, the company’s supposed Foursquare killer. Check in to joints, find friends, meet up and so on.

Surprise! Facebook didn’t kill Foursquare, nor did Yelp suddenly vanish. Foursquare has grown to upward of 20 million registered users, while Yelp went public and is growing by the day with overseas acquisitions. (Now, while they’re not dead, parsing Foursquare’s and Yelp’s business models and long-term prospects is another discussion entirely.)

So what’s different in round two? For one, it’s a heck of a lot nicer than the original effort. It’s personalized, it’s more robust, and all of your Facebook activity really does help fuel it.

In other words, it’s an actual discovery mechanism.

It’s probably going to be a whole lot better, considering Facebook acquired location-based services experts Gowalla, helmed by the very smart (and exceedingly pleasant, I may add) Josh Williams, almost a year ago to date.

But, you know, there’s the whole problem of intent to consider. Does my “Liking” a Facebook page for a business mean I’m inclined to visit them, or purchase anything from them? That’s the case that Facebook’s marketing department is trying to make to both SMBs and big brands right now, with mixed results.

Google, on the other hand, has this sort of thing pretty much nailed. Intent is built directly into how a Google search works. Looking for a restaurant address and times? Google it. On the move and looking for something to nosh? There’s a local discovery bar built into the Google.com homepage when you’re viewing on your mobile browser. In other words, ask Google and ye shall receive.

I’m curious, too, to see how often Facebook users swipe sideways in the app to dig through their tabs and find Nearby. I know I spend most of my time checking my News Feed from the app, rather than messing with other things. We’ll see if other folks use it differently.

Also of note: Facebook recommends you update your profile with lots more relevant information to make Nearby work better. Not too shabby of a way to collect more user data through the power of subtle suggestion, eh Facebook? Nice try.

Expect the new feature to come in an app update Monday afternoon.

]]> http://allthingsd.com/20121217/facebook-push-into-crowded-territory-again-with-local-discovery-update/feed/ 2 http://allthingsd.com/20121216/going-the-extra-mile-now-that-google-maps-have-returned-to-ios/ http://allthingsd.com/20121216/going-the-extra-mile-now-that-google-maps-have-returned-to-ios/#comments Mon, 17 Dec 2012 00:24:18 +0000 Tricia Duryee http://allthingsd.com/?p=278248 In less than 24 hours, Google Maps became the most-downloaded app on the iPhone, as unhappy consumers flocked to the App Store looking for an alternative to the Apple-made application.

But four days later, the reality is setting in that downloading Google Maps won’t result in the same experience as before — that’s because Google Maps is not the iPhone’s default maps program. Apple continues to hold that coveted position.

The arrival of the app on Wednesday was first confirmed by AllThingsD.

Understandably, this disparity could lead to some consumer confusion.

Google Maps was the default application since the smartphone first launched, and remained so until it was kicked off in September as part of the iOS 6 software update.

Now, as users download Google’s map application, they may think that it should function just like before.

After reading reviews in the App Store, the biggest complaint so far has been that contacts are no longer accessible inside of Google Maps.

“Why can’t I access the contacts on my iPhone,” one user asked. “I checked the privacy menu in settings on the phone and maps hasn’t even tried to access them. All of the new features and it won’t let me get directions to my contacts!!” Another user, who goes by the name of Memphis-Drew, wrote: “Since this isn’t a native app anymore, it doesn’t feel fluid. Expected more from Google.”

Overall, Google gets four-plus stars based on nearly 20,000 ratings, so the complaints are relatively minor.

It’s unclear if Google could have included access to the contact list, or if that’s a function that is blocked by Apple, but it should be noted that some of these issues are simply out of Google’s control.

For me, what’s noticeable is how clumsy it is when navigating to an address saved in my calendar. A one-step process has turned into four: To find directions to your next appointment, you must copy the address from the calendar, close the app, open Google maps and paste the address into the search bar. That’s not something I should attempt while driving.

Following the release of Apple Maps, Apple CEO Tim Cook formally apologized to users for MappleGate, and, since then, both mobile software head Scott Forstall and maps manager Rich Williamson have been ousted.

But hoping that Google Maps will be more tightly integrated into some of the operating system’s core activities, like it once was, seems like a stretch for a company that was clearly trying to decrease its dependence on Google with the launch of its own map app.

Is Cook willing to go the extra mile to ensure the user’s happiness by at least giving the consumer a choice of which map it wants to use?

Another thing that consumers will likely notice is that Apple Maps will continue to appear in a number of navigation-heavy applications, like HotelTonight, Yelp or Redfin, just to name a few. In those cases, for directions to a hotel, a restaurant or an open house, the easiest map to use is the one embedded in the application — and by default, that’s Apple Maps.

However, that could be changing soon.

Perhaps as important as the app itself, Google also released a software development kit this week, allowing other app makers to build Google Maps into their programs. Developers interested in doing so can register to get access to the APIs to easily enable their users to search and get directions using Google Maps.

But for now consumers will end up using Apple Maps for a lot of activities, especially if patience is a factor.

That’s especially true since Apple-built applications cannot be deleted from the phone’s operating system. For very diligent people, I found this hack that allows users to hide unwanted Apple applications without jailbreaking your phone. (Note: I did not attempt this myself!) Alternatively, you can also move the app into a folder and bring the Google Maps app to your homepage to make jumping between things easier. That’s pretty simple.

Regardless of your own personal preference, one thing I did learn from the reading dozens of the reviews in the App Store is that a lot of people didn’t find Apple’s mapping application so horrible to begin with. Now that Google is back, they even appreciate some of the new features brought to the table by Apple. As one reviewer said about Google Maps, “All hype, little substance.”

]]> http://allthingsd.com/20121216/going-the-extra-mile-now-that-google-maps-have-returned-to-ios/feed/ 0 http://allthingsd.com/20121214/homeaways-director-susan-wojcicki-resigns-to-spend-more-time-at-google/ http://allthingsd.com/20121214/homeaways-director-susan-wojcicki-resigns-to-spend-more-time-at-google/#comments Fri, 14 Dec 2012 20:15:08 +0000 Tricia Duryee http://allthingsd.com/?p=278145 HomeAway, the company that manages online vacation rentals sites, disclosed yesterday that Susan Wojcicki will no longer be on its board, effective immediately.

As you would suspect, the company was quick to say that the resignation was not a result of any disagreement with the company. Rather, it disclosed in a public filing, that Wojcicki is resigning due to “her need to focus on her significant responsibilities as senior vice president of product management and engineering for all advertising products at Google.”

Wojcicki joined HomeAway’s board in April 2011, right before the company went public. On the surface, Wojcicki’s experience would seem like a good fit for HomeAway since it describes itself as receiving substantially all of its revenue from customers who pay fees for “online advertising listing services.”

But maybe not. In fact, HomeAway’s model is not exactly an advertising model in the truest sense. Mos property owners pay HomeAway a subscription fee to list their rentals on the company’s various Web properties. In contrast, other companies like Yelp do not charge restaurants or merchants to appear in its database, but instead derive revenue from banners and other forms of advertising. Interestingly, other travel sites, like a start-up in Seattle called Dwellable, are currently trying to flip HomeAway’s model on its head by creating a free listings service, which then can be monetized through advertising later. Makes a lot of sense since the founder is from Urbanspoon, a Yelp competitor.

HomeAway also said it would be electing Tina Sharkey to fill Wojcicki’s vacancy. Sharkey, who will serve on the board’s compensation committee, was chairman and global President of BabyCenter, a subsidiary of Johnson and Johnson, from 2007 to 2012. Prior to that, she held various senior positions at AOL from 2003 to 2006.

]]> http://allthingsd.com/20121214/homeaways-director-susan-wojcicki-resigns-to-spend-more-time-at-google/feed/ 0 http://allthingsd.com/20121105/foursquare-launches-numbered-ratings-system/ http://allthingsd.com/20121105/foursquare-launches-numbered-ratings-system/#comments Mon, 05 Nov 2012 23:16:17 +0000 Mike Isaac http://allthingsd.com/?p=266878 Foursquare on Monday unveiled a new numbers-based ratings system for locations within the mobile app. When users look for locations to visit using the “Explore” feature, places are ranked on a 10-point scale, taking into account signals like tips, loyalty and popularity. In a jab to competitor Yelp, Foursquare claims it’s more informative than a one- to five-star ratings system, which relies on users and ultimately averages out to give little information.

]]> http://allthingsd.com/20121105/foursquare-launches-numbered-ratings-system/feed/ 1 http://allthingsd.com/20121031/daily-deals-alternative-locbox-raises-5-1-million-in-first-round/ http://allthingsd.com/20121031/daily-deals-alternative-locbox-raises-5-1-million-in-first-round/#comments Wed, 31 Oct 2012 16:00:41 +0000 Tricia Duryee http://allthingsd.com/?p=265301 San Francisco-based LocBox, which is developing a way to help local businesses retain and attract new customers, has raised $5.1 million in a first round of funding. Investors in the round include InterWest Partners, Google Ventures and 500Startups, with additional investments from several angels. LocBox’s platform helps businesses run marketing campaigns across email, Facebook, Twitter, SMS and Yelp from one dashboard.

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