There has been a lot of very sagacious advice offered by Venture Capitalists and investors to their portfolio companies in the last week. I’ve read them all 3x. Dogster, Inc. is not VC-funded, and we have a negative burn rate (aka are profitable) by, I would credit, putting as much focus on multiple revenue streams as we had on growing a great service. We’ve always been a very risk adverse company, which I suspect in the next year will be reclassified as a quite sensible company.

But for all the doom and gloom of the VC’s desperate to not keep their flock from getting culled like they did six years ago, the next couple of years will not be like 2002 and 2003. They may be for the VC firms that struggle to manage their overfunding and overvaluating tendencies of the last couple of years, but their retrenching into bunkers to save their fund’s value will not have nearly the affect on entrepreneurs and angels as it did earlier in the decade.

It’s no secret that Internet businesses can be started with no budgets and get themselves to profitability within a year or two. We did it during the ‘nuclear winder’ and so did Blogger, Flickr, Delicious, LiveJournal, HotorNot, Moveable Type, Wordpress, StumbleUpon, … need I go on? But more importantly, it’s happening right now. Dozens of similarly potent companies have launched in the last year. You’ve seen the iPhone App store right? The cash model is back and the landscape for digital products is an order of magnitude larger than in 2001. Then it was web and games. Now it’s web, games, phones, social apps, Tivo/DVR appliances, in-car appliances, hand-held games. For dog’s sake walkmen, phones, and VCRs (aka DVRs) are now Internet appliances. What’s next? Who’s going to make it? I don’t know but in two years we’ll all know.

And, as serial entrepreneur Shervin Pishevar so eloquently reminded us in his great entrepreneurial missive, the Horatio Alger spirit is no longer the American Way, it’s the Global Way. It’s not just the minds pouring out of American universities and offices, it’s the minds of the WHOLE world. Creativity is brimming in what we used to deride as Eastern Block countries. And we already know Europe, India, China, Russia, etc. have all reformed their economies to support, foster and expand environmentalism. Even if young Americans put their heads in the sand, there will be as many new Technology products released in the next two years than in the last six.

Then their are the angel investors who are very different than their fin de cielce cousins. Angels in 1999 were Dentist and Alumni Groups, Waste Management companies, mothers and fathers. There were very few ‘made-my-millions’ technologists helping the next generation as there are now. The current generation of angels and early investors, many of whom I’ve gotten to work with and know don’t do it by choice, they do it because they love it. They love the excitement, the discovery, the opportunity, the chase. They love working with entrepreneurs and helping develop their products. I can promise you some that quickly come to mind, Ester Dyson, Joi Ito, Josh Kopelman, Jeff Clavier, Brad Feld, Aydin Senkut, Reid Hoffman are not going to go to Switzerland or Kona to ride out the banking freeze. They would go crazy. Heck, they’ve probably moved more money into cash than they’d like and are seeking more places to put it. Even if some of the angels with funds saw those funds freeze up, I can promise you they would start investing as individuals again because they can’t not pass up on good opportunities. They know better. Wall Street and Sand Hill Road’s loss is their gain.

The next line of whining and fear the VCs are repeating is “but there will be no exits … M&A is closed and IPOs are over”. To that I say IPOs died in 2001 and the M&A market has been tepid at best for the last two years. I was talking with First Round Capital’s Rob Hayes the other night, who said “does anyone seriously think tech had a bubble problem anymore?” And then added more realism by saying ” We’ve gone the last 3 years with a slow exit markets, so it’s not like it will be any different next year.”

If there was ever time I would think the advice I and my partners have made for growing a sustainable value business would not land on deaf ears it’s now. To all entrepreneurs, now is a GREAT time to make something. Trust me new entrepreneurs, you’re better off making it on your own than risking it to VC growth requirements. Develop a great product and great people will find you to help. Expand that great product and companies will still want to partner with and buy you.

In the last month we’ve closed $250k in new deals and have received proposal requests from every major pet-related CPG company. (Mars, Purina, P&G, Clorox, etc.) It’s the banks and equity folks running for cover. People are buying iPhone Apps like they are the candy that they are. People will be playing games, and using the Internet more than ever. Home entertainment devices will penetrate the majority of American homes by the end of the decade. Wii’s will open up like the iPhone App store and everyone’s phone will have a web browser.

So heed all that VC advice: find revenue, watch costs, don’t expect easy outs; but now is definitely the right time to be making the next great thing. Just do in a way that it makes money from the get go, and you’ll guarantee your success no matter what happens.

Dave McClure has a great post about how to avoid the woes of others and stay focused on making great things. He’s right.

[Photo 1 by Laughing Squid of Stewart Butterfield (Flickr) Biz Stone (Xanga, Blogger, Twitter) and Joshua Schacter (Delicious) on a panel I led about Founders. Photo 2 by Dave McClure of Rob Hayes and Jeff Clavier on a panel I added entrepreneurial color too.]

I‘ve spent more time learning Google Analytics (GA) than I care to quanitfy. I’ve asked questions that stumped the GA team and I’ve been invited to speak at Google to the GA project managers and engineers. And yet I found Brian Clifton’s new Advanced Web Metrics with Google Analytics to be a very informative read.

Brian writes clearly, quickly and compartmentally. You can skip over what you know and dive in anywhere that is new. Here are notes I took on features I have since availed or intend to deploy soon.

• » You can track how far visitors get when filling out a web form. Add an onBlur to each form field and each time data is added to a tagged form field GA is updated. Thus track drop-off rates as people are filling out a form. (Page 116)

• » GA has a URL building tool that makes it easy to build inbound links (such as for inbound links in a partner’s newsletter or site) that will track in GA the link source, link-type and anything else. So, instead of having to use the referrer logs to see how many people from the a partner site. You can see if they clicked the text link or the image link and if you set up filters you’ll be able to the see exactly what each user type did during their visit. Page 126)
• » It’s possible to track and transfer a user if they go to a different domain you control and thus have the knowledge it’s one unique, not two. (Page 140)
• » We can do more with filters, such as view stats for new users vs. returning users (I set this up immediately and it’s of course fascinating. Or you can filter users from certain cities, regions or countries (or a series of cities, regions or countries), or stats from people referred from Google or Stumbleupon or users of IE6 or big monitors. (Page 168)
• » You can track the keywords used in Google Image search that led to a visit to our site. Right now all we know is the raw number of visits with no insights on what they were searching for. (page 181)
• » It’s possible to label visitors for their sessions and see stats on what they do. An example could be tracking someone that participated in an advertisers landing page or contest or people that arrived from a search engine, partner site. Anything. You simply assign them a distinct user-cource keyword and then filter all those users. (Page 183)
• » Track our brand awareness by charting how many searches are done using your brand name. If you did a big PR campaing you can track success by an increase in searches done on your brand name. (page 244)
• » You can start assigning values to certain terms (Per Search Value) that are searched on in our internal site search to track overtime which terms mean the most to you, even if they are not searched on the most. You can also isolate visits that used search vs. those that don’t to see how important it might be to get people to use our site search tool (or how much money we should spend improving it) (Page 289-291)
• » In the Visitors Tab in Visits, there is an ‘hourly’ view I did not know about. (Page 59)
• » GA can easily be used to store details of an e-com transaction. Order Id, Total $ Transaction, Affiliate, state, zip, country, shipping type and any other standard field that would be of interest to track. Do this by simply passing custom values to the GA javascript tracking code. (Page 117)
  
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“Listen to your users? … yes, absolutely.
But caring about your users is WAY better!”

   Gary Vaynerchuk

If you’re not passionate about what you’re doing, as the LOLcats say, you’re doing it the wrong way. Watch Gary Vaynerchuk in his keynote from WebExpo08 NYC and translate what he’s advising (or beseaching I should say) into what you are doing and what you want to be doing with your business, your life, your future.

The best press is the kind that simply appears without having to do anything.

So imagine our pleasure when we heard that Southwest’s in-flight magazine has a great review of Dogster.com this month.

Here’s a phone pix that got sent in…

[A free Dogster t-shirt to the first person that sends in a nice clean copy of the article!]

August was a huge month on our network of sites and we were just a hair shy of hitting one million uniques on our network of sites.

Here are some charts from compete.com which show our growth trends in the last year

August Uniques

August Visits

[Note: Compete.com generates reports based upon a very incomplete set of ISP logs. Thus they are not so great at getting exact numbers right, but they do an excellent job reflecting usage trends month over month. Of course we have our own internal reporting tools to know our exact numbers, but these public charts above show our numbers pretty well.]

There is a charged post by John Casasanta, of Tap Tap Tap the maker of great iPhone apps, that is a must read for anyone developing or funding a business.

I 100% agree with John’s position that you should not take a VC round if you feel like you are being pushed into it. In the end, no one cares about your company more than you. We are a 4.5 year old, profitable 17 person company with only a great group of Angel investors. When a VC round is right for us we’re all for it, but if you love what you do and you don’t think you can execute on the plan that a VC investment would require, wait until a better time.

I also sympathize with his fear that too much money flooding in the iPhone app space may turn the iPhone party into a Slide/RockYou thing and not the horizontal party it is at the moment, but I don’t agree that it will hurt Tap Tap Tap as a company. If you make great quality product with a singular passion, there will always be room for your business to excel, especially when it’s in such a young market as iphone (and even web) software is. Stick to your guns John and Tap Tap Tap, but don’t worry too much about what strangers and people you do not trust say and do. Making great things is the best revenge =D

Here’s a great list of highly regrettable mistakes made by a Angel-funded first time entrepreneur from LendingClub.

This are just the bullet-points. Read the whole entry.

1) I Managed People like Michael Scott from “The Office”.

2) I Hired My Friends.

3) I Budgeted Like Britney Spears: Terribly.

4) I Leased A Fancy Office While My Large Basement Went Unused.

5) I Raised Money Before I Had Customers.

6) I Mixed Business with Pleasure.

7) I Assumed Everything Would Go According to Plan.

As an aside, it’s possible to hire friends, and it can be great … BUT, do not enter in such a relationship lightly. Think of it as getting married to you friend and be ready to all the advance on on-going work a marriage requires, because if it doesn’t work out it feels like you are divocrcing your friend … and that sucks.

Here are some more additions/refinements I posted where I originally read it.

* Get books on managing people and read them

* If you dare hire friends, make sure you understand each others expectations to a ‘t’ and check-in often.

* Spend as if you have to manage your business on your own means

* Prove your business model early

* Don’t define yourself by what your start-up is. Keep yourself intact.

Does the fact compete.com constantly shows unique visitor tends for Google.com and Yahoo.com moving in near lock-step imply that overall Internet usage trends (or at least U.S. Internet usage trends) are moving in the same way? Or is it simply that compete.com’s algorithm become more flawed when dealing with super high-volume sites?

Is it possibly true that as goes Google and Yahoo, so goes the Internet? It’s seems unrealistic, but I’ve been watching this chart move for the last year and aside from Google surpassing Yahoo earlier this year, each month’s percent change is almost identical.

On Friday we launched P&G’s second big campaign for the Febreze Pet Odor Eliminator which got written up in Brandweek. The campaign is likely the farthest reaching social media campaign we’ve put together and I expect will be our most successful advertiser brand campaign yet. But, I’m even happier to see the Febreze’s team get the respect they are due for committing to advertising in social media the right way.

Anyone that produces a modern website considers the benefits of socially-focused advertising as obvious as XHTML, but for Madison Avenue it’s still an opportunity to get fired. (Remember the Chevy Tahoe video campaign?) And even for those deeply immersed in social networking it’s still very easy to bungle social advertising (remember Facebook’s Beacon?) So, after a successful product launch with us in April where 20,000 pet owners joined Febreze’s Dogster/Catster Groups, Febreze wanted to take it to the next level and it was critical to all parties to get it right.

Here’s what we orchestrated and why BrandWeek covered the campaign:

*) Febreze understands how important pet adoption and rescue is to our community, so they are now the sponsor of the popular Dogster.com Adoption Center

*) Continuing their commitment to adoption and rescue, Febreze is giving away thousands of gift packs to owners of adopted dogs and cats. Anyone who has adopted a pet is eligible!

*) Raising puppies and kittens right is also very important so they are the sponsors of the Dogster Puppy Answers and Catster Kitten Answer areas.

*) People want to have fun too. Febreze is sponsoring a free gift (seen to the right) in our virtual store. In the first 5 days over 100,000 member pages (~16% of all profiles!) have received one of the gift collars.

On top of this the Febreze Pet Odor Eliminator message will be strategically messaged on our homepage and in our newsletters. Meanwhile campaign banners will be run-of-site through the entire campaign

What’s also gratifying is that by getting this right, we’ve collectively created new engagements factor for members. They love giving the gifts and getting the gifts. They’ve devised games based around the gifts and are writing about it in their diaries and forums. Here’s a member doggie’s photo I stumbled upon over the weekend.

So kudos to Febreze and their ad team for putting in the development time and prep work to turn what could have been a same-old banner campaign into a top topic of conversation on our sites and a source of a lot of fun and engagement.

Marketing Sherpa shares the results of an eyeball tracking study of how viewers looked at ad banners in a new newsletter in the first, second and third issue.

The three images show the results:
* 80% of people scanned the ad areas when reading the first issue of a new newsletter.
* 40% scanned the ad area when they got the second issue.
* Only 20% looked at the ad area by the time they got the third issue. Ouch!

Here are great key takeaways Marketing Sherpa gives:

1. Change the landscape
2. Change the look and feel of ads
3. Increase ad rotation

However, our newsletters do great, even with long-term readers. We often get our advertisers click-thru rate ~8%-10%. (That’s clicks, not just eyeball looks ;)

Here’s how:

1. We ditched the ad banner format. You should too.
2. We integrate the advertiser message and imagery into the rest of the newsletter, and do not have fixed placement areas.
3. We theme the newsletter around the advertiser’s message as often as we can.
4. We do four newsletters a month, but only two of them have ads.
5. We custom-write the advertiser message so it’s most relevant to our readers’ interests.
6. We never run the same ad twice in a month.
7. To advertise in the newsletter the advertiser must also have a presence on the general site (such as banners, sub-section sponsorship, contest, giveaway, etc.) so the viewer is more likely to accept the ad’s message faster.

Here’s a recent newsletter with two paid positions. Can you spot them? (click to enlarge)