TWiST #258 News

PandoDaily is reporting that LA startup BetterWorks executed significant layoffs this week, terminating all of its sales and marketing staff and half of its operations team

The remaining staff consists of product engineering, a limited customer support team, and half of the previous operations team

BetterWorks offers small and medium businesses an online solution to institute employee perks and recognition programs

Its users connect with local vendors that offer discounts on dining, fitness, laundry, education, and other services

The company expanded rapidly in the last 18 months, growing its team to more than 60 and entering most major metros around the country

It was founded by prolific angel investor Paige Craig, Yammer co-founder George Ishii, and Farmville co-creator Sizhao Yang

Craig explained the cuts saying, “The outside sales model is a big risk. When we were on-boarding early adopters, the signals were that it was working. Once we got past the early adopters, the real numbers didn’t justify the cost.”

Craig also said that the company is pivoting with regards to its customer acquisition model and will focus on online, affiliate, and email marketing

Craig said the message that he wanted to get out was, “These are great people that I was unfortunately forced to part with. If anyone sees a BetterWorks resume, they should absolutely hire them.”

BetterWorks has raised a total of $10 million to date, including an $8 million Series A from Redpoint Ventures in February 2011

According to Craig, the company has approximately half of this cash still in the bank, and the new slimmer operation has a 16 month runway to figure it out

QUESTION: Obviously, Paige is a friend and it’s a bummer to see him having to cut staff. Will this new pivot turn the tides in favor of BetterWorks? What should their new focus be?

SOURCE: PandoDaily

Facebook’s IPO is set for today and it promises to break several records

It will be the largest venture-backed IPO on record far exceeding the current record holder, Google

If Facebook’s valuation nears $104 billion as expected, it would be more than 4x the size of Google’s $24.6B IPO in 2004

Another record is the $2.2B Facebook has raised in equity financing, the most capital collected by any U.S.-based venture company

It also holds the distinction of being the most active acquirer pre-IPO, having bought 13 companies while private (Twitter acquired 11)

In the IPO, Facebook plans to offer up to 484.4 million shares of class A common stock

A recent addition to the S1 filing came this week when Digital Sky Technologies, a Russian investment firm that played a key role in Facebook's funding over the years, decided to offer nearly 46 million shares, up from the 26 million it initially planned to sell

Venture capitalist Peter Thiel is also selling 16.8 million shares and Accel Partners, will sell 49 million shares

The company has planned to price the stock between $34 and $38 per share

QUESTION: Would you personally buy Facebook stock? How many days do you think until the price takes a plunge? Or will it?

SOURCE: CNET

Netflix rolled out a completely revamped video player for browser-based viewing this week

Upgrades include lightbox-like text overlays while a video is paused and the ability for users to preview entire seasons of a TV show while they’re watching one episode of the show in full-screen mode

The player also has a new control bar that offers access to subtitles and season previews, and replaces text menus with bigger icons

Additional episodes of a TV show can be previewed right from within the player, even in full-screen mode

Users can also resize the browser window during playback, and the video is resized fairly smoothly

While PC-based playback is still clearly a priority, Netflix has been emphasizing playback on connected devices, which now make up for the vast majority of the service’s usage

One potential issue uncovered by GigaOm is with Chrome on Mac OS – for one user, a warning screen advised a switch to Safari or Firefox for the best viewing experience

A Netflix spokesperson explained via email: “Chrome on Mac support is a limitation of Microsoft Silverlight, not Netflix. It works on some Macs but not on others, so we allow it and give users a warning.”

QUESTION: Will updates like this help keep Netflix ahead of the streaming pack? Or is the bigger issues of user loyalty and adoption centered around available content?

SOURCE: GigaOm

Google formally launched its “Knowledge Graph” this week

The new technology is being used to provide popular facts about people, places and things alongside Google’s traditional results

It also allows Google to move toward a new way of searching not for pages that match query terms but instead for “entities” (or concepts that the words describe)

Google has used a “link graph” to model how pages link to each other, in order to help determine which are popular and relevant for particular searches

Google users searching in US English will begin seeing it over the coming days on Google.com

While the change is significant, Google will still look largely the same as it does now

Knowledge Graph information flows into new units that will appear in panels to the right of Google’s regular results, rather than disrupt the familiar links

QUESTION: Google search has not been without controversy in the past, but will this update bring an onslaught of criticism? Or is will this generally be viewed as a positive change?

SOURCE: SearchEngineLand

General Motors decided this week to stop advertising on Facebook, citing concerns about the site’s effectiveness

According to the story, the automotive company will still maintain pages on Facebook — on which it spends $30 million annually

While GM’s pulling of its $10 million ad spend itself won’t have a significant impact on Facebook, the story here is what this says about Facebook ads and their effectiveness

Software company WordStream recently released an analysis comparing Facebook Advertising and the Google Display Network in which Facebook came up short, with a click-through rate of only 0.05% as compared to GDN’s 0.4%

A lower click-through rate, according to the company, is indicative of a lack of advanced targeting and compelling ad formats that induce viewers to click through

Further, Forrester analyst Nate Elliott, posting on his company’s blog, wrote: “One global consumer goods company told us recently that Facebook was getting worse, rather than better, at helping marketers succeed. And companies in industries from consumer electronics to financial services tell us they’re no longer sure Facebook is the best place to dedicate their social marketing budget — a shocking fact given the site’s dominance among users.”

Advertiser uncertainty could be problem for the social giant, as their S1 filing indicated that, “in 2009, 2010, and 2011 and the first quarter of 2011 and 2012, advertising accounted for 98%, 95%, 85%, 87%, and 82%, respectively, of revenue.”

QUESTION: If advertisers begin to shy away, does Facebook have other revenue streams to fall back on? What do they need to do better to retain and grow their ad base?

SOURCE: Wall Street Journal