Here's a sick sight: Roger McNamee, the fabulously wealthy venture capitalist responsible for countless layoffs, wearing an "Occupy Wall Street" t-shirt at an invitation-only conference at a Ritz Carlton in Arizona. Silicon Valley's most obnoxious, sanctimonious caviar socialists have found their poster boy.
Elevation Partners, which counts U2 frontman Bono and guitarist The Edge as investors, has seen its November 2009 investment in Facebook more than quadruple. And the gains are poised to grow even more.
What did Steve Jobs do to his old buddy Bono? The Irish rock star, once the Apple CEO's adoring buddy, is funding the most credible threat to the iPhone yet.
Why did Jimmy Wales, the cofounder of Wikipedia, an online compendium which includes the world's most detailed article on flim-flams, step down as CEO of Wikia, the for-profit website host which recently laid off some of its employees? The way Wales likes to tell the story, years later, he realized he was a free-flying entrepreneur, not an earthbound bureaucrat. So he hired Gil Penchina, a former eBay executive, to mind the shop. That's not what really happened. Wales was fired from his job as CEO by the company's investors.The cause? The same kind of expense-account hijinks that landed him in trouble at the Wikimedia Foundation, the nonprofit parent of Wikipedia. In 2006, Wales was courting Marc Bodnick, a cofounder of Silicon Valley private-equity firm Elevation Partners, in an effort to find a way to profit from Wikipedia, despite its nonprofit status and volunteer contributors. Bodnick and an assistant had traveled to St. Petersburg, Fla., where Wikimedia was then based. The talks went nowhere, but Wales, his wife, Bodnick, and Bodnick's assistant had a $1,300 meal at one of the city's finest restaurants. ($600 of the bill was spent on wine.) At that point, the Wikimedia Foundation had confiscated Wales's corporate card, so he paid for the meal himself. But he then sought to have it reimbursed by Wikia. Michael Davis, Wikia's chief operating officer, became enraged and reported the expense to Jeremy Levine, a Wikia board member and partner at Bessemer Venture Partners, which had invested $4 million into the company only a month before. Levine then told Wales he was fired as CEO, and found Penchina, who had already made a fortune at eBay. Wales must hate that: Every time he sees Penchina, he must ask himself, "Why is this guy rich and I'm not?" Penchina, meanwhile, must be asking why Wikia is still paying Wales a salary.
Even Bono's privacy is an illusion. A picture of the U2 rocker (and venture-capital investor at Silicon Valley's Elevation Partners) with two comely teenagers, Hannah Emerson and Andrea Feick, was leaked to the Daily Mail via Facebook. (The site has notoriously bad security on its online photo albums. Know someone who knows someone who knows someone? You can see their pics, no problem.) We now understand why Wikipedia cofounder Jimmy Wales likes to pal around with Bono; great minds think below the belt. Can you think of a better caption? Leave it in the comments. The best one will become the post's new headline. Friday's winner: kgbeat, who turned Jason Calacanis's two-fingered salute into the answer to the question, "How many rounds of layoffs are planned at Mahalo?"
David Churbuck, the founder of Forbes.com (and sweaty prep-school wrestling partner of Fake Steve Jobs blogger turned boring Newsweek columnist Dan Lyons), has weighed in on the chaos enveloping his former employer, the investor-friendly, snarkier-than-thou business magazine. Churbuck, like many Forbes alumni, seems to know more of what's going on than its current employees. The publication, now backed by Silicon Valley investment house Elevation Partners, is colliding together its Web and print editorial teams, and the result could be nuclear, as editors and writers scramble for position in the new order. Churbuck observes that the split between print and online had its roots in a plan to spin off Forbes.com in an IPO during the go-go late '90s; even after plans for an IPO were scrapped, the division persisted. Now, Elevation is pushing to consolidate the staffs, Churbuck says. Separately, a tipster reports several personnel moves happening at Forbes. Are they coincidence, or a sign of people positioning their own careers for the coming upheaval? Hard to say.
Most magazines keep their Web and print staffs apart, a legacy of petty rivalries, bureaucratic turf wars, and a fear of change. But Forbes Media has elevated balkanization into an art form. The two sides of the company barely speak to each other. The Forbes family tolerated this, but Elevation Partners, the Silicon Valley private-equity fund which counts Bono as a partner and now owns 40 percent of Forbes is not so patient. A tipster tells us that a "big shakeup" is coming, with the editorial staffs of both magazine and website getting "smashed together."Literally, in the real-estate sense. In New York, Forbes is housed at 60 Fifth Avenue, while Forbes.com is at 90 Fifth Avenue. Now, the publisher is said to be taking a floor at 60 Fifth to house the dotcom reporters, while it clears out "deadwood long-timers." The new mandate: Everyone will write for both Web and print. Which sounds sensible — unless you work at Forbes. What Forbes is not planning to announce: What sounds like a merger is really a takeover — by Forbes.com. Jim Spanfeller, the publisher of Forbes.com, will run the combined operation. "It's a massive coup, one that print people have long seen coming and long feared," says our tipster. As well they should: The editors of Forbes have long looked down on their Web brethren. Now they will be working for them.
The nonprofit parent of Wikipedia, the Wikimedia Foundation, has dumped Florence Devouard as its chair and replaced her with board member Michael Snow, while also appointing Ting Chen, an editor of Wikipedia's German and Chinese editions. Venture capitalist Roger McNamee is surely grinning as he thrums his guitar: Devouard has long opposed efforts to profit off the volunteer-written encyclopedia, an idea advanced by McNamee, a cofounder of private-equity firm Elevation Partners. McNamee, whose partner Bono is a buddy of Wikipedia founder Jimmy Wales, who has helped broker large donations to the foundation, is believed to have given the board change his approval.
Sue Gardner, the power-hungry executive director of Wikipedia's nonprofit parent, the Wikimedia Foundation, has carried out the first phase of her master plan. She's orchestrated a reorganization of Wikipedia's board. The chief changes to the rulers of the world's most complete list of people affected by bipolar disorder: Only 30 percent of the board is now elected. Two board members will be appointed by Wikipedia's "chapters," country-specific nonprofits which wield power far greater than their actual numbers would seem to warrant. Jimmy Wales has been granted an unelected "community founder" seat. The other five board seats, three of them currently empty, can be filled by board appointees with no connection to Wikipedia. Which would make it easy for Gardner to stack the board with wealthy venture capitalists interested in profiting from Wikipedia's highly-trafficked website.
Ordinarily, this would be good news: Vinod Khosla, the former Kleiner Perkins venture capitalist, and his wife Neeru Khosla, have donated $500,000 to Wikipedia's nonprofit parent, the Wikimedia Foundation. But founder Jimmy Wales's dalliances with other VCs — chiefly Roger McNamee and Marc Bodnick of Elevation Partners — have cast a shadow over every dollar the organization receives. Is this one of the $500,000 donations McNamee recently said he helped broker? And if so, what do he and Khosla expect to get in return? For starters, keep a close eye on Wikipedia's articles on ethanol, a major business interest of Khosla's. Wales, ordinarily Wikipedia's front man, makes no appearance in the press release, quoted below:
Jimmy Wales remains frustrated that he hasn't profited from the creation of Wikipedia, former confidants tell me. And even though the world's most complete list of sexually active popes is now run by a nonprofit, the Wikimedia Foundation, Wales is still trying to figure out how to commercialize Wikipedia on the side, with the help of private-equity firm Elevation Partners. Now comes a spanner in the works: The foundation has won a $3 million donation from the Sloan Foundation. Wales does not appear anywhere in the press release announcing the deal. The grant will be doled out at the rate of $1 million a year, meaning Wales, for the first time, has a powerful outside watchdog. The Sloan Foundation won't look kindly on attempts to have their monies fund ways to line Wales's pockets — or put Elevation Partners investors like Roger McNamee or Marc Bodnick on the Wikimedia board. The full release:
The New York Times has picked up Valleywag's extensive reporting on the ongoing Jimmy Wales scandal (How to decode the Times story: Whenever they say "a gossip Web site," they mean us.) While most of the story is a rehash, it does raise one interesting point: What's the relationship between Wikipedia and VC firm Elevation Partners? Roger McNamee of Elevation insists he's just acting as a donor and volunteer fundraiser in pulling in $1 million for Wales's Wikimedia Foundation nonprofit. But Wales admits in the article to proposing Wikipedia-branded business ventures like a trivia game or a TV documentary, with funding from Elevation Partners. Another plan we've heard: Changing the terms by which Wikipedia contributors add to the online encyclopedia to a more liberal Creative Commons license. That would make the site's content more readily reused in, say, printed works sold for profit. (Illustration by a newspaper)
Roger McNamee founded Elevation Partners, a tech private-equity firm with $1.9 billion in assets. He can claim Steve Jobs, Bill Gates, Larry Ellison, Mark Zuckerberg as friends. Bono is his coworker. He earned a 700 percent return saving Seagate Technology in the 1990s. But according to Portfolio, McNamee can't succeed in the one thing he really loves: rock and roll.
It was an odd venue for a tech party — a greasy diner by day, the Grill sits on a corner near the ballpark, neighborhing Border's, McDonald's, and dozens of men in Giants windbreakers asking passerbys if they need a ticket. They say open source is about software that's free as in "free speech," not "free beer," but the open bar featured plenty of the latter.
Tonight, celebrate Wikipedia, replicants, and videobloggers in an orgy of self-congratulation.
Since I first noticed that Fake Bono had taken over Fake Steve Jobs's blog, I've been wondering who Fake Bono really is. We had a number of guesses: Dan Lyons was taking on a second alter ego; Bono himself was writing; Marc Bodnick, cofounder of Elevation Partners, where Bono is a partner, was taking a turn; and Bono-wannabe Valleywag contributor Paul Boutin. After carefully reviewing the Bono posts, we're ready to reveal the identity of Fake Bono.
As CNET points out, it's all about the business ties. U2 lead singer Bono is the most stylish managing director at Elevation Parters, the Sand Hill private equity firm. Elevation cofounder Marc Bodnick is on the board of directors of iLike. Hence, the arrangement. Bonus for close students of the Valley's real social networks: Marc Bodnick's wife is Michelle Sandberg, the sister of Google executive Sheryl Sandberg, who's married to former Yahoo Music chief Dave Goldberg, who's an iLike advisor. Got that?
