On Corporate VC

I know I'm a bit late to this, but I just ran across Fred Wilson's comments about corporate VC from two months ago. “I am never, ever, ever, ever, ever going to do that again," he said of investing with corp VCs, because "they suck." Why do they suck? "They are not interested in the company's success or the entrepreneur's success. Corporations exist to maximize their interests. They can never be menschy or magnanimous."

On his blog Wilson clarifies a bit: corporate VCs are of two types, passive or active. If they are passive, they can be good, because they act like VCs; if they are active they are bad, "The corporate strategic investor's objectives are generally at odds with the objectives of the entrepreneur, the company, and the financial investors." And, "I strongly advise against entering into these kinds of relationships."

There's certainly some truth here. I was an active corporate VC in the 90s and I've been a stand-alone investor for the past five years so I've seen both sides. And I agree with Wilson, pretty much everything he says except that last sentence*.

I ran Omnicom Group's venture division back in the 90s, a strategic corporate investor if ever there was one. For the first few years there I invested primarily in interactive agencies. The mid-90s were a good time for this and we got to seed-fund some great companies: Razorfish, Agency.com, Organic, etc. Our strategy was to invest in the best people we could find, people doing amazing creative work and coming up with awesome customer solutions; a good product, in other words. We looked at pretty much everyone but made few investments, we were pretty picky. We did not think that professional services companies would go public--it was very rare and a bad idea for all but the largest--we thought that we could help build the businesses until they were profitable enough for us to buy out the interest owned by the founders**. We also knew that we could not acquire (or start) world-class companies at that time, but we needed agencies that were connected to Omnicom so we could bring clients looking for an interactive agency to someone in the family: we did not want another holding company to get a toe-hold at our clients. This was our strategic rationale and we did indeed try to maximize our own interests. But our interests included making our investments as successful as possible, and I did everything in my power to that end.

But I understood, and made sure my portfolio companies understood before I invested, what was in my power and what was not. I could not bring them clients, I had no clients, the clients belonged to the other agencies, who did not report to me. I could not bring them partnerships with the ad agencies, those agencies made their own decisions. All I could do was make qualified introductions and go reason with (and otherwise harass) the agency heads. I could also provide unparalleled benchmarking, access to best-in-class advice on how to run a client services organization, M&A, and Omnicom's brand name. This last was what convinced most of the portfolio companies: being associated in a client's mind with the company that already provides their advertising services, PR, etc. was enough to tip the RFP their way.

These investments did phenomenally well. Well enough to draw in VC firms to a space (professional services) that they traditionally avoided. One of the at-that-time well known venture capitalists invested in a second-rate company, one I had passed on. Mystified, I called up the VC and asked to have lunch. I think when he discovered that his lunch date was not the overture of a potential acquiror but a young whippersnapper asking for advice, he was somewhat displeased. It was a short lunch. As the lunch turned chilly I did get to ask him the question I wanted to know the answer to, though: "why did you invest in ____?" His answer, reasonable though curt, was "Because I expect to make money."

It's true that corporate VCs and VC firms should think twice before investing together. They have different goals. But let's understand this.

Strategic VCs invest because they want to make their own company stronger. As Wilson says, they exist to maximize their interests. Maximizing their interests, of course, usually means maximizing the success of their portfolio companies.

VC firms invest because they want to make money. They exist to maximize their interests. Maximizing their interests, of course, usually means maximizing the success of their portfolio companies.

These things are the same, no? Except they're not, because corporates and VC firms define success differently. For a VC firm success is selling their equity to someone else for a lot more money in a relatively short time frame. For a corporate VC success is having a company become powerful and entrenched so they can learn many things from them (and prevent competitors from dominating a market.)

You can see the reasons for frustration. Dominating an industry does not necessarily mean becoming extremely valuable. Most of the ad agency holding companies would have preferred owning a piece of, say, Donovan Data Systems to a piece of Yahoo! back in the 90s. Because, as an Omnicom exec said to me back in 1997 or so, "there's no amount of money you can make that would make any conceivable difference to our market cap."

But this cuts both ways. Because a corporate VC does not need to exit their investments in a relatively short time-frame, they can be more supportive than a VC firm. Since corporates are not necessarily in it to make money, they can put money and time into a company for strategic reasons, even if it doesn't increase the market value of the company in the short-term.

But we did make money on these investments. Quite a bit of it. Much more than the VCs who invested late in the bubble in companies whose sole purpose was to build something that could go public. Good VCs, of any stripe, know that the best way to avoid financial risk is to build an amazing company. I'm not saying that corporate VCs are always better at that, far from it. But they are not always worse.

When I was a corp VC we didn't want to invest with stand-alone VCs, for reasons analogous to Wilson's: their definition of success was different so we had disagreements, brickbats were thrown***, and we had suboptimal outcomes. Whose fault was that? Both sides blamed the other.

Now, knowing what I do about both sides, I invest with corporate VCs, but carefully. The passive VCs are great for filling out rounds, but I don't ever rely on them being around three years from now: because they have no corporate rationale (neither strategic nor profit) they are arbitrarily shut down when VC stops being fashionable, late in any boom. Passive corporate VCs are classic buy high, sell low players. The active VCs can be extraordinarily helpful (one corp VC I've coinvested with has brought some of the first customers to pretty much all of its portfolio, and you know how important getting those first customers is) but I wouldn't put money into a deal that a corporate VC is leading because I recognize that our interest diverge, especially around exiting.

But entrepreneurs should take Wilson's complaints--the tension between two very different types of venture investing--with a grain of salt. I agree that if you take money from strategic investors you need to be careful what kind of control they have over your company. You need to retain reasonable control of the exit, certainly, and of raising more money. The corp VC can have very different ideas about what you should do here, what is best for them. You should also be realistic about what you can expect the corp VC to bring you in terms of strategic advantage. In the end they can't bring you much more than money, advice and some intros. They will rarely bring you customers or tactical help.

But note that all of these caveats hold true for VC firms as well. You should be careful about how much control they have over your company and be realistic about the help they can give you.

Razorfish took Omnicom's money not because they thought Omnicom would bring them clients but because they knew that being backed by the world's largest marketing services firm would enhance their own brand. No venture capital firm would have had this effect with Razorfish's clients. Every company is different and needs different things to succeed. Pick your investors wisely, always, but if a strategic investor is going to bring you more success than a VC, and all else being equal, take their money.

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* And the last sentence of the first paragraph. Wilson can be menschy and magnanimous beyond what's solely in his firm's best interests because he's had so much success already. Kind of like how Neil Young could experiment with Trans in the early 80s. Most VCs do not have the leeway to be menschy or magnanimous, corporate or not.  Also, I'm going to ignore the passive corporate VCs because they are, in fact, simply stand-alone VCs that have been conglomerated; much like GE makes jet engines and refrigerators, Intel makes chips and does venture capital. There are lots of reasons to criticize this sort of conglomeration, Sarah Lacy has all of them--and a few more--here.

** Because of the way Omnicom was managed--acquisitions were always accretive to earnings--and the disconnect between a business' earnings and value during the steep part of the s-curve, we could not acquire the whole thing up front. We also thought that buying out the entrepreneurs when there was still substantial growth ahead would not motivate them as much as letting them profit more directly and substantially from realizing that growth.

*** I once had a very, very well-known West coast VC tell me on a conference call "You will never invest in California again." The other corp VCs on the call bought me lunch for months for that out of pure glee. The West coast VC in question followed-on into my first angel deal. To be fair, it wasn't in California.

Art for Computers

I was reading with interest the New York Times piece on The School for Poetic Computation (via an @aweissman tweet). The idea of the school is worth thinking about: the idea that art, culture, and work subvert each other. That they play off each other. That, indeed, using the tools of progress for play instead of for work is in itself an important component of progress. As Hank Tennekes observed in The Simple Science of Flight:

Among the redeeming qualities of our species is that we play. Indeed, we surround ourselves with toys, and we remain preoccupied with them throughout life… We display almost inconceivable creativity as we tinker with our playthings. The force of imagination and the passion for experimenting propel us toward outrageous designs and technological achievements.

This post isn't about that. But it reminded me of something I wrote a year ago and didn't publish. It's about neo-Luddism, the idea that progress will not just put people out of jobs in the short-term, but that progress will permanently reduce the number of jobs that can exist. I didn't publish it because any learned person who believes this has already demonstrated that they will not believe rational economic arguments, so spouting off even more rational economic arguments is preaching to the choir (I'm trying to do less of that in my life.) But book-ending the very long rational economic argument that I wrote (and ended up using elsewhere) is a different, humanistic one. It might sound a little strange, but it's Summer, so maybe you'll be a little patient with me. Here it is.

*****

A question that's been on my mind constantly over the last few weeks: if machines made art for other machines, what would that art be like? Let's make it a bit easier to think about: if computers made art for other computers, what would that art be like?

No, seriously, I have thought about this every day for at least three weeks*.

Computers don't have the same sense organs we do, they have different in-built biases towards the 'beautiful', they don't have idealized physical forms, they don't have the same perception of time and decay, they don't have the same emotional reactions towards colors or combinations of colors, they don't--in the sense we understand them--have emotions at all.

Would there be an analogue of Hopper, creating moody images of low-traffic URIs whose structure was scanned but not parsed. Or of Mondrian, Fourier-transforming novel time-domain ping patterns. Perhaps of Wyeth, with an idealized but enigmatic snapshot of the L4 cache. Of Duchamp, with partially overlaid, closely-spaced bubble-sort heap dumps. An existentially minimalized kernel panic. An idealized object repeated in a random but predictable way. A real, and carefully chosen for its generalizable realism, record of a SYN flood DoS attack. A program which seems as if it should, but in reality would never, work. An extremely large, but carefully counted, number of zeros in a row.

This is the kind of thing people don't think about. Computer art for the benefit of computers and nobody cares what benefits computers. That is not what machines are to us. We build machines to do things for us. We use them as an extension of ourselves, to achieve what we want but faster or better, more efficiently. Machines make us, as a species, more productive. They help us make more of the things we want, so we can have more of them or more people can have them. Machines are not ends, they are tools.

[Insert long, pointlessly duplicative of centuries of economic thought rational argument here.]

Neo-Luddites believe that machines exist for themselves. They confuse subject and object. They believe that there is some extrinsic mechanism that creates jobs and we are simply the dopey beneficiaries. The political dialog heightens this, making it sound like our government can create jobs and give them to us, like birds feeding their helpless young. That, in fact, that's where the jobs all come from, as if the government were the stork and jobs were babies. The Neo-Luddites believe that if you empty the tub of water faster than the faucet fills it, then you only have half a bath, for the rest of time.

But we are not the bather. There is no bather. We are the water. And no matter how you move around the water in the tub, it remains full.

People lose their jobs because of improvements in the means of production. So, in that sense, progress destroys jobs. The prevailing wisdom has it that progress also creates jobs, and that these forces have balanced each other out in the long-run. Neo-Luddites say this is no longer true and most economists seem to argue with them on their terms. But arguing on these terms is ridiculous: there is no aloof god Progress. People create tools to make jobs more efficient, and then fewer people are needed to do them. And the people who might previously have done those jobs find other things to do, and those 'other things to do' is the job creation we also call progress. Progress is something we make, not something made for us. Economics has generally become more human-centered over the past few decades, but this particular subsector of growth theory has not.

The reductio ad absurdum of the Neo-Luddite argument is a singularity where machines end up doing all the jobs, leaving humans doing nothing. This is absurd in two ways: (1) if machines were not simply tools, they would not care to do the things we direct them to do, they would do the things they care about themselves (make art, perhaps); and (2) if they did continue to serve us, then the things they provide would be effectively free (the machines would not care to be 'paid' in any coin we have) and we humans would be free to create value in other ways without worrying that our needs would not be covered--what else, indeed, would the machines do with all the food and clothing they produced except give it to us?

At any point on the spectrum between now and this singularity, we can make a similar argument. Between when 80% of Americans were farmers and now, when some 3% are, we did not structurally lose 77% of all possible jobs. When each farmer could produce food for many more people than they used to, they did not hoard that food and let the non-farmers starve. They found some other good that they wanted that the non-farmers could produce, and traded food for it**. The non-farmers found ways to create things the farmers wanted but that they previously could not have because there was no one to produce it. And, indeed, what else would the farmers do with all that extra food except find things to trade it for?

To believe that there are no more jobs to be created you have to believe one of two things: that there is nothing else we as a species could use, that we already have everything; or that people are simply too unimaginative to create these things. If you believe the first then you should take a look at our healthcare system or our educational systems, among other places that have a crying need for more attention. If it's the latter, then you need to have more faith in us humans.

Is the question of what art machines would care about interesting? Only in that it forces us to think about why we as people find art interesting. The machines themselves are not interesting, except in how they mediate interactions between people. The only thing that is really interesting in the end is that interaction between people.

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* No, I'm not obsessive. Shut up.
** Through the intermediary of money, yes, but don't let that obfuscate things.

The Seed Round is Dead

[Edit: Wow, I totally missed this piece by Jeff Jordan a couple of weeks ago--The Series A Round is the New Series B Round. Different responses to the same underlying phenomenon, but since the title is echoed here--both being cliche references to the "new black" thing--I want to point to it.]

This morning I talked to three experienced early-stage investors I ran into at demo-day and they all said the same thing: the bar for a Series A has been raised substantially. Companies without significant traction--a product in market, real customers paying real money, exponential user growth, something--can't raise an A. When talking recently about a company I had seeded to a Series A VC the partner said: "We're only looking at companies that have real revenue; there are a lot to choose from, so we're being picky."

"So what?" you say. "That's as it should be." Perhaps. But consider this: when I started in this business the Series A was the first money into a company. There was no revenue, there usually wasn't even a product. When you had revenue you were a Series B company.

This didn't change overnight. Even last year Series As were being raised for companies that only had a beta. Now, Series A is the new Series B.

So who does Series A now? By process of elimination the seed investors do. There has been a huge increase in the number of Seed-2 deals and seed extensions and bridge rounds, all basically second seed rounds. Companies do these instead of a Series A. And when the original seed investors won't re-up into the new seed round it's a red flag, making it very hard to bring new investors into the seed extension.

For entrepreneurs this means you take a lot more dilution. You raise twice as much "seed" money and then raise your A with what used to be Series B traction, but at Series A valuations. Because VCs have backed away from taking risk, valuations have de facto come down drastically even though it doesn't look like it on paper.

For seed investors this means you need to reserve some money for the Seed-2. At least 1x the original investment. Or you need to have syndicate partners with deep pockets who can fund a bridge. If you don't, you might be signalling to new investors that the seed extension is not a good bet. That means every dollar you invest in a new company actually requires two dollars. You should manage your cash on hand accordingly.

For the past several years seed investors have been investing enough to get startups to having a beta product being tested by potential customers (plus three months to raise an A.) Now we need to fund these companies to a further place. The Seed Round is now the Series A--Series A money, Series A goals. Accept it, or even your good companies will starve.

Letter to my Senator re US Government domestic spying

I was saddened to find out the US government is spying on all of us, all the time. I guess some cynical part of me always believed that, but actual confirmation of it still felt like a kick in the teeth.

I just sent my Senator this email. You can find out how to contact your Senator here. Feel free to use this text, or your own.

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Senator,

It did not surprise me when the opposition party misused its powers to spy on United States citizens. I was shocked to learn that a Democratic administration would do the same. In both cases I am appalled.

If my own government feels the need to spy on all of us, all the time, I would appreciate you at least being open and honest about it. The fact that the current administration felt that it needed to keep the program top secret seems to me more a reflection on its awareness of the immorality of this spying rather than any efficacy such secrecy would bring.

I would appreciate you:
1. Censuring the Obama administration for misuse of its powers;
2. Forcing the administration to reveal all surveillance being conducted on US citizens without probable cause;
3. Modifying the so-called "Patriot" Act to forbid my government from spying on me in my country unless it has probable cause for believing I have done or will presently do something to endanger my fellow citizens.

This kind of action is not what I was brought up as an American citizen to expect of my government. I understand that the exigencies of politics forces compromise, but I believe that you would not have taken on the difficult job of governing unless you firmly believed in the ideals enshrined in our Constitution and our proud history. I urge you to step back from immediate political concerns and reaffirm the basic democratic freedoms on which we built our great country.

Thank you,

Gerard Neumann
Hoboken, New Jersey

Midas List Feeder Firms

The Forbes Midas list just came out today. But it doesn't answer the question I know you have: who do you know that can get Jim Breyer to take a look at your go-go somoloco robofoto co?

We at Neu VC decided to help you out. We scoured the Crunchbases to find out which investors coinvest with or invest prior to the Midas List investors' firms. You can think of these firms as the Midas List feeder firms.

The firms are ranked by the percentage of the companies they invested in over the past five years that a Midas List firm invested in at the same time or later.

	Fund	% Midas
1.	Collaborative Fund	86%
2.	Glynn Capital Management	82%
3.	Felicis Ventures	81%
4.	XG Ventures	81%
5.	Thrive Capital	80%
6.	PivotNorth Capital	78%
7.	Forerunner Ventures	77%
8.	Start Fund	76%
9.	Lerer Ventures	76%
10.	Red Swan Ventures	75%
11.	Version One Ventures	75%
12.	DAG Ventures	73%
13.	High Line Venture Partners	71%
14.	Freestyle Capital	71%
15.	Founder Collective	69%
16.	O'Reilly AlphaTech Ventures	68%
17.	SoftTech VC	67%
18.	Tekton Ventures	67%
19.	Cowboy Ventures	67%
20.	Morado Venture Partners	67%
21.	CrunchFund	66%
22.	MuckerLab	63%
23.	Harrison Metal Capital	62%
24.	Northgate Capital	60%
25.	Phenomen Ventures	60%
26.	NextView Ventures	59%
27.	Neu Venture Capital	57%
28.	Kapor Capital	57%
29.	ENIAC Ventures	57%
30.	TriplePoint Capital	57%
31.	Radar Partners	57%
32.	Spring Ventures	57%
33.	A-Grade Investments	56%
34.	Data Collective	56%
35.	Trilogy Equity Partnership	55%
36.	Advancit Capital	55%
37.	Quest Venture Partners	54%
38.	Thomvest Ventures	53%
39.	Transmedia Capital	53%
40.	Helion Venture Partners	53%
41.	Vulcan Capital	53%
42.	Correlation Ventures	52%
43.	IA Ventures	52%
44.	Jafco Ventures	50%
45.	MentorTech Ventures	50%
46.	Silverton Partners	50%
47.	White Star Capital	50%
48.	Graph Ventures	50%
49.	Amicus Capital	50%
50.	Mohr Davidow Ventures	49%
51.	General Catalyst Partners	49%
52.	Google Ventures	48%
53.	Sutter Hill Ventures	48%
54.	Maveron	48%

The usual caveats: the data from Crunchbase is woefully incomplete. It doesn't include all deals. It doesn't have most angel investors, who might be the best way to get to some of these firms (because of the spotty angel coverage I decided to exclude anyone Crunchbase did not consider a 'financial organization,' so almost all angels are not on the list.)

I excluded firms that were primarily life sciences/biomedical and firms that invested primarily in non-US companies. I looked at investments for the last five years and weeded out firms that made fewer than five initial investments in that period or fewer than three in the last year.

I'm sure there's some signal in here, but there's also a ton of noise. Treat it as entertainment. There are many explanations for why these firms are here and others are not. Some good, some eh. For instance, note that Google Ventures is number 52; Google Ventures is making some solid bets and adding a ton of value. Why are they 52? I don't know.

Also note that the 40 firms from the Midas List that were used to generate this list are not themselves on the list. So, if you're like "why isn't SV Angel here?" the answer is that they are on the Midas List itself.

You Can't Learn from Failure, You Can Only Learn from Success

I feel strongly about not criticizing entrepreneurs. It's hard enough to start a company without the peanut gallery razzing you. And really, what good are you doing by being critical? Companies that are going to fail are going to fail without you wishing it on them, while your criticism might hurt companies that are on the path to success. What is constructive about your criticism?

The rationalization I always hear, from people who I suspect simply enjoy blood-sport, is: "how can we learn unless we look at what people are doing wrong?"

The easy answer is that there's a difference between a good post-mortem and criticizing something while people are trying to make a go of it. And there's a difference between a good post-mortem and 20/20 hindsight. The only person who can credibly make that distinction is the founder. Anyone else would have the unavoidable whiff of smugness.

There's a better answer and I think this is important. It's that criticism of failed companies is never very useful. Never.

You don't learn from failure. You can't learn anything from failure.

Ok, Neumann, you say. I have learned from failure. That time I burned my toast I learned to set the toaster lower. Now I don't burn my toast. Ha.

When I was a kid I wrote a computer program that learned to win at tic-tac-toe. First it build a decision tree of every possible tic-tac-toe game. Then it played you. Every time it lost it pruned that branch of the tree until only the wins or draws were left. It learned from failure.

Try that with checkers. Harder.

Try that with chess. Hard to impossible.

Try it with starting a company.

Any complicated system is too complicated to learn from failure. Yes, you can learn a few tricks, like: "don't spend all your money on fancy chairs" or "don't hire your college drinking buddies as EVPs of Business Development." But you can also spend your life learning about every mistake every startup founder ever made in all of recorded history and I guarantee that when you start your company you will discover all new mistakes to make. That is how life is.

All you can learn from failure is to avoid that particular kind of failure. And so what? There are too many other kinds of failure for that to make any difference. You need to learn from success. You should be spending your time trying to learn from success.

The successful entrepreneurs I have known have had the ability to look at a failure, any failure, and pull out the couple of things that were done right. These are what they focused on. Think about the successful entrepreneurs you know or have read about. This is just true.

If you're going to learn from failure you need to learn how to avoid every possible way you can fail. It's a waste of your time. You only need to learn one way to succeed.

Making Everyone a Data Scientist

You probably won't believe this.

There was a time when putting up a decent web page was considered a highly technical skill. In the period 1996-2000 most companies, even most big companies, had homepage designs that were raw HTML: static, poor design, broken links, nowhere to go and nothing to do. People had a name for it, brochureware, that was how common it was.

Firms like Razorfish and Red Sky specialized in using bleeding-edge technologies like CSS and DHTML to build sites that represented brands and told a story, that interacted. They hired the best coders and designers to do it, because it wasn't easy building a web site. The established agencies and design firms could not compete because they could not find enough people to hire who could build a competent site.

Crazy, right? Now ten year olds build web sites. College students put together calling-card websites overnight that rival what would have taken months and a team of people fifteen years ago.

That's how technology works. From magic to art to science to taken for granted. There was a time every car driver in America knew how their car engine worked; they had to. There was a time every programmer knew some machine language. There was a time everybody in the Internet business could tell you about what protocols they used in every layer of the OSI stack. One day every practitioner needs to know some technology. The next day it is invisible. We move up a conceptual layer and the layer below can be safely ignored.

Donald Norman, in The Invisible Computer, says

Everything changes when products mature. The customers change, and they want different things from the product. Convenience and user experience dominate over technological superiority. The company must change: it must learn to make products for their customers, to let the technology be subservient... The normal consumers, who make up the bulk of the market, consist of people who just want to get on with life, people who think technology should be invisible, hidden behind the scenes, providing its benefits without pain, anguish and stress... If the information technology is to serve the average consumer, the technology companies need to... start examining what consumers actually do. They have to be market driven, task-driven, driven by the real activities of those who use their devices.

Or, here's designer Jack Schulze, quoted in Domus:

Tech won't be visible but only if it's embedded into the culture that it exists within. By foregrounding the culture, you background the technology. It's the difference between grinding your way through menus on an old Nokia, trying to do something very simple, and inhabiting the bright bouncy bubbly universe of iOS. The technology is there, of course, but it's effectively invisible as the culture is foregrounded.

Does that tell you when? As an investor, I'm deeply interested in when. There are times I look at a particular sub-industry and it seems to be spinning its wheels. That usually says to me that the best place to innovate is actually a layer down in the stack. And there are times when I see awesome technology that is bottlenecked by a shortage of people who understand it. That's when it's time to move up a layer.

This second could be restated as: when a technology becomes too sophisticated for its users to use, make it a platform and build a user interface layer on top of it. That this makes sense seems obvious, how to do it is not.

*****

I invest in data businesses. Messy, technical data businesses. These companies deal with enormous amounts of real-time data. They push Big Data technologies, machine learning, and data visualization to its limits. They are always and constantly in search of people who can make these technologies work, and they're hard to find. Time to move up the stack.

I became involved with several companies in the data science industry: Metamarkets and Ufora in big data, Granify and BigML in machine learning, and Datadog, Lucky Sort and DataHero in data visualization.

DataHero just released their product this week. I think it's a great example of user-centric design, of de-magicking the tech.

I am as good as it gets when it comes to Excel. I was a consultant and a financial analyst for years when I was younger. But even so, when I pulled some AIPP data a few weeks ago to analyze it, making reasonable charts still took me an hour. Cleaning the data, organizing it the right way, deciding which charts would actually show anything, making the charts, and then exporting them so I could put them on the blog. Time suck.

Here's what I did with DataHero.

1. Connected to my Dropbox, downloaded the dataset I had stored there as an Excel file, made sure Datahero had guessed the datatype in each column correctly (2 minutes);
2. Dragged and dropped the x and y-axis variables onto a new chart, filtered out bogus values, tried different chart types (2 minutes per chart);
3. Exported the charts (like 10 seconds each.)

Here are the first two charts from the AIPP blog post. Total elapsed time: 5 minutes. Compare that to the original hour

Those two were fast because I already knew what I wanted. I then spent another fifteen minutes screwing around, tried about ten different charts to find three I thought had some explanatory value. 

 

The obvious difference between doing this in DataHero and doing it in Excel was speed and bypassing the boring cleaning, categorizing, moving columns around, trying to figure out why Excel doesn't understand what I'm trying to do. But the less obvious and more powerful difference is that DataHero foregrounded what I was trying to do as a user.

The reason data visualization is such a powerful tool is that we, as humans, are better able to understand images than numbers. Tufte says, in closing his landmark The Visual Display of Quantitative Information,

What is to be sought in designs for the display of information is the clear portrayal of complexity. Not the complication of the simple; rather the task of the designer is to give visual access to the subtle and the difficult--that is, the revelation of the complex.

But this then begs the question: how do I figure out how to display the complex when it's so damned complicated? The AIPP data I was working with had no clear patterns at first glance, the set was too big for that. There are algorithmic techniques to discover order in large sets of data and there are simple hypotheses that can be confirmed or not. But doing either of these takes a decent amount of expertise and time. This sort of revelation requires the priesthood's guidance.

The third technique is more quintessentially human: tinkering and visual discovery. But this is not feasible for the non-programmer: it takes too long for each chart and making even small changes to the data being used is almost like starting all over. By taking away the complexity with automation and a user-centric interface, DataHero makes it possible to make as many charts as you like and throw away all but the ones that "give visual access to the subtle and the difficult."

The idea is to give everyone the ability to do most of what data scientists do today. Back in the '90s there were only a few really interesting websites because there were only a few people who could build interesting websites. Today there are only a few really interesting data visualizations because there are only a few people who can make really interesting data visualizations. When anybody and everybody can make sense of the complex data we're surrounded by, what will they find?

In all of the data science technologies, it is time for user-centric tools, tools designed around the real activities of their users, tools that foreground the culture. Because when the tool becomes invisible enough to us we can start to focus on what to do, not how to do it. That's where we can start to create real value.