Monday, March 5, 2007

Organizing Online

We've heard of Web 2.0 which for some means Ajax based websites, but in my opinion, I think Web 2.0 really means the new two way communication of the Internet. Web 1.0 was standard push websites, like,, and other news and information sites. Web 2.0 started with the ability for the user to communicate back. Digg, Open Diary, Friendster, even eBay and, were among the first Web 2.0 properties. These Web sites allowed you, the user, to communicate with the rest of the world, whether through bookmarking and voting (digg), blogging (open diary), your friends (friendster), or ratings (eBay/Amazon).

James Surowiecki's 2004 book "The Wisdom of Crowds" could not have predicted this revolution any better. Web 2.0 has exploded to include 7 of the top 10 most visited Web sites. The collaboration and communication between people all over the world is such a powerful tool. Barriers to entry have fallen down. With simply an Internet connection and a computer, anyone anywhere can add, comment, and broadcast their thoughts and ideas. The best of anything will rise to the top. The best videos, books, sellers, news stories, anything will be chosen by the users. Users are the new editors and the wisdom of crowds dictates that it will be the most interesting, compelling, useful ....

Recently the collaborative and connectedness of the Web has spawned another use: that of mass organization. and have allowed users to self-organize themselves into extremely niche special interest groups. The social aspect of the web has also moved into once thought of old economy industries like finance. With social networks like stockpickr and bullpoo, the best portfolio managers might not be located in New York City, Chicago, San Francisco or Los Angeles but perhaps in a remote village in India or in North Dakota. With the Internet, ideas matter but not geography (but that's another topic). The point that I was making was that self organization is slowly making its way into once locked down industries such as finance. The best example is Eric Jackson's blog in which he is trying to organize a group of Yahoo! shareholders that are unhappy with the performance of the company's shares - an idea he labels as Plan B. To date, he has had the committment of $58M of Yahoo! Shares - the total market cap of Yahoo! is $41.5B. He's still got a long way to go but I think that this is definitely the beginning of a true revolution where ideas rule!

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