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Jonah Lehrer wrote a very interesting piece recently entitled Lying & Creativity.  In it, he makes the profound point that learning to contain our inclination to confabulate, or lie, is fundamentally at odds with our urge to create.

Quoting Picasso, Lehrer writes:

“Every child is an artist. The problem is how to remain an artist once we grow up.” From the perspective of the brain, Picasso is on to something, as the frontal lobes (and the DPLFC in particular) are the last brain areas to fully develop. And so the super-ego settles in, and we become too self-conscious to create. Obviously, we need the frontal lobes to function…but every talent comes with a trade-off. When we repress our urge to confabulate we also repress the urge to create.

In reading this, I was struck by how similar this idea is to something I’ve often observed in entrepreneurs.

Talented entrepreneurs seem to have a unique ability to put aside fear and convention and channel creativity and persistence with an almost reckless abandon.  Nothing will stand in their way.

So is this quality of entrepreneurship, or business creativity, unique to certain types of people?

For those of us out there contemplating taking the plunge yet having difficulty doing so, take comfort in Jonah’s claim that this is something we all have within us.  As he says about a patient in his piece:

Such confabulations tells us something important about the mind: spontaneous creativity - the ability to make up a story on demand - is a fundamental feature of human cognition. We’re all natural storytellers, weaving narratives out of the confusion. In other words, SB’s brain damage didn’t lead to some special new mental capacity, which the rest of us are missing. Instead, it released a latent creative capacity that we all have, if only we learned how to stop holding it back.

So if you’re out there cooking up an idea, but afraid to jump in with both feet, lie to yourself.  You may get something out more beautiful than you imagine.

There’s been a lot written lately about VC seed programs and some of the issues they present for entrepreneurs.  Most notably, Chris Dixon has written a number of excellent posts on the topic.  See here and here.

We’ve approached seed investing at Spark a bit differently, and we think it helps alleviate some of the concerns Chris and others have raised.

The basic premise of [email protected] is that we want companies who ‘start’ at Spark to 'finish’ at Spark.

This first principle is the key driver of how we think about seed investing, and it has a number of very important implications for the firm as well as entrepreneurs:

1) We approach seed investments with the same level of scrutiny that we do all investments.

2) We take active roles in all the companies we seed.

3) We go into seed investments expecting to fund companies in subsequent rounds.

4) We are flexible in how we structure seed investments as well as subsequent rounds of financing to not disadvantage the entrepreneur.

This ultimately results in only a handful of seed investments to which we bring everything Spark has to bear.  While we may be giving up the option value of having many small seed investments from which to cherry pick, we in turn gain a much closer relationship with the companies that we do seed which goes a long way towards ensuring that they get subsequent financing.

So why do we do seed investments?  Fred Wilson wrote an excellent post recently on slow capital.  There are many benefits to taking a staged approach to investing.  It gives everyone a chance to learn, get to know each other better, understand business and capital needs more clearly, create a disciplined, milestone-based culture and generate results that help attract new investors.  And in the off-chance it becomes apparent that the business prospects are not what everyone hoped, reach the appropriate but difficult conclusions together.

There is also the macro reality that capital requirements for many web services businesses have come down precipitously.  It is important that venture firms adapt to this landscape and continue funding the best and the brightest at the earliest stages of development.

There are many advantages to taking seed money from a quality venture firm.  It just needs to be done right.

My friend Jeremy Philips wrote a great review for the WSJ recently of The Curse of the Mogul, a new book on the plight of the media industry by Jonathan Knee, Bruce Greenwald and Ava Seave.  I recently started reading the book, and it’s quite a good read.  But I want to focus here on one very insightful point Jeremy made in his piece:

For an example one need look no further than online classified advertising—which, the authors say, was the “first killer moneymaking application” on the Web. Leading online players around the world, charging fees, have withstood challenges from rivals offering listings free—suggesting significant competitive advantage. Craigslist, mythology aside, has been charging for job listings in its home market of San Francisco for more than a decade.

With all the (deserved) hoopla around the "free" craigslist and its tremendous success, it’s important to remember that craigslist actually charges for key categories (e.g. jobs, real estate) in big markets (e.g. SF, NY).  Not only is this where they make their money, but its also how they make the site useful.  Without separating the wheat from the chaff in these key markets, the service would likely be overrun by spam and unusable for consumers.

This reality is consistent across all classified category leaders on the web. Leaders in Jobs (Monster, CareerBuilder), Personals (Match), Autos (AutoTrader), Real Estate (HomeAway) all have paid listings model that drive their business.

There are current attempts to buck this model, most notably Zillow in real estate and OLX in international markets.

Early on in the life cycle of a business such as Zillow, having a free platform is key to amassing listings and eyeballs.  I’m very curious to see how their model evolves over time though, as they continue to drive audience and scale of listings.

OLX doesn’t suffer from some of these issues in their smaller markets with low supply volume.  And it is my understanding that they are moving towards a paid listings model for exposure in key scale markets.

The only solution to this problem as I see it is a technical one that can separate the relevant listings from the noise for each unique end consumer.  This is seemingly a very challenging data normalization and search/algorithmic (or potentially social data/behavioral) problem that I haven’t seen a great solution to yet.  If you are out there cooking one up though, I’d love to hear about it…

I received the following response to an email I sent today:

I am offline until mid December and will respond when I return.  If this is an urgent matter, please contact my assistant…

Jealousy is an understatement.