Population Statistic: Read. React. Repeat.
Wednesday, November 14, 2021

How big of a believer in the new free-for-all Facebook is Lee Lorenzen? Enough so that that he’s starting a venture capital fund available exclusively to developers producing Facebook applications/widgets.

What does he expect the return-on-investment to be?

Lorenzen, based in Monterey, Calif., has founded several companies, including Shop.com, and is unfazed by criticism. He truly believes Facebook will be huge and that it is the first mainstream social operating system, taking a page from the playbook of Guy Kawasaki, Apple’s former self-proclaimed evangelist.

Lorenzen thinks Facebook will eventually become a massive Web-based mall, but with much more value because people are shopping based on their friends recommendations, with Facebook as their main portal.

The first step in that evolution was the company’s introduction last week of its Social Ads. The idea is that a purchase made by a Facebook member on other Web sites can be listed on their page, allowing their friends see, for example, what book they bought on the other site.

Is Facebook the long-awaited critical-mass online hangout? I really don’t see it. In the popular consciousness, MySpace is probably a stronger, more recognizable brand. Facebook’s stolen the thunder in terms of buzzworthiness, but that doesn’t mean it’s going to stay that way — especially not with the synergies possible at MySpace parent company News Corp. Add in the innate fickleness of social networking participants, and I’m secure in my skepticism.

If anything, I’d have guessed some VC — Lorenzen or someone else — would have anointed Second Life as the messianist online community, just by virtue of all the marketing efforts directed there. Not to mention that SL’s wholly graphical interfaces, with animated avatars and rendered landscapes, make that site that much more inviting than Facebook’s text-based format.

I’m sure Lorenzen will burn through a sizable hunk of cash before it becomes apparent that he’s bet on the wrong pony. If his fund has anything left over, maybe he can use that to seed the next Big Thing Online.

by Costa Tsiokos, Wed 11/14/2007 10:58:18 PM
Category: Internet, Business
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