Posts Tagged ‘Wall Street Journal’

Where’s Spencer?

September 27, 2010

It’s been more than three months since my last blog post so you might be wondering: What happened to Spencer?

Well, the short answer is I’ve been working hard at my new day job as Deputy Bureau Chief of The Wall Street Journal, which takes up most of my working hours.

Given how busy I am at WSJ I have decided to take a temporary hiatus from regularly blogging on Creative Capital. That may change in the future but for now if you want to keep up with my work please subscribe to my Twitter feed where I post links to many if not all of my WSJ stories.

Thanks to everyone for coming by to read this blog. I started it back in 2008 to help launch my book, and then it evolved into a publishing vehicle for a broader set of stories related to the book and my work as a technology and finance journalist.

I am not sure how it will evolve going forward but I am grateful to everyone who dropped by and contributed to the conversation. Onward ….


My New Gig: Joining the Wall Street Journal as Deputy Bureau Chief

March 31, 2010

One door closes and another opens. What’s really neat is when the transition happens quickly and smoothly.

And so …. I am thrilled to announce that I will be joining the Wall Street Journal as Deputy Bureau Chief of its New York Corporate Bureau, starting April 12. Keith Kelly of the New York Post wrote up an item about my new gig in today’s Media Ink column.

This is a new bureau that was formed this January to oversee reportage of big companies such as General Electric, IBM, Procter & Gamble, and several big beats, including telecommunications, New York retail and fashion, and recruiting and management.

“We formed the New York corporate group to focus on the importance and raise the visibility of the main corporate beats that the Journal covers. This group will also help to strengthen the cooperation between Newswires and Journal reporters,” said Robert Thomson, editor-in-chief of Dow Jones & Company and managing editor of The Wall Street Journal, announcing the formation of the bureau.

I will be reporting to Bureau Chief Andrew Dowell, and have a few big priorities:

1. Supervising telecom coverage as a writer and editor
2. Helping to beef up coverage of big tech companies in the region such as IBM, EMC and RIMM
3. Covering New York’s entrepreneurial scene of startups and venture capitalists
4. Helping to beef up’s Digits blog through editing and reporting

I loved working at BusinessWeek for the last decade. And now I am stoked to join the Wall Street Journal at this unique time. Under New Corp., there’s a lot of energy and excitement pulsing through the newsroom as the Journal pursues an ambitious expansion. I hope to play one small part in making a great place even greater. Onward . . .

Preventing Another Christmas Bomber, Part Deux

January 6, 2010

Wall Street Journal columnist Gordon Crovitz wrote a great column on Monday with the biting title “Intelligence Is a Terrible Thing to Waste” criticizing the Obama Administration’s policy of treating terrorism as a law enforcement issue. I’ve mostly been a supporter of this approach but Crovitz got me thinking hard about the limitations of such a strategy.

One problem he highlights is that our legalistic approach is harming our ability to thwart terrorist plots because we are giving foreign nationals Fourth Amendment protection against unreasonable searches. U.S. intelligence agencies are using this standard when deciding if and when to put suspected terrorists on a watch list or a no-fly list.

“The result of prohibiting hunches was that [Umar Farouk] Abdulmutallab was waved through. Information about suspected terrorists flows into a central Terrorist Screening Database, which is then analyzed by the Terrorist Screening Center, where FBI agents apply the “reasonable suspicion” standard to assign people to various watch lists including “selectee” lists and the “no-fly” list,” writes Crovitz. “It’s at this point where an approach based on domestic law enforcement trump prevention, undermining the use of information.”

While I agree that U.S. citizens should be afforded these rights, it seems foolish to give suspected terrorists these same privileges. Clearly, we need to have a more flexible standard for determining whether or not suspected terrorists, who often live outside the U.S., deserve to be placed on any of these government security lists.

Crovitz concludes that we face a stark choice. “We can limit how information is used or we can allow smart use of information to prevent attacks,”” he writes. “If we continue to choose to limit how information can be used in our defense, we shouldn’t be surprised when our defenses fail.”

Man of the Meltdown: How John Paulson Made a Killing on the Housing Crash

November 30, 2009

Man of the Meltdown
How hedge fund manager John Paulson made billions in the crisis
By Spencer E. Ante

Editor’s Rating:
The Good: A fascinating account of how John Paulson profited big time from the housing meltdown.

The Bad: A times the narrative seems a tad scattered and gossipy.

The Bottom Line: A dramatic and plausible account of one man’s triumph.

The Greatest Trade Ever
By Gregory Zuckerman
Broadway; 293 pp.; $26

The Great Recession of 2009 destroyed trillions in wealth. But a few lucky or shrewd souls profited from this catastrophe. Perhaps the single largest beneficiary was John Paulson, a hedge fund manager who engineered the greatest trade in history, earning his firm $20 billion by betting against the housing market. In 2007, Paulson took home a staggering $4 billion for himself, the largest one-year payout in the annals of finance. That’s more than $10 million a day, if you’re counting.

How Paulson and a handful of contrarian investors pulled off this once-in-a-lifetime coup is the subject of The Greatest Trade Ever by Gregory Zuckerman, a senior writer at the The Wall Street Journal. Paulson has released a statement calling the book a disappointment filled with inaccuracies, which he didn’t specify. But The Greatest Trade Ever comes off as a fascinating and believable counter-narrative to the growing pile of books recounting the disastrous mistakes made by many of the supposedly smartest minds on Wall Street. It is also a surprisingly dramatic work—although not always in an enjoyable way. It is the drama of waiting to see the horrific destruction scene in an apocalyptic movie.

Read the rest of my book review here.

Non-Manic Monday: Creative Capital Featured in WSJ Column

August 10, 2009

L. Gordon Crovitz, former publisher of the Wall Street Journal, featured my book Creative Capital in his “Information Age” column in today’s Wall Street Journal (p. A9)-calling it a “fascinating biography.”

It’s gratifying when your work gets recognized in such a respected publication. And it’s even more rewarding when readers and reviewers understand some of the big ideas that you were trying to get across in the book.

On that measure, Crovitz, totally got it. Crovitz focused his column on the government’s effort to more tightly regulate venture capital. The U.S. Treasury wants VC firms declared as systemic risks and put under tight restrictions as part of the broader re-regulation of financial firms, notes Crovitz.

In his column, Crovitz wrote that the history of American Research & Development, the venture capital firm that I profiled in the book, “is a reminder that our regulatory system, by its nature focused on avoiding risk, has a hard time dealing with investment firms whose mission is to take risks.”

To bolster his argument, he summarizes ARD’s history of run-ins with federal regulators, and quotes some of my favorite parts of the witty and wise personal memos of Georges Doriot, the visionary Harvard Business School professor who pioneered the venture capital industry as president of ARD in the 25 years after World War II.

The dangers of over-regulation is one of the primary discoveries and lessons of my research. Thanks to Crovitz for bringing that point to the attention of a much wider public.

Google: A Healthy Respect Towards Microsoft

July 10, 2009

The latest news out of Sun Valley, reported by the Wall Street journal’s Julia Angwin, is that Google CEO Eric Schmidt was cool to the idea of building its Chrome Web browser. Schmidt, a veteran of several wars with Microsoft, resisted the project for six years before a demo of the browser changed his mind.

This minor revelation says a lot about Google, I believe, and reflects a new more healthy attitude towards Microsoft–and perhaps a sign of maturity for Silicon Valley. Ever since Microsoft took over the market for PC operating systems and business software, Silicon Valley companies have generally assumed one of two positions towards Microsoft: abject fear (as evidenced by any startup) or loathsome obsession with taking it down (best embodied by Sun Microsystems’s former CEO Scott McNealy).

Schmidt’s position on Chrome reflects a new attitude toward the Redmond giant that I would characterize as healthy respect. Schmidt did not want to rush into a fight with Microsoft over the browser because he knew, having lost many battles with Microsoft as an executive at Sun and Novell, that it was an unwise and potentially distracting move for the company.

“At the time, Google was a small company,” Mr. Schmidt said. “Having come through the bruising browser wars, I didn’t want to do that again.”

Since then, Google has gotten much much bigger and much more powerful. The Chrome project, both the browser and the operating system, has evolved to a point where it was good enough to fight for consumer’s attention in the marketplace. And Microsoft, though it remains arguably the most powerful tech company in terms of its financial heft, is no longer the pole star around which the entire technology universe revolves.

Even so, Schmidt is still wide enough to not pull a McNealy and stick a finger in Microsoft’s eye, antagonizing the giant and attracting more attention from regulators poking around its business. Schmidt and Google cofounder Page, says Angwin, were careful not to position Chrome as a competitor to Microsoft Windows. They argued that Chrome will expand the market for netbooks, rather than eating into Windows’ share of the netbook market.

I doubt they really believe that. But it’s a much smarter move to play down expectations of this effort.


Holy Cow: Wall Street Journal Reviews Creative Capital

May 21, 2008

Well, just as I had given up hope on landing a review in the Wall Street Journal, lo and behold, in the May 21 issue of the paper Creative Capital got some major ink with a 915-word review. On p. A17 in the Opinion section, Randall Smith reviewed Creative Capital in a piece titled “Money to Make Things New.”

All I can say is: booyeah!!!!!!!!

“In Creative Capital, Spencer E. Ante traces the origins of the investment world that gave us semiconductors, videogames, and personal computers to Georges Doriot, (1899-1987), a French-born Harvard Business School professor, and to the Boston-based company he took public in 1946, American Research & Development (ARD). “I want money to do things,” Doriot liked to say, “that have never been done before.”

Smith described the book as “richly researched with the cooperation of Doriot’s surviving colleagues” and that it is “studded with inside details.”

At the end of the review, Smith takes me to task for not discussing the dot com bust, “when individual investors lost billions investing in stocks that had been brought public by the VC communty. One of the stocks that tanked was a throwback to ARD called CMGI, Inc.”

I never thought that it would make any sense to cover the dot com bust in this book, which basically ends in 1980s with the death of Doriot and the rise of Silicon Valley. Plus, if you understand Doriot, you know that he would be very critical of the dot com boom.

Back in the 1960s during America’s first love affair with high-flying technology stocks, Doriot railed against short-term oriented investors–he called them speculators actually–for inflating the prices of stocks beyond any rational expectation. He joked that investors had traded price-to-earnings ratios for price-to-hope ratios. His philosophy was to build companies for the long haul, not flip them for a quick profit–the antithesis of the dot com boom mentality. So even though I don’t directly address the dot com bust, I think my analysis of that period is embedded in the book.

Still, when the paperback version of the book comes out, maybe I will add a postscript analyzing the dot com bust from the perspective of Doriot.

As the Web Turns: Microsoft Blinks on Yahoo Deal

May 1, 2008

So instead of launching a proxy fight after passing its self-imposed deadline, Microsoft did the smart thing and tried to show Yahoo some love, so says the latest leak-story in the Wall Street Journal.

Last night, the Journal published a report saying that “Microsoft this week indicated a willingness to raise its bid to as much as $33 per Yahoo share, attempting to avoid the hostile takeover battle Mr. Ballmer had threatened, according to people with knowledge of the situation.”

The problem? Yahoo’s major shareholders “have signaled they want in the range of $35 to $37 a share,” while “Yahoo’s management and board similarly shooting for an offer in the upper 30s, say people familiar with the matter.”

My bet: There’s no way Microsoft is going to push its bid into the high 30s. This deal gets done at $34 or $35, just as I have said all along. That allows Microsoft to save some face, and Yahoo to feel like it didn’t roll over. Yahoo’s quarter was good enough, and the prospect of a drawn-out proxy battle is so unappealing, that Steve Ballmer is likely to bump up his offer just a tad more to close the deal. Yahoo needs to get the deal done because if it doesn’t, its stock would plummet, drawing a raft of distracting shareholder lawsuits.

Merger Madness: Yahoo-Microsoft-AOL-FIM-???

April 10, 2008

OK, this is getting ridiculous. Today, the race to acquire Yahoo! has become perhaps the weirdest merger contest in the history of the technology industry.

Consider the day’s string of increasingly absurd leaks, er, I mean reports about Yahoo’s activities. First, this afternoon Yahoo! announced it would begin a limited two-week test of Google’s search technology on the U.S. version of Then, this evening at 10:35 pm EST, the Wall Street Journal reported that Yahoo and AOL were “closing in on a deal to combine their Internet operations.”

Not be to be outdone, the New York Times reported minutes later that “News Corp. is in talks with Microsoft about joining in its contested bid for Yahoo,” proposing a deal to join Yahoo, Microsoft’s MSN and News Corp’s Fox Interactive Media division, home of the MySpace social network. (If the story wasn’t penned by the usually reliable Andrew Sorkin, it would be laughable.)

Here’s my take: Yahoo is getting increasingly desperate. After Steve Ballmer issued a three-week ultimatum to Yahoo on Sunday April 5, Yahoo realized its needed to break out all the stops to either a) get a sweetened offer from Microsoft or b) strike a deal of comparable value that avoids getting co-opted by the Evil Empire in Redmond.

The announcement to outsource a miniscule amount of its search inventory smacked of last-minute desperation. (I like Silicon Alley Insider but I totally disagree with Henry Blodget that this was a “brilliant move.”) Even if the test improved the effectiveness of Yahoo’s search results (which is no slam dunk), there’s no guarantee Yahoo would outsource enough of its inventory to produce a material return. In its press release Yahoo went out of its way to stress the transient nature of the deal, saying “the testing does not necessarily mean that Yahoo! will join the AdSense for Search program or that any further commercial relationship with Google will result.”

The deal talks are a whole other matter. But let’s be clear: These are not superior proposals. Still, even if the deals are inferior (i.e. Yahoo would be much better off merging with Microsoft than the much smaller and weaker AOL, to say nothing of the deal’s antitrust issues), or just off-the-wall (adding MySpace to an already complicated Microsoft-Yahoo combination seems like a one-way express ticket to merger hell), they give Yahoo leverage in its talks with Microsoft. More suitors, however unattractive they are, create the impression of enhanced value (it would be interesting to know the valuation that these deals give to Yahoo). So give Jerry Yang & Co. credit for being shrewd enough to lure AOL and News Corp onto the dance floor.

I said in the beginning of this process that Microsoft would have to sweeten its offer. Lately, as Ballmer & Co. showed increasing signs of aggressiveness and the unimpressiveness of Yahoo’s future plans began to materialize, I began to question myself. But Yahoo’s shucking and jiving today makes me think it just might happen.

SXSW: Has Southby Sold Out? (and book reading post-mortem)

March 15, 2008

In the last two days, the Wall Street Journal and the New York Times have both run front page stories about Austin’s South by Southwest Festival, known as “Southby” to festival aficianados. The Journal story reported on the rising influence of corporations at the music part of the festival–and the consequential crackdown by festival organizers on private, invite-only corporate parties that violate the open access ethos of SXSW.

Long-time music critic Jon Pareles has a different take in today’s NYT. On the contrary, Pareles notes the declining influence of the major record labels (i.e. the corporations) on the music industry. SXSW, he reports, “is full of people seeking ways to route their careers around what’s left of the major recording companies.”

“Major labels used to help create stars through promotion and publicity, but their role has been shrinking,” writes Pareles. “Multimillion-selling musicians who have fulfilled their major-label contracts — Radiohead, the Eagles, Nine Inch Nails — are deserting those companies, choosing to be free agents rather than assets for the system that made them famous.”

I have not had the pleasure of attending the music part of Southyby. I barely survived three days at the non-stop Interactive segment. But I have to say that I was pleasantly surprised to find hardly any sign of corporate influence at SXSW Interactive. Heck, Facebook was the biggest show in town and their CEO is known to wear flip flops and T-Shirts to the office.

Southby is sort of like the anti-CES. It’s not about being overwhelmed by a blizzard of press releases and product announcements or marketing shlock. It’s about the conversation, about exchanging ideas and inspiration with like-minded creative folks down in the trenches. Think TED with an indie bent.

While I was in Austin for three days, I played a game to prove this point: I called it the find-the-man-in-the-suit-and-tie game. Before I arrived, I had heard complaints about the growing role of “suits” at SXSW. So for three days I searched for someone wearing a suit and tie. I found not one. I didn’t even find one single soul sporting a suit, let alone a tie. Instead, I saw an endless stream of cool young people dressed in jeans, T-Shirts, dress shirts and hoodies, with the occassional rebel donning a sport jacket.

Confession: I actually brought a suit to Austin (no tie though). Since I was giving the debut reading of my book and I had never been to the festival before, I decided to play it safe and bring one. Roaming the convention center, I quickly realized, it was as if I had brought a bathing suit to Alaska. The suit never saw the light of day.

Book B&N

I ended up wearing the Southby uniform–jeans and a long-sleeve shirt. The reading went pretty well, though I made a few mistakes. The biggest? I chose too many stories to read, didn’t pick all of the right ones, and underestimated the time it would take to read them. The result was that I raced through the end of the talk and left no time for Q&A. Doh!

Next reading I will pare down the number of stories and tailor their selection more tightly to the audience. Another cool part of SXSW was that Barnes & Noble set up a portable book store in the trade show area of the conference. Here’s a photo of my book for sale. I feel proud to be sandwiched between best-selling authors Bill McKibben and Timothy Ferriss. I hope their pixie dust rubs off on me.

HOW TO BUY CREATIVE CAPITAL: To pre-order Creative Capital and get a 34% discount, click here and go to Amazon