Former MySpace CEO launches a startup studio
Michael Jones wants to help startups grow. Just don't call his project an incubator. And it won't be a startup puppy mill either.
Michael Jones was most recently the CEO of failed social-network MySpace. But that's not what he's talking about now.
In fact, Jones covers that chapter of his life quickly, in one sentence, without taking a breath.
"One of the things I learned at MySpace," he says, starting to talk so fast that I cannot understand him. I'm about to ask him to repeat what he just said, but it's too late. He's already talking, at a natural pace, about this his just-launched company, Science. He calls it a "technology studio," a place where startups get the royal treatment from concept to, hopefully, going public or being acquired.
"Science brings together the best ideas, entrepreneurs, resources and financing to a central platform," he said. "We are going to build startups efficiently and effectively."
His company is like an incubator in that it will help startups grow, but it won't kick them out of the nest. Unlike incubators or accelerators, this "studio" is a permanent home. This isn't a startup puppy mill. It's more of a holding company--created to buy and possess the shares of other companies, which it then controls. Only instead of buying companies, Science will create them.
The startups are ideas of either Jones or a handful of entrepreneurs he is selecting as leaders. Jones said he has lots of ideas for companies. He won't give an exact number of how many companies Science will house, but there will be 10 to 20 maximum.
Science is focusing on three concepts: developing new businesses, providing emerging startups with advice and capital, and acquiring or partnering with later-stage startups that can help the younger ones grow.
The startups will get advice from a management team of trusted entrepreneurs "who together have deep knowledge of all aspects of Internet businesses," according to a statement. While I'm not sure that's entirely possible, Jones has obviously had lots of interactions with industry insiders who tried to dig MySpace out of its impending grave. Those connections will certainly come in handy.
The company is backed by investors, including Rustic Canyon, White Star Capital, The Social+Capital Partnership, Tomorrow Ventures, Jean-Marie Messier, Philippe Camus, Jonathan Miller, and Dennis Phelps. I had to Google all of them. What they all have in common is they are small, flexible, and hungry for a new way to go about business.
Science is based in Santa Monica, Calif., and Jones said he chose the name "studio" because he's taking the model from Hollywood.
"This is like a movie studio in that it has centralized resources," said Jones. "That's different than an incubator. We're more like Betaworks (parent of Bit.ly and ChartBeat), Obvious (created by the founders of Twitter), and Idealab (parent of Picasa and Citysearch)."
Jones said an increase in angel and seed funding, combined with a decrease in cost and time to test and launch businesses, creates a higher rate of innovation. (Of course, some would say it's too much incremental innovation and not enough game changing.) He believes these new business dynamics require a more focused approach to scaling tech companies.
Earlier I said I gave Jones a break about MySpace. I'm not going to let him off the hook.
Jones has had a front row seat to some big successes and failures in technology. After all, his most recent title was CEO of MySpace, which dominated social networking until Facebook ate it for breakfast. MySpace was purchased by News Corp. for $580 million in 2005. Jones joined MySpace in 2009 and resigned this summer after MySpace wasby a group of investors that includes musician/actor Justin Timberlake.
Before MySpace, Jones founded and sold several companies, including Userplane, a group-chat and one-to-one messenger service, which was acquired by AOL for an undisclosed amount. He was the CEO and co-founder of Tsavo Media, an online media network, which sold for $75 million to Cyberplex.
Jones recently wrote a commentary for the CNN Money website in which he said News Corp. should have relaunched MySpace as "an entirely new brand." Jones said the company's growth was stunted by lack of marketing.
"We found that regardless of how much we improved the product or the marketing message consumers' memories about the brand were too strong to allow them to view MySpace with fresh eyes and an open mind," wrote Jones. "We could not escape their images of animated GIFs."
And animated GIF's are exactly what dance through my head when I now hear the name Mike Jones, even though he hates them too. Perhaps Science will make his time at MySpace seem as short and quick as his "what I learned at MySpace" sentence.