[S4E3] How the Internet Happened with Brian McCullough

Welcome to Business Books and Company. Every month we read great business books and explore how they can help us navigate our careers. Read along with us so you can become a stronger leader within your company or a more adept entrepreneur. This month we read how the Internet happened. From Netscape to the iPhone by Brian McCullough. How the Internet Happened is a history of the companies, entrepreneurs, technologists and financiers who launched the modern online world. Covering the years 1993 to 2008, this sweeping volume helps the reader understand not only who the important players were in fostering online communities, ecommerce social networks, and connected mobile computing, but also the context from which they emerged. And context is so important when trying to understand business history, which is why we appreciated the diligent research and careful planning that went into producing this book. We are pleased to be joined by the author of how the Internet Happened, Brian McCullough. But before we get to Brian, let's introduce ourselves.

Hi, I'm David Short.

I'm a product manager.

Hi, I'm Kevin Houdak, chief research officer at a Washington, DC commercial real estate research and advisory firm.

And I'm David Kopek.

I'm an associate professor of computer science.

At a teaching college.

Brian McCullough is a general partner at Ride Home Fund, the host of the popular podcast Tech Meme, Ride Home, and the Internet History Podcast, as well as the president and founder of ResumeWriters.com. But most importantly for our discussion, brian is the author of how the Internet Happened from Netscape to the iPhone, a book that leveraged Brian's own background in the early days of e commerce and his extensive interviews on the Internet History Podcast. Brian, thank you so much for joining us on Business Books and Company gents.

Thanks for having me, and thanks for reading the book. It's six years now since the book came out, but it still sells, and I am grateful to anyone that picks it up.

Yeah, and I like how you had kind of a specific time period that you covered. You didn't go right up to when the book came out, you went up to when the iPhone came out, which made a lot of sense to kind of cap it at that point because it's such a big topic you're covering. But before you even got into the Internet History Podcast, before you even started ResumeWriters.com, let's take us back all the way to the beginning of your career, and if you could just tell us a bit about your early background and how you got into tech in the first place.

Yeah, and I know at the risk of this is probably the most boring part for people, but it is relevant to how I wrote the book, et cetera, because I'm not a historian, I'm not a journalist. I always stress that to people because I respect the craft of both. But long story short, weirdly enough, I always wanted to be a writer, and I think I say in the book at some point that in the when I was coming up, this idea of entrepreneurialism as what kids aspired to was not a thing. When I was coming up in the 90s, dorky kids like me wanted to be Quentin Tarantino? And so, like a lot of my contemporaries, I went to film school for college, but I was in the screenwriting track. So again, a writer. And it's 1998, I'm about to graduate and you have to do a thesis project. And so that's a screenplay. And it's the summer of 98 and what's happening is the.com bubble. I'm looking around for a topic and that seems to be what's happening at the moment. So I get a bunch of magazines. Things existed at the time that you would go and buy on paper, like Wired and defunct magazines. Now, like I can't even remember. Not Business Insider, but anyway, it doesn't matter. Fortune, et cetera, et cetera. I just start reading about the companies that at the time were these big up and coming tech companies in this.com era of the Internet. And so I write a screenplay called Palo Alto that was about kids going off to Silicon Valley to strike it rich, which again, seems sort of cliche now, but at the time was kind of a new phenomenon and thing. And so this is how I get into this, is I sort of also fall in love with the whole what I call the horse race of it. Like who's going to win, Yahoo or Amazon versus Pets.com or you know, I kind of loved the whole business history of it, which is relevant to the show and sort of tangentially. There's a Wired Magazine article that I read about a kid that did a startup at Harvard. Again, this is five years before Zuckerberg at Harvard and I copied him. I was like, that's a good idea, I could do that myself. And so that was my first company, which I started in 1999. So I do a startup in 99. Even after I graduate college, I never get back to doing screenwriting or becoming Quentin Tarantino. I did another startup in 2003, another one in 2005. But all this time I'm still obsessed with the idea of the sort of metabolism and the ecosystem of the startup world. It just felt so exciting and interesting and relevant to me that I was always following it. And if you know the history, I do my first company in 99. That the.com bubble burst in 2000. And then there's the nuclear winner of the next three years, where basically everyone thought that the Internet and technology was a fad that had ended, which I knew intuitively was not the case. So I still cared about this. I still followed these companies. So like, when Google comes around, when Facebook comes around, I'm still following this stuff and I'm doing startups and I'm sort of in the scene. Tangentially I'm not a big important player or anything, but I'm getting to know the people that are doing these things. And so it was really interesting to me to see again, we think of tech as a third of the economy now and all of the biggest, richest players or whatever, but I experienced tech infiltrating our lives and taking over our lives in a different way because everyone thought it was over. And so I saw it crash and burn and resurrect. I stayed in the tech industry and around 2010, 2012, I'm still doing meetups and I do a little bit of angel investing. And as early as 2010 or 2012, I go to these meetups and kids in quotes, people younger than me that are founding startups are like, oh, you were around for the.com era. What was that like? And I was like, the biggest insight of the book to me is that anybody who does a thing for long enough, you're there for history. And if you don't tell the kids coming up behind you what you remember, how you remember it, then the history doesn't get passed on, right? As dumb as this sounds. Because the only reason I was interested in writing the book is because I was there. And so I start to write the book in 2012. Another interesting thing about it is that was still when people thought that technology was great as opposed to when I started the book. People were like, oh, you're going to tell us how technology changed our lives? By the time the book came out, people were like, are you going to tell me how technology ruined our lives in 2012? We're only a few years away from the iPhone launching or whatever and people are still fresh on social media. And I just thought it would be useful to folks like my parents. Like, here's how A led to B led to C. Here's the people that did this. And again, I knew some of these people. So what I did is I reached out to them and I started to get interviews. I recorded those interviews and again, I'm a startup sort of guy, so I like immediate gratification. And I was like, if I just interviewed somebody, the first hire that Jeff Bezos hired at Amazon, I just talked to him for an hour and a half and maybe two sentences of what he told me will get into a book five years from now. And that seemed like a waste to me. So I got into podcasting just being like, what if I just put these interviews out as a podcast? Would people be interested in that? And that was the Internet History Podcast. It took off, became very popular, allowed me to sell the book. The book came out and has had a long shelf life as I alluded to a lot of people in crypto and web. Three have adopted it for trying to find pattern matching for maybe what they could learn for how things get adopted. But to sum up as fast as I can, that got me into podcasting five years ago now, I started the Tech Meme Right Home Podcast, which a ton of folks in Silicon Valley listen to every know the C suite at Microsoft, Andreessen Horowitz folks. And I need to mention that because that's what pays the bills every day, but also because of that, because very important people listen. I also now run the Ride Home Fund, which is a early stage venture capital fund where all of the LPs are listeners to the show. And actually, by the time this comes out, you can tell people this, but Chris Messina, who's the inventor of the hashtag, and I are right now launching an AI focused fund called the Ride Home AI Fund. So most people know me today as the Techmeride Home guy and a VC now. But to sum this up, the one through line, through everything that I've ever done is keeping track of the horse race of these entrepreneurs and these companies that, as I say in the book, sort of took over all of our lives. Yeah, I've been fumfering for ten minutes now, so that's how I got here.

No, thank you so much for the introduction, Brian. And one, as a recovering political consultant, I always love the horse race aspect of some of these different industries. And two, as listeners to the podcast know, I really do enjoy books that are more cinematic in nature. And it makes a lot of sense that you actually went to film school.

Because I did feel like at the.

End of every chapter, there was a feeling of either anticipation of glory or absolute disaster just waiting in the next chapter. And so I did appreciate that. But just to start at the very beginning, you start with a history of some of those early Web browsers, including the story of Mark Andreessen, Mosaic, the founding of Netscape. I was wondering, would there have ever been a world in which an alternative Internet protocol may have become dominant? Or was something like the web as presented by Tim Berners Lee? Mosaic, then netscape. Inevitable, right? What was so special about Mosaic and Netscape compared to some of the other Internet communications platforms of the time? Whether it's Gopher, ARPANET, Computes, closed network.

Things like yeah, and if you listen to the Internet History podcast, I get deeper in the weeds on that than I was allowed to in the book. But you're right, it wasn't clear that we should specify how the Internet happened. But really what happened was the Web, because the Internet has been around since 1969 in various forms, but the Web is the thing that actually took it mainstream. And the point that I try to make in the book is that in the same way that the graphical user interface with GUI is the thing that made computing palatable to mainstream audiences. The Web is what made the Internet palatable to mainstream audiences because it's pictures and graphics. It's point and click. It's abstracting away all of the complicated things behind it, and it's just like, sort of consumption and media and cat photos, as I used to joke or whatever. So Tim Berners Lee gets credit for that know, he very much thought of the Web as a research tool, as a thing for academia, but he also threw it up as a protocol. And so he allowed other people to do whatever they wanted with it. And funny enough, Mark Andreessen is the guy you can look up on usenet posts. He's the guy that's like, what if we had an image tag? What if we put pictures on this thing? And also, he was the driving force behind the browser, which is the way that people first consumed the Web. So Mark Andreessen is famous for tons of other things now, but he deserves a lot of credit for being sort of a driving force behind the Web, being mainstreamed and being palatable to normal users.

Yeah, the way you described it was he wanted it to be available to the masses. He wanted to be sexier with pictures. And that fits his profile that we read in The Hard Thing about Hard Things by his business partner, Ben Horowitz. And I also loved how Mosaic was designed almost as a lean startup. They had their sort of MVP, their minimum viable product that they released to customers as fast as possible for bug catching feedback and those iteration cycles.

Yeah, that's invented at that time. The idea this is still the era where software is software and great margins, because every additional piece of software costs you minimal to produce, but you're still shrink wrapping it and putting it in cardboard boxes and selling it at stores. The Mosaic and then eventually the Netscape folks, the thing that they were the pioneers of, which seems insane today, is the idea that, number one, your distribution channel is the Internet. Right. They were the first folks to attempt this, but also, they were sort of dog fooding their own product because their product was the Internet and getting people online and using stuff like that. But, yeah, again, these were kids. These were kids in college in the 90s that their culture was to be on message boards, to be on usenet posts. And so if you released a beta product and you're like, what should we do for the one product? You would solicit your users and be like, what do you need? What do you want? What doesn't work? What does work? Et cetera. This idea of what was called in the 90s, Internet time, where the product evolves, we're used to now, Threads is a big thing right now, right? And we're all waiting for Threads to release a Web version or a timeline version or whatever. Meta could do that tomorrow. We're all used to the fact that any app on our phone could fix a problem or give us a new feature overnight, and it's just downloaded on our phone. The fact that that was possible was something that the mosaic and then eventually the Netscape people really were the pioneers of.

So you talk a little bit about Netscape kind of creating the Silicon Valley gold rush narrative that a young kid with an idea turns VC money into a billion dollars or tens of millions of dollars within a few months. But when I was reading it, I was thinking like, what about intel?

What about Apple?

Microsoft? It was already called Silicon Valley for a reason. So I'm just curious what you thought about what was different about Netscape. Was it the age of Andreessen? Was it because it was software where he'd made the money? Was it because of what you were just talking about? That ability that the browser ultimately gave everyone, this widespread distribution to everyone, and the CI CD development environment where you.

Really could get new stuff out to.

Your users overnight in a way that was never possible before?

The answer is all of that, but also it's one of those things where, again, when you're young, the differences in years and generations matter. I can tell you how music sounded different between 1991 and 1993. And if you were older than I was, you wouldn't be able to tell the difference. But what you're talking about is, yes, Silicon Valley existed. Like Steve Jobs and the PC era existed. Mark Andreessen has this quote where he said by the time he got out to Silicon Valley in 93, he thought he had missed it. Like the big fortunes had been made in the 80s. Intel and Microsoft was founded in 1975. I'm not saying that Silicon Valley or the tech industry was invented when the Internet or when the Web went mainstream, but it's that sort of granular difference between the early PC era and then the Web and sort of and here's what the difference is. The fact that PCs were a multibillion dollar, probably a trillion dollar industry in the 80s when less than 100 million people were on PCs is kind of incredible because we're used to now, like again, to use the threads example, Meta turned on threads and they have 100 million users in five days. The thing that the Internet changed was your total addressable market is potentially every human being on the planet. Before the Internet era, what product could potentially every human being be a customer of? Maybe Coca Cola. Right. The difference is that I think I say at some point in the book that it's not just a generational thing. It's also like an apocalypte thing where the only equivalent would be like when North America was discovered. And it's like, well, there's a whole continent here. The Internet was a wide open field where there was no limit to what your total addressable market could be to who your customers could be. And there's the whole Clay Christensen thing about disruption, but also the simplicity of delivering your product as we're talking about with things like Napster and other things like that being examples of how the Internet is the greatest distribution methodology ever created, I want to get a little.

Bit more into Netscape. You present the Netscape IPO in the book as really a touchstone event, and I'm wondering if you can give our listeners a sense of just how big a deal Netscape was, especially for younger listeners who don't remember, and why its rise, its IPO, and its subsequent fall in the browser wars against Microsoft were so significant. And as an addendum to that, any opinions you have about how Netscape could have maybe steered the browser wars in a different direction. Was the open sourcing into Mozilla a mistake? That was more like a Hail Mary, it feels like. But any thoughts on the downfall too?

That's a lot, but I'll do my best. If you think about it. And AOL is this too. But what Netscape was was a play on normal people. Folks like my mother coming online, okay, but also folks like know my first exposure to the Web was a Mosaic browser and then Netscape. So essentially it's a play on this is the tool that shows people what the Internet is. There's that famous what was it? The Today Show or something, where Katie Kirk and Brian Gumble are like, what is this Internet? Or whatever. That was a thing in 95, 96. Everyone's learning. We're used to this. Now there's a new thing, oh, I got to adopt this, I got to learn what this is, or whatever. We've had 30 years of that. But the Internet was the first time that that happened for, I'd argue, 50 years after World War II of like a technology or a new thing, full stop, that seeps into everybody every corner of everyday life. And people have to learn what it means and how they will use it in their own lives. The browser is the portal or the window to what the Internet and the World Wide Web is. You have to also remember the context of the biggest stock that everyone wished they had got in on was Microsoft. And Microsoft was a similar play because back to the graphical user interface, it's the thing that made computers palatable to normal people. So people had the recent history of Microsoft operating systems, netscape an operating system, or at least a portal for the Internet. And they thought that a similar platform play would happen. There's way more nuance to the story of how they move so fast. But one of the things was, again, we're so used to a company being founded three years ago and going public to the tune of $50 billion. That did not happen in the post war era, or at least since the what was it the nifty 50s, like the Xeroxes of the world or whatever. The idea that a company would be so young that it would go public within two years of its founding was insane. The fact that it would go public without having much profit was insane. But people were willing to take a bet on this for the reasons of the Microsoft example that I told you. And then also people could see that the Internet was a wide open field where the sky was the limit. You didn't know where the limitations were in the market. It's funny that Mark Andreessen is the start of the book and the whole thing. Mark's now an investor in our most recent fund, so it's come full circle in a decade. My relations with him. But to the degree that he likes to talk about this stuff at all, which he doesn't, the thing that anyone at Netscape would tell you is that they were naive about the fact that Microsoft and Bill Gates were slick operators and they would throw elbows. There's the famous story now of Facebook copying Snapchat or Stories or things like that. The idea that if you try to disrupt somebody they won't just roll over and let it happen again. We have a lot of context for that now, a lot of history with that. These people, it's a nascent industry. They get into it. They think oh, we're going to kill Microsoft. Microsoft is at the time a 90% market share monopolist and they use their monopoly power to kill them, which the US government sued them for. Yada yada yada. That's a longer story. But the bottom line is I think Mark Anderson would tell you they were naive and they didn't know what they were in was. I interviewed for the Internet History Podcast. Folks on the Internet Explorer team. So the Netscape browser was a pure play browser. When Microsoft gets Internet religion they have a competing browser called Internet Explorer. And when Microsoft gets religion about the Internet, that means that overnight they assign 1000 people to developing their browser. And this is at a time when maybe Netscape has a team of 30 at best. So I don't know, if Microsoft hadn't been that aggressive, maybe Netscape could have survived. I don't know that it functionally matters because again, we can get into this with the.com stuff. But there were so many companies in the late 90s that you've never heard of again like the Pets.com and stuff like that. So I don't know that it matters that Netscape got killed because Microsoft also got killed and they went through a decade of irrelevancy after the.com bubble burst. But yeah, those early battles were tough and probably Netscape never had a chance. But one of the points that I've made over and over again is had Microsoft not killed Netscape and the government not sued Microsoft about that, we might not have the world that we have today because Microsoft had to sit on its hands. And so when Amazon is a five dollar stock after the.com bubble burst, they can't buy them. When Google comes up, Microsoft can't acquire them. When Facebook comes up, Microsoft can't acquire them. Because they had just been through the antitrust stuff because of Netscape. So the fact that 1000 flowers bloomed in the big oligarch of the time being microsoft was unable to acquire everybody is due to the fact that the government slapped their hands and said you're not going to be so voracious to kill every market that you see. And so, long story short, I don't think Netscape had a chance. But the fact that they took that bullet for us is probably why the tech industry is the way it is today.

I think that's a super articulate way of describing it in terms of Netscape taking the bullet. And I thought it was fascinating. In the book you describe how Microsoft at first really didn't get the internet. You wrote that quote nothing got under Gates's skin like discovering a software market he did not have dominant control of. Obviously Gates and Microsoft managed to turn that large microsoft ship around and do exactly what you said take on Netscape, take on AOL. Internet Explorer would eventually go on to reach over 90% market share amongst browsers. Then you also mentioned that that antitrust scenario also sort of suffocated some of their creativity going forward. And also importantly, like you just mentioned, their ability to acquire some of these other companies. One thing that they seemed to fail with was MSN. I was just wondering what went wrong with MSN in your opinion.

But it was a me too. In the same way that now meta, facebook is known for being a know, TikTok comes around and so all of a sudden they have a clone of TikTok and they're doing it right now to Twitter with threads. And sometimes it works, sometimes it doesn't. Again, MSN was a clone of AOL. This is hard for younger people to understand, but there was a time when the internet was not just everywhere, like in the ether. You had to dial up on a phone at a very slow rate to get on the internet. And AOL was something that allowed you to do that. It's complicated. They also had their own proprietary network. A walled garden is the term that people like to use. And so MSN was just a MeToo copy of that. But I mean, it was successful enough, especially for the time period that it was created. It didn't work because, I don't know, Microsoft at the same time was also creating expedia and all sorts of other things. The 90s was very much a time of throwing spaghetti against the wall and seeing what stuck and no one was immune to that, including Bill Gates, or maybe even, especially Bill Gates and Microsoft.

So for many of the people that may be listening. Who grew up in the 90s, AOL was synonymous with the Internet. For me personally, I was actually in a Prodigy household and I was begging for AOL to be able to communicate.

I was on Prodigy too, before AOL, I was on all of them. I was on copy serve too. But go on.

How did AOL end up bungling its lead? In retrospect, do you think there's anything they could have done to avoid their fate?

No, to be quite honest about it. And again, subsequently, steve Case is someone that I've interviewed too. Again, if you weren't there, it's hard to explain, but the dial up was never going to last. It was eventually going to become broadband or the WiFi and cellular and 5G as we know it now. AOL was at a bottleneck at a weird time in history that wasn't going to last. In a way, what AOL tried to do was not insane because what they again, for folks that don't know, they bought Time Warner, which at the time was the huge media behemoth of the era. So number one, AOL allows, I think, as much as 50 million Americans their first taste of the internet. But then once Americans get the Internet, they're like, well, let's go to this other place that's faster and better. So number one, AOL became this huge, valuable stock and they tried to translate that stock into something tangible, which was like a media company. That's not insane. The other thing was Time Warner had one of the largest cable companies in the world. And these days, still a large percentage of us get our Internet from our cable provider, even if we don't pay for cable TV anymore. AOL did bungle the fact that they were know the movie You Got Mail is about AOL for a very good reason. There was a time when everybody got on the Internet in North America via AOL, and they tried to extend their franchise. The thing that had made them successful. And it didn't work out. And maybe they could have been smarter about it, but I think they made what in their minds and at the time seemed like the right moves. The real way that they bungled it. And this is kind of getting ahead of ourselves or being tangential, but they had things like Win Amp around the time of Napster, which would have been like the equivalent to itunes. They could have made that before Steve Jobs saved the music industry. They also had AOL Instant Messenger, which to be quite honest with you, was social media. Before social media existed, it was your friends, it was a social graph, it was status updates and things like, you know, famously, Facebook was built by a bunch of college kids chatting with each other on aim. Aim could have been the thing. And this is all to say, I don't know that AOL could have survived. They did all the right moves to. Try to extend what they had done. But what we should really think of for history is that they didn't know what they had because again, they were sort of like behind the historical curve.

Yeah, and I thought it was interesting. Brian one something they didn't bungle was their brand almost. You described in the book the brand of AOL was what helped them sort of weather and survive the coming.com burst and the nuclear winters. You describe it whether it's the millions of CDs everywhere, the fact that they were the training wheels for the internet or Internet access. I thought that was fascinating. And also I would say that my Aim profile was some of my first self expression in the digital age, so I always appreciate them for that.

Yeah, it's funny, I've made this point a lot of times too. I always get into generational things about this, but in the 20th century people frame themselves around music and movies and it's like, well, were you a 60s kid, but were you a Dylan 60s kid, or were you a Beatles 60s kid, or were you a Neil Young? In the modern era, the way that people identify themselves has been around technology in the sense that were you a GeoCities kid, were you a MySpace kid or a Tumblr kid, or was your first phone a Motorola razor or an iPhone or whatever? The way that people get their sense of identity and find their people, find their culture, that they aspire to be among is via technology now. And the nostalgia that people have now are for things like MySpace. And that BlackBerry movie just came out and you're going to see 20 years on people being nostalgic for platforms and things like that, which is a weird thing to say, but that's part and parcel of why I wrote the book, because this is how the internet infiltrated our lives and changed all of our lives.

Ryan one of my favorite chapters in the book is chapter nine, Irrational Exuberance, about the hype filled.com bubble. I remember living through that time as a twelve year old and getting into stocks with my dad in the late 90s. If it's okay with you, to give our listeners some context, I'd like to read a short excerpt from the book. Is that okay with you?

Yeah. Okay.

This is from page 156 of the print edition. When former Surgeon General of the United States C. Everett Coop became the eponymous public face of Drcoop.com, it must have felt like a thumb in the eye. To any media celebrity who hadn't been smart enough to jump on the.com bandwagon sooner, drcoop.com was nothing more than a general interest health portal with a celebrity figurehead. Its traffic numbers were nothing special, and of course the site didn't make any money. Nonetheless, Drcoop.com enjoyed a nearly 100% 1st day IPO pop and raised $85 million from investors despite reporting lifetime revenue totaling only $43,000. Following this lead, veteran news anchor Lou Dobbs shocked the media world in June of 1999 by leaving his decades long stint at CNN to launch space. Okay, for somebody who didn't live through that time period and knows anything about business, that sounds kind of crazy. Yet celebrities, journalists, Wall Street, everyday investors all bought into it. So my question for you, how could so many people from such large swaths of society be so delusional? Or were they delusional and where were the grownups at the time?

Okay, well, number to I'm going to cut you down at the knees right away because talk to Tom Brady about shilling for FTX or any of the other celebrities that have been involved with recent crypto things. A bubble is a bubble, right? And in the moment of a bubble, you can even know that it's a bubble, but you don't know when it'll end and also you don't know that it'll end badly, right? Because okay, you're describing drcoop.com, but there are websites now that provide health content for people that make a lot of money. A lot of the things in the.com bubble that seemed insane, that blew up, that lost investors a lot of money, were things like pets.com. Well, by the way, I haven't gone to a store to buy my dog food for a decade and a half now. I get it delivered to me. Just because at the time, in the late 90s, there was no economical way to deliver dog food to people's houses doesn't mean it was a bad idea. One of the biggest flame outs of the.com era was web van and grocery delivery. There are so many ideas from the.com era that blew up, seemed stupid, some people, a lot of money lost other people later on, a lot of money that have been proven to be good businesses later on. There's a thing in anything, but especially in investing and especially in technology, you can have the right idea and it's just too soon. Like the first smartphone was, you could argue, invented in 1992. But why would you have a smartphone before there was things like WiFi or even 3G? Good ideas are good ideas, but if you do it before it makes sense in the market, they seem like stupid ideas. So this is all to say, yes, you read some of those stories and I took great pleasure in telling the more outlandish stories and how dumb they sound now in retrospect. But I wouldn't say that the people involved at the time were dumb. Some people are. Like, again, you can make an analogy to crypto. I'm going to get in and get out while I can, make my money while I can. Maybe there will be a greater full beyond me. But also there were true believers and again, there are true believers. The first social media site was invented in 1997, right? And it wasn't until Facebook in 2004 that social media as we knew it was born, and even then it was amongst two dozen other social media sites. So the point is that in any bubble, you have people that are opportunistic, there are people that are shysters, there are people that are frauds, but then there's other people that are true believers, and some of them win and some of them don't win. But then 20 years later, it's proven that they had a good idea. They were just too early.

To be fair, I called them delusional, not dumb. But you had so many great anecdotes in the book, and again, I recommend everyone read this book. But I'm wondering what your absolute favorite was. What was just the most absurd story to you personally, of all the many.com bubble stories?

I mean, there's shades of theranos and things like that. There was a startup that raised $30 million and then spent it all on their launch party in Vegas, where they paid to have the Dixie Chicks or whatever. Imagine you raise $30 million, which is a huge amount of money in the you spend 25 billion on it in a launch party at Vegas. There's stuff like that, and there's stuff like one of my favorite stories. This kind of doesn't answer your question, but if you ask me what my favorite sort of entrepreneurial story of that era is, my absolute favorite entrepreneurial story is the globe, because what the Globe represents is social media as we understand it today. It was founded by two college kids. Again, this fits the paradigm of the sort of entrepreneurial stories that we understand today. And it was people finding friends, interacting online, et cetera, et cetera, had huge page views at the time, huge traffic, and they have the biggest IPO pop of the.com era. I think it was something like 700% pop on the day it goes public. And it's one of the earliest casualties of the.com era. By the time, I think by the end of 2000, when the.com bubble bursts, like the stock is worth pennies or whatever. But it's a story where no one did anything wrong. People were incentivized to do things like, well, you're getting a lot of traffic. Go public immediately. Well, we've only made $0.07 in revenue since the day we opened our doors. Doesn't matter, just go ahead. You've got half a million users. Half a million users. Sounds really small today, but at the time was insane. Everybody did the things that made sense at the time and then looked like idiots when everything blew up. But then 510, 15 years later, it looks like, oh, no, you were sitting on something that was the right idea, just too early. I like that you are interested in the.com stuff, because I fought hard to keep those chapters in the book, because I think that it says so much about our society over the last 30 years that we've careened from one bubble to another. Like the.com bubble was the first one that a lot of people you had baby boomers putting their nest eggs into stocks and things like that, and People Day trading, and then you had the housing bubble, and then you have the crypto bubble and things like that. I think it's important to understand that the.com bubble was the first time that Americans sort of got this sense of you can get rich. Entrepreneurialism is a good thing, greed is good, to quote Gordon Gecko, and also new valuable things can come out of it, but also it's tricky and dangerous, and you could lose your shirt. So I fought very hard for a good portion of the book to be about the.com era, because I think it's very instructive to how we got to where we are, even now in 2023.

I'm glad you did. And as anyone who's not only interested in tech but's also interested in economics, I think there's a lot of great stories there. I do want to challenge a bit about the adults in the room and that sort of stuff. You've talked a lot about entrepreneurs, but what about the financial analysts? So what about somebody like a Mary Meeker whose job is to analyze these markets, know, tell people when they're going a little too far, when things are getting a little out of hand?

Yeah. Or a Henry Blodgett, who was absolutely, famously made the $400 Amazon call. But again, he wasn't wrong. It was just too early. Okay, adults in the room, yes. But you could say the same thing about the housing bubble. Like, where were the ratings agencies? Like, this is getting into Big Short territory. Or again, to mention crypto and stuff like that. Like, should Larry David and Tom Brady be held responsible for shilling for FTX or this crypto project, or that crypto project?

Sorry, I don't mean to interrupt too much, but Tom Brady's doesn't have any expertise in economics or marketing, whereas Mary Meeker has an MBA, so she at least is taking classes in economics and finance.

But what I'm suggesting, even if I don't want to necessarily tar these people with that, is I'm suggesting that that's the early days of the influencer. I say in the book, Mary Meeker makes her name by writing the first Internet reports and doing very it's sitting on my shelf right over here right now. Very detailed analyses of where she thinks this Internet market is going to go. Henry Blodgett, again, he makes his name by calling that Amazon is a stock that's going to go to the moon. And it does. And so then the problem is that then the incentives are all bass backwards. Because once he makes that call and gets famous on know, his compensation from the Wall Street firm that he works for, like Quintuples, because he's now a star, he can go on CNBC and everyone wants to know, all right, I got rich because you said Amazon is great and ebay is great. What's the next one? What's the next one? Right. You're right that the adults in the room were negligent. And I'm saying without saying that this is great. That yeah, that sets the template for how we got the housing bubble, how we got the crypto bubble, how we got like, there are no adults in the room. If there ever were, they haven't been around for a long, long time. And if that's too cynical, I apologize. But I'm saying that without trying to put any sort of framing on it. Yeah.

No, I love that. Thank you. Thanks for indulging me there.

No, and I think it's interesting. One of the takeaways I got from the book was that in the very beginning, we went from print media, where impressions were immeasurable in that they could not be measured, to then the digital age, where we started to be able to track page views, unique page views, clicks.

One of the things that my mom likes to say about the Internet era is it all boils down to it's impossible not to know that's everything think about what you just said in the 20th century. If you were Ford and you're like, I need to sell my new car. I'll put ads in a magazine. I don't know how many people saw that ad. Now you know exactly how many people interact with an ad or a thing or what they had for breakfast or whatever. But that's the like, now Ford can know how many times you go to Target because your car is connected to the Internet and tells Ford everywhere you've gone. Ford's not a terrible tracking everything you do. But the Internet is. The modern era is it's impossible not to know anything. Everything is connected. You can quantify anything. Everything is down to numbers. That's what the modern era is. Yeah.

And I think one of the perils that kind of contributed to the.com bust was that then you had on the finance side, to Dave's COPEX point, you had folks coming in with some of those fuzzy metrics again, looking at mindshare and future potential mindshare, growth, things like that. So I think that's where it came from. And one quick point before we move into the post bust era, which I thought was equally important, was also that the bust actually led to some good development of fiber, better infrastructure. And I loved how when you went to examples of previous famous busts, of course you mentioned the Dutch tulip mania, but you said the more important one was the English railway speculation pre Victorian times. Or in Victorian times. That was essentially all of these folks applying for Certifying, new permits for rail, building up rail that ended up not being used until it was really needed. And that really enabled Britain to be the empire it was in that era.

Yeah. People remember the.com bubble bursting because they remember Pets.com and this company and that company that blew up but there were really two bubbles that happened at the same time, and the second one was a fiber and internet buildup bubble. And there were things like Global Crossing and Sprints that we and even Enron, which was an energy company, but was also involved in fiber and things like that. People forget all of those names, but essentially what it was, again, people see the internet's coming. It's not just the internet. It's also people can see the modern era of you're going to get your TV and all of your media and stuff delivered to you electronically. There was a bubble of, okay, we got to lay these pipes. We got to do the fiber in the same way that in Victorian England, it's like, well, we have to have every city in the country connected by railroad. Well, no, not every city needs to be connected. There was over capacity. So there was a coinciding second bubble at the same time as the.com bubble, which was building out all of this fiber and all this infrastructure. The beautiful thing about that was when the.com bubble bursts, the reason that the Facebooks of the world and the Ubers and Airbnbs of the world are later able to do things is because all of that infrastructure had been overbuilt. And so it was just cheap as hell. And so you couldn't have done a Facebook where there's 3 billion users in 1998 because it would have been so cost prohibitive that there's no way it could make sense by 2006, 2009, because all of the infrastructure has been laid and it was overlaid. So it's now cheap, and you can get it for pennies on the dollar. That's what allows sort of the Web 2.0 era to happen, is that the overbuilding and overcapacity just made everything so cheap.

So a lot of our listeners may not realize that Google, while it was started before the bubble, did most of its early growth in a very down tech market. Why was yahoo? The dominant portal and search engine throughout the early web era, not able to keep up technologically with Google even after acquiring overture and inktomy?

That's a funny thing, because if you think of the profile of the two companies, they're almost identical. They're both two Stanford grad students. Yahoo happens first in the 93, 94 to 95 era. Google doesn't get founded till 98. When Google gets founded, there are two dozen search engines. That the joke is like, who needed another search engine? There was Alta Vista, Lycos, like big, huge multibillion dollar companies, excite dog pile.

Just combined all the other ones.

Sure, right. Yahoo. Didn't work. Yahoo. Actually survived the.com bubble. There was a brief period of time when they were like sort of the darlings of the Web 2.0 era because they bought early things like Flickr, which was a social photo sharing site, sort of instagram of its era. But I think what happened was they were never a technology company, even though they were founded by two yahoo. Was founded by two computer science grad students, they always thought of themselves as a media thing. They thought of themselves as a directory. Like, literally, Yahoo started with thousands of people paid to put websites into an index and like, okay, you want stuff about dogs? Okay, click through here's. Stuff about beagles, okay, click through here's. Stuff about beagle puppies. The thing that made Google different was that it was science. From the very first time larry and Sergey, the founders of Google, were interested in large language models, not large data sets. Sorry, but the point I'm trying to make is what you hear about AI today and how AI is trained on the Internet and things like that, that's what Larry and Sergey were doing in 1990, 719 98. And so they came at it from a more scientific angle than the Yahoo. Guys did. Yahoo guys always kind of thought of themselves as a media entity, which is sort of a carryover from the AOL era, from the web portal era. And so I think that, again, the fine granular difference between the way you think of what a web company could be in 1997 versus what you think it could be in 2001, there's a huge difference, huge generational difference between what the expectations are, what you think is possible, et cetera, et cetera. So, bottom line, Yahoo wasn't really a tech company. Never was, never had that in its DNA, and Google had it from day one.

And you described the talent and the discipline of Google, the fact that nothing ever distracted them from their core product. And I really do think it built evangelists as opposed to just users. I still remember my 9th grade Spanish teacher, Mrs. Proverb, in 1999, making us all log on to Google and use that for research for some of our assignments that we had. And I just think it goes back to the importance of the talent brand as well. Google was the place to work at that point, inspired by that hard work, the frugality but frugality that never hurt the productivity and the creativity of Brynn and Paige and all of their executives and employees.

Again, this is timing, because when Amazon survived the.com bubble bursting, because they raised a $2 billion debt offering, like literally three months before the bubble burst. And I've talked to Amazon folks, and they're like, yeah, that money is what kept us alive. So Yahoo was a huge multibillion dollar market cap company in the.com era. That's why Mark Cuban is a billionaire, because he sold his startup to Yahoo. And then smartly hedged his stockholdings when they went down to almost nothing. So Yahoo. Rode the wave, was huge, but then was punished when the wave crashed on the shore. Google had the timing right in the sense that when the nuclear winter happened, if you were a smart person, a talented software engineer, a talented economist. No one thinks about the fact that Google makes all its well, a lot of people know this, but Google makes all its money on ads. The economists that went in there and created the ad bidding system that makes Google all its money are like, Nobel level economists that were given, like, huge contracts to make this happen. Google benefited from the timing of when the nuclear winter happens and the.com bubble bursts. If you're a smart technologist, that's the only game in town. That's the only place where anything interesting is happening. And also they're the only people that have money to pay you. If it had been reversed, if Google was first and Yahoo was second, maybe Yahoo would be the Google of today.

You do a great job in the book kind of discussing the growth of advertising on the Internet. And of course, speaking of Google, we wouldn't have Google without the advertising business model. At least we wouldn't have it today. And the same could be said, of course, of Facebook. I'm wondering, in your research for the book or your many interviews on the Internet History podcast, if you came across a company that was either in the search space or the social networking space that you feel had a viable alternative business model, something other than advertising for those plays, or do those plays have to be done through advertising?

I mean, now, yes, but I'm so old that I can remember when no one's going to pay for content. Netflix is the thing that proved that people would pay for content. Before that, it didn't exist. If Facebook had been founded after Netflix, or if Facebook were founded, know, Elon's tried this, even with can or Snap is doing this to a certain degree of success. With Snapchat, you can get people to subscribe to stuff. Now, it is maybe the original sin of the early Internet that because it was there's lots of complicated reasons for this, but because it was all assumed to be free, that no one was like, well, I'm not going to pay for that. And again, zero marginal returns. It's infinite selection, instant gratification, et cetera, et cetera. I don't know that we would be where we are now without it all being ad supported. But I think also that's part of we're only two decades into the Internet being all pervasive in our lives, so there's a lot of stuff that we had to learn the hard way. And I think that the simple thing of if you're getting value, it might be worth paying for is something that we've learned in the last half a decade, really. And to the degree that you can do things now where it's like, I'm willing to pay for that, that's a new thing. And we as a society had to learn and mature to be like, yeah, this isn't just a free lunch. This is things that are valuable are worth paying for.

That's a perfect transition that you just set up there, Brian, because I did want to move into sort of the end game of your book, which starts getting into social media. And one thing before we jump into there was Napster, right? It seemed for a bit there that Napster and file sharing more generally was going to displace paid know, when we were in college. We had, you know, yet the emergence of the itunes store began a very powerful narrative to that. Why were Steve Jobs and Apple able to get folks paying for media online when nobody else could?

Oh, well, that's an entire nother book there. But bottom line answer is genius of Steve Jobs, because the weird thing about that is that the ipod was all pervasive in about five short years and the iPhone is all pervasive now, but when they launched that macs are less than 3% of PCs. The short answer to that is Steve was able to do that because Hollywood in the music industry was like, oh, you only have 3% of the market, so we're willing to experiment with you because we don't think that you're going to eat our lunch. And then the ipod and the iPhone did eat their lunch. But one of the things I want to say about Napster is napster and file sharing and LimeWire and things like that were of similar ages. So I was on all those sites too. The Napster era taught Hollywood that their traditional distribution methods were dead. There's a whole story to be told of Netflix going against Blockbuster in the era where Netflix was still mailing CDs to you. But the thing of digital as a distribution method for media, everyone knew that it was better, it was superior to, again, putting things in boxes and shrink wrapping them and putting them on a shelf and making people drive to a store to buy Know or. I worked at Blockbuster in high school and college. Like getting your car to watch the movie you want to watch tonight. Napster is a story of digital as a superior delivery method and distribution method for media. But it also kind of trained people to be social in the social media sense, because you were looking at other people's songs and their hard drives and what they were into and how you I remember downloading Kade, the Radiohead album from Napster and doing it overnight, but then seeing all the other people that were into Kade and talking on Napster and Napster again. We use the analogy of they took a bullet for us or they took the arrows in the back so that other people like Netflix could live. They did that for how modern media is delivered, but they also did that for training us to reach out to other people online and do that sort of social thing that we're used to.

Now you document several online communities and social networks in the book that didn't survive friendster MySpace. I remember MySpace is the first place where I ever directly made any code changes, changing the color and background and embedding a music video on my page and things like that. What was special about Facebook that made it so successful? What did Zuck get that is didn't?

Absolutely nothing. Absolutely nothing. Because other social networks were superior for the ways that you just described it's. Timing. And it was sort of the vector of the college thing. I don't know to what degree this is still well understood. Again, this is the thing when I write the book, it's like, well, this is obvious to me that Facebook went from college to college to college. Everyone knows that. I don't know if people know that now, 20 years on, but Zuck launches it at Harvard in 2004, and then they went to, I think it was Yale next or Stanford next or whatever. They went college by college by college. Okay, you're never more social than you are in your high school and college years and your early 20s, right? And we are social primates. We like to see what everyone else is doing, what Facebook did. I can remember Facebook being the dark horse, where MySpace got bought by Rupert Murdoch for $580,000,000 or whatever, and they were the big gorilla in the room, and tequila and other people were made dane Cook were made famous by MySpace. And I can remember when Facebook was sort of like the dark horse. But the thing was that they captured that generation at the time when it's the most important to be social. And then my opinion of Zuck is there's a quote, I think in the book where it's like he's talking about how if he looks at the data, he can see who's going to break up. This is early on. This is like within a year of Facebook he knows who's going to break up based on what they're posting know, because early on in like it's all college. You couldn't have a Facebook account unless you had a account like Michigan.edu or whatever and he could tell what boyfriend and girlfriend or whatever was gonna break up by the frequency of them posting on each other's pages. If data is the new oil mark, zuckerberg is the modern Robert Baron would be the thing, but the JD. Rockefeller, because he understood more than anybody else that all he has to do is look at the data. Facebook bought Instagram because they could see that instagram was being used by their users. They bought WhatsApp for? They bought oculus, et cetera. I think that Facebook won not because they were better than anybody else, they weren't. They were dollar. And Facebook to this day has that sort of Microsoft reputation of being dollar. But Zuck just watched the data and watched what users told him they wanted. And he always, and to this day, intuitively trusts that and goes in that direction for good or. Ill.

I think one thing that I noticed that was different about Facebook was the true identity. So friendster had kind of tried to do that. But with Facebook, the email address from the college actually did allow them to pretty reliably have your real name in a way that I don't think other communities had really done it before. And obviously that got challenged when they went open, but they figured out ways to be fairly good about keeping fake people off of it, obviously with better and lesser success. But do you think that might have been part of why it was able to grow? That people really did put their real name and face on it?

Yes, 100%. But then that didn't work later because why did Snapchat happen? Because you didn't want your mom seeing what you did. Right. Again, it's timing. It's generational cohorts and this is maybe to put a bow on it, but I do make this argument at the end of the book that there's two things that happen in 2007 2008. Number one is the iPhone is launched and number two is Facebook opens up to first high schools and then to everybody if those two things don't happen at the exact same time. Could either of those things have been as successful as they have been? Because Facebook requires for normal people like my mom to use it a device that will make it easier, easy for her to both consume and create content. She needs a device in her pocket that she can take a picture of her grandkid. And she needs a device in her pocket that she can check every 5 seconds to see other people's grandkids. Right. So the iPhone creating the smartphone era has to happen and then Facebook has to open up to allow people like my mom on. But those two things couldn't have happened if the greatest device to both create and consume the media hadn't happened at the same time. And then the platform to both create and consume that sort of media hadn't happened at the same time. So again, I guess what we're coming down to is that for a lot of things in life is timing, but especially in tech and things like this.

I was going to ask because you chose to end the book with sort of the expansion of Facebook to the mothers, aunts, uncles, et cetera, of the world outside of the EDUs and the rise of the iPhone.

And because it comes at the very.

End of the book, it almost seems like a fukuyama end of history moment. Now I can see why that feels like an appropriate place to stop, but was there any other thought put into stopping there versus anywhere else?

No. Again, I could do another book, but right, because once then the App Store happens, well, then you've got Uber, you've got Airbnb, you've got things like that. I wanted to end it there because you have to do it, because otherwise, if you try to keep it up to date, it's out of date by the time the book comes out. But then, number two, that did seem like the paradigm shift where, again, when I went to college, my mom gave me postcards, stamped postcards, and she's like, you're going to write me once a week. All I ask you to do is write me once a week. But I was the first person to go into the dorms and have an email account that was given to me by my college. And so within two weeks of being in college, I was like, Mom, I don't need to send you these postcards because just get on AOL because I have this email. We can just email. And so I think that the era of technology infiltrating all of our lives, for good and ill, happened because Facebook and the iPhone and the smartphone era happened at the exact same time. We're approaching 20 years on that now because, what, 2007? So we're 2022. It's crazy, but it would be too difficult to do the last five years of tech history. It's easier to do 15 years ago. And also, I think that that is a real delineation point. Again, think of everyone listening. When did your mother get a smartphone? It was after 2007, right? I don't know. I default to using Moms as a measuring stick of this sort of thing.

Yeah, and that was a great transition. Again, to my final question for you, and it gets to some of your last point, but I really enjoyed how you structured the book. In some cases it was linearly, but in others you sequenced things a bit overlapping, but always in what I would say an ascending quality score. Right? You started with the story of search engines in general, but then moved to Google overtaking them through the monitoring of the reference links. The relative authority of those links, you led to Napster then, and blogging, sort of increasing the quality score of the overall Internet, ending up with Wikipedia, ending with true social media. And I sort of sense that as you went through the narrative, the quality score was going up for the web.

Are you an SEO?

I am not. I mean, I've done some armchair SEO in the past, which was a lot of fun on AdSense and AdWords, actually. But I was wondering, when it comes to that quality score, would you say that are we still in the era of ascending and increasing quality score? Is that quality score on the web still high today?

And is it a risk to the.

Web if it's decreasing?

I'll tell you this because, again, to bring it back full circle, I did this book because I've followed the horse race of companies. I do the tech meme ride home every day, which again, is on a daily basis, doing the horse race of who's up, who's down, who's winning, who's losing? And I've been doing that for almost six years now. You're using the term quality score. I'm going to use a different term, which is when I started the daily podcast where, I'm telling you, I wrote the book in 2018. I started in 2018 a show where it's like, here's the book where here's how the Internet happened. Here's how the Internet is happening today. It was frozen in Amber so much for the first three to four years of the show. It's not just Elon buying Twitter. It's not just AI coming. I have not seen the tech industry in as much flux as I've seen it in the last 18 months. And again, I've been doing a daily show for five years where it's like, here's what's happening here's? Who's up, here's who's down? I think that you said quality score. Is the Internet getting better or worse? I think that we had a love affair with the Internet. We had a sort of like, oh, the Internet's ruining our lives, but we had to mature, and we're learning how to integrate the Internet into our lives in a healthier way. And that is causing a lot of flux right now. The things that were frozen in Amber, where you have Facebook, you have Google, you have this one, you have that one. There's a lot of things that are basically people are figuring out right now, and that's the money people, but that's also the users. And to me, that's more interesting than sort of the early teens when things seem to be like there were five big players and everything stuck in Amber. And it is what it is.

So, Brian, we've covered a lot of different topics, but obviously it's just a fraction of what's in the book. And I know all three of us enjoyed reading the book and recommend it to our listeners. I'm wondering if there's any aspects of the book that you want to mention to our audience that we didn't talk about. And who do you recommend reads the book?

Who I recommend reads the book is if this is egotistical, forgive me, but I do want younger people coming into the tech industry to read it, because that's why I did it. We've talked about things like Netscape and even Yahoo. If you're 24 years old, why would you know what Yahoo is? But the point is that if you don't, tell the folks I'm an investor now, I run two VC funds. I want the people that are 24 that I invest in for their startups that are brilliant. They should know where this came from. And you don't have to get it from my book, but educate yourself on the industry, because it's not that history repeats, but it does rhyme and it's worth doing that sort of thing. But also, I wrote the book because I want normal folks, not even in this industry, to know who are the people that did this to us and how it happened, because, again, I think it's as profound as learning how Hollywood happened or how World War II happened. Technology is so all pervasive to our lives right now. It's worth understanding the undercurrents of how A led to B led to C. That's great.

That makes a lot of sense to me. Brian, is there anything you'd like to plug? How can our listeners follow you on social media?

Well, now, on Threads, it's Brian MCC. But also on Twitter, it was Brian MCC. B-R-I-A-N MCC. Please, again, if you like the book, buy the book. But I do every single day. A history of the Internet in real time. It's called the Techmeride Home Podcast. I'm blessed to have tons of influential people listening every single day. I also have the Ride Home Fund, the now Ride Home AI fund, if anyone wants to invest in the current AI. Market with Chris Messina. And I look up, ridehomefund.com. But otherwise, yeah. The techmerite home. I will continue to do it as long as I'm able to speak, because I just love telling people about what happened today on the Internet. That's it. That's it. I love talking to the industry. That's the only industry that I've ever worked in my entire life.

Well, Brian, it's really been a pleasure. Thank you so much for coming on the podcast.

I am honored that you asked me, and thank you so much.

Okay, listeners, well, it's been great hearing from Brian. Next month, we're going to be reading the presentation Secrets of Steve Jobs by Carmine Gallo. This is a book about how to give a great presentation whether you're in school or you're a CEO, it goes all the way. We're actually going to be blessed to be joined by Carmen Gallo himself next month. Really excited about that. David and Kevin, how can our listeners get in touch with you on social media?

You can follow me on Twitter at david.

G. Short.

You can follow me on Twitter and Instagram and soon to be Threads at Hoodak's Basebasement. That's H-U-D-A-K-S basement.

Don't forget to subscribe to us on your podcast, Player of Choice, and we'll see you next month.