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Lack of Focus + Featuritis + Poor Fundamentals = -$580 Million

The Sunday Times published an excellent article about how Friendster missed the mark. Poor performance and excessive complexity caused largely by disconnected management cost the site its shot at the big time.

The board also lost sight of the task at hand, according to Kent Lindstrom, an early investor in Friendster and one of its first employees. As Friendster became more popular, its overwhelmed Web site became slower. Things would become so bad that a Friendster Web page took as long as 40 seconds to download. Yet, from where Mr. Lindstrom sat, technical difficulties proved too pedestrian for a board of this pedigree. The performance problems would come up, but the board devoted most of its time to talking about potential competitors and new features, such as the possibility of adding Internet phone services, or so-called voice over Internet protocol, or VoIP, to the site.

THE stars would never sit back and say, ‘We really have to make this thing work,’ ” recalled Mr. Lindstrom, who is now president of Friendster. “They were talking about the next thing. Voice over Internet. Making Friendster work in different languages. Potential big advertising deals. Yet we didn’t solve the first basic problem: our site didn’t work.”

It's not surprising then that while Friendster was flailing and sinking under the burden of unnecessary features, it was crushed by a simpler and more open competitor:

Many people working at Friendster sneered at MySpace. The holy grail at Friendster — and the cause of most of its technical problems — was its closed system: users at Friendster could view only the profiles of those on a relatively short chain of acquaintances. By contrast, MySpace was open, and therefore much simpler from a technological standpoint; anybody could look at anyone else’s profile.

The two companies also mirrored their founders: where Friendster reflected the ordered vision of its engineer-founder — early on, the company famously removed the profiles of people who put up joke pictures, like photographs of their dogs in place of themselves — MySpace was more L.A.-laid back. At MySpace, they rode the wave instead of fighting it, and encouraged users to do pretty much as they pleased.

It's a classic tale of clinging to the poison that is killing you. As the complexity of the site burdened not only the technology, but the user base, Friendster continued to attempt to cure its ills by seeking additional functionality rather than paring back in order to both get the site up to speed and give users more freedom and ability. Clearly simplicity and openness has struck a decisive victory thus far.

Looking to the future, founder Jonathan Abrams has been left with such a bad taste in his mouth over what he believes to be the fumbling of his idea by a disconnected board of directors that he is said to have sworn off venture capital all together in the future — a great possibility in the world of rapid development and open source environments &mdash in favor of more organic development and growth. He is not alone &mdash certainly many of the next big things will be built with little more than a laptop and a hosting account.

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