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Joel recently posted about going for VC funding for SO.

This makes me nervous for ill-defined reasons. Somehow it feels like "the man" would have elements of control in a site which has really been very community-focused so far. Now I'm no tin-foil hat wearer normally, and feel a little silly for even raising this concern... but it may be symptomatic of a deeper concern:

Do we really want to be influential on a stock price?

Okay, so VC funding is a long way from floating on the stock market, but it's a step in that potential direction. Let's suppose SO did float... could I influence its price? If myself and a few other high rep users wrote carefully worded (and time-separated) posts trashing the site - not in a stroppy way, just in an "it's so sad, small decisions X and Y have gradually deteriorated the site until it's no longer the place it was" kind of way... would that lower the value? I'm not saying I would want to do that by any means - it just makes me nervous that I potentially could.

To view it the other way round: I've always been clear that I don't want to be paid for answers. Yet if I owned stocks in SO, then every time I tried to make the site better by answering questions, editing, commenting etc then I'd effectively be protecting my investment. Would it be unethical to do this on company time, waiting for a build?

Apologies for the ramble - I just wanted to air some uncomfortable feelings and give others an opportunity to do likewise. Answers telling me to pull myself together are welcome :)

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From other comments/answers on other questions I get impression Joel is talking about Stack Exchange rather than Stack Overflow specifically - but I could be wrong. –  ChrisF Feb 16 '10 at 9:38
    
So what's the equivalent of insider trading in this scenario? –  random Feb 16 '10 at 9:59
    
@random Buy lots of shares, then post blogs about how great the website is. See the price of the shares skyrocket...maybe. I actually don't know if that qualifies. –  jjnguy Feb 16 '10 at 10:03
    
(Proposal to trade rep for stock options in 10... 9... 8...) –  Jon Seigel Feb 16 '10 at 14:07
    
@random, @Justin Nelson: much easier: buy put options and attack the site (either as Jon shows or bring it down). –  malach Feb 16 '10 at 14:23
    
I would be concerned about posting criticism on meta. If the shareholders don't like it, do i get banned for pointing out issues? That's an extreme case, of course, but not unfeasible. That said, I trust Jeff and Joel (too familiar, should that be Mr Atwood and Mr Spolsky?) to steer things in the right way as they have admirably done so far. –  Jeff Yates Feb 16 '10 at 14:32
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@Jeff Yates: Should be Laurel & Hardy. –  Ladybug Killer Feb 16 '10 at 18:32

4 Answers 4

up vote 9 down vote accepted

It seems to me like the VC funding would be much more focused on the Stack Exchange platform.

Even though Stack Overflow is related to SE, it seems like is a completely different venture in the minds of both Joel and Jeff.

Have a look at Joel's answer to a question about the VC deal. It gives hope for the SO family of sites.

We're not going to accept funding that would in any way interfere with what made Stack Overflow successful. Period.

I don't think any tinfoil hats will be necessary, at least not in the foreseeable future. Pull yourself together man!!!

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Well, you don't have to look that hard to find examples of someone publicly stating "We're not going to do X under any circumstances. Period." Only to later do precisely X. –  Kip Feb 16 '10 at 16:18
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I think you're absolutely right about SE focus. Funny that even the well-published 37signals "rebuttal" (37signals.com/svn/posts/…) seems to totally miss the point. (Hint: it's not about "getting page views to sell for ad crumbs" or "fighting for every niche", but selling a "premium knowledge sharing platform" to paying customers both on public web and inside companies.) –  Jonik Feb 16 '10 at 16:55

No you are not an insider, you are a user.
Users can affect a site, its reputation and even its value, specially high-profile users. That would be as true for Stack Overflow as for every other site you use, and in fact is the case for every product and every company.

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@Kobi: But if you trade in the stocks of a company you work for, you're bound by regulations to avoid insider trading - that's my point. –  Jon Skeet Feb 16 '10 at 13:26
    
I guess I missed the point. But people do own stocks of the company they are employed in. They are still expected to do their work and raise its value. (a side question: what insider information can you use here? or am I missing the point again?) –  Kobi Feb 16 '10 at 13:50
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Suppose I talk the site down a lot, in order to push the value down. Then I buy stocks, and announce I'm coming back. Value goes up, I make a profit - I've manipulated the market. Bad. –  Jon Skeet Feb 16 '10 at 16:09
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@Jon - that does presume we hang on your every word are completely brainwashed by the Cult of Skeet? :) –  The Anti-Santa Feb 16 '10 at 16:20
    
@Kev: It depends on me (and other users) having some level of influence, yes. Don't forget it's not the users who are most important in terms of being influenced - it's investors. –  Jon Skeet Feb 16 '10 at 17:11

I'm failing to really understand how extra funding would benefit either SO or StackExchange - what would it be used for exactly?

StackOverflow seems to be going quite well - its a fantastic QA site, and (I guess) its turning a profit, but I'd also say that its pretty much reached saturation point - the vast majority of programmers who go on the internet to ask / answer questions already use StackOverflow for exactly that.

  • There isn't any need for any "land grab" - the land has already been well and truly grabbed already!
  • Its not exactly repeatable (there is only 1 internets)
  • Extra publicity isn't really needed either

StackExchange also seems to be going quite well - its a fantastic piece of software, and I'd guess that the hosted StackExchange service is also turning a proffit. At the same time however StackExchange is primarily software that has been written for a programmer QA environment, and has been adapted for other purposes.

It works really well for SuperUser and ServerFault because combined with StackOverflow these are sites catering to 3 very similar demographics - People who would ask, discuss and answer questions online. However if you told me that investment was going into setting up a StackExchange style site for QA on say, car maintenance, or cooking, then I'd question how popular you would expect these sites to become?

StackOverflow careers is again a fantastic service / product, and is clearly going quite well, however works because it exists alongside StackOverflow.com.

  • Attempting to rapidly expand careers would undermine the point of the service - a small pool of high quality candidates.
  • Setting up similar services for fields other than programming would only really works if there was an associated StackExchange QA site already there.

On the other hand if investment in the StackOverflow team was offered it would be a completely different story - it strikes me as far more fesable to raise VC for a new product or service based on the proven success of StackOverflow, than it does to raise cash for StackOverflow or StackExchange.

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Hmm, I kind of went off on one here and now this answer isn't particularly relevant to the question any more. Should I move this to meta.stackexchange.com/questions/39539/…? –  Justin Feb 16 '10 at 12:05
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I'm amazed that the VC funding moves come as a surprise to anyone. Joel and Jeff aren't running the Stack Overflow business just so we can feel all warm and cozy earning our rep points. At the end of the day it's a business (and a damn good one as well) and at some point there's going to be an exit strategy with a decent payoff for all the hard work. After all, and like all entrepreneurs, once you've birthed and made your idea successful, it's time to collect and move on to developing the next thing. –  The Anti-Santa Feb 16 '10 at 12:20
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"I'd guess that the hosted StackExchange service is also turning a profit.": errm, the StackExchange service is still in beta and free as we speak, so I don't think it's turning a profit - yet. –  fretje Feb 16 '10 at 12:23
    
@Kev I never said it wasn't a business, I'm merely asking what massive amounts of extra cash is going to do to help the business? –  Justin Feb 16 '10 at 12:44
    
@fretje - Look here - meta.stackexchange.com/questions/4/list-of-stackexchange-sites, There are a hefty long list of sites, I'd be surprised if it wasnt turning a profit... –  Justin Feb 16 '10 at 12:48
    
@Kragen: Look here - stackexchange.com - big orange button "Try now for Free". I've actually did it and created my own StackExchange site just for the sheer fun of it. No probs, it works, and no money is needed. –  fretje Feb 16 '10 at 12:53
    
Ok, Just now I see the "Free for 45 days then pay for what you need." underneath it (although I think this wasn't there when I signed up). So you're probably right that they will already earn something for it. If it's enough to actually turn a profit is another thing of course. –  fretje Feb 16 '10 at 12:59
    
@fretje: You need to pay after 45 days, iirc. –  Macha Feb 16 '10 at 13:00
    
@Kragen - extra cash means being able to hire more development staff, procure more resources such as hardware and basically hit targets and milestones earlier and beat the potential competition and grow the business now that the model has proved itself. There's also the financial risk sharing aspect in pushing the business to the next level and hopefully being able to bring aboard business talent who'll bring new ideas. –  The Anti-Santa Feb 16 '10 at 15:15
    
"I'm failing to really understand how extra funding would benefit either SO or StackExchange - what would it be used for exactly?" It would be used to hire and pay more developers, to grow the business quickly before others are able to get a foothold in the market. –  Kip Feb 16 '10 at 16:22
    
@Kip, @Kev - That's some pretty vague business speak you have going there! What are the developers / hardware going to be used for exactly? –  Justin Feb 17 '10 at 0:15
    
Doing the StackDev Days takes some cash to do. Also, they're going to have non-technical sites that they are going to use to sell advertising and this is going to take a sales staff. –  JeffO Mar 15 '10 at 17:59

The purpose of a business is to generate wealth for the shareholders. Whether that's Jeff and Joel, some VC firm, or the general public, the ultimate goal is the same.

It's certainly conceivable that Jeff and Joel could partner with a VC who would assume too much control and influence, and take the site in the wrong direction due to a lack of understanding. However, if Jeff and Joel want to see the site thrive they will avoid this situation through careful screening (as Joel has already described on his blog).

As for being an insider - management, some employees, and perhaps some outside partners and vendors would be insiders. Not customers or users. And that's only really relevant if the stock is public, as insider trading regulations are designed to maintain a level playing field on the stock market.

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