The water cooler chatter from early this morning in PandoDaily’s virtual offices (aka email):
Sarah: “We don’t want to reference ‘accusers’ before we have them.”
Trevor: “Well by the afternoon, we will have them!”
See, that’s why I hired Trevor. He can predict the news before it hits the blogosphere. Of course, Gawker is also highly predictable. The site is saying we’re conflicted, because we have investors.
We addressed this point this morning here and on our about page and I discussed it with all the news outlets that actually reached out for comment. But to err on the side of over-disclosing, here it is again:
“I’ve also raised a bunch of cash from some of the people I respect most in the industry. This includes: Marc Andreessen, Peter Thiel, Tony Hseih, Zach Nelson, Andrew Anker, Chris Dixon, Saul Klein, Josh Kopelman, Jeff Jordan and Matt Cohler, all investing as individuals. Also investing are a handful of seed funds including the CrunchFund, Greylock Discovery Fund, Accel’s Seed Fund, Menlo Ventures Talent Fund, Lerer Ventures, SV Angels and Ooga Labs.
It’s a long list. And there is a simple reason we spread the syndicate widely: This is a news site built for the startup community, so the more of them that are a part of it, the better. Some people will call this a conflict. Even though it’s become standard for tech sites to be backed by investors they all cover, it’s certainly messy. But things were already messy for us. We are unashamedly part of the startup community. We love it and are advocates for the best parts of it, while we’ll aggressively call out the worst parts of it.
Sometimes our investors will be in the first category; sometimes they’ll be in the latter. I mean, they’ve already written the checks, so it’s not like they can take the money back, right? Either way, we’ll disclose everything.
Another note on conflicts: I won’t be investing directly in startups, nor will the staff-writers of PandoDaily. But we have plenty of contributors and opinion columnists who do, because frequently those people are informed enough to write the best stuff. And that’s no different from the policies of many old media brands like BusinessWeek and Fortune who’ve paid investors to write opinions and columns for years. News is news, but great opinion pieces are supposed to have bias and a point-of-view.”
Like most entrepreneurs, if I were independently wealthy, I would have bootstrapped the company. But I’m not, so I did what almost every other tech site and new media company does: Raised money from investors.
PandoDaily isn’t a hobby. We’re serious about building a long term business that pays reporters fairly for doing a very demanding job. It’s fine to criticize us for it; everyone is entitled to his or her opinion. But you also have to criticize VentureBeat, GigaOm, The Verge, and BusinessInsider.
The reality is nearly every business publication is owned by somebody. It was uncomfortable when I worked at BusinessWeek and McGraw Hill was embroiled in the Google Reader lawsuits. It was uncomfortable when I did a show for Yahoo! and Yahoo! was exploding all around us. And, yes, it was uncomfortable when TechCrunch was owned by AOL and AOL was busy being AOL. I’m sure Kara Swisher shakes her head about the various News Corp. scandals, and then, like any journalist, she writes a scathing post about them, overlords be damned.
We’re being up front about who invested in us; it’s up to the readers to decide how much that conflict bothers them. I think our team has more than earned the benefit of the doubt. We’re not exactly push-overs. In fact, I got to know both Jeff Jordan and Tony Hsieh after trashing their previous companies on my personal blog.
It should go without saying, but in case it doesn’t: None of our investors have editorial control, and none will receive favoritism. The CrunchFund is the only VC taking a board seat, because with Mike’s expertise building a tech blog, I’d be stupid not to have him on the board. (Angel investor and former VC Andrew Anker is also joining the board.)
Having recently left a company where the corporate overlords had the right to fire the editor-in-chief, I feel just fine running a company where a small amount of equity is spread across more than a dozen angels and seed funds.
Now back to legitimate stories.





[...] (We got off the topic of conflicts before I gave the whole spiel. For more on that, see our about page or this post.) [...]
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Like[...] (We got off the topic of conflicts before I gave the whole spiel so for more on that see our about page or this post.) [...]
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LikeGawker will be Gawker... Seriously, what'd you expect?
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LikeI think this conversation is pretty absurd and shows lack of perspective and proportion. Here are my two cents, split to three points (0.66 cents each and you can keep the change). 1) The intention of this blog is clearly stated, funding fully disclosed a number of times and it should be clear that PD aims to be connected to the roots of the ecosystem, writing _stories_ about it, the people, etc, and not just try to be yet another outsider reporting some "objective" "facts" or writing boring gadget reviews. As Brad Nickel said, we (the tech blog readers) are not stupid. Stupid people should perhaps read something else or just watch more TV. 2) having more funders with smaller stakes means less dependence on any one of them. Makes total sense. 3) Sarah Lacy is an awesome, "real" journalist and author, who has an impressive track record, to say the least. This is where perspective and sense of proportion should kick in. Do you really think that she'd trade all her clout and reputation for a payola article on a blog? What would that do for her credibility or any future prospects? (Credibility is the KPI for journalists, rather than pageviews, although it is easy to make the mistake.) Anyway, just wanted to wish Sarah luck for PandoDaily, I'll definitely be coming back because she's a brilliant writer.
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LikeSarah, I think there's a significant difference, which is that you've raised funds from a who's who of A-list Valley investors, and you've stated that you have no intention of selling, ever. If you rule out a big multiple on the exit, it's normal for the rest of us to wonder what these investors are hoping to get for their money.
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LikeJust an FYI, you are the one going for "Link Bait" by responding to this article, not Gawker's original piece. Gawker has gobs of traffic. You are the new site looking for links.
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Like[...] This! Blogger beef! blogs, pandodaily, tech journalism, techcrunch, the [...]
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LikeDid I miss something here? Is this a tech blog? When it comes to tech blogs, I take a look at the product and decide for myself whether it's worth a damn. This whole "are they in bed with the companies they are covering" crap cracks me up. I don't care. I make an informed opinion on my own as to the value or the chances for success of that particular company. If she gets tips from her investors bravo. If she doesn't get tips from her investors good for her (but kinda stupid not too). If you think she is biased and you are incapable of creating your own opinions about things, then don't friggin read it. She and her team don't owe you or me a thing.
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LikeTotally agree!
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LikeWhat I take away from this "controversy" is that Pando has played on its connections to sucker $2.5M from VCs on an investment that will in all probability never pay for itself. "Business blog" is not exactly a path-breaking business model.
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LikeI came here to read Sarah and MGs articles. It's my replacement for TechCrunch. I really don't care who pays the electric bill at their office. I'm smart enough to decide on my own if one of their articles is full of shit or not, so I don't even care if they disclose anything.
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LikeSo maybe it is just me, but here I am NOT sitting in San Francisco and the first thing I read on your new site is a spat between San Fran tech blogs/magazines about things that seem pretty small beer basically. It just seems pretty irrelevant.
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Likei'm surprised you guys even give a #!!@#. i love this give-em-hell attitude. i'm subscribing to pando because pando's badass. #completelyrandom #aside ... i think you need a mascot too. not sure what that would be but something that's rude and obnoxious, like you guys, but with a touch of the pro-fess-ion-al.
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LikeAwesomeness to you, Sarah, and PandoDaily.
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LikeMy dear friends, this is a tech blog, not the goddamn U.N. Who cares who's paying the bills? You're supposed to have your own opinion after reading blog posts, not taking it as absolute truth. If you do, I will just start a new blog and write about how you should donate me all your money. Stop the drama and care about which companies are backing your politicians, not tech blogs. Yeah, that's it...get a life.
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LikeCame for the post - stayed for the comments. An illustrative example of exactly why blogs are improved by allowing free commenting.
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Likeyes, the comments are as entertaining as the content. well said.
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Like[...] i projektet. Bland de övriga investerarna märks Peter Thiel (Facebook), Tony Hsieh (Zappos) med flera. Totalt har projektet tagit in $2.5 miljoner från [...]
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LikeI assume that because this blog immediately shot to th top of techmeme that you inherit the same conflicts that all arringtonware&tm; sites have. Techmme is a pr outlet for them nd they're a pr outlet for techmeme. It's all one trough. assume every story carries all the conflicts of all th others and njoy It all for what it I, an stop worrying bout who's holier than who. You all need to stay on zuck's good side and you all make fun of Scoble, and Andrew keen does you video now tha Steve Gillmor has a Real Job™.
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LikeSarah, big congratulations on the new site launch. It's a very good start and brings a unique female perspective needed in the tech publishing world. In terms of the seed and individual funding - and potential for favoritism or conflict - you're being transparent (just as Kara drops in her disclaimers) and you've stacked the odds in your favor. What's the problem? If CrunchFund blows up, good or bad, you'll cover it ... with perhaps an inside position or enhanced opinion. The transparency of social platforms is affecting tech blogging. Ultimately, the readers are smarter than the writers in aggregate, and we'll ride along with the writing, especially if the opinion comes through - again, giving all the cloned news clogging our rss readers. Congrats again.
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LikeCompletely share your and everyone else's sentiments over the inevitable success of Pando, Sarah's star leadership/reporting, and the unnecessary histrionics re: journalistic disclosure. But I do take issue with your using the phrase, "unique female perspective." It sounds like a tampon ad.
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LikeAND THEY ARE DELETING COMMENTS ALREADY TSK TSK TSK; IT'S NOT GOING WELL SO FAR IS IT,
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LikeYour comment was deleted because it included personal abuse. That's a pretty standard policy across all sites. Post it again without the name-calling.
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LikeMy comment was moderated out of existence and it was nothing but helpful. It was in reply to PXLated responding to how he would have found the syndicate links and general info on what those links would be on just about any WordPress site. I thought Paul's detractors were being nit picky and overly harsh. Just looking for a fight as it were. However, since my harmless, and helpful comment got the shaft I have changed my opinion. I don't really need "Yet Another Tech Blog™." Good bye.
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Like[...] of the politics behind this – but the post would turn into the size of a small novel. Just check out the comments on this post to see some of the back story. (Make sure you read the bits with Paul Carr in [...]
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LikeAnd the drama continues, with the aggressive mr Carr :) The quality of content will be the real answer. So far, I think it's great.
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LikeI look forward to Pandodaily.
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LikeI don't think they said you were conflicted. Gawker said you were perfectly aligned. That's what mouthpiece means. "Conflicted" would mean that you have some other goal besides protecting and enriching your investors. Personally, I don't care. Just pointing out that what Gawker said was quite a bit more pointed than "conflicted."
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Like@PXLated, it is already there. To subscribe use http://pandodaily.com/feed/
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LikeCool - But, how would someone know that? - I don't see any links and the auto-discovery in Safari doesn't indicate there's a feed.
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LikeProbably they didn't see the need for it. RSS is not too used (at least not in a direct way). Most people only add the site to their News Reader of choice and automatically pulls the RSS without ever knowing what RSS is.
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LikeI'm really happy to see this site. Gawker and the rest of the haters can go to hell for all I'm concerned. "Boo Hoo this site is funded" they say. Fuck. Off. Tech writers don't have to live like monks nor should they if they put out good content. Pando is already doing good work, and can remain impartial, so go feed your families. Keep it up.
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LikeI agree that articles can be impartial, and I don't inherently see a problem with having backers. I'm not worried that the words I'm actually reading are skewed with this particular cast of writers. What does worry me is that the coverage itself is biased. It's reasonable, justified, and in no way immoral for PandoDaily's VCs to send them an email saying, "Hey, check out the new company we just funded: Whateverly." Then, Whateverly gets some free press, and PandoDaily is less motivated to cover Whateverly's competitor, Somethingbetterio. If the articles are based even a bit more on emails from VCs than from research or following company announcements, we suffer as readers. We're more seeing press releases from the VCs rather than what is interesting or important. For PandoDaily, the situation is even worse. If each of their VCs ping them about a new company every few months and they have a ton of VCs, they're going to feel obligated or inclined to cover those companies at the expense of competitors. There's a reason VCs are increasing intermingling with journalists. It's good for business. I don't think it's immoral, but I don't think it's good for readers, either.
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LikeYou do seem to have legitimate concerns, but I question your intention behind these comments - being anonymous really does not help your case either. I have read many reports by Lacy, Carr, and Arrington and they have all been fair and great with disclosing information. I am a avid reader of tech news and this is my first time replying. Just thought I'd cheer you guys on for the great work you guys have been doing up to this point. I am one among many that are happy that PandoDaily launched. Cheers.
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LikeThere's nothing wrong with being anonymous. I carefully cultivate the search results that come up for my name, and I'd rather they be my own personal sites than my comments on other sites. Also, Isaac is anonymous. Also, all you did was attack me and not explain why. What exactly are my ulterior motivations? All I want is tech news, and I want to see the coolest/best companies rather than the companies that are best socially connected to bloggers. That said, many of the best companies are, by the nature of their teams, connected to bloggers. I never said I see these things happening frequently, only that they easily could (and probably do).
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LikeGood to see you have your own comments - TechCrunch fell off my radar when they wen't with Facebook. Now, if you'd add RSS I'll be happy :-)
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Likethey will not add RSS. They want to you come to the site and be subjected to ads for the start ups that are funded by the mountain of investors.
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LikeI am not sure if this is the right/approriate comment. I admire your goal, passion, and courage to start out a new path when many others afraid to do so. As a professional tech blogger, I don't think others' unprofessional comments regarding your company hold any values for the keen audience. Let them cry and whine about things, as they got nothing better to do/write about.
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LikeSarah herself has said that if she sells the company she will have failed. So barring an IPO, she doesn't anticipate ever having an exit. So the investors are getting in for some other reason than a financial return. Of course the investors are paying for positive coverage. It's not an explicit thing, the same way corporate contributions to political campaigns aren't explicitly bribery. And yet, somehow those contributors tend to see things go their way more often than not. Just watch as the investors above get more stories, and more positive stories, for their startups as opposed to those not affiliated financially with the site.
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LikeRegarding the breadth of your investors: "This is a news site built for the startup community, so the more of them that are a part of it, the better." Could you elaborate on how they'll make it better? I think the breadth of investors makes PandoDaily's situation slightly different than the other VC-backed blogs you cite.
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LikeJosh, Are you asking that question as a curious independent observer or as a recently hired (by Erick Schonfeld) writer for TechCrunch? If the latter then, without a disclosure, your comment feels like push-polling. http://en.wikipedia.org/wiki/Push_poll Welcome to PandoDaily. Paul
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LikeThe question is relevant and valid. I wondered the same thing when I read the article. Instead of implying that he's taking a shot at you, it would be more interesting to just answer his question. Your response sounds like a grumpy PR person at a large corporation with something to hide, and it actually achieves a smear on PandoDaily much better than the original question. It smacks of defensiveness. It's this attitude, of defensive, vague hostility rather than Hitchens-esque self-righteous hostility, that makes me avoid you're writing, Paul. It doesn't make me feel more informed, but it does incense me against you and, by proxy, any publication you're writing for at the time.
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LikeThank you, anonymous commenter. That's the thing with push-polling, isn't it? "BUT YOU DIDN'T ANSWER THE QUESTION! WHAT HAVE YOU GOT TO HIDE!" I'm pretty sure Sarah answered the question in her original post, and I don't speak for Pando. I'm happy to be explicit though: I have a career-long history of telling editors and investors to fuck off when I've smelt the slightest whiff of editorial censorship or unreasonable interference. I was the first to call CrunchFund bone-headed, and the first to tell Tim Armstrong to go fuck himself over his suggestion that TC had "different editorial standards". Anyone who has read a word of my writing will know I'll be the first to cry foul if any Pando investors try to affect editorial policy. Moreover, for an undisclosed TC staffer, backed now by an anonymous commenter, to ask snarky questions about the editorial propriety of Pando contributors is ludicrous to the point of offensive. Perhaps had Josh been around during the glory days of TC, he'd understand that close relationships with members of the startup community -- including VCs and other leading investors -- are how TC got many of its biggest scoops. And yet never once did Mike Arrington or anyone else hesitate to blow the whistle when those same sources fucked up. See Scamville, see Airbnb, see a million other things. As Sarah wrote, in an ideal world, we'd all be rich and able to fund the media out of our own pockets. Sadly this isn't an ideal world, so the best we can do is disclose, disclose, disclose. Something neither of the above two commenters saw fit to do. Finally, I note that you've made other comments on Pando, all casting aspersions on the writers. I assume your have some deeper personal issue with the team. Another undisclosed conflict. Paul
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LikeCould you answer the question though, Paul? I'm a writer with Betabeat, the tech blog of the New York Observer, and genuinely curious. Sarah name-checks AllThingsD and Kara Swisher, who, for example, has a very clear and thorough ethics policy in terms of protocol for getting information from her partner who works at Google. We're in the process of developing a statement that's as comprehensive. Will PandoDaily be getting information about portfolio companies or competitors from its 10 investors and 7 funds? If so, is it your policy to indicate who that information came from?
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Like@Nitasha I just answered the question, above. Does that suffice? Also, my original ethics statement (written years ago, but still pretty accurate) can be found here... http://www.facebook.com/notes/paul-carr/pauls-statement-of-ethics/124385747645784 With an update here... http://techcrunch.com/2011/04/30/an-update-to-my-ethics-policy/ P
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Like@Paul Very amusing policies, Mr. Carr. It's like you're practically begging to be called a rogue! I might be have missed the section that deals with this, it's almost 1am here, but I'm still curious about whether PandoDaily will source tips from its investors and if so, whether it will disclose that within the posts. This part of your response "Perhaps had Josh been around during the glory days of TC, he’d understand that close relationships with members of the startup community — including VCs and other leading investors — are how TC got many of its biggest scoops," indicates that they will be sources. But as a reader, I'm curious whether that will be divulged within posts. Thanks so much for responding!
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Like@nitasha I'm not ducking that question -- I assume given the breadth of investors that some of them will occasionally also be sources, but I'm not a reporter at PD and won't be writing news so I really can't say what the policy is. All I know is that at TC VCs were able to be "friends" of the site, sources and targets, sometimes all at the same time. Mike would later invest in companies we covered, but if anything that just made him more driven to question them. They key was always disclosure.
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Likefucking hell paul, I thought you were dead.
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LikePaul, re CrunchFund being bone-headed, you really should have disclosed that we're an investor in your new startup.
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LikeTouche. Although my comment doesn't really make sense if CF wasn't one of my investors. Disclosure is exhausting. (Also: to be entirely accurate, it's CrunchFund's *name* that I described as bone-headed. CrunchFund itself I quite like.)
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Like