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Kevin Rose reflects on Digg, the dangers of outside investors, and his legacy

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By the time Digg was portioned off for sale this year, company founder Kevin Rose wasn’t visiting the site anymore. He had already left Digg for other projects, including his own startup and a role at Google(s goog) Ventures, and says it had become hard to see what happened to his “baby.” But even if Digg has changed since its initial roots, and he has regrets regarding some aspects of how things went, Rose is still proud of what the team accomplished.

“When I look at some of the early stuff we did in 2004 and early 2005, I’m proud of that,” he said Wednesday evening at the Founders Showcase event in Mountain View. “There are a lot of things where we were the first company to launch some of these social features on the web.”

Rose took the long view of his role at Digg Wednesday night (as Om did in the wake of Digg’s sale), reminiscing on some of the challenges he faced as a new entrepreneur and coming of age around the same time as other companies who eventually did the social-media thing better:

“I grew up in between Facebook(s fb) and Twitter,” Rose said. “People took what we created and innovated on top of our creation to make something better. And it’s tough to maintain that,” he said, citing the realization that came when he heard people talking about news they’d seen on Twitter, rather than news they might have previously seen on Digg.

Rose also said that Digg hired individuals with very niche skills, like developers who only knew PHP and were not as useful once PHP went out of use.

“We ran into these huge problems, and didn’t have generalists who could go up and down the stack,” he said, noting that it was a problem he worked to correct at Milk, his next startup, and urges young companies to think about.

One of the best aspects of his current gig at Google Ventures, Rose said, is that he can apply some of the wisdom he gained in his Digg and startup years to help younger entrepreneurs, who he cautioned against taking on too much financing too early.

“I don’t think you should give away a lot of your company,” he said, noting that he liked bringing on advisors, as long as they were willing to invest some of their own funds in the company’s success.

Rose spoke highly of New York-based incubator Betaworks, which acquired the remaining assets of Digg for $500,000. That didn’t really reflect the value of the company’s parts, Rose said, which were acquired by companies like The Washington Post and LinkedIn(s lnkd). Rose said Digg received higher offers but picked Betaworks because it thought those executives had the best vision for what to do with Digg, and he thanked the investors for being willing to go along.

“We had a site with a lot of visitors, and when we sort of put out a word that this was up for sale, there were a lot of companies that offered more money. There were spam sites wanted to make it a link farm, and a bunch of properties that would have really screwed things up,” he said. “But if there’s any company that understands the real-time nature of the web, it’ll be the people that brought us all these really cool things like and Chartbeat.”

Rose said he’s seen mock-ups of the new Digg, and he likes it.

“I love the design. It’s very simple, and there’s a lot of emphasis on real-time,” he said “It’s very bare bones, but in a good way. They’ve killed a lot of features and bloat that’s grown up over the years, and they plan on launching a very bare bones system and then over the next couple weeks increase the functionality.”

An audience member asked Rose what he hopes his legacy will be, and he thought about it for a minute.

“When it comes to investing, I want you to be able to look through my portfolio and say, ‘That could have been big.’ They might not all make it, but at least they could have been something really cool,” he said. “I want to do Pinterest when it was Pinterest, not a clone. Big ideas and shaking things up is my passion.”

28 Responses to “Kevin Rose reflects on Digg, the dangers of outside investors, and his legacy”

  1. Digg didn’t fail because of Facebook and Twitter.

    Digg failed because of Digg.

    Digg never offered any sort of meaningful API, which quashed its utility to third-party developers, who make or break this types of sites. Digg also ran into serious trouble during the 2008 election for sketchiness involving its voting algos.

  2. Joe Park

    I dont blame digg for what happened, they were trying to make digg better to adapt to the internet’s growing pace. Understandable. They should have done more testing before officially changing digg. It its not completely their fault. Facebook, took a chuck out of everybody’s users. A buddy of mine was maintaining a free forum board, now taken down by facebook.

  3. Michael Williams

    I thought Digg wasn’t the same after they moved beyond tech news. It seemed like the audience changed after that. Kevin created a really nice site. It just didn’t stand the test of time.

  4. I can understand the need to “go social” but many people do not want to share everything they look at with every possible place. I think is should be available but optional at the user’s choice.
    Currently, Digg is essentially forcing me to sign in using Facebook, at least in Firefox. I don’t choose to do so, so I can no longer sign in and rate stories that I might be interested in.
    This may be due to “tracker blocking” that I use. If I cannot be tracked, I cannot sign in. Oh well, bye bye Digg.

    • That is frustrating. I am seriously thinking about shutting FB down, partly because I get tired of finding that what I do on other sites has just been broadcast on my FB site. My friends don’t need to know my every move, not at all. And Digg ties itself to this. Bad move.

  5. Jeff Putz

    I met him very briefly at a conference, years ago. He seemed like a very genuine and very smart guy. I don’t think he pretends to be a great manager… that’s why he didn’t want the CEO role. He’s a vision guy, and he deserves credit for that.

    I perceived the problem with Digg as the users, which is a weird problem. The “game” of Digg became so intoxicating for them that they didn’t want anything to change, ever. That led to the “wisdom” of the crowd to otherwise make innovation difficult, and a virtual PR crisis with every deployment. At the end of the day, the site couldn’t evolve to do what Facebook does for me today: Give me interesting links from people I trust, namely my friends.

    • Couldn’t agree more. Many of the most active users had conflicting interests (i.e. they were employed/contracted to drive traffic to sites via Digg), and the cat & mouse game between Digg and them (as well as Digg’s efforts to appeal to mainstream sites and larger advertisers) essentially pitted Digg against its entire user base.

  6. Come on. Digg sold out the front page to advertisers.
    Any other argument about why it failed is wrong.
    There is no room for debate here.
    The stunning thing to me is that rose or someone there
    thought that would work. All merit unemployment.
    Unfathomably clueless.

    • Tony Drummond

      I like to think that the reason why Digg failed was because of the gaming that went on, not the advertising. People constantly gamed the system, voted up posts that sucked because a friend submitted it, etc. With all of this going on, the site became a joke because all of the top articles were pretty much garbage. Reddit definitely helped further Digg’s downfall as it is a very simple yet well-built site. After all, why go on Digg and see a bunch of fake upvoted articles when you can go on Reddit and get a more realistic view of what is popular online.

    • You don’t hate on Google for putting ads on all their searches. It’s all about the implementation. Digg’s first mistake was making too many product changes too quickly and as a result disenfranchising power users. Digg’s second mistake was not taking the spam problem seriously. Digg’s third problem was being too late to the game with Newsrooms, and not giving users any power at all to create / moderate new communities on the site. The ads played a very small part in their downfall.

  7. I like Rose. In a lot of ways he represents the best of my generation of entrepreneurs more than Zuckerberg and anyone else in that era. The fact that he keeps working, and seems to always have something new, is inspiring and in a way, motivates me to do the same.
    Pownce was ahead of its time. Had it been released in 2011, it would be a viable twitter alternative. I guess that’s what he was getting at with how he wants his legacy to be seen.

  8. Ben Rowell

    “I love the design. It’s very simple, and there’s a lot of emphasis on real-time,” he said “It’s…”

    -I can’t wait to see what John Borthwick and his team do. I don’t think there were many better companies than Betaworks to take over st Digg. Most interesting of all will be how Digg is integrated with, and how their experience in mobile development will play out for Digg. There is certainly a lot of potential in the embers of this once huge site.

    “When it comes to investing, I want you to be able to look through my portfolio and say, ‘That could have been big.’ They might not all make it, but at least they could have been something really cool,”

    -Oh and I think Kevin will make for a brilliant investor. No offence to him, but I don’t think he’s yet cut out for the management side. He’s always been an ideas guy and that’s where he should focus his energy.

    Best of luck to all parties.

      • There are many paths one can take toward becoming an “ideas-person”. Many people demonstrate advanced creative thinking at an early age. Judging by your question, you’d like to know where someone who is not naturally creative can become creative. That’s an excellent question. Most people expose themselves to new things (i.e. art, music, technology, architecture, etc.) and, as they become immersed in these creative fields, they begin to identify with the creators and frame new ideas. Another direction not to be discounted is higher education. By attending a top tier university with brilliant peers, you’ll find your impressions of the world challenged. Through team projects, you’ll learn new problem solving methods from your teammates. Most creative ideas in business are derived from the identification of an issue and the development of a solution. I genuinely hope this response has aided in your personal growth.

  9. He tries now to fix the damage that made by BI, and position himself as a great investor? Oh sorry, I can’t tell him what I think about his investing methods since I’m not an investor myself.

  10. Jonatha

    The dangers of outside investors?’d be in those investors NEVER recovered since Digg (or ANYTHING you have been a part of) has ever made a penny in profit.

    • Jonatha

      It was KEvin that IMPLEMENTED the changes that killed it. He was the perfect example of terrible management. A pathetic man-child who still thought it was clever in his 30s to never be seen without a beer in his hand. Some outcast in college who was trying to finally live out hose college party days in his 30s since no one ever invited him to parties when he was IN college.