Well known fact . . . the functional differences between version 1.0 and 2.0 (of anything) are actually pretty small but these little differences could make all the difference in the world as far as adoption, monetization, and growth. . . ie 1.0 is an idea while 2.0 become a business and/or phenomenon. The first post I read that compared Bubble 1.0 and Web 2.0 in these terms was from Fred Wilson who invested in Geocities and is an avid blogger (blogging 1.0 vs. blogging 2.0).

Blogging 1.0 paved the way for Blogging 2.0. I see four fundamental improvements that differentiate Blogging 1.0 from Blogging 2.0.

The first is the notion of the post as the central piece of content. About.com had some of this in its DNA, but Geocities and Tripod did not. Posts drive freshness, frequency, and syndication and make Blogging 2.0 much more exciting than Bloggin 1.0 was.

The second is related to the first. Permalinks have changed the game fundamentally. Linking to content was not really possible until permalinks came along. Now each piece of content is a persistent object that has a unique identifier. This is a huge deal and this concept did not exist in Blogging 1.0.

The third is RSS. Blogging 1.0 was a web experience. Blogging 2.0 is a everywhere experience. Content was a solid in Blogging 1.0 and its a fluid in Blogging 2.0.

The fourth is CPC and contextual ad networks. In Blogging 1.0, the only way to monetize the business was with banners. And brand advertisers were not thrilled with paying high CPMs to advertise on “amateur content”. With the arrival of CPC and contextual ad networks, this is no longer the case. Wherever advertisers can get clicks, they’ll place their ads. The result is a huge increase in the potential revenues.

Yesterday through Dare’s blog and almost simultaneously through Anil Dash’s blog, I discovered an equally eye opening and insightful analysis of social bookmarking 1.0 versus 2.0 by Ari Papro on Blink.com called “Getting it Right”

Since the post is a little long, I’ll just paraphrase/generalize/augment Ari a little bit . . . (but please still read it)

1. Defaults Matter - dont assume use cases for the end users, find out, survey, and measure . . . they might turn out to be more resilient than you think . . . that “socialness” is a fair and valuable tradeoff for “privacy”

2. Folders Suck - dont underestimate users’s ability to process and organize very fuzzy and large amount of data, show them everything (within reasons) and give them the tool to filter/search

3. Make it Instantly Useful - same as above

4. Don’t Let Technology Decide - users dont care about elegance, they care about usefulness

Like what Fred & Ari mentioned, very very small differences in positioning, product functionality, and design orientation can make the 2nd generation disrupters scale more efficiently than the 1st generation. (notice that I didnt mention success since I’m not sure if delicious or blogging will be sustainable in the long-run just like their 1st generation cousins did not). With lots of ideas being recycled from the first boom to the second boom, it is always hard to figure out the small differences and how “this time it will be different.” It is from the individual stories of insiders that lived through the first boom that we can all learn not to repeat the same mistakes. We, as managers and entrepreneurs, finally have a channel(blogs) to share these snippets of stories that would not have found daylight in another era.

I’m thankful for Ari’s post especially because as an founder, he shouldered the responsibility perpetually for the all the success (and there are many) and failure of the company. That post required deep courage, clarity, and thought of delicious, blink, the industry, and especially of himself. He has come to terms with the past and has moved on with better purpose. Anyone who was a founder of a failed dot-com during the first boom will still remember vividly the bitter, thoughtless(?), and vitriolic criticism heaped on them from the media and the anonymous mobs of fuckedcompany. Dont get me wrong, we(entrepreneurs, founders, executives, VC’s) deserved it and should take full responsibility for the failure of our companies, but I think conversations like the ones that exists today on the blogosphere (aided by identity transparency of today’s web) creates a much more constructive environment.

To be honest, I too have been writing and re-writing a mea culpa of sorts for the last few month but unlike Ari, I still lack a successful foil to my failed venture. I’m actually still praying that B2B “comes back” (B2B 2.0?) so I can find out for once what worked and what didnt. Even better, my startup, in its current incarnation could still discover the right business model or right set of functionality to come roaring back under the rightful/determined leadership of my ex-colleagues. For now, there are still too many things I screwed up on that I should share for the same reason Ari shared his (I’m guessing) . . . 9/10 unselfish knowledge contribution, and 1/10 selfish self-absolusion. Look for it soon