If you thought Steve Jobs presented key-man risk at Apple Inc., just consider Michael Arrington. For those who’ve never heard of him, he is the founder of Techcrunch, a blog whose musings on technology and start-ups over the past few years have become required reading to the denizens of Silicon Valley, and which was once valued at some $100 million (Rs489 crore).
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But now Arrington, like Jobs, is taking a break. But he’s not sick. Rather, he claims to have been spat on during a conference in Munich this week and revealed he received death threats from a reader presumably unhappy with his opinionated views. While understandable, his decision highlights how key-man risk—the vital importance of one individual to a business—may keep this emerging online medium from hitting the big time.
Whether Techcrunch can exist without its leading light will be a test case for the blogosphere generally. Many blogs rely heavily on the contributions of their creators, making them little more than online columns. Techcrunch is no exception. Arrington’s extensive tech-industry connections helped the blog break stories—like Google Inc.’s purchase of YouTube—that made it a must-read.
With Arrington out, rivals have an opportunity to nab his two million monthly readers. After all, they will still be looking for insight on technology and may switch their attentions elsewhere if Arrington’s remaining employees are unable to match his consistency or style. It also clouds the potential for blogs to sell themselves to traditional media companies.
The Huffington Post, which recently raised $25 million, and others are well ahead in creating diverse revenue streams and developing multiple content sources. But their businesses are also untested against a departure of their founders. By taking a break, Arrington may be doing them and the rest of the blogosphere a favour in seeing whether one of these businesses can prosper without its key man.