When beleaguered social networking site MySpace.com suddenly needed new leadership, its owner, News Corp., tapped one of L.A.’s most respected entrepreneurs who has strong ties to the local tech community.
Mike Jones, who was named co-president of the Beverly Hills-based Internet giant Feb. 10, is regarded as one of L.A.’s most successful tech executives. His reputation as a product developer may be helpful as MySpace bleeds users while rivals Facebook Inc. and Twitter Inc. eclipse its once-dominant role. Jones’ challenge will be reversing the trend.
MySpace hired him in April to become its chief product officer. Two weeks ago, when former Chief Executive Owen Van Natta abruptly stepped down, Jones and former Sling Media executive Jason Hirschhorn of New York were promoted to run the company. Their duties haven’t been publicly specified. A MySpace spokeswoman said Jones declined to comment for this article.
The 34-year-old tech expert made his name in the span of a decade, launching two local startups, selling one for $40 million. Those who know him say he has a penchant for building good products, he’s a demanding executive with high standards, and he’s a dedicated family man who spends a good deal of his free time with his wife, son and daughter. He’s a frequent speaker at local conferences and is routinely sought after by budding entrepreneurs as an adviser or mentor.
But he’ll need all his skills, and maybe more, for his huge task: reverse the fortunes of struggling MySpace.
“What Mike really has a chance to do is make MySpace a preeminent brand again,” said Jason Nazar, chief executive of local startup Docstoc, one of many L.A. tech companies where Jones is a board member. “If there was any single person I’d put my money on to turn around MySpace and make it something great, it’s him.”
Jones is part of a new generation of local tech executives who have capitalized on their early success to found and fund other L.A.-based companies. In addition to his board positions, he has personally invested in at least one local tech company, Goodreads, a Santa Monica-based social networking site for book lovers.
Jones has a reputation of being personable and approachable, and responds to e-mails from total strangers. Nevertheless, he isn’t a regular at local tech parties and doesn’t blog about personal details of his life. When he isn’t working, he’s home in Manhattan Beach with his family.
“He’s not showy and trying to be Mister Universe or a superhero,” said Ophir Tanz, chief executive of Santa Monica-based GumGum Inc., another company where Jones serves on the board. “He’s pretty humble, and just gets the job done.”
AOL experience
Born in Philadelphia, Jones has shown an entrepreneurial streak since he studied for a degree in international business and marketing at the University of Oregon in Eugene. He was named the school’s Student Entrepreneur of the Year in 1997.
He launched his first L.A.-based company, Userplane, in 2001. It provided text, chat and video chat software to Web sites. It got the attention of America Online, which bought it in 2006 for $40 million.
Jones then spent about two years as a senior vice president in AOL’s product division before leaving to help start Tsavo Media, which is building a Web site network, in 2008. Jones was there for about a year when MySpace tapped him for the job of chief product officer.
Business associates said one of Jones’ greatest strengths should transfer well to MySpace: his talent for building Web products. Those who know him said he has an eye for seeing how a new product would work best, and can drill down to the smallest details. At Docstoc, for instance, Jones advised the company on the most effective placement of advertisements on its Web pages.
Product smarts are sorely needed by MySpace, where its Web site and offerings haven’t aged well. When Rupert Murdoch’s News Corp. bought MySpace in 2005 for $580 million, it was the largest social networking site in the United States. Now it’s second to Facebook: In December, MySpace attracted 70 million visitors, according to ComScore Media Metrix, down from 78 million a year earlier. In that same period, Facebook more than doubled its monthly traffic to 112 million.
Industry watchers said they expect Jones and co-President Hirschhorn to continue Van Natta’s strategy of rebranding MySpace as a platform for games and media, especially music. Despite its troubles, MySpace’s online traffic is still the envy of most Web sites, and is a valuable asset as it tries to find its way back to prominence.
“I think it’s clear they’ve lost the social networking race,” said Mark Suster, a partner at Century City venture capital firm GRP Partners. “What they can do is reposition themselves and say, ‘We are not going head to head with Facebook,’ and then improve the product to stem the decline in users.”
Corporate man?
MySpace offices are on a leafy road in Beverly Hills, in a prominent building that also houses the rest of News Corp.’s interactive businesses. At one point, the company employed about 1,400. After last year’s layoffs, that number is believed to have dropped to less than 1,000.
At its peak, the company’s location was seen as a factor in defining Los Angeles as a center for the rebirth of the Internet industry after the dot-com crash of 2000.
It remains to be seen how Jones works inside News Corp.’s corporate structure, which industry watchers say has sapped MySpace of its entrepreneurial creativity. Van Natta reportedly stepped down in part because he chafed under News Corp.’s bureaucracy.
Jones knows what working for a large corporation is like thanks to his time as a vice president at AOL. But News Corp. will likely be leaning on Jones and Hirschhorn to show quick results because MySpace’s struggles have hurt the company’s bottom line. Last year, News Corp. was forced to take a $403 million write-down in its quarter that ended June 30 for its interactive division, where MySpace is one of the primary assets.
Running MySpace may be Jones’ biggest challenge yet.
“I think this was an offer that he just couldn’t pass up,” said GumGum’s Tanz. “MySpace is sort of this sinking ship, and if he’s able to save that ship, he’ll be regarded as a miracle worker.”
