One wonders just how far outside the echo chamber that is Silicon Valley a conference full of fanciful startups will matter. Yes, Tech Crunch, now in its third year, provides a media pulpit from which countless mostly-unknown tech industry startups launch their hot new idea. Problem is, most people who run startups are woefully deluded as to the probably of success and are running on the same kind of bravado found requisite to be a tech startup today: You believe you’ve got an innovating edge to a growing market (or you believe you can create a market where there wasn’t one anymore), you’ve got some piece of software that does something Web 2.0, and you’ve got a marketing team. Problem is, most of them don’t actually have anything innovative and are running on hot air.

TechCrunch is like American Idol for internet startups: 50 are selected from thousands of submissions. Through the course of the week, each one makes a presentation. Most of them have been in “stealth mode” (building a business without publicly telling anyone what you’re doing) until this event. Some of them have been around but are launching a new product. The presentations are then critiqued by a panel of experts (think, people who actually made it): Roelof Botha (from Sequioa Capital), Ron Conway (an industry veteran who invested in the early days of Google, Ask Jeeve, Paypal), Dick Costolo (Chief Operating Officer at Twitter), Reid Hoffman (co-founder of LinkedIn), Tim OReilly (Yes, Tim OReilly himself. if you don’t know who Tim OReilly is I can’t help you), Kevin Rose (founder of Digg), and several others (only a subset of all the panelists are on the panel each day).

While there is no rounds of elimination, the judges do offer candid critique American Idol-style. The official prize is $50,000 to the startup with the most potential, but the unofficial boon to the companies themselves it he publicity. Other investors might see or meet them and, if they are successful at generating interest, might invest.

Perhaps the funniest happenstance so far was the very first presentation who was none other than Penn Jillette of Penn & Teller. They were the first presentation to go up, the headlining event, and ironically the least understood. One imagines what TechCrunch was thinking when they accepted them and put them first: A good opening act, world famous Penn & Teller present their new iPhone app (yes, they wrote an iPhone app), which is – you guessed it- a card trick. As his usual style to debunk the allure of magic itself, Penn told everyone exactly how the trick works after he presented it a couple of times.

Penn & Teller got famous in the 90s by being the magicians who gave their secrets away. Literally, after doing a great trick they just tell the audience how it is done. Philosophically, they do this do make a break from the mystique of the supernatural magic act – think the Doug Henning, Siegfried & Roy, David Copperfield. While being bona fide magicians in their own right, they attempt to break the 4th wall and engage the audience by challenging us to see our own blind spots: Magic works because of confirmation bias. Magic is not so much about the concealing of certain things from the audience, it is about making the us pay attention to other things so that we don’t notice the trickery behind the illusion. In the business, this is known as “misdirection.”

But back to TechCrunch. So here’s how the trick works: You tell your friend that you are personally good friends with Penn & Teller and that you text (SMS, on your iPhone) all the time. You tell your friend to think of or pick a card from a deck of cards. You then hand your iPhone to your friend, and it comes up in the SMS application. You tell your friend to text either Penn or Teller and ask what the card was. The response is comical and often includes several text messages. (On stage, the response that came up was Teller saying “I’m thinking of a queen.” To which the participant said outloud “I didn’t pick a queen.” The next text message read: “But enough about my personal life…” before the final text which is, of course, the exact card you picked.) To find out how it works (clue: it’s not really Penn or Teller texting you back), you’ll have to buy the app or see the presentation.

The scene after Penn presented was comical. First, as best I could tell, the panelists seemed to have no clue who this huge (he is 6’6), sort of crass New Englander is. During his presentation he said that this card trick was used by a stripper in Vagas and has dramatically increased her tips. “If you can get noticed when you have tits & ass to misdirect, imagine how well it will do when you don’t have tits and ass.” A rather salacious thing to say at a tech industry conference, no? Well, it just got funnier.

Penn tries to again explain the whole trick again (after having just finished explaining it a first time) to the strained Ron Conway who responds, “So, it’s a card trick?”

Being TechCrunch panelists, they treated Penn as if he was a start-up. (One wonders, didn’t anyone tell them that this headlining act wasn’t really a startup but one of the world’s most famous magicians demoing a simple technology-based app). The panelists were so thrown off by Penn’s demeanor and crass that one of them said “Are we being punked?” 

“So your revenue model is selling the app?”

It’s cool that Penn & Teller are hip the times, but they’re not about to launch an internet startup, which the panelists just couldn’t seem to believe (that is, in fact, the point of Tech Crunch). Bluntly honest and slightly out of place at this dorky conference, Penn responds: “No, it’s not so much a money maker for us as a public service to get guys laid.” To cap it all off, another panelist says “I hope you don’t make me disappear from saying this, but I don’t know what the long term business that I’m investing in…”

Penn’s frank response: “No, there’s no venture capital required, we’re done and it’s for sale.”

Did someone miss the point here?

By Jason

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