Come on, Peter, not even a giggle? (Tumblr)

How many times does Peter Thiel have to tell you that unless your startup disrupts death or advances the singularity, he's just not that impressed?

CNN Money reports that Mr. Thiel took the conference stage with Twitter investor Marc Andreessen earlier this week. And while he's pretty sure that Twitter will still be around in 10 years, and he thinks the company's $10 billion valuation is fair, he just can't get all that excited about it.

He told the crowd: 

"New technologies are being used to send pictures of your cat halfway around the world," Thiel said. "We've talked ourselves into thinking that throwing cats at birds is the best we can do. We can do more than that."

Is that a reference to Twitter's logo? Or is there some cat-related startup we've missed?

(Photo: Charlie Rose)

The Rosewood Hotel on Sand Hill Road, conveniently nestled near almost every important VC firm in the Valley, has long been a hotspot for wealthy VCs to meet potential mates. This is due in part to love concierge Amy Andersen, founder of the super stealth matchmaking company Linx Dating. She helped cultivate an unofficial “Cougar Night” at the hotel after setting up a meet-and-greet there for her wealthy clients in 2009.

Ms. Andersen helps geeky Valley guys clean up their act (Get a spray tan! Whiten your teeth!) and switch out the sandals-with-socks look with the hopes that they'll find the "Einstein-meets-Heidi Klum" of their dreams.

"A lot have been incredibly successful because of their analytical minds,” Ms. Andersen told Vanity Fair, "but women don’t want to be out with a cyborg." Speak for yourself, lady.

We're not really sure how Thursday nights at the Rosewood went from powerful VCs getting drinks to a "Cougar Night" so infamous even Starbucks baristas know to try their luck there, but luckily storied venture capitalist Marc Andreessen took to Quora to help explain it.

In response to the Quora question, “Why does the Rosewood Sand Hill attract its lively late-night bar crowd?” Mr. Andreessen wrote:

My theory is that the Rosewood bar is wired with video cameras and is actually a long-form reality TV show titled "Cougars vs Hookers".  Could be wrong though.

Someone get Andy Cohen on the phone so we can clear this one up ASAP.

(h/t Daily Mail)

(Photo: vanityfair.com)

That Sergey Brin sighting amid the hedgerow at Vanity Fair's Oscar party must have gone to the glossy's head. Today, they attempted to catalog "Silicon Valley's Most Stylish."

Try as Jack Dorsey might with his "modified Mandarin collars," this is a crowd that once compared its colorful sock flair to boardroom "gang signs," so the bar was already low--especially considering that the New York Times already marked and tagged the every pair of Louboutins in the Bay Area.

But VF.com still managed to leave us aghast for one very troubling reason:

This photo of Marc Andreessen disrupting Dockers.

@samfbiddle dude looks like a real estate agent trying to sell me the house that he's standing in.

— Gary He (@garyhe) April 4, 2013

(Photo: Daily Tech)

Quinn Norton speaks out on what life inside the Aaron Swartz investigation was like. "This will not be the final word on Aaron's story, nor is it intended to be. Two years later, these are the events as I remember them, and the feelings as I knew them." [The Atlantic]

Former dotcom millionaire Jennifer Sultan plead guilty to selling prescription drugs and conspiring to sell a firearm in exchange for four years in prison on Friday. Ms. Sultan, who sold her company Live Online during the first boom, burned through her fortune after becoming addicted to prescription pain killers. Let this be a cautionary tale for bubble 2.0. [New York Times]

Marc Andreessen and Ben Horowitz took to Rap Genius this weekend to decode Andrew Mason's goodbye letter. Swag? [TechCrunch]

If you got an email this weekend from Evernote that it had reset your password, that’s because the company suffered a major security breach. [The Verge]

SpaceX Dragon has successfully docked at the International Space Station, which is great because we don't really need any more griping from Elon Musk right now. [Ars Technica]

(Photo: Code.org)

Agitprop about "coding as the new literacy," lost momentum last year somewhere around the time adults felt compelled to issue public apologies to Codecademy for ignoring their email tutorials. But with President Obama shouting out high tech high schools in the State of the Union--and Chinese hackers inspiring a possible "Sputnik moment"--the cause of educating young minds in the ways of coding seems to have taken on new urgency.

Witness, for example, this video produced by Code.org, a nonprofit devoted to enhancing computer programming education. "Learn about a new 'superpower' that isn't being taught in in 90% of US schools," the description advertises. Wait, America still has a chance at staying a superpower? Tell me more!

The five-minute spot attempts to make coding seem more approachable--you don't have be a genius is the commercial's refrain--by equating it with other creative, challenging disciplines like learning an instrument and playing sports. Not sold? Here, let Miami Heat's Chris Bosh convince you. Mr. Bosh, whose bio reads "NBA All-Star, Coded In College," tells the camera about the after-school program called Whiz Kids (ok, legit adorable) where he first learned to write code. "People found out. They laughed at me and I was like, man I don't care, I think it's cool and I'm leaning a lot and some of my friends have jobs."

The whole thing ends with Will.i.am ("Created the Black Eyed Peas, Now Taking Coding Classes") calling coders the new rock stars.

The video gives nod to all the different disciplines where knowing programming can help: Banking! Agriculture! Entertainment! But Code.org's donors since corporations like Microsoft, Google, and Facebook provided support for the video and Code.org's advisors include investors like Marc Andreessen and Ron Conway, there are plenty of shots of cushy startup cafeterias, scooters, music rooms, and other amenities.

The only thing we can't believe is that self-appointed Glass Ambassador Sergey Brin missed an opportunity to show off his new toy.

(Screencap: Facebook)

GQ just published an in-depth feature on Reed Hastings, the endearingly gaffe-prone (RIP Qwikster) Netflix CEO. With a slew of original programming coming to the platform--including a new Netflix exclusive season of Arrested Development--Mr. Hastings is working diligently to turn the video streaming service into a true HBO competitor.

That's all well and good, but Mr. Hastings has other worries on his mind: mainly, why did GQ scrap his photo spread? (No doubt the shoot would've given the Terry Richardson-Beyonce collab a run for its money.)

"When GQ does a feature on you, but they cut the photos of you, is that a message?" lamented the modest CEO on Facebook.

Luckily, storied venture capitalist Marc Andreessen had a similar tale to help comfort Mr. Hastings.

"I once had a GQ photographer talk me into a photo where I was wearing a Netscape company T-shirt backwards," he commented. "Then they made fun of me in the article for being unfashionable."

"So I just switched to getting all my fashion tips from PC Magazine," Mr. Andreessen continued.

At least Mr. Andreessen and Mr. Hastings can comfort themselves with the fact that they're both bajillionaires.

Funny, because after a presidential campaign that fixated on Mitt Romney's taxes, the debate on carried interest has been largely absent from negotiations over avoiding the fiscal cliff. Funny, because the reference wasn't to the tax rates paid by hedge fund and private equity managers, but rather to levies on venture capitalists.

And funny because a minor Twitter skirmish erupted over it.

Writing in PandoDaily, Sarah Lacy went to bat for the venture capital industry, arguing that VCs shouldn't be grouped in with hedge funds or private equity firms in the debate over carried interest, that raising taxes on VCs seems "egregiously unfair," and would negatively affect the companies VCs fund—an argument that found a ready combatant in New York magazine's Kevin Roose:

So who's bogus, and who's twisting facts? First a quick refresher course:

Venture capitalists, like their hedge fund and private equity manager brethren, typically charge investors a 2 percent fee on assets under management, and another 20 percent on profits they generate. The 2 percent management fee gets taxed like regular income, along the same rate structure that the rest of us pay. The 20 percent "carry" is often treated as investment income and taxed as capital gains, which is to say, at a much, much lower rate.

Taking a page of the National Venture Capital Association playbook, Ms. Lacy argues that taxing carried interest as capital gains makes sense:

Capital gains is there to reward long term, high risk investment, which venture capital is by definition. ... So the NVCA and VCs can argue that an investor is more aligned with the entrepreneur—the two of them both forgo any real return until there’s a big exit and an entrepreneurs’ proceeds are most definitely taxed as capital gains.

Which is, we suppose, is how you might look at it if you were a VC—or a journalist trying to curry favor with VCs. (If you were that type of journalist, you might also attribute the impulse to eliminate the carried interest tax break to "anti-business forces in the government.")

Another way to look at it would be to point out that VCs invest other people’s money, and earn fees as compensation for services rendered—it’s not their capital at risk, and it’s not their money tied up long-term—and so it's unclear why carried interest should get taxed as capital gains. Also: However well-aligned their interests, VCs are money managers, not entrepreneurs, right? Right.

Marc Andreessen, hardly a tax-and-spend liberal, argued as much this spring in an appearance on CNBC:

My personal view is that there's no question carried interest should be taxed as ordinary income, it is in fact a fee for service, it's an incentive fee against somebody else's capital, so I don't think there's any logic to the current tax treatment.

And Fred Wilson made a similar point a couple of years ago, blogging that higher taxes on VCs wouldn’t prevent pension funds, endowments and institutional investors from investing in startups, but might lead him to spend more time investing his own capital.

That’s a much less dire impact than the one Ms. Lacy foresees:

It could well put pressure on the consolidation already underway; it may attract a different kind of person to the industry in the future; or it could push a shorter return time horizon at a time when the big home runs are taking longer and longer to get to an IPO. That could mean fewer Series A investments, as individuals without institutional obligations take over seed deals, and the rest of the industry pushes towards later stages that take less time to mature.

Of course, those trends are already underway, making us wonder when and why the PandoDaily editor-in-chief decided to appoint herself lobbyist for the venture capital industry.

Wikipedia.

Marc Andreessen talks fast. And so when the Andreessen Horowitz co-founder sat down for a conversation with The New York Times's Andrew Ross Sorkin at Dealbook's Opportunities for Tomorrow conference, he covered a lot of ground, from the fiscal cliff to higher education, the future of English majors, newspapers and self-driving cars, and other topics our fingers weren't fast enough to keep up with.

On the fiscal cliff: "The last thing we want is for all the politicians to get together and figure out a grand solution," Mr. Andreessen said. "The last time we all agreed on anything, we got into the war on Iraq."

On government regulation: "If there's regulation or unions, the entire venture capitalist class in California totally avoids it," he said.

On education: "I think it bifurcates, it's bifurcating now, and technology is going to cause it to bifurcate further. Government or union run education, on one hand, is horrible and getting worse." But online schools offer great opportunities.

On English majors: "Anything that involves math, quantitative skills, computers—I think that's going to set people up really well. A degree in English, I'm sure it's fun to get the degree. But the average graduate from the average college is going to be working in a shoe store."

On scotch: "I have tons of opinions on the IPO," Mr. Andreessen said about Facebook's public offering, before noting that as a board member it was inappropriate to hold forth publicly. "There's Johnny Walker Blue in the green room. If you'd let me drink that before, I'd tell you everything I think."

On Hewlett-Packard, on whose board Mr. Andreessen also serves: That might take a whole bottle, he said.

Is it a tech bubble? Mr. Andreessen said that we're experiencing the opposite of a tech bubble, what he called a "tech depression," where investors are fearful of technology stocks. "The big dogs are trading at generational lows, Cisco and Dell and Microsoft and Oracle and on and on. The public market hates tech," he said, adding: "I think we're still dealing with broken trust from the 2000 crash." Also: "The level of cynicism among investors, and entrepreneurs, is very strong."

On Google: He said that the company was trading at "crazy lows," with investors valuing the company on the strength of its search business, essentially treating YouTube, Android and Chrome as worthless propositions.

On self-driving cars: "I can't wait."

On newspapers:the future of print: "Today," he said when asked when the New York Times should stop publishing a paper edition. "As soon as possible." Fast forward 20 years, he said, and online is going to be 100 percent of the news market. "It's not that you can't make money in print, it's not that there aren't people who want it. But is your organization able to be on offense and take the future?" Many news outlets, he said, are spending too much time playing defense. It's not all bad news. "The global market opportunity for media is growing exponentially," it may be 100 times larger in years to come. "The question is, how do you get to the online format?"

Mr. Dixon

Earlier today, serial entrepreneur and investor Chris Dixon made it official. The cofounder of SiteAdvisor (acquired by McAfee) and Hunch (acquired by eBay), who invests both personally and through Founder Collective, will be decamping our fair city for sunnier shores to join Andreessen Horowitz as the Sand Hill Road powerhouse's seventh general partner. We spoke with Mr. Dixon by phone shortly after the announcement was made to find out what it means for the many ventures he's involved in here (like eBay's massive new Flatiron R&D lab, which is slated to house 200 developers and data scientists).

Don't hold your breath for an East Coast outpost, as cofounder Marc Andreessen emphasized earlier, his is a "single office firm." In fact, based on the tenor of our questions, Amy Grady, a representative from Andreessen Horowitz who was also on the call, wanted to assure us Mr. Dixon's hire was about more than just geography. "We didn’t hire Chris just because of New York. It’s a huge bonus, he’s obviously really tapped in, but if we find an entrepreneur with a great idea in Idaho, we’ll invest!"

Silicon Prairie, start your pitch decks.

Is this a way for Andreessen Horowitz to keep a better eye on New York without opening up an office here?
Chris Dixon: I’m keeping my apartment in New York, I plan to be there a lot. I plan to make a lot of investments there. I think they saw it as a positive that I have been in New York and know a lot of people there. That said, I’m going to be based in California and I think it’s important with these things--VC firms need to work together as a team and, you know, that just often requires being around each other a lot. But yeah, I’m going to be very aggressively looking for investments in New York.

What about your role at Founder Collective and the fate of Founder Collective in general?
CD: There’s two people who run Founder Collective, Eric Paley and Dave Frankel. They’re the general partners. I’m not a general partner. What I’ll do is I’m going to continue to support any companies that I invested in through them. So if I can be helpful to those entrepreneurs I will be--the same for my personal angel investments. [In addition to Founder Collective, Mr. Dixon has personally invested in Skype, Gerson Lehrman Group, OMGPOP, BillShrink, Oddcast, Knewton, and many others.] But I’ll be doing all my future investing through Andreessen Horowitz.

Will you still be an advisor at eBay or Hunch?
CD: It hasn’t been finalized yet, but I will have some kind of an advisory role at eBay and my cofounder [Tom Pinckney] from Hunch is going to be taking over the New York office. He’s been my cofounder for two companies now [including SiteAdvisor] so they’re in good hands.

You mentioned Andreessen Horowitz’s so-called CAA model of offering help in various domains like recruiting and research. Will your expertise be in bringing in deals?
Amy Grady: Just to be clear, he’s the check writer, he’ll be doing investing.
CD: So the way it works is there are seven general partners and I’m one of them. Those are the people who go out and find new investments and then make the investment and join the board and do things they can do to help. Then there’s 55 other people who provide all sorts of support for the entrepreneur, once the investment’s made.

Was it a difficult decision to leave New York? In a lot of ways you’re representative of the scene from its infancy. You started in Wall Street, transitioned into startups, and then to investing. Were you worried it would be a loss for the community?
CD: To the extent that I can try to get Andreessen Horowitz to be more active in New York, I think that’s a net win for the New York City tech scene. You could look at this glass half full or half empty, but that’s how I see it. I care a lot about the New York tech community, it’s in a great place and it’s growing quickly and I want to keep supporting it.

I’m not sure if Marc Andreessen or Ben Horowitz or anyone there commented on how vocal you are on Twitter or in your blog posts in terms of critiquing trends that you see?
CD: They’ve encouraged me to continue to be vocal and blogging and tweeting and doing all that stuff--Tumblring, Foursquaring [laughs]. So, yeah I intend to do that. They’re totally supportive and they like it.
AG: Yup, we welcome it, no censorship allowed. We welcome feedback. We love a fresh perspective so he actually fits in quite well with the culture.

What are you most excited about in terms of moving out there? To be immersed in a place that has a different kind of expertise than New York’s consumer web?
I think it will be nice to have a different perspective, I think I’ll learn a lot. The people at this firm are really, really impressive and I’ll learn a lot from them. Over the last few years--seven years--that I’ve been angel investing, it’s always been sort of a hobby for me. So it’s just going to be fun to try it as a full time thing.

I imagine part of the appeal is having so many resources behind you? In your blog post, you mentioned founders choosing the investor and Andreessen Horowitz excels at that.
Yeah, absolutely. I’ve always done the angel investing stuff totally by myself. It’s trying to do something on a larger stage with more resources, it’s pretty exciting.

What will you miss the most about not being here?
Well, I’ll be there, okay? [laughs] I’ll be there a lot! I love New York and I’ll be there a lot. And I want to make a lot investments there. I’m hoping I won’t miss anything because I'll be there a lot.

Mr. Lehman, Mr. Zechory, and Mr. Moghadam (Photo: Sumner Dilworth, courtesy of Vibe)

Visitors who search for Harlem rapper Azealia Banks’s breakout hit “212,” on Rap Genius, an online platform that crowdsources explanations of hip-hop lyrics, will find nearly every verse annotated by the site’s users, who clocked more than 2 million monthly uniques in August, according to comScore. Click on the line “Now she wanna lick my plum in the evening/ And fit that ton-tongue d-deep in,” and a pop-up immediately appears explaining that Ms. Banks is employing a metaphor for cunnilingus and that “She stutters the words tongue and deep to mimic the stuttering that occurs when one receives such a gift.” That exegesis received 11 upvotes, earning the contributor jamima-j, a female “slam poetry writer,” a healthy bump in “Rap IQ” points on the site.

Readers might find her analysis either amusing or unnecessary. But the reigning kings of Sand Hill Road, venture capital firm Andreessen Horowitz, view Rap Genius as “one of the most important things we’ve ever funded,” co-founder Ben Horowitz told Betabeat last week. The prominent VC firm, which clawed its way into the Silicon Valley firmament in just three years by aggressively plowing millions into fast-growth tech startups like Facebook, Pinterest, foursquare and Airbnb, often at towering valuations, were the sole investors behind the site’s $15 million Series A.

Mr. Horowitz (Photo: C Flanigan/Getty Images)

“When I first brought it up, [Marc Andreessen] kind of laughed at it,” admitted Mr. Horowitz, the rare VC who can quote the appropriate Rick Ross rhyme for every occasion.“He was like, ‘Really? Rap Genius?’”

The site’s potential finally clicked for Mr. Andreessen after he used it to try to understand the Kanye West and Jay-Z song “No Church in the Wild.” Click on the lyric “Is pious pious because god loves pious?” and the site walks you through Plato’s Euthyphro, Pope Pius and Immanuel Kant. “It’s a big philosophical question just, like, dropped in the middle of a Jay verse,” Mr. Horowitz said with admiration.

Despite the platform’s name, contributors have already used Rap Genius to annotate a number of texts outside the world of hip-hop, including the Supreme Court decision Plessy v. Ferguson, the Mayflower Compact and the Digital Millenium Copyright Act. Last week, author and NYU professor Clay Shirky added the iTunes terms of service for dissection. Users obliged by appending a cartoon of the Human Centipede.

After the Jay-Z song, Mr. Andreessen went on to read annotations of The Great Gatsby contributed by high schoolers whose teacher added chapters to the site. His favorite part, Mr. Horowitz said, was a reference to old money versus new money that read, “In the days of ‘The Great Gatsby,’ it was better to have old money, unlike today, when it’s better to have new money.”

No doubt the investor and Netscape co-founder, who was photographed on a gold throne for Time’s “Golden Geeks” cover in 1996 and recently named No. 2 on Forbes’s “Midas Touch” list of tech investors, appreciated that reading.

Mr. Horowitz’s abiding obsession with rap has been well-documented. He notoriously starts every post on his business blog with a couple of expletive-laden lines from his favorite MCs, and has nicknamed his partner, Mr. Andreessen, “Big Tunechi,” in reference to Lil Wayne’s childhood nickname (just ask @LilTunechi’s 8.7 million Twitter followers), because he thinks the two moguls are similarly prolific. It ultimately fell to “Big Tune” to articulate the site’s grander vision: turning Rap Genius into an “Internet Talmud” that, Mr. Andreessen said, will drop the same “knowledge on knowledge” in other arenas, like law, the Bible, poetry and even country music—to eventually “annotate the world.”

The site’s three 20-something co-founders are currently beta-testing the idea of rolling out those content areas into separate verticals: Stereo IQ (for indie rock), Poetry Brain, Country Brain, Law Genius and Bible Genius.

“The criticism is: ‘Ben, I can’t believe you’d invest in something so frivolous as rap,’” Mr. Horowitz acknowledged, but he pointed out that Andreessen Horowitz engendered the same eye-rolls when the firm was part of a $2.75 billion deal to buy Skype from eBay. Two years later, Skype was sold to Microsoft for $8.5 billion. “People who kind of understood the basics [of that deal] were like, ‘Oh, that’s stupid. Those guys are idiots.’ But if you looked a little deeper and saw what was really going on, you would say, well, this is a magical opportunity.”

Rap Genius’s co-founders, who met as undergraduates, have been expounding on the idea for some time now—that the Internet needed this kind of pop-technology, a Rosetta Stone by way of Urban Dictionary, to decode the Western canon—but it wasn’t until Andreessen Horowitz came along that anyone believed them.

If you spend any time with the trio, you can understand the skepticism.

As their origin story goes, the co-founders were treading lucrative career paths when they started the site, first called Rap Exegesis, as a side project. Tom Lehman was an engineer at the hedge fund D.E. Shaw. Ilan Zechory was a project manager at Google and a former writer for Deadwood, and Mahbod Moghadam, a Stanford law school grad, was on deferral from the law firm Dewey & LeBoeuf.

In 2009, deferral was code for a recession-related year off for a fraction of the salary. With his free time, Mr. Moghadam was slated to start a free internship with Warren Buffett when Berkshire Hathaway found his blog, Beneficent Allah, in which he had drafted a satirical billable memo referencing the “Ballstate Insurance Company” (Allstate was a client) on “the probabilities of Inheriting the Earth.” Mr. Buffett's conglomerate didn’t appreciate the irony and neither did Dewey. The same day he was fired, Mr. Lehman built the site.

“We’re more into writing than underwriting, you feel me?” Mr. Moghadam told Betabeat last week, sitting in the startup’s new headquarters: a penthouse apartment in Williamsburg overlooking the East River.

Mr. Lehman, whose actual apartment is four floors down, had returned moments earlier with three trays of sushi for the team’s dinner. A handful of the company’s fresh-faced 20 to 30 employees were unwinding in the back bedrooms.

Mr. Moghadam was sporting a striped button-down and walnut-colored dress shoes that came to a masochistic point. He introduced Mr. Lehman as a “swagged-out Mark Zuckerberg,” but between Mr. Lehman’s upswept column of curls, electric blue T-shirt, neon Nikes and sweatshirt from A Bathing Ape, he looked more like a dubstep deejay just in from Tel Aviv. Mr. Zechory, in emerald green Nikes and a pastel button-down, fit somewhere in between.

Months before they raised that Series A, another New York startup entrepreneur described the braggadocious trio of Yale graduates, who sometimes borrow the vernacular of the rappers they admire, as “total characters and a pile of contradictions”—a representation that speaks to their awkward, if so far potent, positioning at the nexus of the tech and hip-hop worlds.

Sitting in the living room, amiable and unguarded, the co-founders seemed to suffer from the interloper’s dilemma: they’re one “swag” too cocky for the tech scene and a “tight” too Ivy League for the rap game.

Up until last month, outside of verified accounts from artists like Nas, 50 Cent, and 2Chainz, the startup was best known for two things. The first was an essay in The New York Times magazine that devoted considerable column inches to critiquing Rap Genius’s “wrongheaded conclusion” that every hip-hop rhyme had or was in need of an academic annotation.

The second was a misguided late-night video of a shirtless Mr. Moghadam mocking the rap group Das Racist, who met at Weselyan, after one of the MCs equated Rap Genius with “white devil sophistry.” The closing line? “I’m trying to diss you, but you ain’t even famous. You’re like a slim anus.”

“I’m embarrassed of my freestyle dis,” Mr. Moghadam admitted of the video. “I want to take it down, but these guys say, ‘Hey, it’s a meme now!’” He added, “My body looks all right, but I can do much better raps than that.”

Mr. Horowitz acknowledged the trio’s bluster. “They have a real personae-slash-performance art to them,” he said. “They play the part. It took me a little bit to get past the surface pretense, just because it is so unusual. At least in my world—in the tech world.”

“We used to want to be writers and artists and stuff like that,” Mr. Zechory said, when asked about the team's self-presentation. “Then we got really busy working on Rap Genius and we realized it’s all folding in on itself and we have to never break character.”

That routine has gotten them this far. In fact, Andreessen Horowitz wasn't the only firm eager to fund their vision.

“There were definitely other investors who gave them term sheets and there were other investors who thought that it could be important, but in their minds nobody else quite understood it or quite understood them, you know what I mean?” said Mr. Horowitz.

Rap Genius was the fastest-growing startup in its class at Y Combinator, the archetypal Mountain View incubator. (Mr. Zechory says their Quantcast numbers show 10 million uniques, but that account has been made private.) During their three months in the Valley, "The elders were kind of wary of it," said Mr. Moghadam. "They’re starting to come around now that they realize we’re gonna make a shit ton of money."

That last claim remains to be seen. After all, despite its ubiquity in search engine results, Urban Dictionary is still primarily a website that sells ads.

Rap Genius' business plan also calls for selling advertising, but according to the latest numbers from comScore, the site members occupy an industry sweet spot. Sixty-three percent of users are 18 to 34, 66 percent of them are male, and 29 percent boast a household income of $100,000 or more.

“We are gonna do the dopest ads of all time,” Mr. Moghadam declared, but they have other potential revenue streams in mind as well. “Law firms will pay 100K a year for Law Genius Premium,” he insisted over email. “Lexis and Westlaw are jank—you go from one case to another and it’s sloppy and wack ... Law Genius will be legal footnotes on crack! Also it can include ANYTHING ... video, audio ... instead of simply citing a Supreme Court case, you can embed the oral arguments!”

And then there’s the merchandising. “Girl, we finna have an entire STORE of gear for each site,” he wrote in an email that could benefit from some decoding itself, “not just shirts, you can get a Rap Genius onesie, a Poetry Brain parka ...” The possibilities were endless.

Rap Genius has been remarkably successful in getting rappers to sign up to explain their own double entendres, regionalisms, and allusions, partly by hosting the artists at Rap Genius headquarters both in Williamsburg and a villa they rent in “far Malibu,” where Mr. Moghadam said RZA and Black Cobain have both stayed.

The company is planning on moving closer to Los Angeles’s city center. “So with the Hollywood house, we’re always going to have rappers living with us,” he wrote. They even offer visitors use of a studio. “Our recording is decent it’s not wowzers, but it’s pretty dope,” he added, explaining that it was more of a “chill vibe type situation.”

Earning the trust of the rap world wasn’t easy. A breakthrough was provided by 50 Cent’s former manager, the late Chris Lighty—“RIP,” said Mr. Moghadam, tapping his heart twice. Over lunch a couple months ago, Mr. Zechory recalled, Lighty “was like, look, if you want 50 Cent to gamble on Rap Genius, just get Nas to do it. Because 50 Cent will see Nas doing it and be like, ‘Okay, cool.’”

In a similar vein, it was Troy Carter, Lady Gaga’s manager and a startup investor, who encouraged the founders to come up with their “verified artists” section.

It remains to be seen whether Rap Genius will have the same luck with indie rockers. Mr. Moghadam said that he tried talking to Chan Marshall, better known as Cat Power, into explaining her lyrics when he ran into her in L.A. “She was like, ‘I don’t want anyone to know what these mean! It’s so deep to me! Get away from me,’” he said, his voice dropping to a stage whisper.

Had he tried Fiona Apple? we asked. “She’s my queen,” Mr. Moghadam responded, wistfully. “Fiona Apple, if I could, I would just want to take her to sushi. I know what [her lyrics] mean!”

If Rap Genius succeeds, it will be because its founders have no other choice, a dynamic that happens to be of the VC firm’s investment criteria, said Mr. Horowitz. “Their whole lives are dependent on them making this work, right? They are all-in,” he said with a laugh. “It’s not like they’ll go work at Facebook! Nuh-uh. This is it. They have to make this work. And we love that.”

ntiku@observer.com

A version of this story appeared in the October 17, 2012 issue of the New York Observer.