I'm sure it's been a very tough experience and the author learned a lot during the time. But I would expect that if you fail to build a billion dollar company you end up at least with a $100 million company...
Reflecting on My Failure to Build a Billion-Dollar Company
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Re: Reflecting on My Failure to Build a Billion-Dollar Company
#72I’m incredibly grateful for Gumroad - Lambda School (YC S17) wouldn’t exist without it.
We threw up a my book on Gumroad because why not/it was easy, and now I believe we’re sitting north of $100k in sales. I don’t think we would have put it anywhere else - wasn’t worth the effort. I often think about how important it is to remove even the slightest amount of friction as a result.
I also find the move from KPCB admirable. They gave up their interest in the company (it was a loss for them anyway) and allowed the company to flourish. Hats off for that.
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#73Reminds me a lot of Bandcamp, which serves a similar market and has a similar and very refreshing ethos: in it for the long haul, dedicated to serve their audience because (likely) nobody else will, because there's not and never will be VC-sized 100x upside.
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#74Nice story, but:
> It doesn’t matter how amazing your product is, or how fast you ship features. The market you’re in will determine most of your growth.
This is just a cop-out. The market will limit, not determine, your growth. It's up to you to hit that maximum, and use marketing/sales to extend that maximum. That is called creating a market. And overall it's called execution.
OTOH, Sahil isn't wrong. Some markets are either not that ripe (timing is important), don't have enough support, are too niche, and a thousand other factors. But as a generalization, "Product doesn't matter" is just wrong.
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#75I've always liked Gumroad as a product and service but this line kind of bothers me: > There is, of course, the $178,000,000 we have sent to creators This money wasn't sent to creators. They sold products worth $178M + Gumroad fees through the service. The creators made the products, marketed the products, acquired the customers, etc. When I use Paypal to sell something they aren't "sending me money".
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#76Hey, #1 on Hacker News! I don't think that's happened since...I launched Gumroad back in 2011: https://news.ycombinator.com/item?id=2406614 Thanks HN for being a part of my journey!
I love your story Sahil, it is so true that people equate 'wealth' with 'success' but that is short sighted. If you step back and look at the big picture, you're on this planet for anywhere from 70 to 100 years, and at the end of that time there are two metrics, the number of people you helped and the amount of wealth you amassed and held on to, which number is a better representative of 'success'? Working on things…
Based on the revenue and growth rates of Gumroad my guess is Sahil will make more money from it than he would have at Pinterest. It will take longer but it will be on his terms.
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#77I've always liked Gumroad as a product and service but this line kind of bothers me: > There is, of course, the $178,000,000 we have sent to creators This money wasn't sent to creators. They sold products worth $178M + Gumroad fees through the service. The creators made the products, marketed the products, acquired the customers, etc. When I use Paypal to sell something they aren't "sending me money".
You could say the same thing about Uber, Lyft, Airbnb, Etsy, TaskRabbit, etc..
When you sit down and think about it you start to realize just how “temporary” all these so-called unicorns are, as they are just middleware services with no real differentiating benefits other than size and brand recognition and maybe some vague “guarantee” to the customer. You’ve got to get big fast, because what you actually do is easily replicated.
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#78Hey, #1 on Hacker News! I don't think that's happened since...I launched Gumroad back in 2011: https://news.ycombinator.com/item?id=2406614 Thanks HN for being a part of my journey!
Thanks for sharing your story, Sahil. Something I was wondering: do you think that Gumroad could have gotten to where it was without raising money to begin with? You mentioned sales not really changing with or whithout a sales team, but do you think you could have developed Gumroad in the beginning with a smaller group of developers, or even just by yourself?
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#79Really love this post. My favorite line is: > Every month of less than 20% growth should have been a red flag. I think that's pretty insightful. 20% growth is great for a normal business, of course; for a VC-backed startup it can show some warning signs about future hard decisions you might have to face. I think there's certainly lots of discussion that has been had — and should be had — about "should I or shouldn't…
> The idea behind Gumroad was simple: Creators and others should be able to sell their products directly to their audiences with quick, simple links. No need for a storefront. Then: > For the type of business we were trying to build, every month of less than 20% growth should have been a red flag. According to what metric? This isn't meant to be snarky, but that type of growth rounds out to about 900% over the course…
According to the metric of Social Media.
The Metric you have to meet now is Facebook's growth rate in the first few years of launching with high gross. 500% first year, 250% next year etc...
Re: Reflecting on My Failure to Build a Billion-Dollar Company
#80I'm sure it's been a very tough experience and the author learned a lot during the time. But I would expect that if you fail to build a billion dollar company you end up at least with a $100 million company...
Unfortunately failing to build a billion dollar company often means ending up with a $0 company. Like the OP said, VC too often comes with the pressure to either succeed in a big way or pack everything up and go home. And when your liquidation preferences are greater than the current value of your company, as a founder it's not very compelling to keep moving forward.