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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

#151

Post by rchaud »

fsloth wrote: post #52
shereadsthenews wrote: post #22

Earlier quoted context omitted.

Pinterest is a malignant tumor on the face of the Web that exists to trick people who are trying to search for images. Being rich off that would be worse that toiling in obscurity.

Uh - can you elaborate? I often search for images and sometimes from pinterest - but I don't find pinterest interfering with my searches when not using it.

The poster is likely referring to how Pinterest links now dominate Google image search results. Clicking on the Pinterest link takes you to the Pinterest website, and not the actual image source. Pinterest will often block you from viewing the page unless you sign in or create an account.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#152

Post by rchaud »

jshowa3 wrote: post #85

Honestly doesn't seem like he failed at all. Sounded like just bad times for the business. I mean 2 years of difficulty seems like a minor thing in the grand scheme of the business lifetime. Not only that, the business literally keeps growing if the graphs are to be believed. Failing is when you can't come back and you close the business.

I think that's the point the author is making. The benchmarks for "success" are different if you're in the SV VC-funded startup world. What may be a sustainable 10-person staff e-commerce business would be seen as a failure in some circles because it didn't grow fast enough to IPO, which is all VCs care about.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#153

Post by mixmastamyk »

Sounds like the story of a young person who drank the VC cool-aid. The company should have been bootstrapped from the get-go... $25k/mo office, …doh.

Yep, easy to say as a greybeard and hindsight. But I remember Joel on Software articles on this subject circa 2000, so some information was out there.

Between the lines I feel a lot of self-punishment going on. Well, I'd love to have $10k+ of "failure" coming in every month, with the satisfaction of helping the little guy/gal no less.

Perhaps you'd consider selling to someone who believes in the mission and hates dark patterns? I don't have a lot of capital laying around, but some, and perhaps something else could be arranged?

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#154

Post by theptip »

jcims wrote: post #138
theptip wrote: post #100

> 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. For better or worse, Gumroad grew at roughly the same rate almost every month because that’s how quickly the market determined we would grow. This seems like a simplification, and perhaps overly fatalistic. A company's growth rate is a function with many parameters, and at most poin…

so s/determine most/constrain/

Precisely this. Seems like a small change, but I think it's a significant one.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#155

Post by phkahler »

I struggle to see how this story is one of failure. A kid launched a business that is still going 8 years later. He learned that VC funding is a double edged sword and was able to shed some of that burden - buying them out for $1. In the beginning he speaks of building this thing and having it be his lifes work - which it may well be if he keeps going. And yet there was all this talk of being a billion dollar company and an IPO - which is actually as exit strategy. I was floored by the notion that only 20 percent monthly growth was a red flag. 'du fuk you people think you're doing? Launching a rocket? Oh right... SV, VC, etc...

In the end this guy learned a bunch of hard lessons about business, finance, and life. I hope he continues at least until he finds a new adventure, and stops calling it a failure. It may turn out to be exactly what he said he wanted in the beginning: "what I thought would be my life’s work."

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#156

Post by marcinzm »

themagician wrote: post #77
lancesells wrote: post #69

I'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 easil…

>because what you actually do is easily replicated.

Not really for Lyft/Uber, at not now that it's flat fee and ride pooling instead of a traditional per minute/mile fee structure. To achieve those thing efficiently you need data and until you get that data you're burning through a lot of money.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#157

Post by jboy55 »

gav wrote: post #109
why_only_15 wrote: post #65

Earlier quoted context omitted.

Startups. To choose a recent one that turned big, Facebook was approaching such numbers: https://i.guim.co.uk/img/static/sys-images/Guardian/Pix/pict...

Not even close. If you start at 1 million users, 20% monthly growth for 9 years means you would have 13,375,565,248,934 users, or a little over 13 trillion.

You don't need 20% monthly growth for 9 straight years, but for your first year and maybe the second after your Series A you do. Although I'd say 10-20% is more the range.

The reason this is true is that your investors are giving you a lot of money.

Think of it this way, I have a big idea, and I've turned that into a small product making say 10k a month. What I'm telling the investor is that I NEED these millions to turn this small product into the big idea, and that I'm ready to scale this out.

At the point I'm asking you for money, I'm representing that I have the product that the market wants. I'm representing the marking is huge, and that I need this investment to take advantage of it.

Its not unreasonable to say that with that kind of money I can take something that's making around 10k a month and turn that into 30-100k (10% to 20% MoM growth) a month in a year.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#158

Post by a-wu »

sahillavingia wrote: post #13

Hey, #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 writing this Sahil.

> But I was accountable to our creators, our employees, and our investors–in that order. We helped thousands of creators get paid, every month. About $2,500,000 was going to go into the pockets of creators — for rent checks and mortgages, for student loans and kids’ college funds. And it was only growing! Could I really just turn that faucet off?

I really appreciate that you value being beholden to your customers more than your investors. It seems like as you've bought back your ownership you've had more opportunity to run your company the way you want to, and I admire that that way is doing right by your customers. If I ever start my own company, I would like to run it this way.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#159

Post by FreeRadical »

sahillavingia wrote: post #13

Hey, #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 remember this very well and telling my sibling to use your service

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#160

Post by chkuendig »

themagician wrote: post #77
lancesells wrote: post #69

I'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 easil…

> no real differentiating benefits other than size and brand recognition and maybe some vague “guarantee” to the customer.

- scale

- brand

- customer loyalty

that's a lot of differentiation. more then 99% of the businesses in the world and more than even many public companies.

(especially once you add the power gained from aggregating demand and supply which most of these companies have)

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