Fuck it - that is the game and "investors" know it. Go drink an awesome import beer. Rent a comedy and laugh your ass off.
The Truth about a Failing Startup
31–40 of 169 posts
Re: The Truth about a Failing Startup
#32I had a company fold up on me like this as a team manager. I was close to the founders and they ALL did just fine. I also did fine. The only one I fault were some damn famous investors that didn't even respond to requests to have us meet at their related hiring portfolio companies. Cold.
Everyone else (including the founders), love them -- we all ended up on our feet and were better for the whole awesome startup experience.
Re: The Truth about a Failing Startup
#33This is why I fundamentally don't like investments. This is why profitability is king. Not users, not revenues, nothing except profits! This is why self funding is so important. In life there is a right way to do things and a wrong way. The 37 signals (bootstrap) model is the proper way to do web business. Taking other people's money is the wrong way. To author: Dude, you probably care more than the investors. Make i…
ugh Maybe...maybe not. Sometimes capitalization is what your business really needs. Sometimes it isn't. I can provide a whole list of "web businesses" that bootstrapped to profitability, but I can come up with an equally impressive list of companies took really significant capital. I can certainly find businesses that would have not succeeded without the capital to sustain them through their early years (I experience…
Second this. Bootstrapping is great, and it's even underrated. Most people raise too much too early, and it ends up hurting them. In the end VC capital is a tool though, and you can use it well.
One position from which raising money might be a good idea is when you have a product that is already scaling and shows strong product/market fit, and you know (know, not think) that going 10x on spending is going to let you grow a lot faster.
Re: The Truth about a Failing Startup
#34That's exactly what's moronic with investors, they invest in the company, not in the founders. Unless you made them money, they will ignore you.
Until next time you succeed then, they will start following you back and talk about old days how it was fun and exciting.
Yeah, exception exists and they have a track record showing it.
Re: The Truth about a Failing Startup
#35Earlier quoted context omitted.
OOC, Have either of you built and lost others money from investors as well as lost your own?
When I was 25 I lost more than $20,000 of my own and FFF money investing in my own project only to have it fail. At the time I was obviously, really upset. Fast forward to today -- looking back it was one of the greatest investments in my life so far as all the stuff I learned both emotionally, psychologically and professionally has really helped with current work and life. I used to think losing money was a big deal…
It sounded like you supported what the original commenter said, not to worry about investors.
Having a slack attitude towards money (our own money or others) doesn't build a business or an understanding of value that ultimately ends in a revenue stream.
It's nice of you to share you story -- I don't think many folks do. I have similar experiences (good and bad), but I think the one thing that really stands out for me is that investors are in a sense "buying" your time, not much different than consulting...... :)
Re: The Truth about a Failing Startup
#36The point about taking other people's money is a big one. I am in the process of starting a business doing cloud computing for accounting and ERP and we decided specifically against taking other people's money. I know that will sound like heresy on HN, but I want to discuss why we made that decision. I think other founders may find this to be a useful piece in that it may confirm that taking other people's money is a good decision or it may help question that. I don't think our decision was right for everyone.
The basic issue that made us decide the way we did was that accepting VC money locks you into the VC exit strategy. This means you are building either an acquisition target or a company you want to take public. If that's what you want to do, partnering with VC's makes a lot of sense. They may help you get there faster. If you aren't sure that's what you want to do there is nothing wrong with taking the first steps on your own before committing to such a strategy.
There's a second issue too, which is what I call "overfunding syndrome." The basic truth is that the vast majority of businesses will fail before they succeed. If you are funding it yourself and the like you have more options than if you are racing towards the VC exit strategy gamble. This is why bootstrapping can often be a real business saver.
I suspect we could find investors if we wanted or needed to. But the fact that we don't need to at the moment and aren't sure we want to lock ourselves into the acquisition-or-IPO cycle means for us the best option is keeping our options open. That doesn't preclude changing our minds down the road, but it is a lot easier to decide that "you know, maybe we could use venture capital after all" than it is to change one's mind and get out of the funding cycle. To my mind this is part of staying upstream of the larger problems.
Re: The Truth about a Failing Startup
#37Things may not be as bad as they seem. Don't worry about the investor's money - it's called venture capital for a reason. You've probably learned a tremendous amount from the experience. Think about what the next step for you is after this company. Sounds like you're a developer and can easily get a well-paying job. Sounds like there is still some money left and you can take some time and decompress from the experien…
Indeed, it may be possible to radically reduce expenses, get a moonlighting job, and make the business more easily maintainabile at that point as well. If the investors won't call you back, and you and (and presumably co-founders) want to commit to being successful, it may not even be too late if you are willing to get secondary jobs to pay bills with.
Re: The Truth about a Failing Startup
#38Curious question: If an entrepreneur raised money from VC, and things go south, is the entrepreneur's career basically "done" (e.g. blacklisted by every VC on the planet)? Can he start another venture and get VC money again? How is it compared to being fired? (Being fired = you can find another job, might need to explain why you're fired to potential employer, but life goes on)
From my (admittedly quite limited) experience with investors and entrepreneurs here in the bay area, it's quite the opposite. Failure in itself is not at all a black mark. Product/market fit not existing is a common reason for startup failure and it's well understood in the investor community.
Re: The Truth about a Failing Startup
#39I have gone thru this state of mind.
We got A+ investors but we failed to deliver. We had founder breakups early on and I was made a single founder for the last two years. I ended up working twice as hard to make up for my founder's departure. (The stress and long hours actually made me less productive.) It almost killed my health and my relationship with the loved ones.
Don't take it personally. You have given your best shot and remember you have your own opportunity cost. It's a fair deal to the investors. The important thing is to handle the wind down professionally. Try to savage what you have (team or product). You or your investors may not get anything out of it but they sure would appreciate your effort.
Re: The Truth about a Failing Startup
#40If they're professional investors, they know all the investments don't work out. Communicate honestly about what's been tried and failed, but don't ruminate excessively about having "let them down".
If 'doom' is still a month or two off, but inevitable, attempt orderly wind-down. Maybe a corporate entity is bankrupt. Maybe employees need a fair warning. Maybe there are salable assets. You can ask for help, even from strangers, even non-anonymously. It will be hard to get help if still presenting a facade of "everything's great", and since the 'doom' will be public knowledge soon enough, stop pretending. Instead, use this as practice in confronting the worst and making-do as best as possible with bad options.