Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why I turned down $500K and shut down my startup

medium.com

Post reply on HN
Print view View original

111–120 of 180 posts

Re: Why I turned down $500K and shut down my startup

#111

Post by agentgt »

I don't know much about contract management so take most of what I have to say as an ignorant opinion.

I'm trying to figure out how ContractBeast's problem of continuous usage is any different than almost all the business tools out there that require human intervention (with the exception of email, and MS office suite).

It seems every investor and entrepreneur has this desire to make "crack" and not just tools. Good tools don't need to be used all the time. They don't need to provide some sort of gamification, feedback loop, or enjoyment.

As for money making good business tools don't need even need to be used by the user... in fact they really should be automated. I know this because we had some of the some problems ContractBeast did and the key was not getting the endusers involved at all. Automate and integrate so they are almost out of the loop completely (again I don't know much about CLM... maybe this isn't possible).

As far as top down selling it is almost impossible in the B2B market to do something different. Managers force users to use tools and those users use MS Office most of the time but those tools still get bought and eventually those tools do provide value (aka sales force).

Re: Why I turned down $500K and shut down my startup

#112

Post by tptacek »

sparkzilla wrote: post #82
dang wrote: post #80

Earlier quoted context omitted.

> I've read multiple cases where investors, including Y Combinator, forced founders to pivot I don't think you should sling this kind of thing around so lightly. It's trivial to post charges like this on the internet and have many people just believe them. But this is a serious thing to say right after you've invoked the idea of suicide, and doesn't remotely resemble anything I've observed at YC. In my observation, Y…

Here's one Y Combinator founder who spoke out about the continual push to pivot. https://backchannel.com/how-i-f-ed-up-in-ycombinator-35a19e7... >The last few weeks of the program are a bit of a blur. My morale plummeted, and my stress skyrocketed. I dreaded going to the weekly dinners, where I would have to talk to my cohort and confirm that no, we hadn’t found an idea yet and yes, we were still super excited about…

I read that story and the author's own comments on HN, and they do not support the argument that YC "forced" them to pivot. If anything, they barely knew what they were in YC for in the first place.

Re: Why I turned down $500K and shut down my startup

#113

Post by nickbauman »

quanticle wrote: post #64
onion2k wrote: post #59

Earlier quoted context omitted.

If the situation were really "take the money and do 70+ hours a week for a year" versus "shut down the business" then I'd agree, but that's a false dichotomy. You can run a startup putting in far less time than that; putting in long hours is a choice. You can bring in a team or outsource the parts you don't like. It makes it harder to succee but it's an option. You could (depending on lots of caveats) simply hand the…

but that's a false dichotomy It's a false dichotomy for self-funded/bootstrapped businesses. But if you consider yourself a startup, you have to deliver growth . It's that pressure that leads to the 70+ hour weeks. It's entirely possible to own and run a business while still putting in reasonable hours. But it's unlikely that business is a startup , by Paul Graham's definition of the word. For reference, Paul Graham…

This idea is key, regardless of what the dictionary definition of startup is. A startup cannot merely be a profitable business. If that were true many more startups would be still running today. But if you take investment of 10 million and you're positive cashflow of, say, 200,000 in your first year with a projection of 1 million / yr in 10 years, you will be shut down and sold off: Investors want AT LEAST a 2x return in that same timeframe otherwise it isn't worth it.

Re: Why I turned down $500K and shut down my startup

#114

Post by bsdpython »

lordnacho wrote: post #75

"When users are unhappy but can’t explain exactly why, they often express that dissatisfaction as a series of tangential, trivial feature requests." This bit resonates the most with me. I worked on a project worth little traction where we'd keep getting feature requests from the client facing team members for things that were of minor value but sometimes major effort. It grinds you down over time as you realise there…

I have a long list of features that I want to implement at some point. When I get feedback from users for those same features I move them up somewhat in my priority list. If it's something that's not on my list I add it to the bottom of the list and re-evaluate it's importance a few days later. I think it is a good way to avoid immediacy bias and keep a handle on what's a true priority.

Re: Why I turned down $500K and shut down my startup

#116

Post by tedmiston »

mediascreen wrote: post #93
vertex-four wrote: post #90

Earlier quoted context omitted.

Really, only on HN and other "startup forums". Anywhere else... well, do you think even an ice cream stand is immediately a viable, profitable business? Usually not. The space between "having a registered company" and "actually in the black and stable" is a startup.

I would still say that, to most people, a startup implies more than just a newly started business. I have never seen or heard someone who has just started a small brick and mortar business (without grandiose expansion plans) refer to it as a startup. That said, I'm not a native english speaker and I don't live in US - maybe it's more common than I think.

You're correct. We'd just call them small businesses.

Though I have seen some small businesses working in technology refer to themselves as startups without really understanding the definition (or because they're trying to sound "sexy" to recruit developers).

Re: Why I turned down $500K and shut down my startup

#117

Post by tedmiston »

nickbauman wrote: post #113
quanticle wrote: post #64

Earlier quoted context omitted.

but that's a false dichotomy It's a false dichotomy for self-funded/bootstrapped businesses. But if you consider yourself a startup, you have to deliver growth . It's that pressure that leads to the 70+ hour weeks. It's entirely possible to own and run a business while still putting in reasonable hours. But it's unlikely that business is a startup , by Paul Graham's definition of the word. For reference, Paul Graham…

This idea is key, regardless of what the dictionary definition of startup is. A startup cannot merely be a profitable business. If that were true many more startups would be still running today. But if you take investment of 10 million and you're positive cashflow of, say, 200,000 in your first year with a projection of 1 million / yr in 10 years, you will be shut down and sold off: Investors want AT LEAST a 2x retur…

Perhaps a confusing example, since that startup isn't profitable during its lifecycle anyway.

Re: Why I turned down $500K and shut down my startup

#118

Post by tedmiston »

capkutay wrote: post #38

"I was deciding whether this venture was worth committing to another year of 70+ hour weeks. I need a higher level of certainty than investors do because my time is more valuable to me than their money is to them. Investors place bets in a portfolio of companies, but I only have one life." That's the key quote in the article. It's a fair decision from his standpoint but I wonder if saying that will lead investors to…

> I suppose the investors could also appreciate that he didn't want to waste more of their money if he didn't believe in the product.

I didn't get the impression that it was more of their money, but rather the first injection, like a seed round.

Re: Why I turned down $500K and shut down my startup

#119

Post by corry »

sparkzilla wrote: post #82
dang wrote: post #80

Earlier quoted context omitted.

> I've read multiple cases where investors, including Y Combinator, forced founders to pivot I don't think you should sling this kind of thing around so lightly. It's trivial to post charges like this on the internet and have many people just believe them. But this is a serious thing to say right after you've invoked the idea of suicide, and doesn't remotely resemble anything I've observed at YC. In my observation, Y…

Here's one Y Combinator founder who spoke out about the continual push to pivot. https://backchannel.com/how-i-f-ed-up-in-ycombinator-35a19e7... >The last few weeks of the program are a bit of a blur. My morale plummeted, and my stress skyrocketed. I dreaded going to the weekly dinners, where I would have to talk to my cohort and confirm that no, we hadn’t found an idea yet and yes, we were still super excited about…

Really hard to read the article and conclude that "YC forced them to pivot". Sounds like things weren't working and YC was honest with them.

From the same article:

> We went back to PG, and he told us to stop worrying about Demo Day. With the right idea, we’d be working on the company for the next five-plus years. It was foolish to sacrifice the quality of the company to optimize for the next five weeks."

Seems like a good long-term view and very reasonable way to look at things... definitely not crazy "pivot-right-now-or-die" pressure.

Re: Why I turned down $500K and shut down my startup

#120

Post by throwanem »

camillomiller wrote: post #79
quanticle wrote: post #64

Earlier quoted context omitted.

but that's a false dichotomy It's a false dichotomy for self-funded/bootstrapped businesses. But if you consider yourself a startup, you have to deliver growth . It's that pressure that leads to the 70+ hour weeks. It's entirely possible to own and run a business while still putting in reasonable hours. But it's unlikely that business is a startup , by Paul Graham's definition of the word. For reference, Paul Graham…

Really? Quoting Paul Graham as you would quote the Gospel? I agree with the comment above, that's the definition of startup according to PG, not THE definition. Especially not a definition carved in stone you can quote to justify a false dichotomy. What about innovation? It's not true that innovation comes only from growth. Geez I don't even think it's true all other startup features come from growth. This is what a…

> Quoting Paul Graham as you would quote the Gospel?

Welcome to Hacker News.

Post reply on HN