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AngelList acquires Product Hunt

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Re: AngelList acquires Product Hunt

#151

Post by nostrademons »

visakanv wrote: post #43
moeamaya wrote: post #25

Earlier quoted context omitted.

The tough thing about running a maker community is makers don't want to sit around all day to browse products and comment. But you know who does? Growth Hackers. I say this coming from my own experience growing a community of hardware hackers who have even less of an inclination to chat since they aren't always in front of a computer.

You just hit on one of the fundamental reasons why all online communities tend towards toxicity – the people who have the most time and energy to invest in discussions (which eventually snowball into flame wars) are the people who aren't actually doing the actual work. These things then feed off of themselves – in a sociopolitical 'guardian' type community (/r/atheism, /r/childfree, etc etc) it ends up becoming highl…

This is more true of communities built around ideas rather than activities, and there are also moderating tactics you can use to avoid it. For example, online communities based around astronomy, or radio-controlled airplanes, or baking, or other hobbies remain relatively healthy even decades after their founding.

Also there are communities around conventionally caustic topics (eg. Lambda: The Ultimate for programming language design, Penny Arcade for games) that manage to survive for a decade+ with no loss of quality because of moderation policies. For example, L:tU has an "avoiding ungrounded discussion" policy - every thread must be centered around discussion of a published academic paper, which first of all keeps the focus on people who actually do work, and second of all discourages everyone without the background to read and understand academic papers.

Re: AngelList acquires Product Hunt

#153

Post by scalesolved »

exogeny wrote: post #109
gkoberger wrote: post #104

Earlier quoted context omitted.

This comment saddens me. Ryan may be "in the circle" now, but it's not like he had a rich VC uncle. It's not nepotism; he had no connections when he started out. Product Hunt didn't succeed because he's "in the circle", he's "in the circle" because Product Hunt succeeded. Ryan is one of the nicest, most genuine person I've met, and he worked hard to get where he is. He built a great team and a product that people lov…

His personal characteristics are irrelevant to the economics; he raised money from A-list VCs and failed to do anything notable with it, resulting in a bailout from one of his existing investors and a marginally better employment situation for his staff. Nice guy? Fuck you, go home and play with your kids. You lose that excuse when you raise a Series A.

I think you could have made your point a lot better with dropping the profanity and really in full that whole last line.

Re: AngelList acquires Product Hunt

#154

Post by stonesvsglass »

dang wrote: post #134
stonesvsglass wrote: post #73

svskeptic 1 hour ago [-] 'Experiment' with no conceivable way of monetization gets 'investment' for some behind-the-scenes, non-investment reasons. Bros funding Bros, and then bro acquiring bro when the first-bro has blown through 7.1M. Its the Silicon Valley version of nepotism. Its all play money, but is only available if you are in the circle. Now that you have an exit to your name, next stop, VC partner. And then…

Please don't copy and paste comments that appear elsewhere in the thread (and especially not as an end-run around moderation, if that happens to be why you did it). We have nested threads here so people can reply to what they read directly. The issue isn't brevity, but the toxicity that I described in my comment. I'm not sure I can describe it any better than that.

It was a comment not everybody wants to hear (esp. everybody who got their jobs this way), but that very true accounts how this kind of meetings go -- as you mention Schadenfreude, ask the Germans how the burning of books works, exactly this way

Re: AngelList acquires Product Hunt

#155

Post by mbesto »

2drew3 wrote: post #82
pdeuchler wrote: post #64

This smells fishy to me. ProductHunt had no hope of ever becoming an actual business with realized monetization, it was a glorified marketing tool built by SV insiders to sell the ventures of their friends, colleagues, and investors. Slimy, but I guess not illegal. I start to draw the line though, when PH raises millions of dollars on XX million valuations (that anyone could easily see they had no chance of ever meet…

>relatively small community Lmk when you create a website with this much traffic. http://www.alexa.com/siteinfo/producthunt.com

1. There is no proof Alexa data is reliable.

2. Traffic isn't fungible. Reddit is one of the most viewed websites in the world (top 10?) and roughly yet makes as much money in a year as Facebook does in an hour.

Re: AngelList acquires Product Hunt

#156

Post by jfktrey »

henrygrew wrote: post #70
visakanv wrote: post #43

Earlier quoted context omitted.

You just hit on one of the fundamental reasons why all online communities tend towards toxicity – the people who have the most time and energy to invest in discussions (which eventually snowball into flame wars) are the people who aren't actually doing the actual work. These things then feed off of themselves – in a sociopolitical 'guardian' type community (/r/atheism, /r/childfree, etc etc) it ends up becoming highl…

A very interesting point of view, what do you think can be done to counter this outcome.

What if you made community contribution a limited resource?

Continuing the reddit example. You could limit contribution by three routes:

1) Limiting the number of posts. For example, 3 posts per week, max.

2) Limiting the visibility of posts. The more you post, the less an upvote counts. Effective Upvote Value = 1 / (posts this week)

3) Limiting the visibility of posts based on post quality. The more you post in a week and the lower your per-post average karma, the less an upvote counts. Effective Upvote Value = (per-post average karma) / (posts this week)

Just a thought.

Re: AngelList acquires Product Hunt

#157

Post by pcmaffey »

visakanv wrote: post #43
moeamaya wrote: post #25

Earlier quoted context omitted.

The tough thing about running a maker community is makers don't want to sit around all day to browse products and comment. But you know who does? Growth Hackers. I say this coming from my own experience growing a community of hardware hackers who have even less of an inclination to chat since they aren't always in front of a computer.

You just hit on one of the fundamental reasons why all online communities tend towards toxicity – the people who have the most time and energy to invest in discussions (which eventually snowball into flame wars) are the people who aren't actually doing the actual work. These things then feed off of themselves – in a sociopolitical 'guardian' type community (/r/atheism, /r/childfree, etc etc) it ends up becoming highl…

> the people who have the most time and energy to invest in discussions (which eventually snowball into flame wars) are the people who aren't actually doing the actual work.

Pretty sure we've reached peak-discussion. Future online communities will be based primarily on activity.

Re: AngelList acquires Product Hunt

#158

Post by was_boring »

olalonde wrote: post #152

> He gets asked where he "summers" and then walks out confused. Anyone cares to explain that one?

I assume you're asking for an explanation of what "summers" or "summering" means.

The basics of it are those with wealth can afford to spend weeks/months away from the place they call "home". They can also afford to drop their work commitments, or otherwise force those around them to conform to their wishes.

With that in mind, wealthy people from New York are known to "summer" in the Hamptons. Well off retirees will also migrate from Florida to New York / Maine depending on the season, which is akin to "summering". I'm not from the west coast so I'm not sure where people from the bay area go to "summer" -- I would assume Napa Valley.

By asking someone where they "summer" you are asking about their socioeconomic status.

Re: AngelList acquires Product Hunt

#159

Post by tedmiston »

ThomPete wrote: post #28
cocktailpeanuts wrote: post #16

As an early fan of ProductHunt I became saddened to watch their community get diluted and become more of a place for "growth hackers" to hang out than people who actually make things. But I also realize this was because they raised tons of money and was under heavy pressure to get traction at any cost. So I think this can be a good news, now that they can just let go and focus on the startup community instead of arti…

What on earth would you need funding for when you do a site like Product Hunt? That makes no sense.

You need a team to curate and engineers / product folk to build the product. Web app, mobile apps, Chrome extensions, ...

Re: AngelList acquires Product Hunt

#160

Post by nostrademons »

birken wrote: post #63
kevando wrote: post #40

It looks like Product Hunt raised about $8 million. Can someone explain how this type of acquisition pays out?

Unless AngelList is teeming in cash, which they probably aren't, the deal is likely either all stock or mostly stock. So imagine AngelList internally values themselves at $500M (a number I just made up), to get to the 20M figure they would be offering ~4% of their stock in exchange for PH. Most likely common stock. Adjust that figure up or down depending on what you think AL thinks they are worth.

Likely they pay out enough in cash to make the VCs whole. So assuming 1x participating preferred and 30% of the company owned by VCs, that's $8M + 0.3 * 12M ~= $12M cash returned to VCs, and then the remaining $8M is in Angellist stock distributed to the founders and employees. Assuming 20% employee ownership, it'd be just under $2M to employees collectively and $6+M to Ryan (I think he's a solo founder, right?). If I assume an internal Angellist valuation of $200M (also made up, but you're more generous than I am), PH employees collectively get 1% of AngelList stock, and Ryan gets 3%.

Also seems to fit everyone's incentives nicely. a16z & seed investors get their money back, so they at least don't have to take a loss. Ryan Hoover gets F-U money, assuming AngelList doesn't tank. Employees get enough for the down payment on a house, also assuming AngelList doesn't tank before they can liquidate. AngelList acquires a pre-made team with a proven track record for not much more equity than they would spend on the open market. Pretty typical SV acquihire.

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