How to proceed when you run out of cash, but you still believe? • Hacker News Board

Re: How to proceed when you run out of cash, but you still believe?

#201

Post by nostrademons » Thu, Dec 05, 2019, 6:22 PM UTC

StillBored wrote: post #165

munk-a wrote: post #129

Earlier quoted context omitted.

Does centralizing many small dry cleaning places have significant economic advantages assuming that each location has to negotiate independently for it's space and (to parallel wework) items like cleaning supplies and staff management necessarily vary from location to location due to local regulations? WeWork is sort of the golden example of a business being sold as something that works at scale... except the busines…

It seems in a lot of places (where I live, Austin TX) all the little mom/pop dry cleaning shops are actually shipping the dry cleaning off to a central location. The EPA/etc regulations apparently have forced that part of the cycle to converge. That is part of why it costs more/takes longer than simple laundry which is frequently still done at the mom and pop location. Although, I think the larger chains (Jack Brown)…

The advantage could be in eliminating the jobs of the mom & pop drycleaners and the rent they pay for the space. That's surplus that could be captured by a dry-cleaning app delivery service, assuming that the cost of transportation isn't greater than the cost of rent. In dense urban areas, where rent is expensive but you could hit up several customers on one trip, that might be a valid assumption. Particularly if you have someone good at logistics programming the app's backend, and a pool of inexpensive labor for drivers.

Re: How to proceed when you run out of cash, but you still believe?

#202

Post by munk-a » Thu, Dec 05, 2019, 7:42 PM UTC

nostrademons wrote: post #201

StillBored wrote: post #165

Earlier quoted context omitted.

It seems in a lot of places (where I live, Austin TX) all the little mom/pop dry cleaning shops are actually shipping the dry cleaning off to a central location. The EPA/etc regulations apparently have forced that part of the cycle to converge. That is part of why it costs more/takes longer than simple laundry which is frequently still done at the mom and pop location. Although, I think the larger chains (Jack Brown)…

The advantage could be in eliminating the jobs of the mom & pop drycleaners and the rent they pay for the space. That's surplus that could be captured by a dry-cleaning app delivery service, assuming that the cost of transportation isn't greater than the cost of rent. In dense urban areas, where rent is expensive but you could hit up several customers on one trip, that might be a valid assumption. Particularly if you…

That's a great business plan and differs from WeWork's because WeWork's business plan assumes that the cost of leasing office space in high rent areas is never going to be removable.

When looking at a potential business as something that can be economically scaled you always need to find the saving factor, for WeWork the saving factors are Administration efficiency (to administer 10 properties individually you need 10 administrator labour units, maybe for grouped properties you can get away with 6), rent leverage (being well established might lower the apparent risk of your lease being canceled early, so you may have some savings there) and maintenance (this is a significant one, I bet you could really scale down the expense of janitors and the like if you have multiple properties in a dense area). But none of the costs I listed above are seriously impacting your cost per sale, they're all quite marginal savings, so you'd really need high volume to reap that benefit and it's likely that the cost of marketing, building an app, having a crazy CEO etc... will outweigh the savings you could eek out.

Re: How to proceed when you run out of cash, but you still believe?

#203

Post by fphhotchips » Thu, Dec 05, 2019, 10:29 PM UTC

areoform wrote: post #169

aldamiz wrote: post #34

Earlier quoted context omitted.

Thanks bumblebee4 - fashiontasteapi.com is a the b2b side of the company and the value prop is that we can help retailers automatically classify clothes and understand/classify people. It is for technical and business people, not the end consumer. This is a line of business we were just starting, and hopefully will continue. The consumer website is chicisimo.com :)

Hot take: You need a woman to design this website. None of it screams fashion. When I think fashion, I think instagram influencer not "Omnichannel Personalization." Your killer app could be a simple FB quiz. People give you their FB/insta and you spit out what looks that they'd think are wicked sick. Ideally culled from Instagram. This web page sounds like nerds talking about fashion rather than fashionistas. I'm fai…

I would say they need someone with real marketing experience. Someone who can define a target market and write for that person.

I could be the target market here. I have a desire to look good for work and casual situations but absolutely no fashion sense. I hang out on HN. ML powered fashion sounds great! But then I go on their website and it looks like it's for 13 year olds who can read at a college professor level.

Re: How to proceed when you run out of cash, but you still believe?

#204

Post by chrisgarand » Fri, Dec 06, 2019, 3:58 AM UTC

lmeyerov wrote: post #172

streetcat1 wrote: post #90

Earlier quoted context omitted.

Startups should not create new markets. Too risky. Do what amazon/google does, just with a twist. You dig where the gold is.

That's sad and I disagree - category creation is amazing. Though indeed, I've observed that almost all VC's are indeed against this until it's been handed to them on a silver platter, despite what they may believe about themselves and their firms. So the tricky part is how to fund it over time :)

They're people as well, the good ones use it as a way to test the conviction of the founding team. If they can't take a few verbal licks, why would they be able to acquire enough customers to gain traction? Not a perfect test, but it has proven to be a workable process where the ones with the most conviction always get _something_. Sometimes it's too late, and sometimes it doesn't work out. That's life.

Re: How to proceed when you run out of cash, but you still believe?

#205

Post by areoform » Fri, Dec 06, 2019, 4:25 AM UTC

fphhotchips wrote: post #203

areoform wrote: post #169

Earlier quoted context omitted.

Hot take: You need a woman to design this website. None of it screams fashion. When I think fashion, I think instagram influencer not "Omnichannel Personalization." Your killer app could be a simple FB quiz. People give you their FB/insta and you spit out what looks that they'd think are wicked sick. Ideally culled from Instagram. This web page sounds like nerds talking about fashion rather than fashionistas. I'm fai…

I would say they need someone with real marketing experience. Someone who can define a target market and write for that person. I could be the target market here. I have a desire to look good for work and casual situations but absolutely no fashion sense. I hang out on HN. ML powered fashion sounds great! But then I go on their website and it looks like it's for 13 year olds who can read at a college professor level.

Yup! I'm their target audience too, and they lost me at the headline.

Re: How to proceed when you run out of cash, but you still believe?

#206

Post by 1_over_n » Fri, Dec 06, 2019, 4:46 AM UTC

tomrod wrote: post #166

1_over_n wrote: post #164

There are other ways to proceed when your running low - in my experience it depends heavily on how hungry a bulldog you have built (i think paul graham said this) which is often a function of when you raised cash. If you have to make payroll and can't proceed without all those people sat in their we-work seats with computers you need to buy them thats a difficult spot. We have tried to stay lean for as long as possib…

Are you comfortable sharing what you've built? I'm in the non-profit side of medtech and love seeing well-built products.

Happy to talk about it offline / privately as we are quietly working towards releasing something. Not sure how is best to reach you?

Re: How to proceed when you run out of cash, but you still believe?

#207

Post by HeyLaughingBoy » Fri, Dec 06, 2019, 8:21 PM UTC

areoform wrote: post #169

aldamiz wrote: post #34

Earlier quoted context omitted.

Thanks bumblebee4 - fashiontasteapi.com is a the b2b side of the company and the value prop is that we can help retailers automatically classify clothes and understand/classify people. It is for technical and business people, not the end consumer. This is a line of business we were just starting, and hopefully will continue. The consumer website is chicisimo.com :)

Hot take: You need a woman to design this website. None of it screams fashion. When I think fashion, I think instagram influencer not "Omnichannel Personalization." Your killer app could be a simple FB quiz. People give you their FB/insta and you spit out what looks that they'd think are wicked sick. Ideally culled from Instagram. This web page sounds like nerds talking about fashion rather than fashionistas. I'm fai…

It may be popular to hate on the Kardashians, but this kind of personal attack is really in poor taste.

Re: How to proceed when you run out of cash, but you still believe?

#208

Post by lmeyerov » Sat, Dec 07, 2019, 12:01 AM UTC

chrisgarand wrote: post #204

lmeyerov wrote: post #172

Earlier quoted context omitted.

That's sad and I disagree - category creation is amazing. Though indeed, I've observed that almost all VC's are indeed against this until it's been handed to them on a silver platter, despite what they may believe about themselves and their firms. So the tricky part is how to fund it over time :)

They're people as well, the good ones use it as a way to test the conviction of the founding team. If they can't take a few verbal licks, why would they be able to acquire enough customers to gain traction? Not a perfect test, but it has proven to be a workable process where the ones with the most conviction always get _something_. Sometimes it's too late, and sometimes it doesn't work out. That's life.

Yes, I agree -- many like to believe they are into deep tech and category creation, but even of those, most punt until a lot has been derisked. For deep tech / category creation, by the time the risk is gone, you are into growth phase. Someone like Lux Capital is on a very short list of exceptions.

Re: How to proceed when you run out of cash, but you still believe?

#209

Post by streetcat1 » Sat, Dec 07, 2019, 11:06 PM UTC

lmeyerov wrote: post #172

streetcat1 wrote: post #90

Earlier quoted context omitted.

Startups should not create new markets. Too risky. Do what amazon/google does, just with a twist. You dig where the gold is.

That's sad and I disagree - category creation is amazing. Though indeed, I've observed that almost all VC's are indeed against this until it's been handed to them on a silver platter, despite what they may believe about themselves and their firms. So the tricky part is how to fund it over time :)

So do category creation. Just be in the same categories that are being created by the big 4.