"Web start-up companies are like play-companies. They stand in relation to real companies the way those cute little make-believe baking stations stand in relation to kitchens."
When I asked him whether he regretted going public—whether he thought he could have accomplished more without the market pressure—he became incensed. "I feel like the only reason you could be asking me that question is because you think I’m stupid or because you’re trying to see if I’m going to lie to you."
—Say what you will about fired Groupon (current share price: 4.53) CEO Andrew Mason—he's a slob, he made terrible choices, his company was pretty close to being a scam for desperate businesses of the recession era—but at least he always makes sure to give a entertainingly terrible interview. I do look forward to [...]
$85 million sounds like a lot of money! That's what Tumblr just raised, on top of the $30 million they raised ten months ago, bringing their investment dollars to a bit north of $120 million. There's a staff of 50 (now only 82% male!), so that's like $5 million a year right there. (Also, they've outsourced tech support (rather poorly; if you ask Tumblr for help with something, you get some dude copying and pasting a manual at you) with some minimal supervision, and that's probably a significant, if user-annoying, cost savings.) But staff costs are surely dwarfed by the cost of doing at the very [...]
"Groupon's filing Wednesday also revealed its financial results for its second quarter, which ended June 30. Groupon's sales came in at a record $878 million, but it lost $102.7 million." —Everybody be carpin' at Groupon but it's hitting records, you see! Groupon also had a first quarter loss of $117.1 million. Let's go buy some!
Happy Internet Week! In case you don't know, Internet Week is "a festival celebrating NYC's thriving Internet industry & community," according to the website of Internet Week Dot Com.
If you wanted to, there's a talk tonight at the Internet Week, except it's not on the Internet, it's in real life, called "Will Tweet for Food: Writing Your Own Ticket in the Digital Age." There's tickets, and you can write them.
But even more notable are two new developments in this wonderful age. There's Sonar, which shows you people not in your networks who are around you and using Foursquare or Twitter. They call this "extreme networking." (They [...]
By the time I took my seat at [TechConference] on Monday, I had already seen its host’s logo 51 times. The name was printed twice on my conference badge, five times on the lanyard holding that badge, 16 times in the conference agenda, nine times on the side wall of the conference’s main hall, and finally all over the 20-logo tessellation on the stage background. (A giant wooden statue outside the front door spelled out its initials, but we won’t count that.) As I sat down for the first panel, heavy synth-and-bass beats shook the speakers overhead. It was the conference’s theme song. The only lyric: The conference’s name, [...]
A hundred-thousand screams were heard last night, when it was announced that a startup called Color had gotten $41 million in investment money—pre-launch. It has seven founders! It's a social photography iPhone app! They paid $350,000 for the url "color dot com"! (Which is just a "click-here for the app store!) And it is now live.
Basically, Color finds people around you, and so you can see (and have) everyone's photos from around you. (Everyone who is also using Color, that is.) The tech sounds wildly impressive! (And high-bandwidth—it samples audio around you to match up devices that are "hearing" the same things? Whoa.) The case can be [...]
Yahoo buying Tumblr is digital gentrification.
— Jason Chen (@diskopo) May 19, 2013
The question of the weekend is: "Why did Yahoo! spend one-third of their cash on hand to buy a company that by all accounts is about to run out of money?"
And here are some fairly sober answers, including: "if you were given 1.1 billion dollars, would you be able to build a service used by more than ten million people for more than an hour a month? You could not. That's a bigger audience than American Idol, or for that matter anything else (except Facebook or Twitter)." That's very attractive!
(I mean [...]
Everybody's spending his Facebook IPO money before it's converted to cash! The Bay Area is going to hell in an Hermes handbasket! Real estate agent Jeff Appenrodt said a client of his recently was among 51 bidders on a three-bedroom, one-bath Edwardian-style home built in 1903 that was showing its age. The client, a tech entrepreneur, made an all-cash offer 50% over the $849,000 asking price — and got thumped. The house sold for $1.4 million to a rival bidder.
Here's your other damning quote, from a real-estate-broker-to-the-rich: "Everyone feels confident again." Muh ha ha, you know what that means. (Comeuppance.)
Well, the TechCrunch "Disrupt" conference in San Francisco has ended. And no one is talking about the drama surrounding TechCrunch founder Michael Arrington's sort-of dismissal any more, because a legal agreement was clearly made with AOL, his former employer, and everyone's obeying the NDA. Plus the vaguely promised self-immolation of the staff of TechCrunch didn't materialize in the slightest. But wait, who won TechCrunch Disrupt???
Of 31 startups competing to be the "winner," they came up with… this thing. "Shaker is a mixture of Second Life, The Sims, and Turntable.fm all mixed together using your Facebook data and connections. Your Facebook profile becomes a walking avatar, your pictures [...]
I hope all these people who are glomming onto The Startup Daily's hideous daily koans aren't doing the accounting at their oh-so-hot startups. I mean, say my startup was 51% good already, then I made it 52% good? So at the end of the year it's not going to be 101% good, because, COMPOUND INTEREST, [...]
Groupon competitor Yipit comes out with all guns (and some charts!) blazing today, analyzing Groupon's business in Boston. It does seem notable that the cost to acquire a Groupon subscriber is something like $30, while their quarterly revenue per subscriber is $14. (That being said, customer averages are always weighed down by the one-time customer, and businesses rely on the repeat "power user.") And at least the company had $810 million to pay to backers and executives! Buying a printing press to make dollar bills at home would be much more work, it turns out.
Color, the app that makes location-based photo sharing possible, that launched with $41 million in investment three weeks ago, is… well, it's still in business! But the day comes in every business where you send the employees into isolation to "hack" new schemes to pivot the business….
10. It could be like Shazam, which "listens" to music and tells you what it is! Except for colors: you point your camera at something and it names it. ("So that's what chartreuse is!")
9 Visual learning tools for pre-tweens and toddlers. ("Color: We Learn Together!") Point and match shapes! Has great sponsorship opportunities.
8. Totally kicky Latina lady iPad mag. [...]
Now that the SXSW start-up bus has landed, it's time to take things to the next level. In case you missed the fun, buses full of buspreneurs departed the four corners of the country (and Cleveland), bound for Austin, and along the way they built companies that were then besieged by incubators and investors. The winning companies were TripMedi and WalkIn, which, respectively, collect information about medical tourism (oh my God! Finally we can find the cheapest plastic surgery + safari package in South Africa!) and allow you to "check in" to not have to wait in line at places that have lines. Like I guess [...]
Mark Ghuneim and David Peris dug up this delicious chestnut from January, 1999: "Internet search engine Yahoo! Inc. confirmed Thursday it will buy GeoCities, a fast-growing Web site community, in a $3.6 billion deal that will further solidify Yahoo!'s position as a frontrunner in the online popularity contest." RIMSHOT.
Makes a billion dollars for Tumblr seem like a steal. Here's what I don't understand: who's blabbin' about the potential acquisition of Tumblr by Yahoo!? Oh, gosh, whoever benefits from that. Tumblr made $13 million in 2012, so $1,000,000,000 sounds totally natural.
Oh, and how was GeoCities at the time of its Yahoo! acquisition? "In [...]
It's been really quiet on the Internet Bubble front, because no one likes that narrative. It's bad for everyone! (Except some people.) But here's a report from close to the startup incubators that makes it pretty obvious that nothing's changed in the last year. Or if it has changed, then for the worst: "Y Combinator had sixty-five companies present. And we saw 500 eager investors, frenzied almost, excited to invest in entrepreneurs. One investor emailed me four times, texted me three times, called me and sent me a message on LinkedIn—desperate to get a check in before the round closes. No business plans, not even pitch decks [...]
"When Betabeat first visited General Assembly a few weeks before it opened, co-founder Adam Pritzker told us that the vision was to create an educational space free from the pressures of venture capital so often tied into startup incubators and accelerators.
That has all changed now." —Yup: with investments of $4.5 million (asdfasdjfl???), General Assembly can do all kinds of things! But they've got a plan, writes their cofounder: "So will we open a bunch more campuses? Put all our classes online? Start training executives? We don’t know."
"The party was friendly but ultimately like all other startup parties: serial startup consultants Rex Sorgatz and Rachel Sklar showed up, as did several members of the ad agency Barbarian Group… [People] were surprised to find I’d just asked my way into the party; everyone else attending was a friend or a friend’s plus-one, which probably proves that the same ten people are doing everything in New York startup-land." —Startup launch parties reviewed: "Fortnighter." (Previously: the "Socialisting" launch party.)
The Groupon IPO filing is delightful! It's an enormous, amazing business.
We increased our subscriber base from 152,203 as of June 30, 2009 to 83.1 million as of March 31, 2011.
We sold 116,231 Groupons in the second quarter of 2009 compared to 28.1 million Groupons in the first quarter of 2011.
We grew from 37 employees as of June 30, 2009 to 7,107 employees as of March 31, 2011.
That's incredible! Also? Net loss, before taxes, for all of 2010? $456 million. They lost $146 million last quarter. So yes, last year they lost more than half the value of this year's planned $750 million [...]