I’m reminded by the 1990s when I see a lot of the technology companies receiving press (and funding) these days.
I’m uncertain what many of the most public venture capitalists really intend to do with their portfolios. Companies that have a lot of “users” but no revenue aren’t really corporations – they’re just hobbies funded by shareholders.
The older generation of entrepreneurs and contractors are jaded about venture capitalists and corporate management in general. Veterans remember how many companies were destroyed by VC malfeasance during the boom years. The funds are structured in such a way as to use entrepreneurs like soldiers in a war. You send your workers up against the hill, most of them get blown to smithereens, and you hope to secure some territory by the end.
Investment bankers (the gatekeepers to a significant IPO) are also weary of fraud on the part of VCs in accounting and revenue projections.
It’s odd that VCs would continue that approach even during this era.
I don’t see much demand for web applications. It’s too easy for developers to create them for free. It’s also too easy for cash-rich public companies to replicate features and roll them out to the market at a faster rate.
If you have an intention to sell your company, it’s best to keep that the primary goal. If your technology has already been replicated elsewhere, there’s no purpose to raising huge amounts of money to pay engineers and programmers to work in fancy commercial offices for years on end drawing down salaries.
Product developers like to feel important. They want to “innovate.” Innovation pisses off customers.
Customers hate change.
Regardless of whether you like it or not, even tiny alterations to an entrenched service spikes customer service costs and can hand your business to a competitor.
My ideal business these days is something that uses tested technology to drive in revenue from the first moment. I’m disinterested in innovation-for-innvation’s sake.
You can’t build a cradle for your baby with “innovation.” You can’t take your girlfriend out to dinner with “users” or “metrics.” You can do all of those things with profit, which is the entire point of being in business in the first place.
Only the deluded (and those interested in quashing competition) will buy out companies with no revenue. I enjoy services like Twitter in that it has successfully marketed the IRC experience to more people, but the valuation it commands is absurd. The staff seems bloated. And I have no clue what their exit strategy could be.
The specialized press seems only happy to fuel the craze.
One Question For Your Investors: “What’s Our Exit Strategy?”
I’m reminded by the 1990s when I see a lot of the technology companies receiving press (and funding) these days.
I’m uncertain what many of the most public venture capitalists really intend to do with their portfolios. Companies that have a lot of “users” but no revenue aren’t really corporations – they’re just hobbies funded by shareholders.
The older generation of entrepreneurs and contractors are jaded about venture capitalists and corporate management in general. Veterans remember how many companies were destroyed by VC malfeasance during the boom years. The funds are structured in such a way as to use entrepreneurs like soldiers in a war. You send your workers up against the hill, most of them get blown to smithereens, and you hope to secure some territory by the end.
Investment bankers (the gatekeepers to a significant IPO) are also weary of fraud on the part of VCs in accounting and revenue projections.
It’s odd that VCs would continue that approach even during this era.
I don’t see much demand for web applications. It’s too easy for developers to create them for free. It’s also too easy for cash-rich public companies to replicate features and roll them out to the market at a faster rate.
If you have an intention to sell your company, it’s best to keep that the primary goal. If your technology has already been replicated elsewhere, there’s no purpose to raising huge amounts of money to pay engineers and programmers to work in fancy commercial offices for years on end drawing down salaries.
Product developers like to feel important. They want to “innovate.” Innovation pisses off customers.
Customers hate change.
Regardless of whether you like it or not, even tiny alterations to an entrenched service spikes customer service costs and can hand your business to a competitor.
My ideal business these days is something that uses tested technology to drive in revenue from the first moment. I’m disinterested in innovation-for-innvation’s sake.
You can’t build a cradle for your baby with “innovation.” You can’t take your girlfriend out to dinner with “users” or “metrics.” You can do all of those things with profit, which is the entire point of being in business in the first place.
Only the deluded (and those interested in quashing competition) will buy out companies with no revenue. I enjoy services like Twitter in that it has successfully marketed the IRC experience to more people, but the valuation it commands is absurd. The staff seems bloated. And I have no clue what their exit strategy could be.
The specialized press seems only happy to fuel the craze.
Always know where you’re headed.