Since I joined RRE Ventures last fall, I’ve spent time researching mobile on-demand services that we are able to access with a push of a button. “On-demand mobile services” (ODMS) is a broad category so I believe it’s important to start with a definition. My friend Semil Shah defines ODMS as…
Apple CEO Tim Cook, talking to Daisuke Wakabayashi:
Last year, we grew (revenue) by $14 billion to $15 billion. Yes, those percentages are smaller compared to a year earlier and two years earlier and so forth. But that doesn’t mean that you’re not a growth company. We were in hyper-growth, or whatever is above growth. We went from $65 billion to over $100 billion to $150 billion to $170 billion. These are historic, unprecedented numbers. I don’t know any companies adding growth at that level. So when you say $14 billion to $15 billion compared to those numbers, it’s clearly smaller and a smaller percentage, but, to put it in some context, that’s like adding three Fortune 500 companies in a year. I think that’s hard to say that’s not a growth company.
Tucked between the clamor of Soho shoppers and Lower East Side creatives, Nolita is a narrow sliver of a neighborhood with a charmed rhythm all its own. Every street corner, shop, and cafe is an invitation to linger, to watch the fashion parade stroll by, to play…
It’s been a long four year journey, full of highs and lows. I am simultaneously incredibly proud, and incredibly disappointed.
I’m incredibly proud of an amazing team and all that they have accomplished. Our most recent product, DrawQuest, is by all accounts a success. In the past year it’s been downloaded more than 1.4 million times, and is currently used by about 25,000 people a day, and 400,000 last month alone. Retention and engagement are great. And yet we still failed.
It may seem surprising that a seemingly successful product could fail, but it happens all the time. Although we arguably found product/market fit, we couldn’t quite crack the business side of things.
Building any business is hard, but building a business with a single app offering and half of your runway is especially hard (we created DrawQuest after the failure of our first product, Canvas). I’ve come away with new found respect for those companies who excel at monetizing mobile applications. As we approached the end of our runway, it became clear to us that DrawQuest didn’t represent a venture-backed opportunity, and even with more time that was unlikely to change.
I’m terribly saddened that this may spell the end for our wonderful community, but it’s my goal to use what little money we’ll have left after the wind-down to keep the service alive for another few months. However as of today the team has gone their separate ways, and our doors are effectively closed.
I’m disappointed that I couldn’t produce a better outcome for those who supported me the most—my investors and employees. Few in business will know the pain of what it means to fail as a venture-backed CEO. Not only do you fail your employees, your customers, and yourself, but you also fail your investors—partners who helped you bring your idea to life.
In my case, I am extremely lucky and grateful to be partners with people who are simply the best. What separates the best investors is not how they help you when you’re a rocketship, but when your ship is on fire and you’re venting atmosphere. In this case, our investors have demonstrated what sets them apart from the rest—they’ve supported me throughout the ups and downs, and especially the downs.
With that said, life goes on, and the best path forward is not a wounded one, but a more learned and motivated one. I’m definitely not itching to start another company any time soon—it will take time to decompress and reflect on the events of the past four years—but I hope that if I do some day decide to pursue a new dream, I’ll be in a much better position to. After all, I did just receive a highly selective, four-year education for a mere $3.6 million dollars! (I find humor helps as well.)
As for what’s next, I honestly have no idea. This is the first time in four years I’ve been at a crossroads like this.
One thing I’ll be doing more of is writing about my experience. Partially because it’s therapeutic, but also because if there’s a silver lining in all of this (and there is), it’s that I can help educate others about a path fraught with hardship, but rewarding nonetheless.
I’m also particularly inspired by what Everpix has done by making so much of their story public, and hope many others will follow in their footsteps of radical transparency. I don’t wish to glorify my failure, but it’s certainly something I’d rather embrace than hide behind for the next five years.
On that note, if there are any specific topics you’d like me to write about, feel free to submit them via my Ask page. Or if you’d like to say hi in general, please don’t hesitate to e-mail me at email@example.com. Believe me—I’ll have a lot of free time on my hands these next few weeks.
Last but not least, to my team—Dave, Eunsan, Alex, Nick, Shaun, and Jim—I am eternally grateful. To my investors—Union Square Ventures, Andreessen Horowitz, Lerer Ventures, SV Angel, Founder Collective, Chris Dixon, and Joshua Schachter—I could not have done this without you.
And to everyone who has supported us over the past few years, from the bottom of my heart: thank you.
I am seeing this as well in enterprises. The mobile devices of choice are running iOS and iPads make up the overwhelming bulk of corporate tablet computer purchases. If you are an enterprise mobile developer deciding on which OS to deploy first, you would be best served going with iOS for the foreseeable future.
We could not be more delighted to announce that DFJ Growth has led Foursquare’s latest round of funding of $35M. We are long time fans of Foursquare and CEO Dennis Crowley’s vision of making your mobile device the most convenient and useful discovery tool ever.
We are picky and patient investors at DFJ Growth and have closely tracked Dennis and his team’s progress in 2013, and it was a very impressive year. The latest product releases deliver passive geo information - no need to check in - and the community has now posted over 40M tips at more than 70M venues worldwide. The company also validated its business model with an innovative portfolio of ad and promotional tools that are a win-win: useful and valuable to the member and great results for the advertiser.
When we think a company has the product the model and the market to go really big, we want to invest and be a part of the team. Managing Partner Barry Schuler will be joining the Foursquare Board and is looking forward assisting the team in building an epic company (and earning their coveted DFJ Golden Frisbee in the process.)
A state judge today ruled to legalize same-sex marriage in New Jersey, saying gay couples would be denied federal benefits if the state kept allowing only civil unions.
Superior Court Judge Mary Jacobson granted an emergency request by six gay couples, ordering state officials to begin officiating same-sex marriages on Oct. 21.
"Same-sex couples must be allowed to marry in order to obtain equal protection of the law under the New Jersey constitution," the judge wrote in a 53-page opinion.
This is surely going to be appealed, as these rulings always are, but marriage equality advocates are no doubt thrilled about this. It also puts Governor Chris Christie in a tough spot. How vocal will he be in opposing this decision? He previously vetoed a gay marriage bill; will he take any steps to fight marriage equality this time, knowing that doing so could hurt his chances in 2016? Or might opposing gay marriage actually help his chances in a Republican primary?
Gripping read on CNN about Akamai Technologies co-founder Danny Lewin, who found himself on the wrong plane (American Airlines Flight 11, which hit the North Tower of the World Trade Center) during the nadir of the dot-com bubble … something which seems almost modest in comparison to what happened on the way.
Nevertheless, things were particularly grim on September 10, 2001. [Fellow Akamai co-founder Tom Leighton] remembers a session stretching late into the evening in which the executives had to decide whom to lay off, including some friends and colleagues who had been with them almost since the beginning. The next morning Lewin had to fly from Boston to Los Angeles.
"He probably barely got an hour of sleep before getting on board the next morning," Leighton remembers.
Lewin was sitting in seat 9B. With his Israeli military training and understanding of Arabic, he may have figured out what was going on, perhaps even tried to stop it. According to flight attendants’ calls relayed to authorities on the ground, the first passenger to be killed was seated in 9B. He was stabbed to death.
He died at just 31, but he left behind a quiet, persistent legacy: Akamai’s technology was among the earliest efforts to speed up the Web, finding success because it managed to keep up large sites even during traffic surges. In other words, he was sort of a low-key hero of the internet, creating a foundational layer which allowed sites to stay online even as traffic was crippling.
What’s more, the tips on Foursquare are arguably easier for the startup to parse, enabling the company to call out popular venue features and embed them seamlessly in its search engine. They can range from highlighting the best bar cocktails to the best secret dance clubs to the fastest coffee shop Wi-Fi.
It’s interesting to me that I no longer check-in on Foursquare for the social dynamic, but instead just to see the tips left at the venue I’m at. Those tips, when plentiful, are a goldmine of information about a place. Some of the best meals I’ve ever had in my life are a result of those tips.
Eat real food, as close to nature as possible. It’s what we do to food that is a problem — processing, refining, reducing and altering in general. Forget about reduced fat and skim milk. The less processing the better. If you’re going to eat fat, choose good quality and go for full-fat. Eat avocados, use olive oil or coconut oil (yes coconut oil is healthy) in cooking, have nuts, wild salmon, grass-fed butter, and pastured grass-fed beef.
I think that reduced-fat foods, particularly skim milk, nonfat yogurt, etc. are a slippery slope. When you remove the fat content from one cup of milk, you lose a significant volume, which means it’s replaced with milk that has a higher concentration of sugar to fat ratio. It’s not the fat in milk that makes us fat. It’s the sugar.
People are willing to get short-term gains at the risk of long-term choices. So, if someone can do something to sell a few more records now at the expense of the artist, even if that artist will sell a lot less later, they’ll make that choice.
A lot of it has to do with structure, because the structure of the music industry is rooted in a corporate structure. It’s a quarterly business, but art is not a quarterly business. … And it’s impossible to build a music company as if you were selling shoes. It’s a different business. It has a different ebb and flow. The highs are higher and the lows are lower. You have to look at it as a longer-term game.
Almost 2 years ago today, I quit my day job and started building something. After months of customer development, discussions with my wife about my plans, savings and sleepless nights, I finally decided to take the plunge.
I’m glad I did
That day I quit my job marked the beginning of an epic roller coaster ride. One that saw me hit the top of TechCrunch, hire employees and become a rising star in the technology world. Glowing in our newfound success and ramen-riches, we got an offer that seemed to be the key to making it huge. We were offered a spot in a very well known accelerator.
They say accelerators speed up success and failure, in our case, all it sped up was our ability to play the startup game
The day we set foot into the doors of the accelerator, we had a business that DHH would be proud of. Bootstrapped, lean and already providing (in a small way at least) for the needs of my family and that of my co-founder. Over the next 3 months, our initial desire to not raise a seed round was dismissed and we were thoroughly convinced that we had to continue on the VC rocket-ship in order to matter to anyone. My reluctance to do this was met by scoffs and dismissals from many others in the accelerator cohort (most of which have since gone on to fail hard) as well as by the mentors and investors who had offered their time, network and resources to help us succeed. This is where we made the first in a series of many mistakes
We listened to our investors
They were proven entrepreneurs that had made millions (sometimes nefariously…) and they believed in us. If only we would:
“Make feature X free”
“Stop focussing on revenue, someone else will pay the bills”
“Grow $VANITY_METRIC so you can show a hockey stick at demo day and look good”
“Cut out that pesky client that generates 80% of your revenue, they’re a distraction on the road to executing $OUR_BIG_VISION”
We drank the Kool-Aid and went all-in. By the time demo day came around, we had cheques being written and were all over the press. Still, I had this nagging feeling eating away at me. That nagging feeling was disbelief.
I didn’t believe the shit I was selling investors. This was not the company I put my life on the line to build.
We raised our round, closing up early so we can get back to work and stop fucking around on endless pitches and breakfast run-arounds. Product after product hit the market and found traction, but not the million-user strong kind of traction that would make us matter. My team was still motivated though, firing on all cylinders building these apps that they loved. Despite this, I found myself sitting at my desk, afraid, alone and overwhelmed.
I built a team that I love. I didn’t build a team that can lead.
I really love my co-founder. It’s an enduring bromance that will last a lifetime. He’s a talented executor, supportive listener and I trust him entirely. However, he left me alone in the cold. He didn’t mean to do this, he didn’t even realize he did. I became the guy who would “do-it-all”. Biz Dev, check. Product Management, check. Support, check. Accounting, check. PR, check. Ad Copy, check. Development Lead, check. While he took complete ownership over design (and really excelling at it).
I’m overwhelmed, stretched so thin and unable to do a really good job at any of my duties. I don’t sleep nearly enough and honestly think the only thing that keeps my health and my marriage intact is my running.
When I built this team, I didn’t build it with generalists and with people who could jump into any area of the business and get shit done. Instead, I built it with quality-minded perfectionists who build beautiful things. These people have their place, but not as early founders unless they can hustle.
Thus, in many ways, when my startup fails, I can clearly say that I failed since behind the scenes I’m responsible for much of what the world sees and how the gears of this (albeit tiny) organization turn.
I don’t know what happens next
I made the decision to start this blog in the middle of the night last night while lying in bed next to my sleeping wife. Just one of the many people I will have disappointed due to this failure. (However, undoubtedly one of the few that will still love and support me afterward). This week, I need to speak to the other founder and fire our first employee before he leaves on a planned vacation. He’s a good developer, but I won’t fucking make payroll next week if I don’t clear him and his severance out of the company.