Exactly. Sometimes when you think your idea is good all you need is one or two other people to tell you they think its good and that's it: it's a good idea. How did Instagram come to the conclusion that their idea was a good idea? Or any other startup for that matter. If Zillionears turned out to be a success no one would have thought that having a few people say "good idea" in the beginning was insufficient to get started.
I totally agree with that! There are tons of companies that "win the lottery", and build a product with no validation and succeed. It is obviously not the "right" way to do it, but sometimes it does work.
Yeup. Lots of arm-chair advice these days. It's a business all in itself. It's funny watching people compile lists of "all the mistakes" in hopes that not repeating a single one of them will equal success. Plenty of wildly successful businesses became so without having MVPs or setting up fake landing pages. They spent years building out real product-breakthroughs, maybe with even real technology/science. I'm willing to bet that for every rule that's broken in that StartUpGrave twitter list above (I haven't looked so I don't know what's really there, but I'm going on just the idea of compiling lists of mistakes), there's a company who succeeded while still failing the rule.
There's so much retro-active quarterbacking that goes on (especially in the VC-world) that says X company was success because they applied this-thing-I'm-just-now-naming as a rule. Even though, Apple has taught us things like you're users don't always know what they want or need.
Getting to the point where an idea is truly validated by unbiased and honest customers is way, way more difficult than we all pretend like it is. I think the idea that you can figure out if your business is viable by talking to a few people can be just as dangerous as it can be helpful.
Maybe this explains so many me-too consumer based websites are de rigueur around here? I'd like to hear more feedback about MVP practices within the enterprise space.
This seems unkind. What data would you want? It's easy to jeer in hindsight, but frankly if focused and professional market research could reliably determine the existence of new markets there would be no need for a startup to find them. This very web site wouldn't exist.
They played a hunch and lost. The linked post details lots of mistakes, but this particular one doesn't seem like one to me.
I agree that was unkind. But treating a little positive feedback as validation is, as the original author now clearly realizes, a giant mistake.
You've got a business when people repeatedly exchange value with you. Kind words are validation of a sort, but the weakest kind. To go from there to spending a year building a platform is basically hearing what you want to hear. Better not to ask than to believe what you hear uncritically; if you don't ask, at least you know you don't know.
The data that was lost right here: "After that moment we basically stopped talking to artists for a year [...]"
Find customers as early as possible, engage with them as often as possible, and really really listen to what's being said. This is a huge benefit of bootstrapping. Customer engagement from the earliest possible time is vital to the process of transforming an idea into a product.
A cool idea does not equal a business model. That is why I think soooo many startups fail. They build something awesome, amazing, cool whatever, but they don;t stop to ask people, "Will you pay for this? Is this something you think I could charge for?" That is the data I WANT and need.
Life must be especially complicated for you, considering that each of your assertions are flat out wrong.
Facebook, Google, and Microsft not profitable? Seriously dude, just google them; they're very profitable (technically MS lost money last year, but that was entirely due to a one-off asset writedown, and they've made gobs of cash every other year).
All successful startups are outliers. "Real life" startups, to first approximation, fail. This one did too. But frankly it wasn't because of the lack of market research.
Reading about failures can be more illuminating and educational than reading about success. It's interesting to see how you reached a number of gateways where you could have terminated but instead continued to pursue your goals/dreams (despite going against what many would consider the logical conclusion to close).
I wonder how many other business have adopted that strategy (of ignoring initial reduced interest in your startup) to only find glory and success down the line.
Either way you failed but you should be commended for it.
Yes, well, people are terrible, terrible, at thinking for themselves. And when they do think for themselves, they are even more terrible at acknowledging that their thoughts don't shape reality.
That's glib. There is a very, very difficult balancing act between trusting your innermost convictions and learning to doubt said convictions frequently, as an exercise which reinforces the good bits and dispels the nonsense within them. Failure is the most valuable when you fail at something you personally believe in, because you're forced to confront yourself in the failing. Failure because you followed some BS system for doing or creating a thing without using your own thought processes along the way might teach you to stop being such an idiot, but usually it takes many failures of that sort before the message seeps in.
I think part of the difficulty of knowing when (or when not) to quit is that opportunity lurks even inside failure.
My first startup attempt was a coaching marketplace and community for poker players. My co-founder and I were both successful professional poker players and coaches at the time, but we were young (20ish) and all but clueless about technology. I still think the market opportunity was there, but we hired an agency who outsourced everything, made bad tech choices, took forever, and gave us a fraction of what we originally agreed on. I learned to program myself in order to complete a major component of the site (in flash) which they had just completely botched.
What we ended up with wasn't terrible, but it fell way short of the vision we had, and our marketing efforts fell mostly flat as well. We were able to recruit a few smart people to post and discuss hands here and there, and we wrote a few articles ourselves that showcased the flash hand analysis tool I had built (the best functioning aspect of the site), but we weren't getting any other traffic. There were a few bugs and an assortment of minor ux issues which made the site feel a bit clunky, and people's feedback was pretty unenthusiastic, so all in all we weren't feeling very good about the direction of things. It didn't take very long (maybe six weeks or so) before we threw in the towel.
It wasn't a complete failure--after all, I had learned how to program and discovered that I quite liked it (certainly much more than grinding poker online), and both of us had learned a lot of lessons about business and technology. But there was another lesson that we only discovered with time.
Even after we completely abandoned the site and it went dormant, I would still check google analytics from time to time to see if there was any traffic, and an interesting trend started to emerge: a few of the hand posts and articles we had posted were developing really steady search traffic. One article in particular was generating something like 20 uniques per day.
At that point, we were both just done with the whole endeavor and had no motivation to try to pick it up again, but we realized that if we had kept at it and continued to create more and more quality content, that we probably could have had an seo goldmine on our hands, developed reputations as poker strategy bloggers, and leveraged that into the community we had originally envisioned. Who knows if it would have gone that way, but it seems like there was at least a relatively unobstructed path to success available to us if we had been willing to stick it out and let the long tail kick in.
Startups often live on the cusp of 'other people think we should quit but we're not going to!' I appreciated these sorts of posts because they are illustrative. The only thing to be bothered by is if you don't find anything to learn from the experience.
Good point, it's why it's such a difficult situation to be in. You really do have to block out everyone EXCEPT the customer that's actually using your product.
Almost anything worth doing is difficult and to an extent risky. You are likely to fail both wasting time, money and other resources. But you are also likely to win big.
Anything that is easy is either already solved, or leads to mediocrity or pays too less.
To succeed at your goal you either need to get lucky or simply persist until you get there. Some can, many can't. Some just get lucky.
Yes, it is definitely a test of resourcefulness to persevere in the face of challenge, but you have to also know when you're doing the wrong thing or going down the right path. Persevering in the face of clear, direct evidence that what you are doing is not going to pan out is stubbornness. But persevering and LEARNING from what is working when other things are not is a best practice. The key is realizing when something is not working and then iterating to find the success. Or knowing that perhaps what you are doing will work, but the timing or market circumstances are not optimal, and then just biding your time until the market changes. This is not as obvious as one might think.
That is what great minds of business say about pivoting, especially in the early stage of business. Google didn't get into the ad selling business until they aquired AdSense. Now if I only can pivot some of my own ventures...
>I think part of the difficulty of knowing when (or when not) to quit is that opportunity lurks even inside failure.
No, it does not. Since, statistically, most startups fail, it's is mathematically sound to assume that mostly failure lurks inside failure.
At some point you have to stop and do something else. Even if you've lost money and time, it's wiser to quit and do other stuff, than continue to losing money and time in the same endless sink.
I bought into a couple poker training sites. What killed a lot of that business was Poker Black Friday, I'd guess most the income for these sites was coming from US players, and that dried up immediately. There might be another opportunity coming up though. I can hardly wait to play when on-line poker starts up again in the US.
So, I guess I'll be the wet blanket here. It's pretty clear to me reading this that this person and their partner were nowhere near ready to found a startup. It highlighted the potential benefits for some people of getting a corporate(ish) job, learning about the business world, and learning the trade a little more before trying to starting a company.
It's like the demotivator for "Mistakes", this is probably best as a cautionary tail for people that have a startup itch, but don't necessarily have the necessary skills yet. I mean, this really talked about business and technology problems, but even assume they hit lighting in a bottle with the business model and didn't run into the technical issues, does it sounds like they would have been able to capitalize on it? I got a feeling that it was organized in an ad hoc way, and they weren't set up as an llc/s-corp/etc, had equity agreements, or basic contracts (otherwise, how did the one artist change not know they terms of the business, or opt out so quickly?) I feel like they would have ended up in trouble with the IRS, in a lawsuit with each other, or getting screwed by a less than scrupulous VC.
That said, everyone is better off from sharing, and I thank the author for it.
You know, I respectfully really disagree with you.
Based on the blog, I get the sense that the founders are in their early twenties. At that age, no one is "ready" for a startup.
I doubt that Mark Zuckerberg, Steve Jobs, etc. were ready to start their company.
At that age, you just do it, since the risks are low.
Unless your parents are wealthy or you have access to a lot of money, at that age its unlikely that a lot of money is on the line. Sure, they "wasted" time on this startup but this is valuable for the next company they will build.
Also, if there was a lot of money involved (and it wasn't their's) its likely that the business would not have gone as far as stakeholders would have wanted validation.
I mean, it's clear to me that their startup failed. But "nowhere near ready to found a startup"? What does that even mean? Where do I get my secret decoder badge of startup readiness exactly?
Reading through it, I saw and empathized with their mistakes--they decided they'd found validation before they really had. They kept it going too long. They ignored the writing on the wall for too long. But aren't those always the tough questions? When should a founder give up versus persevere? It's not a straightforward answer and as a business owner I find it frustrating when I see people (particularly other business owners) suggest it is.
Bottom line though--everyone needs to decide for themselves if they want to go into business for themselves. But are they "ready"? Who the hell knows? There isn't a list of required skills and credentials for this position.
Regarding being ready to found a startup, I'll fall back on the Justice Stewart's line that, "I know it when I see it".
When I was a young kid, I had an idea that I was going to have a plant store (really. I had just learned about splitting African violets) that would have 'low price days' and 'high price days'. I swear. They idea was that people would be so grateful for the low price days that they would go to the high price days to help keep the place in business. This would have been an idiotic company.
You ask when the authors of the blog post should have given up vs persevere? I would say either when the drew up the business plan or after the beta when the found that people didn't like their product and that they couldn't execute on their idea.
I'm unromantic on this point. To me a startup is to make money (as a profitable business or on the exit), not find creative outlet or have a life experience. I'd rather see 20-somethings blow the ~$5K spent on EC2 hosting apps with fundamentally broken business models instead on (AirBnB) trips through Europe or South America and getting a little bit interesting as people first.
It's up to them, but (to avenger123's point) almost nobody is a Jobs, a Zuckerberg, or a Musk. Most startups fail. Plenty of YC class startups fail, and they're the winners of a highly selective process with access to unbelievable connections.
I'm not sure anyone is completely ready to found a startup.
If you are, you're probably not all that hungry.
Obviously a line, but these guys demonstrated plenty of competence.
So what are you suggesting people do? Go get a "corporate-ish" job first? Personally, I agree with the sentiment of others: no one is "ready" you just have to try. Going the corporate route first has a high chance of getting you addicted to a steady income. Once that happens you'll probably never be able to do a startup because you can't take the salary hit.
I'm saying that founding a startup is not terribly different than founding a bakery, it's just the ROI characteristics of the business model are better. If one's skills are lacking in marketing, the basics of business/contract/tax law, time managment, accounting, or the core competency of the business then it's probably a bad idea. Some people are rockstars and can learn these skills on the fly, most can't.
So my point is this: if someone is not a rockstar and they don't already have these skills, they can learn a huge amount by joining small companies in their C or D rounds (ie, corporate-ish) and practice those skills by applying them in a structure where it's likely they have more experience coworkers to learn from. Then they can found a startup when they have the tools and an idea they're passionate about.
If a person can "get addicted to a steady income" then their financial planning sucks or they aren't committed enough. Better off they don't bother and waste time and capital that could go to people that give a damn.
Learning from failures is invaluable. Focusing only on successes is like getting a math exam back and only studying the ones you got right. Paraphrasing Tolstoy: all successes are alike, each failure is unique. It seems like there are far more ways to go wrong than right, but developing that catalog of mistakes from which to learn is difficult when it can be so painful to share (and often to listen to) unpleasant experiences.
I like the idea of a catalog of mistakes. TechCrunch makes it easy to get caught up in all the success stories, but there's no easy way to learn from the failures, which can be far more enlightening.
I decided to start a Twitter profile to collect all these post-mortems in one place. If such a resource already exists, let me know!
I'm sure it's painful, but thanks for sharing. I agree with cup, that reading about failures can be more valuable than reading about successes.
If anything, your story adds more fuel to the fire for the approach that @sgblank advocates[1][2]. Get out of the building, talk to customers, validate customer needs, etc. We've been doing this, but - to be honest - we haven't done as good a job as we could. Hopefully we will soon start another big round of Customer Development interviews, much more targeted this time, building on the feedback we got the first go-round, and moving more into what Steve calls the "Problem Presentation" phase.
It's a tough slog, but I continue to remain convinced of just how important it is.
Startups repeatedly make the same mistake of not talking to customers enough and dying as a result.
One of the most helpful guides is to try to make a mistake in the other direction. Try to talk to your customers too much. No early stage startup ever died from talking to their customers too much.
I mostly see it as a matter of empathy with existing people, or exposure to existing problems. I would say one of the best ways to come up with an idea for a startup is to be working for your potential customer.
I have seen so many people start their own company after breaking off from some existing company and "doing it better" or realizing some previously un-claimed niche specifically because they had the industry knowledge.
I've been there done that, so I get the frustration you went through. Lesson # 1 What people say is cool doesn't mean that it's something that they'd use. Just because you say you're building the next Facebook will get you some "that's cool" responses but doesn't mean they'd actually use it.
One of the most useful things I do to validate an idea is to actually use YC's application- if you can't answer all the questions about your idea without any doubts, you're don't have a solid idea yet. And validating your idea means to follow up at the very least with the people that said it was "cool". Forget the stealth startups, be completely transparent in what you're building and have beta users follow you from day 1.
Once he found out about the dynamic pricing he tells us “I think I am just going to release with another platform.” FUCK! Are you serious????
What other platform(s)? What were differentiating factors between those, and your service? Do artists suffer any particular trending pain-points in alternate services?
1,700 or so artists could probably provide great feedback into what they actually want in a platform, vs building it in a vacuum.
i realise you want the actual answer here, but if i was going to sell my own stuff, i would be using bandcamp http://bandcamp.com/ and have as a buyer many times. it's simple to set up and purchase from, is the main selling point.
Yes, Bandcamp was for sure our competitor. Simple to use, and well known. Our added value was the dynamic pricing (which we found out was not a value at all). There are many pain points for artists. The main one is "no one is buying my music". That pain point hasn't yet been solved in an easy way, and as time goes on, it seems its getting harder and harder.
"Dynamic pricing" -- does anyone really like that? I've seen reports of online booksellers (no, not Amazon) giving people different prices based on the account they use. No one really likes to feel like a sucker.
EDIT to add: Some people might bring up airline tickets or hotel rooms. Limited analog inventory, not infinite digital inventory.
It's also called value-based pricing [1]. You're correct in your edit, hotels/airline tickets where you're auctioning off a limited value is one thing, selling a inexhaustible commodity at different rates without any reasonable factor like location (water in a desert = more valuable) just feels dishonest.
Amazon and Travelocity rightfully caught a lot of flack when they were caught trying this (perhaps pricing A/B test?) years ago.
Yes, perhaps it would feel dishonest, but think about it for a bit, you are a musician, and you want your music heard. So you give out your music for free. Later, people want to support you, so you start selling at $1. Now you are getting play on the radio, whatever - you are hot now. Bump that price up automatically to $5 or whatever and get paid because your value increases.
Keep Moving Forward. Pick up the pieces, mend the broken bones, take a vacation, regroup, do something else that you love and are passionate about. Failure is part of life. You miss 100% of the shots you don't take, right? Just keep at it.
Even the people at the very top of the value chain in the music industry --- the vanishingly small set of people who produce commercially viable music --- can't make the business work. So I'm curious as to why you'd have tried to start a company in music. Did you start before Dalton Caldwell's talk?
I'm just interested in how people pick the ideas they pursue.
I got the feeling there were in college or fresh out of college when they started this. Probably they were just doing what they had an interest in and thought they knew something about.
A friend of mine who worked for a venture fund expressed the theory that people tend to do startups based on things they like a lot. Since many startup founders are young guys, this leads to an oversupply of startups in things that are young-guy-ish, like music and video games.
The notion was that both VCs and founders should look at broad markets and dig in to find opportunities. As Bezos did back in the day with books. Less fun initially, sure, but taking one's company behind the barn is definitely not fun.
I see this happen more and more that we talk to our potential customers about the idea we've been brewing and they say 'heck yeah I would totally use it', later only to find no interest in it. One thing I learned is, most of our ideas are pretty cool and most likely all the potential customers would agree when you try to validate but very few would actually hop on to try it. May be the implementation wasn't right, or may be its too hard to change the customer behavior to switch. Sometimes the customer was not serious enough when you pitched.
The correct answer is that people don't like being rude and saying no, particularly when its' easy for them to agree.
If you have no product and are not asking for a sale, saying 'yes' has not cost to the person. Saying 'no' makes them a grouch, and they would have to justify why they said no. So lots of people say 'yes' even though they don't really mean it.
That's why the only data worth talking about is sales and adoption, and why minimum viable product is the way to go.
You have a tangible yet unmarketable product. Rather than abandon it completely, would you consider open-sourcing it? Any contribution to the open source community is a positive use of time (in my opinion).
I did want to open source it, but the problem is all of our passwords and keys for amazon and everything are in the code. Is there a way to get around that?
There was a discussion on storing passwords in source control here: https://news.ycombinator.com/item?id=5178914, Although if you plan to discontinue development entirely you could just substitute keys with placeholders (YOUR_KEY_HERE) and make a note of it in your README.
We were a middle-man to the artists. We had it setup so when a fan bought their music all of the money went directly to us, and then we paid out the artist. That is where we went wrong. You need to use "recipient tokens" so the money is split by Amazon. This way the money goes directly to the artist and we get sent a cut directly from amazon.
Best advise I can give here is to do what Steve Blank, Martel, and many other advisers/founders/etc say - If you can get a check for the product. Then you've sold it. Then there is demand. Until that money is in your hand, you just have an idea.
NOTE: This doesn't mean you'll be a success. You may have found a market, but you need to do more customer development in order to really figure out if the market is large enough to sustain.
Landing on that site and seeing the big 'Create Sale' button is pretty confusing. I don't think 'oh this is a site for musicians to sell their music directly to fans'. It also claims I can use 'social sales' but is that a meaningful term? I've never heard it before and it sounds pretty buzzwordy.
edit: Just watched the video on the front page and I can easily believe that only 1 out of 1700 people thought it was worth bothering with.
Completely agree. This doesn't show much knowledge for the music industry. The huge call to action button and the blond girl are just a bit demeaning for someone who is trying to establish their name to their fans
Ouch. One thing that leaped out at me was your mention that the first beta was a disaster because it didn't comply with Amazon's payment-processor requirements, so you burned a lot of capital making good on your promises. This sort of thing is why I keep saying more startups need a legal person on board early on - and with a surplus of underemployed JDs around, now is a great time to work that into your team plan.
Lawyers are not just there to object to things and make life difficult for dreamers, they're there to spot major potential pitfalls like this and steer around them. Far too many entrepreneurially-minded people see contractual and statutory constraints as some sort of obstacle course designed solely to prevent competition or enterprise, and react to said constraints by simply wishing them away. I was impressed that your reaction to this problem was to pay everyone as promised and retool your application to be compliant with Amazon's requirements, rather than simply blaming them for your problems. A hard lesson to learn, but one which will put you ahead of the pack in future.
Often, yes, if you have a good relationship with a well-established firm or have someone who does vouch for you. Most top tech law firms (WSGR, Orrick, Fenwick & West, Gunderson Dettmer, etc.) will defer payment or even waive certain fees for early-stage startups in exchange for a small amount of equity.
Some would. I know quite a few lawyers in startups. That's why I mentioned 'underemployed JDs' who have an incentive to explore other avenues if they can't get a job at an established law firm or public body. You might not be aware that there's a major supply-demand imbalance in the legal field right now.
More importantly though, people really didn’t really LIKE anything about our product. No one that used the service thought it was that cool. In fact, some people that participated in the sale didn’t even like our “dynamic pricing” system. They were trying to support the artist, so saving a few dollars didn’t excite them. They could easily have just gotten his music for free elsewhere.
i am one of those people. why do so many bands have such a minimal online presence that i cannot even buy a t-shirt? surely these days it should be trivial for any band to create a store with some basic items generated from a few uploaded images. there are people out here looking for something cool to buy to give back money for what we just heard... even stickers are nice.
All of these things I DO agree with. And yes, we are young. We might not use the word "shit" on our homepage next time. But Hell, I used the word "fuck" on the title of this article, and it sure turned alot of heads.
Sorry if you took my comment as a dig at Christians, I was merely stating an observation based on the data we collected. I personally encountered a handful of Christian musicians who stated our use of vulgarity and drug references were the reason they were not interested in our product. For example, we also had some female musicians who were not excited about our video because it was geared towards guys. not a dig at female musicians
At the end of the day, you're trying to make money. Transactions are very intimate events and you have to pay attention to what your customer feels when they navigate your site. Copy that conveys distrust is going to lower conversion rates.
Instead of buying their music, the site is focused on you listening to it via the embedded player and then going to see them live. You can even buy them a gift card so that they can buy advertising. They're growing like crazy with a marketing budget close to zero.
Thanks for sharing your hard learned lesson. It reminds us all to get out of the building and talk to users.
Good post and you had me all the way up until you said "journey". I hate that word. Pre-internet Journey meant something now every man and his cat uses it to talk about the incites they had while doing something, it has lost its impact. However like I said I enjoyed the post until then.
Billing info was authorized, but not captured until the end of the sale period. Similar to what Kickstarter does. Amazon is really the only option (that we could find) that would allow that type of flow.
Dans right (he's my co-founder). Amazon allowed for a much larger period of time between authorization and capturing. They are the only processor that had the technology on hand for us.
Music is probably one of the hardest, if not the hardest industries to be successful in. Props to them for continuing to press on, hoping for a break and smart enough to throw in the towel and move on.
Also, happy to hear you didn't mortgage your life savings and burn out in grand fashion. You're wise beyond your years.
So did mine, largely because I was not able to commit to it for a variety of reasons that wouldn't be unfamiliar. I like reading the success stories, but I get pretty down thinking about my experience -- not the doing, but the way it ended up going down.
185 comments
[ 4.9 ms ] story [ 227 ms ] threadWhy was that sufficient data to justify spending months and months of your life bringing this startup to fruition?
EDIT: I did not intend to make a sly insult toward the author. I've seen people do startups with similar justifications and I am confused.
There's so much retro-active quarterbacking that goes on (especially in the VC-world) that says X company was success because they applied this-thing-I'm-just-now-naming as a rule. Even though, Apple has taught us things like you're users don't always know what they want or need.
With launchrock + adwords this has become stupid easy.
They played a hunch and lost. The linked post details lots of mistakes, but this particular one doesn't seem like one to me.
You've got a business when people repeatedly exchange value with you. Kind words are validation of a sort, but the weakest kind. To go from there to spending a year building a platform is basically hearing what you want to hear. Better not to ask than to believe what you hear uncritically; if you don't ask, at least you know you don't know.
The data that was lost right here: "After that moment we basically stopped talking to artists for a year [...]"
Find customers as early as possible, engage with them as often as possible, and really really listen to what's being said. This is a huge benefit of bootstrapping. Customer engagement from the earliest possible time is vital to the process of transforming an idea into a product.
These are money-losing businesses. As we speak.
Real life is much more complicated.
Facebook, Google, and Microsft not profitable? Seriously dude, just google them; they're very profitable (technically MS lost money last year, but that was entirely due to a one-off asset writedown, and they've made gobs of cash every other year).
I wonder how many other business have adopted that strategy (of ignoring initial reduced interest in your startup) to only find glory and success down the line.
Either way you failed but you should be commended for it.
I do wonder (gently) if there's something like cargo-cult avoidance though? "These people didn't do this thing, and they failed, so we have to do it."
That's glib. There is a very, very difficult balancing act between trusting your innermost convictions and learning to doubt said convictions frequently, as an exercise which reinforces the good bits and dispels the nonsense within them. Failure is the most valuable when you fail at something you personally believe in, because you're forced to confront yourself in the failing. Failure because you followed some BS system for doing or creating a thing without using your own thought processes along the way might teach you to stop being such an idiot, but usually it takes many failures of that sort before the message seeps in.
My first startup attempt was a coaching marketplace and community for poker players. My co-founder and I were both successful professional poker players and coaches at the time, but we were young (20ish) and all but clueless about technology. I still think the market opportunity was there, but we hired an agency who outsourced everything, made bad tech choices, took forever, and gave us a fraction of what we originally agreed on. I learned to program myself in order to complete a major component of the site (in flash) which they had just completely botched.
What we ended up with wasn't terrible, but it fell way short of the vision we had, and our marketing efforts fell mostly flat as well. We were able to recruit a few smart people to post and discuss hands here and there, and we wrote a few articles ourselves that showcased the flash hand analysis tool I had built (the best functioning aspect of the site), but we weren't getting any other traffic. There were a few bugs and an assortment of minor ux issues which made the site feel a bit clunky, and people's feedback was pretty unenthusiastic, so all in all we weren't feeling very good about the direction of things. It didn't take very long (maybe six weeks or so) before we threw in the towel.
It wasn't a complete failure--after all, I had learned how to program and discovered that I quite liked it (certainly much more than grinding poker online), and both of us had learned a lot of lessons about business and technology. But there was another lesson that we only discovered with time.
Even after we completely abandoned the site and it went dormant, I would still check google analytics from time to time to see if there was any traffic, and an interesting trend started to emerge: a few of the hand posts and articles we had posted were developing really steady search traffic. One article in particular was generating something like 20 uniques per day.
At that point, we were both just done with the whole endeavor and had no motivation to try to pick it up again, but we realized that if we had kept at it and continued to create more and more quality content, that we probably could have had an seo goldmine on our hands, developed reputations as poker strategy bloggers, and leveraged that into the community we had originally envisioned. Who knows if it would have gone that way, but it seems like there was at least a relatively unobstructed path to success available to us if we had been willing to stick it out and let the long tail kick in.
You have to be stubborn enough to succeed in a world where the majority of people will tell you you're going to fail, you have to ignore all that.
Often times however, you do fail.
Almost anything worth doing is difficult and to an extent risky. You are likely to fail both wasting time, money and other resources. But you are also likely to win big.
Anything that is easy is either already solved, or leads to mediocrity or pays too less.
To succeed at your goal you either need to get lucky or simply persist until you get there. Some can, many can't. Some just get lucky.
No, it does not. Since, statistically, most startups fail, it's is mathematically sound to assume that mostly failure lurks inside failure.
At some point you have to stop and do something else. Even if you've lost money and time, it's wiser to quit and do other stuff, than continue to losing money and time in the same endless sink.
It's like the demotivator for "Mistakes", this is probably best as a cautionary tail for people that have a startup itch, but don't necessarily have the necessary skills yet. I mean, this really talked about business and technology problems, but even assume they hit lighting in a bottle with the business model and didn't run into the technical issues, does it sounds like they would have been able to capitalize on it? I got a feeling that it was organized in an ad hoc way, and they weren't set up as an llc/s-corp/etc, had equity agreements, or basic contracts (otherwise, how did the one artist change not know they terms of the business, or opt out so quickly?) I feel like they would have ended up in trouble with the IRS, in a lawsuit with each other, or getting screwed by a less than scrupulous VC.
That said, everyone is better off from sharing, and I thank the author for it.
Based on the blog, I get the sense that the founders are in their early twenties. At that age, no one is "ready" for a startup.
I doubt that Mark Zuckerberg, Steve Jobs, etc. were ready to start their company.
At that age, you just do it, since the risks are low.
Unless your parents are wealthy or you have access to a lot of money, at that age its unlikely that a lot of money is on the line. Sure, they "wasted" time on this startup but this is valuable for the next company they will build.
Also, if there was a lot of money involved (and it wasn't their's) its likely that the business would not have gone as far as stakeholders would have wanted validation.
I mean, it's clear to me that their startup failed. But "nowhere near ready to found a startup"? What does that even mean? Where do I get my secret decoder badge of startup readiness exactly?
Reading through it, I saw and empathized with their mistakes--they decided they'd found validation before they really had. They kept it going too long. They ignored the writing on the wall for too long. But aren't those always the tough questions? When should a founder give up versus persevere? It's not a straightforward answer and as a business owner I find it frustrating when I see people (particularly other business owners) suggest it is.
Bottom line though--everyone needs to decide for themselves if they want to go into business for themselves. But are they "ready"? Who the hell knows? There isn't a list of required skills and credentials for this position.
When I was a young kid, I had an idea that I was going to have a plant store (really. I had just learned about splitting African violets) that would have 'low price days' and 'high price days'. I swear. They idea was that people would be so grateful for the low price days that they would go to the high price days to help keep the place in business. This would have been an idiotic company.
You ask when the authors of the blog post should have given up vs persevere? I would say either when the drew up the business plan or after the beta when the found that people didn't like their product and that they couldn't execute on their idea.
I'm unromantic on this point. To me a startup is to make money (as a profitable business or on the exit), not find creative outlet or have a life experience. I'd rather see 20-somethings blow the ~$5K spent on EC2 hosting apps with fundamentally broken business models instead on (AirBnB) trips through Europe or South America and getting a little bit interesting as people first.
It's up to them, but (to avenger123's point) almost nobody is a Jobs, a Zuckerberg, or a Musk. Most startups fail. Plenty of YC class startups fail, and they're the winners of a highly selective process with access to unbelievable connections.
So my point is this: if someone is not a rockstar and they don't already have these skills, they can learn a huge amount by joining small companies in their C or D rounds (ie, corporate-ish) and practice those skills by applying them in a structure where it's likely they have more experience coworkers to learn from. Then they can found a startup when they have the tools and an idea they're passionate about.
If a person can "get addicted to a steady income" then their financial planning sucks or they aren't committed enough. Better off they don't bother and waste time and capital that could go to people that give a damn.
I decided to start a Twitter profile to collect all these post-mortems in one place. If such a resource already exists, let me know!
https://twitter.com/StartupGrave
http://techcrunch.com/tag/deadpool/
Remember the famous maxim: "I failed a thousand times but each one brought me a step closer to stealing what I needed from Tesla"
If anything, your story adds more fuel to the fire for the approach that @sgblank advocates[1][2]. Get out of the building, talk to customers, validate customer needs, etc. We've been doing this, but - to be honest - we haven't done as good a job as we could. Hopefully we will soon start another big round of Customer Development interviews, much more targeted this time, building on the feedback we got the first go-round, and moving more into what Steve calls the "Problem Presentation" phase.
It's a tough slog, but I continue to remain convinced of just how important it is.
[1]: http://steveblank.com/category/customer-development-manifest...
[2]: http://steveblank.com/category/customer-development/
One of the most helpful guides is to try to make a mistake in the other direction. Try to talk to your customers too much. No early stage startup ever died from talking to their customers too much.
I have seen so many people start their own company after breaking off from some existing company and "doing it better" or realizing some previously un-claimed niche specifically because they had the industry knowledge.
One of the most useful things I do to validate an idea is to actually use YC's application- if you can't answer all the questions about your idea without any doubts, you're don't have a solid idea yet. And validating your idea means to follow up at the very least with the people that said it was "cool". Forget the stealth startups, be completely transparent in what you're building and have beta users follow you from day 1.
Good luck with your next thing!
Once he found out about the dynamic pricing he tells us “I think I am just going to release with another platform.” FUCK! Are you serious????
What other platform(s)? What were differentiating factors between those, and your service? Do artists suffer any particular trending pain-points in alternate services?
1,700 or so artists could probably provide great feedback into what they actually want in a platform, vs building it in a vacuum.
Thank you for sharing!
EDIT to add: Some people might bring up airline tickets or hotel rooms. Limited analog inventory, not infinite digital inventory.
Sorry, had to say that :) It's fun for me how analog/digital have become synonyms for material/virtual.
Amazon and Travelocity rightfully caught a lot of flack when they were caught trying this (perhaps pricing A/B test?) years ago.
[1] http://en.wikipedia.org/wiki/Value-based_pricing
Companies like this make it very hard to explain what we do which is use machine learning to maximize profits.
I'm just interested in how people pick the ideas they pursue.
Who is this Dalton Caldwell, and why is he relevant?
The notion was that both VCs and founders should look at broad markets and dig in to find opportunities. As Bezos did back in the day with books. Less fun initially, sure, but taking one's company behind the barn is definitely not fun.
If you have no product and are not asking for a sale, saying 'yes' has not cost to the person. Saying 'no' makes them a grouch, and they would have to justify why they said no. So lots of people say 'yes' even though they don't really mean it.
That's why the only data worth talking about is sales and adoption, and why minimum viable product is the way to go.
http://zillionears.com/
Landing on that site and seeing the big 'Create Sale' button is pretty confusing. I don't think 'oh this is a site for musicians to sell their music directly to fans'. It also claims I can use 'social sales' but is that a meaningful term? I've never heard it before and it sounds pretty buzzwordy.
edit: Just watched the video on the front page and I can easily believe that only 1 out of 1700 people thought it was worth bothering with.
The execution just seems awful.
Lawyers are not just there to object to things and make life difficult for dreamers, they're there to spot major potential pitfalls like this and steer around them. Far too many entrepreneurially-minded people see contractual and statutory constraints as some sort of obstacle course designed solely to prevent competition or enterprise, and react to said constraints by simply wishing them away. I was impressed that your reaction to this problem was to pay everyone as promised and retool your application to be compliant with Amazon's requirements, rather than simply blaming them for your problems. A hard lesson to learn, but one which will put you ahead of the pack in future.
i am one of those people. why do so many bands have such a minimal online presence that i cannot even buy a t-shirt? surely these days it should be trivial for any band to create a store with some basic items generated from a few uploaded images. there are people out here looking for something cool to buy to give back money for what we just heard... even stickers are nice.
And after watching it I still don't understand the "decrease price by a dollar" pricing scheme.
For a site that resonates with artists, check out Reverb Nation:
http://www.reverbnation.com/
A sample artist page here:
http://www.reverbnation.com/evangibb
Instead of buying their music, the site is focused on you listening to it via the embedded player and then going to see them live. You can even buy them a gift card so that they can buy advertising. They're growing like crazy with a marketing budget close to zero.
Thanks for sharing your hard learned lesson. It reminds us all to get out of the building and talk to users.
YOU DON'T DESERVE TO BE AN ENTREPRENEUR.
Also, happy to hear you didn't mortgage your life savings and burn out in grand fashion. You're wise beyond your years.