3 Founders, 1 Round & $.72 in the Bank(founderdating.com)
founderdating.com
3 Founders, 1 Round & $.72 in the Bank
http://founderdating.com/3-founders-1-round-and-0-72-in-the-bank/
Brendan McCorkle recounts the true story of how he and his cofounders (all from DreamIt Ventures) were out of money before their round was raised and how they survived.
14 comments
Nowhere in the post the actual earning of money is mentioned. Yes, I know, all startups these days care about users/eyeballs, but it would be refreshing to read about businesses that actually, you know, have a business model based on earning real money once in a blue moon
It's funny that you mention that, as that is my personal beef with many startups as well. Funding is not a measure of success; revenue is. However, this article is not about revenue. It's about the funding process. Talking about our revenue (which we didn't have at the time, but we do have now) would have been off topic.
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It would seem they do, indeed, have a business model going: https://cloudmine.me/pricing
Yes, I know, all startups these days care about users/eyeballs
The joke is that, as I understand it, this kind of business model was a large part of what drove the crash in the 90's.
The joke is that, as I understand it, this kind of business model was a large part of what drove the crash in the 90's.
I'm rather fond of Steve Blank's definition that a startup is "a temporary organization designed to search for a repeatable and scalable business model". If you already have the business model figured out and are executing on it, you're running a business.
Good story, good moral. The understanding that you have to ask them is a tough one to swallow. I still don't know if I'm there yet - I sort of go on autopilot.
> As founders, we have a disproportionate share of the upside of a business, but we also have a disproportionate share of the downside.
Disproportionate to what? You're the founder.
> As founders, we have a disproportionate share of the upside of a business, but we also have a disproportionate share of the downside.
Disproportionate to what? You're the founder.
I don't know why everybody doesn't start doing a rolling close. If you close incrementally, you don't have to worry about one difficult investor holding up the whole round.
How are they different from Kinvey (Techstars company at http://www.kinvey.com)? I'm not a developer, so I'm judging solely on the tagline and design I saw in the first 30 seconds of being on both sites.
Wait, you "closed an oversubscribed round shortly after the events of this story"? How on earth was that pulled off? Was the $15,000 the signal other investors needed to get on board?
I feel like I'm only being told half of the story here.
This all happened during the final negotiations of our round. That last bit takes obnoxiously long as lawyers have to talk to one another. That was the awkward chasm we fell into: running out of cash as the final documents for the round were being finalized.