SnapTalent (YC W08) Shuts Down(snaptalent.com)
snaptalent.com
SnapTalent (YC W08) Shuts Down
http://www.snaptalent.com/
49 comments
It would be nice if they switched course without announcing they're going out of business. Reminds me of this:
http://www.paulgraham.com/die.html
AppJet did a good job following that advice IMO, but Heroku takes the cake. They didn't just change direction. They kept the old product alive, too.
Edit: I was wrong. AppJet kept some of their old stuff around, too! I can't wait to check it out. http://appjet.com/dev-archive.html
http://www.paulgraham.com/die.html
AppJet did a good job following that advice IMO, but Heroku takes the cake. They didn't just change direction. They kept the old product alive, too.
Edit: I was wrong. AppJet kept some of their old stuff around, too! I can't wait to check it out. http://appjet.com/dev-archive.html
Finally, a failure. I'm tired with all the success stories.
Most failures just wither away and die. They rarely announce it.
And how many of those failures actually pay back investors instead of burning through all their cash first?
This is quite possibly the most responsible failure I've ever read about.
This is quite possibly the most responsible failure I've ever read about.
Odeo. Except that in hindsight, I think the investors may've wished that Ev kept their money and started Twitter out of the same company...
I know someone that tried to shut down his company (rfid luggage tags) and return capital to investors. He ended up being forced out and the company burned through all the cash and shut down. Sometimes doing the right thing isn't possible.
The 3 thirds figure is thrown around a lot: 1/3 of VC investments make a sizeable return, 1/3 break even, 1/3 crash and burn. This would appear to be the middle 1/3.
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Sumon and crew will be successful at whatever they do next, there's no doubt about that. By giving the money back to investors and being fully transparent, they've also shown that they're classy and full of integrity. Seriously, mucho respect for this move. Curious to see what they do next.
> Sumon and crew will be successful at whatever they do next, there's no doubt about that.
I don't know how you can make that statement unless you know something that is not public knowledge.
To repay your investors if it doesn't work out is class (though they say it was from 'money in the bank', it is very well possible that this was simply the easiest way of liquidating the business and that the founders let their share of the payment due to them go), there is no doubt about that.
But the fact is that this didn't work out, how the next project fares remains to be seen.
Past failures are not a guarantee for future success or something to that effect.
What impresses me most about this farewell note is that they decided not to go for mediocrity but instead decided to pull the plug.
That takes guts, and is on par with the repaying of the investors (which is relatively easy if you have the $, otherwise it is much harder and even more classy).
I don't know how you can make that statement unless you know something that is not public knowledge.
To repay your investors if it doesn't work out is class (though they say it was from 'money in the bank', it is very well possible that this was simply the easiest way of liquidating the business and that the founders let their share of the payment due to them go), there is no doubt about that.
But the fact is that this didn't work out, how the next project fares remains to be seen.
Past failures are not a guarantee for future success or something to that effect.
What impresses me most about this farewell note is that they decided not to go for mediocrity but instead decided to pull the plug.
That takes guts, and is on par with the repaying of the investors (which is relatively easy if you have the $, otherwise it is much harder and even more classy).
> I don't know how you can make that statement unless you know something that is not public knowledge.
Probably through personal experience, Ive met Sumon a couple of times and would happily take bets on him being part of something successful.
Probably through personal experience, Ive met Sumon a couple of times and would happily take bets on him being part of something successful.
I'd take that bet because they built a great product. It didn't work out and they want to move on to better things I'd happily be a part of that if I were an investor. They seem to have learnt the lesson that investors keep screaming and founders keep ignoring about trying to find the right market.
Why is it classy to throw in the towel? The letter doesn't suggest that investors asked for their money back. This is the worst case scenario given my understanding of the VC market. It sounds like the team has lost their momentum, but certainly they have learned something in the process. If they dissolve the company and start something new which becomes successful, the original investors get nothing. There's nothing wrong with that from a morality perspective, but don't assume that investors want their money back - their reasons for investing might be complex.
I agree it's pretty rare to see a company fold before the money gives out. I suspect the "opportunity cost" which is mentioned in passing was probably a significant factor.
They had two years in the bank. They knew the risks and the likelihood of what would have happened. They could have been paid themselves for 2 years, tried a lot of different things, and potentially wasted the money. That is how it usually goes. Instead they cut their losses. I'm pretty sure the investors would rather have their money back than nothing at all.
By "they", I assume that you meant the founders. Did the founders have personal losses to be cut?
> I'm pretty sure the investors would rather have their money back than nothing at all.
Did you ask them? Are you yourself a VC investor? Its rather possible that investors saw promising talent and wanted to buy 2 years of their time.
> I'm pretty sure the investors would rather have their money back than nothing at all.
Did you ask them? Are you yourself a VC investor? Its rather possible that investors saw promising talent and wanted to buy 2 years of their time.
Good luck! It's never fun to read about a young startup closing its doors, but I'm sure you'll do great things with these experiences.
A quick question: I've been reading a lot about the theory of customer development lately (mostly via Eric Ries's blog and The Four Steps to the Epiphany). I know hindsight is 20/20, and I apologize in advance if it sounds like I'm just rubbing salt in your wounds, but I'd love to know what you think about this...
It sounds like your experience is a good example of a company that might have benefited by putting as much effort into finding the initial customers as in product development. Working closely with these earlyvangelists from the start might have helped you learn whether the product being built solves real pain points and to learn how and to what extent these earlyvangelists would be able to deploy the product internally.
I personally think it would be very difficult to do anything but build product in the three months leading up to demo day. The time it would take to locate and engage potential customers seems mammoth. Perhaps the product delivered on demo day is used to secure additional funding, and then as the demo product used to find market fit.
Anyway, I'm no expert in this stuff, which is why I'd really like to know your thoughts.
Best of luck with your next company!
A quick question: I've been reading a lot about the theory of customer development lately (mostly via Eric Ries's blog and The Four Steps to the Epiphany). I know hindsight is 20/20, and I apologize in advance if it sounds like I'm just rubbing salt in your wounds, but I'd love to know what you think about this...
It sounds like your experience is a good example of a company that might have benefited by putting as much effort into finding the initial customers as in product development. Working closely with these earlyvangelists from the start might have helped you learn whether the product being built solves real pain points and to learn how and to what extent these earlyvangelists would be able to deploy the product internally.
I personally think it would be very difficult to do anything but build product in the three months leading up to demo day. The time it would take to locate and engage potential customers seems mammoth. Perhaps the product delivered on demo day is used to secure additional funding, and then as the demo product used to find market fit.
Anyway, I'm no expert in this stuff, which is why I'd really like to know your thoughts.
Best of luck with your next company!
We did start applying Steve Blank's stuff in Q4 '08 when we began to change direction to focus on college, but we applied it poorly. There are a number of reasons why, many are too long to explain here. I'll be writing up some posts on what went wrong and post them here so hopefully that will prompt further useful discussion.
Spent 1.5 years as lead Product for Yahoo HotJobs and this post is spot-on -- nicely captured. To put it rather bluntly there is more innovation happening in most small sized municipal utilities (see the Palo Alto Green program) then in the online job recruitment space. Given how incredibly important talent is to companies the CEO needs to reset incentive structures for their HR organizations.
I'm sure the SnapTalent guys started working on something new before even posting that good-bye
It takes a long time to shut down a company. We stopped working on Snaptalent almost 4 months ago. I'm hoping to get some time in the near future to write some posts going into more detail about what went wrong. There are definitely a lot of takeaways that are being practically applied to my new project.
Best of luck with your future endeavors Jamie. Was a pleasure working with you and Snaptalent back in the early days. ;-) I still have one of the little post-it notes you guys sent with my checks.
are you selling assets/domain? or folding into another venture?
Company is being liquidated. All the other founders and I are doing separate things now.
too bad, undoubtedly a result of the collision of a bunch of bad circumstances.
good to see that they're able to analyze and learn from the situation at hand and have the fortitude and responsibility to make the call to shut it down before they crashed and burned.
good to see that they're able to analyze and learn from the situation at hand and have the fortitude and responsibility to make the call to shut it down before they crashed and burned.
Except for a couple of typos ('are' instead of 'our'), this is an extremely articulate and informative statement which will no doubt help them justify this decision to future funders or employers. Very impressive.
If you think language like the following is "extremely articulate" or "informative", well, please do not send me anything to read.
The decision has primarily dictated by market conditions and opportunity cost which in aggregate would mean we probably wouldn't have been able to show the kind of results we wanted to make this a big company in this market.
The decision has primarily dictated by market conditions and opportunity cost which in aggregate would mean we probably wouldn't have been able to show the kind of results we wanted to make this a big company in this market.
HiddenNetwork (http://www.hiddennetwork.com/) which had a very similar business to SnapTalents first service also recently shut down. I think both of these affirm that advertising jobs to people who aren't looking for jobs isn't the best business model. (Job boards frequented by good people can be a lucrative business though, see 37signals, etc)
Couple guys from my University started Jobloft.com and they were recently acquired - although this was before the recession.
"In November 2008, we transitioned from this product to identify an opportunity to try and focus on how recruitment products could be adapted for the Facebook generation. We hoped that our experience of consumer products and frustrations of this generation would allow us to deliver an amazing product."
Frustrations of this generation?
Frustrations of this generation?
knowing the difference between how technology can work, and how it does work in real life.
at least for me.
at least for me.
The main frustration seems to be lack of jobs.
Does anyone know if they tried to sell the company?
You gave it a go, which is more than you can say about most people. So, good job.
Good luck in whatever endeavors you head to next.
Good luck in whatever endeavors you head to next.
so sorry to hear this.
Recruiters and HR are the worst people to deal with in the entire technology industry.
Real Estate is close.
I have exactly the same experience, I have worked with some amazing HR people (as clients) at my previous job and we really made a good product that would have been impossible without their fantastic input. They are humans like everone else, and it's a job like any other.
There seems to be a disconnect between your comment and that of the parent. Can you elaborate?
All I'm saying it doesn't matter what your clients are doing as long as you and your product keeps them excited. Even the most stereotypically boring accountants will get excited about a cool product that will actually help them concentrating on their profession in their valuable time by doing the boring, tedious tasks instead of them. While the HR product we made wasn't directly related to recruiting, it made the lives of HR people a lot easier by automating a lot of tedious "paperwork" in a quite innovative and "fun" way.
Everyone, without exceptions, likes fun, innovative, interesting stuff that makes their lives easier. You just have to hit the right chord.
Everyone, without exceptions, likes fun, innovative, interesting stuff that makes their lives easier. You just have to hit the right chord.
I'm not talking about boring. I'm talking about competence.
I just wish they would have read over that goodbye note, or at least spell checked it.