Note to the Gang
| April 27th, 2012I am going to be short and honest. Actually I am short and honest. In any event I need guidance from those that know more than I.
I am going to be short and honest. Actually I am short and honest. In any event I need guidance from those that know more than I.
I promised myself that I would be honest writing about my experiences pursuing “this internet idea”… Ok I also promised myself that I wouldn’t be maudlin or embarrassingly revelatory. But here’s the deal I (I keep wanting to say we… either I think pretty highly of myself or I guess that shows how much I want to build a community around this) have hit a wall. After a few weeks of positive discussions apparently the relationship with a local consulting firm has gone away. And by gone away they told me exactly how much they were going to charge me (both in equity and cash) to do the required work to shake hands with those with the required moola. If you see the oddness about the final outcome then you are not alone… so do I. Pay cash to get more or less the same amount of cash… and lose 20% equity? Hmmmm… Honestly I guess they were a consulting firm… I still don’t really know what they do but they do have swanky offices on Barcelona’s most fashionable street… and young folks running around with airbooks… and the vibe was good, they seemed like minded. They seemed serious but light hearted. They were good guys. Guys… no malice here but damn… you loved the idea, we met 4 times, we lightly bonded, we exchanged links, I still have you’re incredibly old fashioned book on developing a business plan. Here it comes… WTF.
OK back to reality. Now on to building an amazing product that yep… will change the world.
Laurie Garrett Takes on 9/11 & Anthrax – Reviewed by “Download The Universe.”
An amazing book reviewed by an amazing site and an example of the kind of serious events that Storyline could be used for.
The Atlantic: How to Fail Less: Steve Blank on the Secrets of Start-Ups http://goo.gl/mag/ARb40
Ok… I’m dancing in this world but… give me a break…
The Atlantic: Instagram Is Now Worth $77 Million Per Employee http://goo.gl/mag/Kn27U
1bn. 1 billion dollares. 1 thousand million clams.
So I’m talking to my new friend X. X is way up in a company that makes and sells glasses. He’s been there for like 27 years. He has a 6 percent piece of the pie. They want to sell the company. According to X a few years ago the rule of thumb for the value of a company used to be 10 to 15 times the annual pre tax profit. (See I am learning the jargon.) Now they can only hope to get 5 to 6 times that number. There are probably hundreds of employees and an entire network of manufacturers, distributors, sales folks, warehouse workers… lots of people. Heck the folks that make the springs that keep your glasses open… Lots of mouths fed. Lots of jobs created and sustained. And a sustained and sustainable 5 to 10% growth rate for the foreseeable future.
Then there is today’s news about Instragram. Facebook pays 1 billion for Instagram. OK it’s a cool gadget but at least on the surface Instagram doesn’t make anything… or at least they don’t charge anything. This makes the annual pre tax profit of 0. OK minus zero… you know overhead…
Quora says Instagram has 6 employees. This means that 6 employees will divvy up 1 thousand million dollars. These employees have also been given jobs at Facebook. OK 6 employees and the angel investors and venture capitalists… which here is like 48 million. Series A. Series B… Pre money… yada yada.
I just had lunch with an old friend who is president of thriving medium sized IT business. I asked him to explain how this all works. He did. I still don’t understand. Anybody else want to try?
OK… the good folks at Y Combinator want a video to go with the application. My buddy Alfonso at Barcelona Center News came over and we whupped this thing up in like 30 minutes. Editing took an hour. Whether they “get it” or not is another matter. Cut Alfonso! Cut!
OK… it has been sent. Finally the team is:
And me… Rex the wonder dog.
Damn… it’s like the Buckeroo Bonzai… Except for Rex. What to do about Rex…