It’s always fascinating to see why a startup fails, always useful to see what goes wrong. Not everything can or should be a huge business, or “a big hit.” For that reason, I appreciate that Pando Daily reporter Erin Griffith wades into the deadpool to bring us stories, like how YC alum Tutorspree shut down.
Tutorspree graduated from Y Combinator in 2011, calling itself an “Airbnb for tutors,” reports Griffith. Basically, Tutorspree was a marketplace that matched a tutor with its tutee. Besides the glaring pitfalls in such a model, several of which Griffith outlines in her article, we should also be thinking about whether this startup was really worthy of a $1 million investment and $7 million valuation in the first place.
Our obsession with building “big hits” hides all the other wonderful opportunities to make a real difference in people’s lives. Aggregating existing exchanges, like tutoring, and trying to monetize off the backs of others isn’t world-changing. Founders should try creating and providing real value.
Journalist Noreen Malone argues in the New Republic that tech bubbles exist, but mostly to protect the relatively young, well-off, and like-minded generation that builds apps that don’t matter. “Tech is something like the new Wall St. Mostly white mostly dudes getting rich by making stuff of limited social purpose and impact,” economist Umair Haque argued on Twitter. Malone also quotes Mother Jones’ Clara Jeffrey: “I saw the best minds of my generation building apps to send sexts and brag about fitness and avoid the poors.”
Scale, for the sake of size alone, is a small ambition. When you get investment, from venture capital or angel investors, your entire company changes. Your goal is to seek users or sales at the expense of everything else. I have been part of startups that failed – or will fail – for this reason. You sacrifice learning, and as a result, you don’t build a useful machine. You don’t build a meaningful machine. You build a marketing machine (which most people will fail at, since good marketing is predicated first and foremost on a good product). But the strongest biz dev strategies can’t save a crappy product. The best sales people won’t conceal thin intentions.
SIlicon Valley is losing its ability to inspire. “Popular culture has soured on Silicon Valley’s hotshots,” Malone argues. And that’s because long ago, Silicon Valley lost its ability to innovate.
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