8 ms·

Layoffs Hit Gumroad as the E-Commerce Startup Restructures

84 points by ssclafani 11y ago

alex_hirner 11y ago
Intermediaries get disintermediated. Braintree is a tad bit closer to the iron and maybe (if PoW conundrum finally overcome and after debt is introduced) crypto will do it again.
porsupah 11y ago
> has been in the process of laying off most of its staff in an effort to run more efficiently Is that meant to sound quite as much of a death knell as it does to me? I hope not. I've made a few comics purchases through Gumroad (Skin Horse, Narbonic, and Inhuman Relations, amongst others), and found the process quite delightfully straightforward. I do hope this isn't their end - they deserve better.
aaronbrethorst 11y ago
The company had 22 employees as of earlier this year, and it has been in the process of laying off all but what is expected to be around 3 of its staff. Normally, when I hear the words "layoff" and "restructure", I think 15% of the company, not 'basically everyone.' That's a bummer, and I expect this won't be the last time we hear this story this year. I hope the frontend engineers making $75,000-$125,000[1] for a shot at one day accumulating up to 1% of Gumroad decide to pursue market wages at the next company they join :-\ The economics of startups rarely offer a worthwhile return to those who choose to play the game. For what it's worth, this is something I've found out the hard way. [1] https://web.archive.org/web/20130516103241/https://angel.co/gumroad https://web.archive.org/web/20130516103241/https://angel.co/...
- rokhayakebe 11y ago
  This never made sense to me. A startup should pay you more because if you are capable, you are giving up a lot. If you want to be part of something revolutionary as an early employee, I suggest a better plan. Go talk to your employer about starting something small inside the already big and solid company. Negotiate the equity and terms before getting started. If your company is too big and complex to get this going, then simply cut your hours and work part time on your product with someone else. 1% to 3% is just way too small for someone who is capable. A gal who loves this game and spends 10 years working at different startups can end up loosing $500k to a couple of millions considering she could get paid very well at big co. Note: Capable is the keyword here.
  - cookiecaper 11y ago
    >This never made sense to me There's a lot of naive people that will allow their trust to be exploited if there's a carrot dangled in their face. Now it makes sense. Most investors will flat refuse to invest in a startup that pays anything more than low-mid-range salaries. Contrary to your theory that the greater risk should be rewarded with a greater tangible wage, I've personally seen investors pass on companies because the founder(s) wanted a 100k salary, even though it represented a 40% haircut in wage for the founder(s). While the investors don't want you to think it, and do a lot to try to stop it from being thunk, Silicon Valley and tech culture make a lot more sense when you just realize that wealthy, seasoned investors are exploiting naive, just-out-of-college young adults as practically free labor, primarily compensating them in idealism and empty promises instead of dollars.
- serpentor 11y ago
  $75,000 isn't market wages for a developer?
  - aaronbrethorst 11y ago
    Not in SF, where the median rent is now $4,225/month, or $50,700/year. Realistically, you can't even expect to take home $50,700 on a gross income of $75k. http://blog.sfgate.com/ontheblock/2015/06/02/san-franciscos-median-rent-hits-a-ridiculous-4225/ http://blog.sfgate.com/ontheblock/2015/06/02/san-franciscos-...
    - pen2l 11y ago
      I've been thinking about this lately. Why doesn't Google or Facebook just pack up one day and go to... say, Detroit? Buy a shitload of property there, and tell all their workers that in the course of the next 5 years they want to have presence in two places: this new place in Detroit, and the old place in the Valley. Whoever wants to stay in the valley can stay... and whoever wants to move to Detroit can come move to Detroit. Same pay. It would win a lot of good will... and it makes sense. The engineers making $150k will actually live what living on $150k is supposed to feel like. It'll jumpstart the hell out of Detroit... etc. etc. Not necessarily Detroit (I just chose to say Detroit because property there is so much down the shit that you can buy a sizable portion of the city for a good few million).
      - deftnerd 11y ago
        There is a long history of Company Towns in the United States. At their peak in the first half of the 1900's, about 3% of the population lived in one. At the time, it was seen by the industrialists as a way to raise their workers into the middle class. "Paternalism was considered by many nineteenth-century businessmen as a moral responsibility, or often a religious obligation, which would advance society whilst furthering their own business interests. Accordingly, the company town offered a unique opportunity to achieve such ends." "Although economically successful, company towns sometimes failed politically due to a lack of elected officials and municipally owned services. Accordingly, workers often had no say in local affairs and therefore, felt dictated. Ultimately, this political climate caused resentment amongst workers and resulted in many residents eventually losing long-term affection for their towns." Perhaps it is time for a new company town concept being pushed by one of the big tech firms. Apple, Microsoft, Facebook, or Google might be able to pull it off. It could also be a test bed for their new technologies. [*] Quoted paragraphs lifted from https://en.wikipedia.org/wiki/Company_town https://en.wikipedia.org/wiki/Company_town
- onewaystreet 11y ago
  That's from 2013. No way they were paying sub $100k today.
  - aaronbrethorst 11y ago
    How about middle of 2014, then? "$95k-$125k" https://web.archive.org/web/20140707172338/https://angel.co/gumroad https://web.archive.org/web/20140707172338/https://angel.co/...
  - mynameishere 11y ago
    There's a "hiring" post on the front page right now offering sub $100k for front end developers and others. It's in Oakland though.
anon8418 11y ago
That's pretty surprising... You would think with 15K creators and their traffic they would be able to monetize better... having to cut down to only three employees suggests they aren't making much revenue at all...
- RyJones 11y ago
  or three employees were bringing in all the money, and the others were overhead.
- cookiecaper 11y ago
  That's the unicorn way. Tech companies are encouraged, practically forced, to overspend in an attempt to show "hockey stick growth". This strategy has two positive properties for the investor: it ensures that the entrepreneur will be back before the VC to grovel for more cash in the next 24-36 months, and it gives the VC a way to kill investments he doesn't believe in anymore, despite what is a conventionally respectable and sustainable growth rate, by refusing to provide that infusion. Since most founders are naive 20-somethings, this trick works.
deleted 11y ago
[deleted]
mattjaynes 11y ago
Interesting. I've been a customer of theirs for ~2 years. It's been really great until a couple months ago. Then something seemed to change. Rather than just being a great payment provider, they seemed to change direction in order to become a "platform". In emailing with Sahil about my concerns about Gumroad's new direction, he said "We want Gumroad to be the core channel for everything. We started with sales, and are moving into audience/list management." He made it clear that they want me to import my audience lists to Gumroad and that they don't plan to support future integrations with CampaignMonitor, Mailchimp, etc. That makes sense, since those email platforms are now the competition I guess. It's bad news for me though - if I wanted to stay with Gumroad, I'd now have a project on my hands to move everything over to a (currently) much less powerful email platform. I imagine this will work for many of their customers, but there are customers like myself that don't want to be pushed in this direction. I prefer to keep my audience management separate from my payment provider. I don't want my payment provider deciding that my customers are now their customers that they can now spam and upsell them in order to grow their platform. I'm not saying that that is Gumroad's plan - but I'm increasingly worried that it might be. Particularly if they get in a "desperate for growth" situation like this article hints at. Again, they've been great for years and I really appreciate that. The new direction just seems too risky and not a good fit for folks like me who don't want their payment provider as the middle-man for communicating with their audience. I guess there's an argument that they're not a payment provider, but a "sales platform" or something. Currently I'm looking for a replacement payment provider (or whatever they should be called) to use. SendOwl looks promising. If you've used them, or have another provider you'd recommend, please let me know!
- angelbob 11y ago
  Oof. I sell through Gumroad as well, and now I'm a lot more worried :-/ I had been using hand-rolled Stripe integration. They're not bad, but I really like the invoicing in Gumroad, and that they accept PayPal. They've been great while I've used them, though.
- SingAlong 11y ago
  I was part of GumRoad's recent 10-day challenge called Small Product Lab. I had this feeling that they were getting very good at their business. I'm about to finish up work on my ebook. I was to go with GumRoad. As per my research, they were THE best in terms of design, seller pricing and payment experience for end-users. The next best would be PulleyApp.com by BigCartel. Costs $6/month. Nowhere near Gumroad's percent-per-sale pricing. But BigCartel.com has been around for a long time (I remember they focussed on helping people sell tshirts online). PulleyApp is just their digital variant. The main downside of most GumRoad-alternatives is that if the product's sales go down or just die out. Unless seller has made huge amounts of profits (say $10k), then paying $6/month to keep it alive for previous customers might slowly leak out profits previously made. If anyone is to buy Gumroad, it should be Twitter (or Facebook?). They have the buy button and GumRoad would be a nice fit for small sellers.
prawn 11y ago
I remember when Gumroad was announced on Hacker News 4-5 years ago as a little weekend project. "Over this past weekend I had the idea to build a sort of link shortener but with a payment system built-in... I think it has some potential. What do you guys think?" https://news.ycombinator.com/item?id=2406614 https://news.ycombinator.com/item?id=2406614
- deleted 11y ago
  [deleted]
- jrbedard 11y ago
  It was April 4th 2011. There's an entertaining sub-thread about Bitcoin in that discussion https://news.ycombinator.com/item?id=2407053 https://news.ycombinator.com/item?id=2407053 At the current ~$0.70 / bitcoin... I can't imagine bitcoins in their current implementation gaining traction as a form of payment with 'regular folks'...
  - necubi 11y ago
    And four years later at $400/bitcoin, that's still true.
    - cookiecaper 11y ago
      Yep. One of the main allures of credit card processing is that it's instantaneous. Bitcoin's confirmation system is a non-starter as a competitor against credit cards unless you have special circumstances that make it the only practical option (can't trust customers to refrain from filing chargebacks and/or conventional financial institutions won't have anything to do with your business). Ultimately, while Bitcoin may maintain some value, it's not very convenient as an everyday payment instrument (just like gold, actually).
  - angryasian 11y ago
    at this time I would still say thats an accurate statement.
- deleted 11y ago
rloomba 11y ago
Restructuring down to only 3 people? I think this will make the company way more attractive for an acquisition.
pbreit 11y ago
You've gotta find some semblance of product/market fit or traction before staffing up to 22 people.
_qc3o 11y ago
Huh? I thought Gumroad was one of the better services out there for selling stuff. Too bad "hypergrowth" mania devalues companies like Gumroad because they look like a pretty awesome and sustainable business.
quest88 11y ago
I've wondered why a company like this needs to be present in the bay area paying bay area salaries and bay area office space prices.
- angelbob 11y ago
  For anybody doing the VC thing, they need to be able to plausibly promise their VCs to grow really, really fast. That means hiring a lot of engineers, designers, etc., really fast. That's much harder outside the Bay Area, and especially outside really expensive areas generally -- Seattle isn't that much cheaper than the Bay Area, for instance.
kwarner 11y ago
Former Gumroad employee here. Since we didn't write about this, here's a response from the other side-- we weren't blindsided by this. We knew there was a chance we wouldn't get our series B, yet we believed in the product. The numbers looked great (the best they had ever looked). And we wanted to see this work, whether or not it meant being part of it in a few months. This isn't some photo sharing app; many creators earn their living from Gumroad. When the time came to make a decision whether to be acquired and have the product die, or to downsize and have the product live on, this choice involved a lot more than our 20 person team. It involved the thousands of creators that rely on Gumroad. With or without me, I still believe in Gumroad.
- tzier 11y ago
  It's refreshing to see employees who are this dedicated to the product. Kudos, Gumroad team.
- coderdude 11y ago
  I've always admired Gumroad for its execution, professionalism, and design chops. Good luck to you all. Other companies will be fortunate to gain the Gumroad team.
fasdf3asdf 11y ago
The real question is, why did they have 22 employees? I think this would have been an incredibly profitable one-man business (think TinyURL) but it tried to be something that was very hard for it to be.
- lucaspiller 11y ago
  This is what VC investment does to a company. The investors make you go for hockey stick growth, which means instead of just having a good service for selling content (that makes the owner a very handsome income), you need to take on the likes of Facebook and Pinterest. DHH's article from yesterday is right on: > Part of the problem seems to be that nobody these days is content to merely put their dent in the universe. No, they have to fucking own the universe. It’s not enough to be in the market, they have to dominate it. https://signalvnoise.com/posts/3972-reconsider https://signalvnoise.com/posts/3972-reconsider
Georgio_1999 11y ago
I run a company called SendOwl, which is probably the biggest competitor to Gumroad, and I must admit I'm sad to see this. We've been watching them over the years and have been impressed with some of the work they've delivered. I've also met a few of their employees and have liked their thinking around selling digital goods and where it's going. You could see they wanted to make a success of the company. Their problems, in my opinion, have come from being VC backed. VCs ultimately want thier money back and with this comes massive, often unrealistic growth expectations. I've had a lot of offers of VC money for SendOwl over the years but I've never once considered taking it. I've bootstrapped SendOwl because I wanted complete control of the company, to direct where I thought it should go, to create the company where I wanted to work at (we work a sensible 9-5, I spend lunchtimes hitting the gym...), but most importantly to serve our customers and build something for the long term. This last part is something I've always seen as uncompatabile with the VC model. The VC model is alluring though - VC money makes growing quickly easier, it makes getting PR easier and it makes bringing in lots of staff early on an easy decision. I'm not saying it's right or wrong per say, it's just not the path I wanted to go down. Bootstrapping isn't as sexy as VC money, but as long as we're growing, getting great customer feedback, and innovating with new features I know we're on the right path. Focus on those three things with Boostrapping and it's hard to go far wrong to be honest. Interestingly we're getting more and more people asking about us as a company and whether we'll be around long term, so maybe the tide is starting to turn. Anyway I wish everyone leaving Gumroad all the best for the future. And any sellers out there who are interested in alternatives please check us out at: https://www.sendowl.com https://www.sendowl.com Happy to also answers questions in the thread below!
- baobaba 11y ago
  I just read your blog post on the topic. We need more voices like yours.
  - Georgio_1999 11y ago
    Thanks so much - we're going to be talking about this much more in the future
niketdesai 11y ago
SHL learns a ton from this, gets experience most executives don't have. Optimistic in his future either way. To the GR team, your work is not marginalized by this speed bump. GR is really good and something people love. I hope other people recognize that and snap up everyone into good places.

84 points by ssclafani 11y ago

Intermediaries get disintermediated. Braintree is a tad bit closer to the iron and maybe (if PoW conundrum finally overcome and after debt is introduced) crypto will do it again.

porsupah 11y ago

> has been in the process of laying off most of its staff in an effort to run more efficiently Is that meant to sound quite as much of a death knell as it does to me? I hope not. I've made a few comics purchases through Gumroad (Skin Horse, Narbonic, and Inhuman Relations, amongst others), and found the process quite delightfully straightforward. I do hope this isn't their end - they deserve better.

aaronbrethorst 11y ago

The company had 22 employees as of earlier this year, and it has been in the process of laying off all but what is expected to be around 3 of its staff. Normally, when I hear the words "layoff" and "restructure", I think 15% of the company, not 'basically everyone.' That's a bummer, and I expect this won't be the last time we hear this story this year. I hope the frontend engineers making $75,000-$125,000[1] for a shot at one day accumulating up to 1% of Gumroad decide to pursue market wages at the next company they join :-\ The economics of startups rarely offer a worthwhile return to those who choose to play the game. For what it's worth, this is something I've found out the hard way. [1] https://web.archive.org/web/20130516103241/https://angel.co/gumroad https://web.archive.org/web/20130516103241/https://angel.co/...

rokhayakebe 11y ago
This never made sense to me. A startup should pay you more because if you are capable, you are giving up a lot. If you want to be part of something revolutionary as an early employee, I suggest a better plan. Go talk to your employer about starting something small inside the already big and solid company. Negotiate the equity and terms before getting started. If your company is too big and complex to get this going, then simply cut your hours and work part time on your product with someone else. 1% to 3% is just way too small for someone who is capable. A gal who loves this game and spends 10 years working at different startups can end up loosing $500k to a couple of millions considering she could get paid very well at big co. Note: Capable is the keyword here.
- cookiecaper 11y ago
  >This never made sense to me There's a lot of naive people that will allow their trust to be exploited if there's a carrot dangled in their face. Now it makes sense. Most investors will flat refuse to invest in a startup that pays anything more than low-mid-range salaries. Contrary to your theory that the greater risk should be rewarded with a greater tangible wage, I've personally seen investors pass on companies because the founder(s) wanted a 100k salary, even though it represented a 40% haircut in wage for the founder(s). While the investors don't want you to think it, and do a lot to try to stop it from being thunk, Silicon Valley and tech culture make a lot more sense when you just realize that wealthy, seasoned investors are exploiting naive, just-out-of-college young adults as practically free labor, primarily compensating them in idealism and empty promises instead of dollars.
serpentor 11y ago
$75,000 isn't market wages for a developer?
- aaronbrethorst 11y ago
  Not in SF, where the median rent is now $4,225/month, or $50,700/year. Realistically, you can't even expect to take home $50,700 on a gross income of $75k. http://blog.sfgate.com/ontheblock/2015/06/02/san-franciscos-median-rent-hits-a-ridiculous-4225/ http://blog.sfgate.com/ontheblock/2015/06/02/san-franciscos-...
  - pen2l 11y ago
    I've been thinking about this lately. Why doesn't Google or Facebook just pack up one day and go to... say, Detroit? Buy a shitload of property there, and tell all their workers that in the course of the next 5 years they want to have presence in two places: this new place in Detroit, and the old place in the Valley. Whoever wants to stay in the valley can stay... and whoever wants to move to Detroit can come move to Detroit. Same pay. It would win a lot of good will... and it makes sense. The engineers making $150k will actually live what living on $150k is supposed to feel like. It'll jumpstart the hell out of Detroit... etc. etc. Not necessarily Detroit (I just chose to say Detroit because property there is so much down the shit that you can buy a sizable portion of the city for a good few million).
    - deftnerd 11y ago
      There is a long history of Company Towns in the United States. At their peak in the first half of the 1900's, about 3% of the population lived in one. At the time, it was seen by the industrialists as a way to raise their workers into the middle class. "Paternalism was considered by many nineteenth-century businessmen as a moral responsibility, or often a religious obligation, which would advance society whilst furthering their own business interests. Accordingly, the company town offered a unique opportunity to achieve such ends." "Although economically successful, company towns sometimes failed politically due to a lack of elected officials and municipally owned services. Accordingly, workers often had no say in local affairs and therefore, felt dictated. Ultimately, this political climate caused resentment amongst workers and resulted in many residents eventually losing long-term affection for their towns." Perhaps it is time for a new company town concept being pushed by one of the big tech firms. Apple, Microsoft, Facebook, or Google might be able to pull it off. It could also be a test bed for their new technologies. [*] Quoted paragraphs lifted from https://en.wikipedia.org/wiki/Company_town https://en.wikipedia.org/wiki/Company_town
onewaystreet 11y ago
That's from 2013. No way they were paying sub $100k today.
- aaronbrethorst 11y ago
  How about middle of 2014, then? "$95k-$125k" https://web.archive.org/web/20140707172338/https://angel.co/gumroad https://web.archive.org/web/20140707172338/https://angel.co/...
- mynameishere 11y ago
  There's a "hiring" post on the front page right now offering sub $100k for front end developers and others. It's in Oakland though.

anon8418 11y ago

That's pretty surprising... You would think with 15K creators and their traffic they would be able to monetize better... having to cut down to only three employees suggests they aren't making much revenue at all...

RyJones 11y ago
or three employees were bringing in all the money, and the others were overhead.
cookiecaper 11y ago
That's the unicorn way. Tech companies are encouraged, practically forced, to overspend in an attempt to show "hockey stick growth". This strategy has two positive properties for the investor: it ensures that the entrepreneur will be back before the VC to grovel for more cash in the next 24-36 months, and it gives the VC a way to kill investments he doesn't believe in anymore, despite what is a conventionally respectable and sustainable growth rate, by refusing to provide that infusion. Since most founders are naive 20-somethings, this trick works.

deleted 11y ago

[deleted]

mattjaynes 11y ago

Interesting. I've been a customer of theirs for ~2 years. It's been really great until a couple months ago. Then something seemed to change. Rather than just being a great payment provider, they seemed to change direction in order to become a "platform". In emailing with Sahil about my concerns about Gumroad's new direction, he said "We want Gumroad to be the core channel for everything. We started with sales, and are moving into audience/list management." He made it clear that they want me to import my audience lists to Gumroad and that they don't plan to support future integrations with CampaignMonitor, Mailchimp, etc. That makes sense, since those email platforms are now the competition I guess. It's bad news for me though - if I wanted to stay with Gumroad, I'd now have a project on my hands to move everything over to a (currently) much less powerful email platform. I imagine this will work for many of their customers, but there are customers like myself that don't want to be pushed in this direction. I prefer to keep my audience management separate from my payment provider. I don't want my payment provider deciding that my customers are now their customers that they can now spam and upsell them in order to grow their platform. I'm not saying that that is Gumroad's plan - but I'm increasingly worried that it might be. Particularly if they get in a "desperate for growth" situation like this article hints at. Again, they've been great for years and I really appreciate that. The new direction just seems too risky and not a good fit for folks like me who don't want their payment provider as the middle-man for communicating with their audience. I guess there's an argument that they're not a payment provider, but a "sales platform" or something. Currently I'm looking for a replacement payment provider (or whatever they should be called) to use. SendOwl looks promising. If you've used them, or have another provider you'd recommend, please let me know!

angelbob 11y ago
Oof. I sell through Gumroad as well, and now I'm a lot more worried :-/ I had been using hand-rolled Stripe integration. They're not bad, but I really like the invoicing in Gumroad, and that they accept PayPal. They've been great while I've used them, though.
SingAlong 11y ago
I was part of GumRoad's recent 10-day challenge called Small Product Lab. I had this feeling that they were getting very good at their business. I'm about to finish up work on my ebook. I was to go with GumRoad. As per my research, they were THE best in terms of design, seller pricing and payment experience for end-users. The next best would be PulleyApp.com by BigCartel. Costs $6/month. Nowhere near Gumroad's percent-per-sale pricing. But BigCartel.com has been around for a long time (I remember they focussed on helping people sell tshirts online). PulleyApp is just their digital variant. The main downside of most GumRoad-alternatives is that if the product's sales go down or just die out. Unless seller has made huge amounts of profits (say $10k), then paying $6/month to keep it alive for previous customers might slowly leak out profits previously made. If anyone is to buy Gumroad, it should be Twitter (or Facebook?). They have the buy button and GumRoad would be a nice fit for small sellers.

prawn 11y ago

I remember when Gumroad was announced on Hacker News 4-5 years ago as a little weekend project. "Over this past weekend I had the idea to build a sort of link shortener but with a payment system built-in... I think it has some potential. What do you guys think?" https://news.ycombinator.com/item?id=2406614 https://news.ycombinator.com/item?id=2406614

deleted 11y ago
[deleted]
jrbedard 11y ago
It was April 4th 2011. There's an entertaining sub-thread about Bitcoin in that discussion https://news.ycombinator.com/item?id=2407053 https://news.ycombinator.com/item?id=2407053 At the current ~$0.70 / bitcoin... I can't imagine bitcoins in their current implementation gaining traction as a form of payment with 'regular folks'...
- necubi 11y ago
  And four years later at $400/bitcoin, that's still true.
  - cookiecaper 11y ago
    Yep. One of the main allures of credit card processing is that it's instantaneous. Bitcoin's confirmation system is a non-starter as a competitor against credit cards unless you have special circumstances that make it the only practical option (can't trust customers to refrain from filing chargebacks and/or conventional financial institutions won't have anything to do with your business). Ultimately, while Bitcoin may maintain some value, it's not very convenient as an everyday payment instrument (just like gold, actually).
- angryasian 11y ago
  at this time I would still say thats an accurate statement.
deleted 11y ago

rloomba 11y ago

Restructuring down to only 3 people? I think this will make the company way more attractive for an acquisition.

pbreit 11y ago

You've gotta find some semblance of product/market fit or traction before staffing up to 22 people.

_qc3o 11y ago

Huh? I thought Gumroad was one of the better services out there for selling stuff. Too bad "hypergrowth" mania devalues companies like Gumroad because they look like a pretty awesome and sustainable business.

quest88 11y ago

I've wondered why a company like this needs to be present in the bay area paying bay area salaries and bay area office space prices.

angelbob 11y ago
For anybody doing the VC thing, they need to be able to plausibly promise their VCs to grow really, really fast. That means hiring a lot of engineers, designers, etc., really fast. That's much harder outside the Bay Area, and especially outside really expensive areas generally -- Seattle isn't that much cheaper than the Bay Area, for instance.

kwarner 11y ago

Former Gumroad employee here. Since we didn't write about this, here's a response from the other side-- we weren't blindsided by this. We knew there was a chance we wouldn't get our series B, yet we believed in the product. The numbers looked great (the best they had ever looked). And we wanted to see this work, whether or not it meant being part of it in a few months. This isn't some photo sharing app; many creators earn their living from Gumroad. When the time came to make a decision whether to be acquired and have the product die, or to downsize and have the product live on, this choice involved a lot more than our 20 person team. It involved the thousands of creators that rely on Gumroad. With or without me, I still believe in Gumroad.

tzier 11y ago
It's refreshing to see employees who are this dedicated to the product. Kudos, Gumroad team.
coderdude 11y ago
I've always admired Gumroad for its execution, professionalism, and design chops. Good luck to you all. Other companies will be fortunate to gain the Gumroad team.

fasdf3asdf 11y ago

The real question is, why did they have 22 employees? I think this would have been an incredibly profitable one-man business (think TinyURL) but it tried to be something that was very hard for it to be.

lucaspiller 11y ago
This is what VC investment does to a company. The investors make you go for hockey stick growth, which means instead of just having a good service for selling content (that makes the owner a very handsome income), you need to take on the likes of Facebook and Pinterest. DHH's article from yesterday is right on: > Part of the problem seems to be that nobody these days is content to merely put their dent in the universe. No, they have to fucking own the universe. It’s not enough to be in the market, they have to dominate it. https://signalvnoise.com/posts/3972-reconsider https://signalvnoise.com/posts/3972-reconsider

Georgio_1999 11y ago

I run a company called SendOwl, which is probably the biggest competitor to Gumroad, and I must admit I'm sad to see this. We've been watching them over the years and have been impressed with some of the work they've delivered. I've also met a few of their employees and have liked their thinking around selling digital goods and where it's going. You could see they wanted to make a success of the company. Their problems, in my opinion, have come from being VC backed. VCs ultimately want thier money back and with this comes massive, often unrealistic growth expectations. I've had a lot of offers of VC money for SendOwl over the years but I've never once considered taking it. I've bootstrapped SendOwl because I wanted complete control of the company, to direct where I thought it should go, to create the company where I wanted to work at (we work a sensible 9-5, I spend lunchtimes hitting the gym...), but most importantly to serve our customers and build something for the long term. This last part is something I've always seen as uncompatabile with the VC model. The VC model is alluring though - VC money makes growing quickly easier, it makes getting PR easier and it makes bringing in lots of staff early on an easy decision. I'm not saying it's right or wrong per say, it's just not the path I wanted to go down. Bootstrapping isn't as sexy as VC money, but as long as we're growing, getting great customer feedback, and innovating with new features I know we're on the right path. Focus on those three things with Boostrapping and it's hard to go far wrong to be honest. Interestingly we're getting more and more people asking about us as a company and whether we'll be around long term, so maybe the tide is starting to turn. Anyway I wish everyone leaving Gumroad all the best for the future. And any sellers out there who are interested in alternatives please check us out at: https://www.sendowl.com https://www.sendowl.com Happy to also answers questions in the thread below!

baobaba 11y ago
I just read your blog post on the topic. We need more voices like yours.
- Georgio_1999 11y ago
  Thanks so much - we're going to be talking about this much more in the future

niketdesai 11y ago

SHL learns a ton from this, gets experience most executives don't have. Optimistic in his future either way. To the GR team, your work is not marginalized by this speed bump. GR is really good and something people love. I hope other people recognize that and snap up everyone into good places.