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YC partner Aaron Harris had a similar problem with his first startup[1], and is a lesson for all startups: It's risky to rely on one customer for the majority
by acconrad 11y ago
YC partner Aaron Harris had a similar problem with his first startup[1], and is a lesson for all startups:
It's risky to rely on one customer for the majority of your revenue.
90% of PriceZombie's revenue was dependent on affiliate revenue, and thus Amazon. Similarly, virtually all of TutorSpree's revenue was dependent on SEO, and thus on Google, and when Google changed their algorithm, they saw a similar fate.
[1] http://www.aaronkharris.com/when-seo-fails-single-channel-dependency-and-the-end-of-tutorspree http://www.aaronkharris.com/when-seo-fails-single-channel-de...
- darkclarity 11y agoA similar thing happened to me with Google Images. They were unintentionally a major source of my traffic. Some years ago Google changed their Images service so that it continued to take images from other websites but was very unlikely to send people to the source. It surprised me how little fightback there was to this change. So, anyway, never rely on platforms like that, always assume it's a temporary arrangement (especially if the platform is run by a major player).
- AznHisoka 11y agoThis is part of the risk of startups/business. This is like the opposite of survivorship bias... Think about all the successful companies out there that DO depend on third parties: - Buffer (Twitter has a bad day? Cut their API access off!) - Candy Crush (Apple hates them? Remove their apps!) - RetailMeNot (Google thinks they're spam! Delist them!) - DuckDuckGo (Bing hates them? Cut off their API access) - Heroku (Amazon has a bad day? Cut off their AWS Access) - MailPlane (Google doesn't want Gmail apps?! Cut them off!)
- shostack 11y agoJust because these companies are doing well today says nothing of the potential impact this (still very present) risk holds for them.