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It's absolutely crazy some of the reasons stated for evernote failing to get investment early on. Today people would be clamoring to invest in a company that wa
by Traster 8y ago
It's absolutely crazy some of the reasons stated for evernote failing to get investment early on. Today people would be clamoring to invest in a company that was bringing in users by offering the product for free. The sell is so compelling "Get our users to write everything in evernote, build a huge userbase and then you can start to monetize because you've got a fantastic way of keeping them". I feel like that's one of the most common uses of VC money today.
- a13n 8y agoI think it's opposite actually. 10 years ago, it was way easier to raise without any profitability story. Then a ton of VCs got burned, and Paul Graham wrote "Ramen Profitability" (2009), and later "Default Alive or Default Dead?" (2015). Nowadays, you NEED to have a story for how you're going to become default alive, and not rely on investor cash. That's because of what we learned from all of the failures from Evernote's era. Think about other companies that started in that era – Facebook, Twitter, Yelp. The entire strategy was user growth and figure out monetization later. You don't see that as much today. I suppose Uber/Lyft are good counter examples, but they at least had massive revenue along the way, and a great story about future profitability. (Swap out drivers with self-driving cars.)
- huffmsa 8y agoBut they gave the full feature set away for free. Hoping that users would be generous enough to "make a small donation over on Patreon" (to use today's language). In a shit economy. No one does that today, not even Google. You get limited features for free.