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Who buys a $20K couch at a startup? Besides, this analogy is pointless. Saying a $20K couch - or a $20K breakroom/kitchen refit (more realistic) is 'equivalent
by onan_barbarian 16y ago
Who buys a $20K couch at a startup?
Besides, this analogy is pointless. Saying a $20K couch - or a $20K breakroom/kitchen refit (more realistic) is 'equivalent' to 0.2% is meaningless. If you just turned profitable then you can afford it and you have to decide if the $20K is worth spending (vs. saving, or handing out as cash to the employees, or buying something else). If not, you have to decide whether $20K is worth shortening your run-way by however many days/weeks it will shorten your runway.
Knowing that it was 0.2% of a historical figure (amount of money you raised) doesn't tell you anything. If you've made $10M of revenue since, you'd look at a $20K expenditure quite differently than if you've made $0.
This might all make more sense if you're building a company to make noise on Hacker News for a while, then exit (perhaps a 'talent acquisition'), without any real plans to make revenue in the meantime.
- drusenko 16y ago> Who buys a $20K couch at a startup? Apparently, some people do. But it's more of a symbol for frivolous expenses than anything else. This thought was meant for the "we just raised money" phase of a startup. It's certainly very applicable to the money you just raised, since by definition it was a trade of equity-for-money. It's not just about being able to "afford it" (which is obviously better than not being able to afford it). Even if you are generating a ton of revenue, blowing it all in non-helpful ways is still not justified. We've built a company that generates very significant revenue, and it remains even more important to have anchors to keep the value of money in perspective.
- deleted 16y ago[deleted]