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How can you make a list of failed yc companies and not mention homejoy? $66m raised, bad operations, bas unit economics, lawsuits and an abrupt shutdown. All
by knes 6y ago
How can you make a list of failed yc companies and not mention homejoy?
$66m raised, bad operations, bas unit economics, lawsuits and an abrupt shutdown.
All of that after being the calley darling for so long.
- nicocerdeira 6y agoWill add it!
- Sindrome 6y agoMaybe because the CEO is now a YC exec
- WoahNoun 6y agoAfter stealing HomeJoy's customer DB for another start-up, she is now a YC partner... Move fast and break things?
- swyx 6y agoi dont know Adora and i'm sure she has useful things to teach people. however i really wonder if this clouds every interaction with people going through YC. it's kind of the huge elephant in the room.
- Judgmentality 6y agoI guess people can brand themselves as "successful" after what is by all objective standards a spectacular failure. I have no idea how impressive Adora is and I cannot speak to her qualifications, but HomeJoy should be a textbook example of an SV failure.
- deleted 6y ago[deleted]
- cvhashim 6y agoThis comment a little sexist. Is it just me?
- Judgmentality 6y agoHow is my comment sexist?
- IncRnd 6y agoIt's just you.
- twmahna 6y agoThe person who was accused of "stealing customer data" was the other co-founder - not Adora (CEO & now YC partner). If you actually look into the details of the matter, what happened was that the co-founder acquired the failed company as it was put through a bankruptcy process. People who weren't privy to the process thought it was stealing when it really wasn't different from any other acquisition.
- TimSchumann 6y ago> The person who was accused of "stealing customer data" was the co-founder, not the CEO & now YC partner. So, her brother?
- WoahNoun 6y agoMy comment doesn't use the word CEO so I'm not sure what point you are making.
- deleted 6y ago[deleted]
- adora 6y agoOk sure but what was the implication you were trying to make?
- hitekker 6y agoIs it true that you worked with your brother behind-the-scenes so he could buy your failing startup? For reference: https://en.wikipedia.org/wiki/Homejoy#Controversies https://en.wikipedia.org/wiki/Homejoy#Controversies
- adora 6y agoA 3rd party called Sherwood was brought on to wind down the company. This is common thing for a company to do when there are lots of assets to sell and loose ends to tie up. Everything from office furniture to domains to etc. They made all the decisions to sell what to who. If anyone wants a startup idea, it's to make the inverse of Stripe Atlas. Closing down a company properly is a very long and complicated process.
- sillysaurusx 6y agoOk, the situation seems to be: brother and sister cofounded startup; startup failed; brother acquired failed startup’s assets via legal proceedings. Which part of this is illegal, or — I’ll meet you halfway — unethical? It seems like a straightforward business transaction. If I’m missing something nefarious, I’d like to educate myself to avoid it. What do you see as the problem? (Apologies if my facts are incorrect; this is info from elsewhere in the thread, so maybe you know something that hasn’t been said yet.)
- avery42 6y agoI'm not familiar with the story, but this is what I found: https://www.businessinsider.com/aaron-cheung-brings-homejoy-customers-to-fly-maids-2015-10 https://www.businessinsider.com/aaron-cheung-brings-homejoy-... > The weird tale begins with an email that John Salzarulo received Tuesday afternoon. A Los Angeles based user, Salzarulo received an email from Cheung that "$20 cleaning is back!" thanks to its local partner. > "I wanted to reach out personally today to invite you to join a private house cleaning trial with our Los Angeles partner, Fly Maids," Cheung wrote, not disclosing his connection to the company. > When Salzarulo clicked the email link, the Fly Maids' site logged him into his Homejoy account, which still had his credit card number and notes about where to find the trash can. I don't know if it's illegal, but I definitely think it's unethical.
- sillysaurusx 6y agoHmmm. Thank you for finding that! This opens up a fascinating discussion about ethics. So, to start from a purely capitalistic viewpoint, it seems like you are free to use your property that you own however you wish, subject to the law. That raises questions like: in this situation, is it legal for the CC numbers to be stored in that way? From the customer’s POV, they authorized HomeJoy to store their CC info, not Fly Maids. But that leads to the question of: those CC numbers are stored somewhere (or the authorization token) and those assets were a part of the sale. I don’t know. It’s a massive advantage to have your customers in a position of “just click this button to give us money” rather than pestering for CC details. It’s a little odd, to be sure, but... it seems like unless it’s illegal, it might not be unethical to take advantage of that opportunity. It depends how you feel about capitalism, I suppose. If there was nothing illegal here, which seems perhaps likely, then it seems valid. From another point of view, it sounds like he was just trying very hard to succeed, and in some sense Fly Maids was the continuation of his previous endeavor. So I sort of understand why it might have felt natural to reach out to the customers you were already doing business with. But again, all of this has two important assumptions: (a) he legally owned all assets, and (b) used those assets to the letter of the law. If those are mistaken then someone with more experience should definitely call it out. "When we contacted customers, we didn’t tell them we were Homejoy relaunching because we wanted to gauge reception to our new model without the influence of Homejoy’s brand," Cheung allegedly wrote. "As a result, we scared many customers, who expected the worst had happened to their data. We should have told customers upfront who we were, what we were testing, and used original content." I dunno. This seems pretty reasonable, honestly. It kind of alarms me that you see this as clearly unethical, because I could see myself making this same mistake, in a different life. If you feel like explaining more of the reasoning regarding the ethics, I’d personally find it interesting to listen.
- mattkrisiloff 6y agoI used to work alongside Adora at YC and she works super hard for the startups she is working with and is very helpful — totally justified for her to be there.
- tikwon34 6y agoso you said it and we should buy it? Why? Because you had successful experience? What about people whose data is stolen?
- nxmnxm99 6y agoShe railroaded our YC interview for having a similar model (albeit in a different vertical) simply because she failed, so naturally we would also fail. Aaron Harris, another failed entrepreneur turned YC partner, has routinely done the same I've heard. We're now 2 years later pushing $2M ARR profitably and about to raise our Series A. YC not taking 7% of our company was the best thing that ever happened to us. YCombinator is nothing like what it used to be. The majority of the partners are useless as venture partners.
- nodesocket 6y agoWhile seemingly harsh criticism, I think you may be right. YC of the old (PG, Jessica, etc) was much more selective and smaller inner circle. However, even when PG was at the helm he said they passed on many insanely lucrative opportunities. Picking startups is hard, like picking stocks. You aren’t gonna pick every winner, but frankly 2M in ARR after two years is not exactly a home-run for YC. So, perhaps them passing was the right call for YC. Congrats though, sounds like you’ve built something useful and you can be proud of that. Plus, taking VC money ain’t all it’s cracked up to be. If you can bootstrap to get to a level that pay’s yourself $200-300k a year, that’s a win.
- jkarneges 6y ago> frankly 2M in ARR after two years is not exactly a home-run for YC It's been awhile since I looked at this deeply, but I thought the path of a good startup is to raise a seed with an 18 month runway, grow to 1m ARR, and then raise a series A. Assuming that's true, growing to 2m ARR in 2 years is in the ballpark.
- crazydoggers 6y ago$2M ARR is such a small part of the story though. You really have to look at things like cost of acquisition, churn, gross profit, along with understanding the market itself. Certain markets can be easy to create quick ARR either through enormous CAC spends and/or large amounts of churn, all of which means poor long term growth potential.
- hnracer 6y agoIn the hedge fund world there is a mindset that if you're going to fail, you must fail BIG (without breaking the law). Then you get a sort of undeserved glamor associated with the failure that can actually lead to new opportunities. For example, the case of Brian Hunter, if he failed small he would've been long forgotten.
- xenihn 6y agoSounds like WSB.
- hnracer 6y agoI think it's a pretty universal phenomenon. You want to be either outstandingly good (best outcome) or extremely offensive (second best outcome). Just don't be another drone that is indistinguishable from the million of other drones, that only leads to being forgotten.
- mathattack 6y agoThat’s a heavy duty accusation. Source? Attached is the wired story. https://www.wired.com/2015/10/why-homejoy-failed/ https://www.wired.com/2015/10/why-homejoy-failed/
- pmiller2 6y agoIt's clearly not a very complete list. I wish they had presented a more complete list, filterable by funding round, amount raised, year founded, year shut down, and maybe one or 2 other things.
- nicocerdeira 6y agoMaybe something like this (https://www.failory.com/cemetery https://www.failory.com/cemetery), but only for YC startups?
- tikwon34 6y agoRegardless of who stole the data, does it have to do fact that they are chinese? Ever wonder if something cultural going on here?
- dang 6y agoYou can't post slurs like that here. I've banned this account.
- kapitalx 6y agoI used HomeJoy once, a student showed up and said "Wow your house looks pretty clean already, I'm not sure what I would even do". My apartment was tidy, but it wasn't clean (at least by my standards)
- seibelj 6y agoDon't forget this legendary post from the CEO https://news.ycombinator.com/item?id=8794956 https://news.ycombinator.com/item?id=8794956
- duxup 6y agoMan that seems kinda sad. If someone is in a situation where they really don't have anything else to do on Christmas, ok. But hard to imagine they don't have some friends or family missing them...
- seibelj 6y agoKeep in mind this business finds gig workers to clean houses. That is its mission and passion.
- duxup 6y agoYeah I was a little bit surprised by all the passion talk. Granted I could see being passionate about building a business but ... yeah, to an extent it was kinda weird to read in that way too.
- adora 6y agoGood news, since then I've found my caps locks key.
- seibelj 6y agoI hope you have also found some perspective as to why the post I linked to is an absurd thing for a CEO to write.
- seattledev 6y agounlikely
- adora 6y ago$40m but who's counting :) I've seen the $66m figure quoted a lot but not sure where it comes from.
- deleted 6y ago[deleted]