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Bill Nguyen: The Boy In The Bubble
- jphackworth 15y agoThere's no big secret why Bill Nguyen can raise money. Once you have sold one company for $850 mil, you aren't going to have trouble raising money in the future.
- akkartik 15y agoI think it also makes acquisitions more likely.
- tatsuke95 15y agoWhich is one of the problems with the Valley. These incubators operate on the same premise. Take Techstars, where they openly said, "It's about the people, not the idea." We're literally throwing money at people to think of ideas, and it stems from our obsession with "stars". Is it that hard to wait for a tangible product? There is so much money sloshing around, and people are so scared to miss a deal that they're willing to take all the risk up front. It's crazy, and doesn't work like that in any other industry I can think off..
- kiba 15y agoThat how YC works, I think.
- drumdance 15y agoIt's a long way from $20-150k to $41 million. And many other industries work this way. Biotech and oil & gas come to mind. In fact, the tax laws around carried interest were enacted to encourage oil & gas exploration.
- neurotech1 15y agoI honestly believe YC is different. It's not just about "People" or their ideas, but in their execution. Throwing money blindly and seeing what sticks doesn't seem to be the YC modus operandi. It is interesting to see the number of YC alumni who join other YC startups, or do a second start-up, with similar teams and a new idea. I would hope to measure up to the YC standard, and get myself and my ideas accepted, when the timing is right.
- jodrellblank 15y agoI honestly believe YC is different. It's not just about "People" http://techcrunch.com/2011/05/24/y-combinators-paul-graham-were-looking-for-people-like-us/ http://techcrunch.com/2011/05/24/y-combinators-paul-graham-w...
- Deutscher 15y agoI don't really know how venture funding works, so pardon my stupid question: Why did he need/want to raise $41m from outside when he sold his company for $850m a few years ago?
- deleted 15y ago[deleted]
- gallerytungsten 15y agoA) He probably didn't own very much of it at that point. B) Using other people's money is always a lesser risk. C) Raising big money = big PR ("social proof").
- larrys 15y ago"Raising big money = big PR ("social proof")." And of course the mafia always needs to be cut into any good deal and requires a "taste" and to dip their beak.
- twelvechairs 15y agoThis is his business - the raising of money, not the production of high-quality long-term products...
- dwynings 15y agoThe simplest answer: because he could.
- earbitscom 15y agoI asked this of an old boss of mine who cashed out perfectly fine and then raised money for his next business. It's not just about money - having people like Sequoia Capital on your team is more valuable than the money.
- protez 15y agoNot just raising money, but attracting smart people and getting takeover offers from APPL, AMZN, GOOG, MSFT, etc., apparently. The bubble in this market already convinced the investors that trading start-ups can work without users. The other delusional money is waiting to take their shares at x5 price anyway.
- aristidb 15y agoIs it just the way I read it, or does Bill Nguyen come across really badly, there? Wow.
- esk 15y ago> "I mean, I literally don't think there's anything to be learned from other people's stuff." That is exactly what happened with Color, which Nguyen never even bothered to test. "I'm not here to practice. I'm here to play," says Nguyen[...] I don't think there's any other way to read that.
- artursapek 15y agoMy reaction was the same. This pull-quote makes me think of a little kid: "There is no one in the world who I won't outlast. There's no way. There's no way. There's no way."
- zheng 15y agoI'm naive when it comes to anything related to VC's and funding, but I'm pretty sure if I had a ton of money to invest, it wouldn't be anywhere near someone like that. Even after reading the article, I don't think I fully understand why he can secure funding so easily.
- tptacek 15y agoVCs know that most of their investments aren't going to pan out. When they evaluate companies, they aren't worrying about whether they'll fail. Even the good companies fail. What the VCs are worried about is that they're going to say no to Facebook, and then have to explain 5 years from now how the fuck they possibly could have said no to Facebook. What that seems to mean is that if you: * have a persona that at least superficially seems driven, ambitious, likely to succeed, and * you tell a convincing story about a market that might experience explosive growth, and * you have any kind of track record of any sort to make it hard to write you off as a total bozo, and * you have some sales skill, so you can manage the pitch process and create pressure to VC firms, then you're probably fundable even if you think testing means "practicing instead of really playing". These kinds of pitches seem very different from the kinds of things people write in Show-HN: postings. In particular, these pitches aren't meant to be reasonable. This is way more of a response than you were looking for; sorry, I just had to get this out, since all I can think of when I read about Color is how good an illustration it is of VC cliches.
- statictype 15y agoIt's been two years since we entered the 'post-PC' world. If you had to choose which one to give up - your ipad apps or the web, which would you choose? That's what I thought.
- deleted 15y ago[deleted]
- suivix 15y agoIf you had to give up your mobile plan or your home broadband, what would you pick?
- xxbondsxx 15y agoA better question is if you would sign up for data online on your phone or voice-only :P
- statictype 15y agoGood question. On one hand, my mobile plan is expensive. On the other hand, its damn useful. But I fail to see how this relates to what I said. I can still browse the web on my mobile device/tablet. The web is very much not in danger of being replaced by native "post-pc" device apps.
- sjs 15y agoWhat? Who ever said anything about post-PC devices not accessing the web? Way to knock down that straw man.
- statictype 15y agoSays the Boy in the Bubble right in the article: IBM didn't survive the PC, none of the PC guys survived the web, and I don't think any of the web guys will survive the post-PC world So he didn't say post-PC devices won't access the web (and actually, neither did I) but that web apps today will not survive. That was the point of my question.
- DilipJ 15y agofascinating article. It looks like Color raised a lot of money, then launched and found out why customers didn't want it, and now they are trying to pivot. Basically the opposite of what YC and 37signals recommends.
- protez 15y agoIt's a costly path only few can afford to take, funded by the other few who believe that big bangs can happen overnight.
- csallen 15y agoFor the record, YC doesn't push any particular ideology as hard as 37signals does. And if you were to ask PG, I think he'd say that different things work for different companies and founders. Running out of money before capitalizing on a profitable business model is the most common way that startups die. So launching quickly, raising money, and pivoting are all good things.
- DilipJ 15y agooh I see. For some reason I thought Jason Fried and pg were completely on the same wavelength when it comes to startup methodology
- arram 15y ago>' "When you're binary, you just pick a side; whether it's right or wrong doesn't really matter. You're all in. So you find out all the good and bad things about it instantly. When you find that it's not right, you just move on," he says.' I'm reading the Isaacson book, and he reminds me of Steve Jobs. Everything is black and white, everyone is either a genius or a shithead.
- protomyth 15y ago"The premise was to create a mobile social network of people you didn't know, rather than ones you already did. Nguyen believed Color would be the Facebook killer." I have a theory that conflicts with his thinking. If an app connects people it will trump an app that requires people to physically connect themselves. My test for this is "does this app work for users coming from a rural setting?". Facebook works amazingly well because it connects people. Color works horribly. Your app can be profitable and cool not working in a rural area, but it won't be a Facebook.
- rms 15y agoOne of the great secrets of the Valley is that investors love hypomanic CEOs.
- deleted 15y ago[deleted]
- gwern 15y agohypomanic?
- rms 15y agoYeah, true clinical mania looks a lot like psychosis.
- gwern 15y agoNo, I meant that 'hypo' means a lack, and 'hyper' means an excess, so I would expect a 'hypo'-manic CEO to be some sort of depressive and not look like a great candidate for funding and a 'hyper'-manic CEO to be extremely energetic and convincing and voluble and so at an advantage with VCs.
- prodigal_erik 15y agoClinically it's used as "not quite mania, but close". http://en.wikipedia.org/wiki/Hypomania http://en.wikipedia.org/wiki/Hypomania
- gwern 15y agoHuh. TIL. Goes to show that understanding Greek or Latin roots doesn't always help you.
- antimora 15y agoAfter so many times encountering Color, I still don't understand what this is.
- roythunder 15y agoI used to work with Bill at Seven, and this article captures his personality pretty well. His biggest strength is he's an unbelievable salesman. He can talk pixie dust and make you want to sign on to his vision. I believe the ability to sell your vision is the most important skill for an entrepreneur (which is too bad for me, cause I'm a coder and I suck at this skill).
- r00fus 15y agoHe should stay in sales then. Without a meaningful vision, all the sales in the world is just bullshit talking.
- roythunder 15y agoDepends on your perspective. He sold OneBox for $850 million, so I'm sure he's happy he didn't stay in sales.
- dylanhassinger 15y agoSeems to me he still IS in sales
- away 15y agoDid you like working for him?
- deleted 15y ago[deleted]
- MJR 15y agoFirst his product was the Facebook killer then he decides that he doesn't want to kill it, he wants to build on top of it. "It's the everything." ... "So we're about to make it more functional, more valuable for people than ever." You can't flip-flop more than that. I can't wait until Facebook incorporates their new ideas into the product and puts them out of business - assuming that this new business actually exists in the first place.
- Timothee 15y agoWhat struck me is that he pimped out Color as a Facebook killer without, according to this article, having really used Facebook before. Then of course to turn around and say that Facebook is the answer to all things is pushing the irony very far…
- wavephorm 15y agoIt was an interesting read. But by the end I have no idea what Nguyen is really good at other than selling a startup. He's a wheeler and a dealer, but I sure don't have the impression that he knows how to build something as truly disruptive as he says he can.
- felipemnoa 15y agoSo he is missing a Wozniak, I guess.
- wavephorm 15y agoBut there was nothing in the article that gives me the feeling he is anything like Steve Jobs. He's just phenomenal at the flip, and that says a lot about what the Silicon Valley VC's that invested in Color are after.
- wyclif 15y agoHe flips companies. That's nice and everything, but it's not innovation. He's essentially a parasite.
- OstiaAntica 15y ago"Parasite" is unfair. You still need guys like him to agitate, to unsettle and disrupt the marketplace. Color was a pretty innovative idea, it was just terribly executed both in technology and marketing.
- wyclif 15y agoYeah, that's unfair...I retract that. But I wouldn't suggest for a second that you don't need "guys like him" i.e. great salespeople who can sell ice to eskimos. That's why I find his arrogance so over the top insofar as he compares himself to Jobs and other innovators.
- wyclif 15y ago
- dgurney 15y agoThe new Color app, judging by its website, actually looks really cool. Nguyen has taken something that already exists -- social broadcasting from your phone's video camera -- and made it seem space-age (turn a photo into real life.. the "transporter" comparison). Same technology, but now I can see why he's a master salesman.
- JulianMiller520 15y agoi couldn't agree less. I think the thing looks exactly like what it is. A hurried, "let's ship something before my reputation is entirely ruined" product from someone who sold a vision without so much as the scaffolding in place. The original product was a mess and facebook could easily eat the lunch of "color" as it stands now. Hoping for better for whatever is next from this team.
- vimalg2 15y agoAfter reading, I feel motivated to re-read my copy of 'Influence' by Robert Cialdini. Bill Nguyen was really really good at one thing. Here is a guy who thrives on persuading people. I think the average founder could always use a little more of the same skillset.
- arihant 15y agoThere's a lot of criticism about raising money, having a high profile team and starting a company without actually having a product. This may turn out to be short sighted. I think Cisco started the same way. For all his negative qualities pointed out, at least this man is thinking something freaking different than a freaking share button with a varied alias. Color didn't go hit, but its far better than 90% of photo sharing apps out there. It at least does something different. What these guys are selling is a photo app, what these guys are doing is that they are toying around with possibilities in sensing, VR and localization on mobile. Could very well be huge.
- deleted 15y ago[deleted]
- alexwolfe 15y agoFacebook started with $17,000 investment from a friend and was a dorm room project, not a company. When trying to beat someone it is probably a good idea to see how they got to where they are at. Steady growth over time works. Dumping a shit ton of money into something and saying its going to the the "X" killer doesn't. The laughing stock is not Bill Nguyen, its the VC's that gave him the money. If you walk in a room and say Color and they laugh, they should really be embarrassed. How many of these same people wanted to get in on this deal before it launched? The really funny thing is that there will be someone else that comes in with a great deck and grand illusions of how they will be the next Facebook, the VC's will pump this person with money too.
- skrebbel 15y agoWhy is it that political journalists are critical, trying to turn every stone, and business/financial journalists treat their subjects with softer gloves than a teen mag does Rihanna? If there's one person in the Valley who you can ask difficult questions, it's Bill Nguyen. Instead, the author asks him about whether his wife likes the house on Maui.
- ricefield 15y agoPoliticians live in the public eye, in a way different from celebrities (be they pop stars or CEOs). They are, in a sense, obligated to grant interviews and be open to the hard questions, because a politician is selling him or her SELF. A pop artists sells music, a company sells a product or a service. I'm not predicating my use of facebook based on whether or not Mark Zuckerberg did pot in college or got blowjobs from his secretaries. So when you interview someone who isn't selling themselves, you don't have the freedom to ask those kinds of questions. Unless maybe you don't that person to ever grant you or your magazine an interview ever again.
- ahoyhere 15y agoThis explanation doesn't really get to the heart of it. Fast Company has always been breathless and brainless. They always present "business" in such a way to make it seem like all you need to be a rich, successful, famous, sexy entrepreneur is "a great idea" and maybe some fun personality traits. They aren't in the business of reporting, they're in the business of titillating, teasing, and making their reader think "that could be me!" - exactly, in other words, the stuff I've dubbed entreporn: http://cubic-m.blogspot.com/2011/09/entreporn-dictionary-definition.html http://cubic-m.blogspot.com/2011/09/entreporn-dictionary-def... "I've got a pizza here with extra sausage." "Ohhhh, we lost our purses, however can we pay?" -- I DELIVER PIZZAS… IT COULD BE ME!
- DilipJ 15y agothat's true, but that's also why I love Fast Company. If you want harder-hitting business journalism, it's better to stick with Fortune or Businessweek. There you can read about the underbelly of business,the Madoffs/Goldmans/oligarchs etc. Fast Company and Inc. are both owned by the same firm, and they try to portray a more humanistic view of business, ie. social capitalism, the belief that entrepreneurs can one day solve all of the ills in the world. Its a very uplifting philosophy, and I for one find it encouraging. I've never heard of the term entreporn though, if you coined it then congrats! I like the term, and maybe it is apt. Maybe that's precisely what someone is curious but hesitant about entrepreneurialism needs.
- ambertch 15y agoYou know something interesting? I went around linking friends to this article due to Bill possessing a lot of the traits typically lionized in entrepreneurs. My psych major friend reads it and goes "yup that's a checklist for psychopathic behavior. Don't believe me?" then he links me the wiki: http://en.wikipedia.org/wiki/Psychopathy http://en.wikipedia.org/wiki/Psychopathy VERY interesting if you read the wiki on psychopathy and re-read the Bill Nguyen article. I'll also be careful to state I'm not trying to say anything here - behavior is highly contextual after all. Take for example a professional fighter who can be a really nice guy, loving family man and friend yet flip a switch when the bell rings. You just can't say whether this man is violent or not - his behavior is contextual.
- scottallison 15y agoThis article summarises what makes the valley both awesome and absurd. I got mixed emotions reading it. It manages to be both appalling and inspirational. And Bill Nguyen makes the manic Zuck portrayal in The Social Network appear shy and retiring by comparison. I'd love to meet him.