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Nice post. Proactive work. Thinking outside the box. Getting things done. Very encouraging. Sounds like a place where I would want to work. Just one major nit.
by edw519 15y ago
Nice post. Proactive work. Thinking outside the box. Getting things done. Very encouraging. Sounds like a place where I would want to work.
Just one major nit...
(This is directed not only to OP, but to everyone in our industry.)
Raising funding != success.
As inspiring as this post was, it would have been so much better with a title like:
"We work a 4-day week and just satisfied 10,000 new customers."
or
"We work a 4-day week and just realized $10m new profit."
Great work, guys. But please don't allow this "success" to let you take your focus away from the real metrics. I assume you already know this, but every once in a while, it still nice to say that which should go without saying.
- pclark 15y agoGetting to profitability isn't as noteworthy (from a startup POV) as raising an A-round from working 4 days a week.
- drewmclellan 15y agoWhich in itself is sad. Profitability, providing employment, and creating a better quality of life for all those involved. Funding is great, but the above sounds like a better measure of success to me.
- tomgallard 15y agoafter all funding is just a way of saying 'we persuaded some people to lend us some money'. (I know- equity finance is different in some respects) Is 'the Bank just lent us $ million' as impressive as 'we reached profitability? It certainly shouldn't be.
- StavrosK 15y agoTo whom? I'm just a regular guy and I'm not impressed at all by raising money, I've seen utterly incompetent people do it. I am supremely impressed by someone getting 10k paying customers.
- judofyr 15y ago> (from a startup POV)
- StavrosK 15y agoSorry, I'm a regular startup guy, having just started (co-founded) my own a few months ago.
- TapaJob 15y ago"Getting to profitability isn't as noteworthy (from a startup POV) as raising an A-round from working 4 days a week." What we have found here in the UK, is without profitability, raising an A-round is near enough impossible. The UK Start-up/Inventment scene is still very much in it's infancy and investors are reluctant to give sums anywhere near the figure Ryan has quoted without a 'profitable' business. Well done to the team for creating a fantastic service all whilst spending time with family, highly commendable!
- lusr 15y agoThen I have a great business proposition for you! It's easy... for the past month we hung around a street corner and for everybody who paid us $1 we gave them $1 back with a SMILE! We've done this with 10K paying customers so far! We also sold a packet of sweets worth $1 to my aunt for $2; she's always had a soft spot for me. We're profitable! :D I believe in my product so much I haven't even taken a salary, amazing huh?! And I believe with a $10 million investment we can scale this to 10 million paying customers within 1 year! Wanna invest?! [Oh and in year 2 I'm taking a $10 million salary.] I'm obviously being facetious and while I don't want to be "that guy" dismissing what appears to be a very respectable business, mentioning revenue & customer numbers without mentioning profit values or percentages irks me. This is probably because of 8 seasons of Dragon's Den and 3 seasons of Shark Tank that have impressed upon me just how few people understand that a large turnover means nothing; "turnover is vanity; profit is sanity". It's not easy to achieve a large turnover, sure, but it's also meaningless unless it is associated with a reasonable net profit. Having read through a few more comments I suspect the author's business is probably turning a decent net profit, but, nevertheless, the post seems incomplete without this data or at least some form of confirmation (e.g. "our net profit is between 10-20%").
- raverbashing 15y agoHumm... no Profitability is more important. There are examples to the contrary (Tumblr, Pinterest, Instagram, etc) but if you're profitable this means you are providing a worthy service (unless you're in the 'Nigerian Prince' business), and people are willing to pay you! Never underestimate the power of people actually paying you.
- pclark 15y agoWhy does every Hacker News post involving venture financing have to have a discussion about how "companies should focus on making revenue"? this never used to happen as frequently.
- samstave 15y agoLet's call it "Bubble Froth" - the excitement and frenzy the startup community has around financing and funding. "Tiny bubbles... In the whine..."
- csallen 15y agoWell, for one, he isn't saying that fundraising is more important. Just that in Startup Land, the culture seems to find it more "noteworthy". For better or for worse, that seems to be the case. As for the age-old debate of profitability vs fundraising, it's not a black and white issue. And I don't know why people so often feel the need to try and turn it into one. Profitability is great. You're right -- it's a signal that you're providing a valuable service. But as you pointed out, there are many examples to the contrary, and rightly-so: because achieving profitability is not the only way to build a valuable business. And even for companies who do focus on charging customers rather than, say, getting tons of users, raising money is often an important step on the path to eventual success.
- tomgallard 15y agoI disagree. It is not possible to build a valuable business without achieving profitability. Over a long-enough time period, the value of a non-profitable business will revert to zero. If a business is valuable, it is because the market (or investors) believe either a.) It is going to make profits at some point in the future. b.) It is going to be an attractive acquisition for another company (who are presumably only going to buy it if they believe it will enhance their long term profitability). Of course there is c.) , which is when investors buy into something because they believe someone else will come and buy it off them in the future for a greater amount of money. If we've reached this point, it is a sure sign of a bubble (cf Tulip fever in the Netherlands).
- pemulis 15y agoI think that the two items are related, though. Could they have raised an A-round working just four days a week on a startup that was not profitable? I doubt it. If anyone knows of any cases where that happened, though, I'd be interested in seeing them.
- j45 15y agoA startup that gets to the same place without funding isn't noteworthy?
- Terretta 15y agoAs the only CDN / video delivery network to bootstrap and stick around for a decade without funding, I'd say it's usually not considered noteworthy. Tech press looks at funding and the stable of investors as validation that a company is worth covering. "How much money have you taken?" and "Who are your investors?" seem to rank above covering how the tech works or if it's unique, both for journalists and for prospective acquirers.
- rdl 15y agoThat's true -- entrepreneurs are faster to adapt than VCs. I guess because VCs don't have good metrics for intermediate stages toward success, and "how long are you in the office each week" is something they use.
- Johngibb 15y agoI think the point is that working 4 days a week didn't preclude them from raising money from investors. Not that funding is the key metric, but to show working extremely long hours isn't a pre requisite to raising money.
- ryancarson 15y agoThe first bullet point on my list of our achievements was "Achieved profitability". I fully agree with you.
- ryancarson 15y agoForgot to mention. We just hit 10,000 paying customers as well. Yay!
- andysinclair 15y agoMaybe you should change the headline to "We work a 4-day week and have 10,000 paying customers". I don't equate raising money with success. 10k paying customers speaks for itself.
- pbreit 15y agoRaising money is absolutely a milestone on the journey to success. Congrats to Treehouse on raising the funding necessary to continue expanding the business and delighting customers. Bollocks to the haters who have no clue on how to build a business.
- outside1234 15y agoi think the point is that raising money and building a business are orthogonal. some businesses need external capital. some don't.
- bira 15y ago"Raising money is absolutely a milestone on the journey to success." Go tell that to DHH :) I personally like it more this way: "Profiting is absolutely a milestone on the journey to success." Different perspectives, I guess. No hate.
- pbreit 15y agoThe difference is I agree that both funding and profiting are milestones on the success journey. Whereas the person I responded to apparently does not. And it's not clear that you do either.
- j45 15y agoAgreed. The title should say profitable at 3 mill a year and working 4 days a week... Funding was a side note.
- pbreit 15y agoBut the dichotomy here is specifically the thought that venture capitalists require portfolio companies to work 6-7 day weeks.
- webwright 15y agoHe picked the right headline, IMO. There are a gazillion profitable software businesses. Some work reasonable hours. There are very few funded software businesses and I can think of exactly zero that work 4-day work weeks. I think Ryan's path is an awesome one. Step #1- get internet famous. Pay your dues, run conferences, build a popular blog, become a thought leader. Not a ton of equity to be built doing this, but it's a solid business. Step #2- Build a product tailored to the audience you've created. Step #3 - Tell everyone how effortless Step #2 is. :-) 37Signals took this path. Sarah Lacey did, too-- with PandoDaily. Om Malik is now an (awesome) partner at True Ventures (after being a really well regarded writer and entrepreneur with GigaOm). Edit: Actually, it could be argued that Patio11 of HackerNews took this path (but perhaps not on purpose). To be entirely clear-- I'm not being sarcastic. I think this is a smart/awesome path. Not much gives you more leverage than an big audience that's chock full of influencers.
- ryancarson 15y agoYou summed it up pretty well. We put in 10 years of hard work to have an overnight success :P
- estel 15y agoHow long ago did you have Treehouse mapped out for development?