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In the defense of YC by modern neoliberalist definition bob was a terrible businessman. The company's only worth 50 million, he ran up debts so large it requir
by nimbius 3y ago
In the defense of YC by modern neoliberalist definition bob was a terrible businessman. The company's only worth 50 million, he ran up debts so large it required a partner to bail him out, the company never went public or sold to large agricultural interests to maximize shareholder value, and he committed the cardinal sin of making the employees owners instead of fully capturing the excess capital of his means of production and offshoring production entirely to focus on branding. he focused on an unprofitable cadre of niche markets.
Bob was a great guy though and a sterling example of a leader who really cared about his product and his customers.
- nerdponx 3y agoOther than running up too much debt and getting bailed out (is that functionally different from getting outside funding?), I don't see any reason why these things are bad business. Even if you're a steely-eyed capitalist, you have to admit that these were wildly successful long-term investments in developing loyal lifelong customer base. The only difference is that the time horizon on those investments are much longer than your typical VC or PE firm cares for.
- deleted 3y ago[deleted]
- diputsmonro 3y agoI think you're making the same point, but just to make it more obvious - all of that is more an indictment of modern neoliberal business practices than it is of Bob's Red Mill. Sustainability, efficiency (in terms of doing things right, rather than doing them quickly) and overall most benefit for the most humans is better than the get-rich-quick schemes that most startups have become.
- TheGeminon 3y agoWhere are you getting that the company is worth $50m? The article says it’s a “$100 million-a-year” business
- AceJohnny2 3y agoThat’s revenue, which is different from company value.
- mydriasis 3y agoOh boy, if his 100MM/year in revenue business is only worth 50 million, most startups are _really_ in trouble.
- AceJohnny2 3y agoWhy yes, company valuation is uncorrelated from revenue. By the way, this is why VCs love software startups, and drive so hard for an IPO exit.
- cscurmudgeon 3y agoLook up revenue multipliers: https://www.bizbuysell.com/learning-center/industry-valuation-multiples/ https://www.bizbuysell.com/learning-center/industry-valuatio...
- c0pium 3y agoThat’s pretty clearly what they’re talking about, yes.
- cscurmudgeon 3y agoNot really. They and others here seem clueless about multipliers less than 1.
- c0pium 3y agoThey described a fractional multiplier. That’s their whole point.
- 3y ago
- devb 3y ago> the company never went public or sold to large agricultural interests to maximize shareholder value Wow, shame on Bob :eyeroll:
- matteoraso 3y agoYeah, I can't believe that loser only managed to found a single company worth $50,000,000.
- mixmastamyk 3y agoGordon Gecko is that you? Sounds like a parody but you should make it clear to avoid downvotes.
- shiroiushi 3y agoI think the clause starting with "cardinal sin" was the real tip-off.
- dotBen 3y ago"to maximize shareholder value" You know, philosophically speaking, not every company has to do that. And before someone steps in and quotes 'fiduciary responsibility for shareholder returns', I'm a VC and I run a VC fund so I'm acutely aware. Now, if you take venture funding then that's a different story. But there are countless businesses - from small mom+pop to larger ones like Bob's Red Mills - which are operating for higher purposes than just shareholder returns. See B Corps generally. And the world is better place for it. I tuck into a bowl of Bob's oatmeal every morning and I'll be fucked if I'm buying Great Mills or PepsiCo (Quaker Oats) big company shit. "he committed the cardinal sin of making the employees owners instead of fully capturing the excess capital of his means of production and offshoring production entirely to focus on branding" Many would say this was anything but a cardinal sin. Try reading fewer Ayn Rand books.
- mingyeow 3y agoDude, he’s being sarcastic
- cultofmetatron 3y ago> Try reading fewer Ayn Rand books. in ops's defense, he's specifically stating that his statement is from a neoliberal classical view. which would be entirely accurate. It not necessarily HIS personal opinion.
- dotBen 3y agoI guess I could read you a statement from Mein Kampf if you want. Not necessarily MY opinion... and it certainly wouldn't be. But my point is, why would I do that? In both of these examples I can only assume one writes out an opinion because it's close to the one they hold themselves. I don't go around advocating opinions I don't actually hold myself.
- cultofmetatron 3y ago> I guess I could read you a statement from Mein Kampf if you want. Not necessarily MY opinion... and it certainly wouldn't be. with all due respect, being able to take a assertion or make a reasoned argument within the context of a logical framework outside your personal beliefs is a prerequisite to be a judge or lawyer or engineer. beyond mere "devils argument", it is valuable to be able to evaluate an idea in its context. one could argue for all sorts of things from the context of Mein Kampf and not personally believe it. it could be used a rhetorical device for framing a narrative in a way that lets others view it objectively.
- asveikau 3y ago> In the defense of YC by modern neoliberalist definition bob was a terrible businessman This sentence doesn't read as a defense of YC or "modern neoliberalist definition" but as a criticism of it.
- insane_dreamer 3y ago> he committed the cardinal sin of making the employees owners instead of fully capturing the excess capital of his means of production and offshoring production Ayn Rand is turning in her grave