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Bootstrapping (adj): a self-sustaining process that proceeds without external help. Not bootstrapping: $5M in VC. There is no "partially bootstrapped," you ei

by ecaron 14y ago

Bootstrapping (adj): a self-sustaining process that proceeds without external help. Not bootstrapping: $5M in VC. There is no "partially bootstrapped," you either are or aren't. Can somebody update the headline?

vonmoltke 14y ago
"They had bootstrapped the company, launched the service, and were well on their way. They didn't need our money. But eventually we convinced them to take it," USV's Fred Wilson writes. Looks like the headline is based on this quote. Still doesn't make them bootstrapped, but it does seem like the $5M was just a safety net, not a requirement.
- davidwparker 14y ago
  I disagree. Take GitHub for example. They just raised $100M in VC. That doesn't take away from the fact that they bootstrapped from April 2008 until July 2012. Not bootstrapping is taking early Angel/VC funding in order to run the company.
  - vonmoltke 14y ago
    True. Indeed actually does fit the definition given above, since they did not require the VC money to start and run the company. Sometimes I post faster than I think.
    - ecaron 14y ago
      Except Indeed got the VC infusion in 2005, and only after that did they start becoming a recognizable player in the industry (if my personal experience in the industry isn't enough of a source for this, see http://www.google.com/trends/?q=indeed.com&geo=usa&sa=N http://www.google.com/trends/?q=indeed.com&geo=usa&s...)
      - vonmoltke 14y ago
        From Fred Wilson's blog announcing the partnership[1]: To Paul and Rony’s credit, during that seven month courtship, they have built Indeed into the leader in the job search market. Their competitors will probably take exception to that comment, but our analysis of traffic, jobs indexed, and name recognition indicates that Indeed is the leader in pure job search. They did not need the money to start and maintain the business. What their growth rate was before and after the investment is irrelevant; they were a sustainable business without the VC money. Sure, the infusion of money and intangibles gained from having Union Square Ventures as an investor helped propel their rise, and may well have been necessary to push it to a $1B valuation by today. However, it was not necessary for the business[2]. [1] http://avc.blogs.com/a_vc/2005/08/indeed.html http://avc.blogs.com/a_vc/2005/08/indeed.html [2] Based on publicly-available information
        ecaron 14y ago
        > However, it was not necessary for the business I don't think anyone is arguing that Indeed would still exist had the $5M not come around. The point is that the $5M helped Indeed purchase the traffic/partnerships necessary to make it the #1 job search site on the internet. And without that money, they couldn't have bought their way to their current size - and their current size is reasons 1, 2 and 3 they were acquired.
  - dsolomon 14y ago
    $100M for a SourceForge clone with prettier colors? OMG.
- gojomo 14y ago
  I believe eBay was a similar situation: they took ~$7mil venture money in 1997 but never actually needed it.
ig1 14y ago
I believe the implication is that they didn't raise money as a startup, but only at the growth stage when they were well established. Growth stage financing is significantly different from early stage/startup financing, hence it's worth differentiating a company that got to growth stage through bootstrapping rather than the traditional seed and VC stages of financing.
riviera 14y ago
It seems like they listened to you: "Indeed, An Almost Entirely Bootstrapped Job Search Giant, Gets A Monster Exit"

by ecaron 14y ago

vonmoltke 14y ago

"They had bootstrapped the company, launched the service, and were well on their way. They didn't need our money. But eventually we convinced them to take it," USV's Fred Wilson writes. Looks like the headline is based on this quote. Still doesn't make them bootstrapped, but it does seem like the $5M was just a safety net, not a requirement.

davidwparker 14y ago
I disagree. Take GitHub for example. They just raised $100M in VC. That doesn't take away from the fact that they bootstrapped from April 2008 until July 2012. Not bootstrapping is taking early Angel/VC funding in order to run the company.
- vonmoltke 14y ago
  True. Indeed actually does fit the definition given above, since they did not require the VC money to start and run the company. Sometimes I post faster than I think.
  - ecaron 14y ago
    Except Indeed got the VC infusion in 2005, and only after that did they start becoming a recognizable player in the industry (if my personal experience in the industry isn't enough of a source for this, see http://www.google.com/trends/?q=indeed.com&geo=usa&sa=N http://www.google.com/trends/?q=indeed.com&geo=usa&s...)
    - vonmoltke 14y ago
      From Fred Wilson's blog announcing the partnership[1]: To Paul and Rony’s credit, during that seven month courtship, they have built Indeed into the leader in the job search market. Their competitors will probably take exception to that comment, but our analysis of traffic, jobs indexed, and name recognition indicates that Indeed is the leader in pure job search. They did not need the money to start and maintain the business. What their growth rate was before and after the investment is irrelevant; they were a sustainable business without the VC money. Sure, the infusion of money and intangibles gained from having Union Square Ventures as an investor helped propel their rise, and may well have been necessary to push it to a $1B valuation by today. However, it was not necessary for the business[2]. [1] http://avc.blogs.com/a_vc/2005/08/indeed.html http://avc.blogs.com/a_vc/2005/08/indeed.html [2] Based on publicly-available information
      - ecaron 14y ago
        > However, it was not necessary for the business I don't think anyone is arguing that Indeed would still exist had the $5M not come around. The point is that the $5M helped Indeed purchase the traffic/partnerships necessary to make it the #1 job search site on the internet. And without that money, they couldn't have bought their way to their current size - and their current size is reasons 1, 2 and 3 they were acquired.
- dsolomon 14y ago
  $100M for a SourceForge clone with prettier colors? OMG.
gojomo 14y ago
I believe eBay was a similar situation: they took ~$7mil venture money in 1997 but never actually needed it.

ig1 14y ago

I believe the implication is that they didn't raise money as a startup, but only at the growth stage when they were well established. Growth stage financing is significantly different from early stage/startup financing, hence it's worth differentiating a company that got to growth stage through bootstrapping rather than the traditional seed and VC stages of financing.

riviera 14y ago

It seems like they listened to you: "Indeed, An Almost Entirely Bootstrapped Job Search Giant, Gets A Monster Exit"