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This represents a rare (AFAICR) failure for Sequoia. I don't mean to be the naysayer but even at the time, for me, Color had disaster written all over it. All f

by cletus 14y ago

This represents a rare (AFAICR) failure for Sequoia. I don't mean to be the naysayer but even at the time, for me, Color had disaster written all over it. All flash, no substance. I wonder how much of that $40+ million is left and will be returned to investors. Anyone know how many employees Color has (had?)? It's been said that the military is always busy planning for yesterday's war. The lessons of the past often don't reflect the change in circumstances. I think the tech sector suffers from a version of this, particularly for VCs. Facebook is big. Instagram sold big. Lots of people are chasing social. But IMHO social is largely yesterday's war. Take one of my current bugbears: social search. Many view it as the Next Big Thing. Social is seen as a key future driver to recommendations and the like. IMHO this is completely overhyped. This is something that's been much-discussed already but a month or two ago I had an interesting conversation that I think shed some light on the problem. Let's say Alice is friends with Bob. Bob likes a particular movie. We as programmers and entrepreneurs see an opportunity to use technology to solve a "problem" here: namely, how to allow Bob to express that information in such a way as to expose it to Alice, who it is argued, may well be interested in that. The problem here is that the view of the "problem" here is backwards. We see social interactions as an inefficient way of disseminating information but in most cases in the real world, it's the opposite: that movie recommendation is simply a way of enabling and facilitating a social interaction. In other words, the movie recommendation is a means to an end not an end in and of itself. Too many social startups (IMHO) view the social interactions as a means to an end when in fact it is the end. Anyway, my condolences in particular to the employees of Color, who I have no doubt worked hard over the last year or so. Luckily we're in a market where you should easily be able to move on to bigger and better things.

eta_carinae 14y ago
> Color had disaster written all over it. Hindsight is 20/20, it's easy to criticize now, but look at it from the investors' perspective: - A CEO who not only sold his latest startup to Apple but who built about eight companies in the past twelve years, three that he sold and three that went public. - A co founder team made from engineers that came from Google and Apple ... and you have a very solid foundation for a startup with much higher success odds than any other.
- heyitsnick 14y ago
  It's not just hindsight; a lot of people, commentators here and elsewhere, were bemused by the entire Color story. A ridiculous amount of money for a product that didn't exist, had no market, likely had niche interest at best, and had no clear business strategy. It did have disaster written all of it, and a lot of people called them on it at the time. As just one example, a quick google first turned up, but i read mountains of commentary like this: http://news.ycombinator.com/item?id=2655652 http://news.ycombinator.com/item?id=2655652 edit:the parent thread is better to read. this was after shit started hitting the fan, but i can't turn up earlier convos atm http://news.ycombinator.com/item?id=2655592 http://news.ycombinator.com/item?id=2655592
  - MatthewPhillips 14y ago
    I remember reading those threads and you're right. The positive spin was built around 1) That it was an interesting idea. or 2) That it was a talented team which justified the funding. or 3) That being a "fat" start-up they had plenty of chances to get it right. I don't remember many (any?) people saying it was a good idea that would succeed on its own merits.
    - cube13 14y ago
      Re: 1 It was an "interesting idea" in that most people really didn't know what the heck they were doing, or what problem they were trying to solve. All anyone really knew was that they got a boatload of money, and spent a lot of money to get color.com.
  - alexqgb 14y ago
    Let's not forget: the product itself was hideously creepy. It was intended to be a Trojan horse designed to harvest semi-private data from previously inaccessible spaces / transactions / situations, etc, but the design made those intentions a bit to clear - at least to a critical mass of people who were actually paying close attention (not surprising giving the $ involved).
- manuscreationis 14y ago
jpdoctor 14y ago
> This represents a rare (AFAICR) failure for Sequoia. ??? Too numerous to remember. My favorite is still WebVan: $200M flushed down the toilet.
bmm6o 14y ago
> I don't mean to be the naysayer but even at the time, for me, Color had disaster written all over it. I agree with you. I never knew what the investors saw in Color. But that's missing the point, really. Betting against companies is a sure thing - to a decent approximation, none of them achieve the kind of success that a VC is looking for.

by cletus 14y ago

eta_carinae 14y ago

> Color had disaster written all over it. Hindsight is 20/20, it's easy to criticize now, but look at it from the investors' perspective: - A CEO who not only sold his latest startup to Apple but who built about eight companies in the past twelve years, three that he sold and three that went public. - A co founder team made from engineers that came from Google and Apple ... and you have a very solid foundation for a startup with much higher success odds than any other.

heyitsnick 14y ago
It's not just hindsight; a lot of people, commentators here and elsewhere, were bemused by the entire Color story. A ridiculous amount of money for a product that didn't exist, had no market, likely had niche interest at best, and had no clear business strategy. It did have disaster written all of it, and a lot of people called them on it at the time. As just one example, a quick google first turned up, but i read mountains of commentary like this: http://news.ycombinator.com/item?id=2655652 http://news.ycombinator.com/item?id=2655652 edit:the parent thread is better to read. this was after shit started hitting the fan, but i can't turn up earlier convos atm http://news.ycombinator.com/item?id=2655592 http://news.ycombinator.com/item?id=2655592
- MatthewPhillips 14y ago
  I remember reading those threads and you're right. The positive spin was built around 1) That it was an interesting idea. or 2) That it was a talented team which justified the funding. or 3) That being a "fat" start-up they had plenty of chances to get it right. I don't remember many (any?) people saying it was a good idea that would succeed on its own merits.
  - cube13 14y ago
    Re: 1 It was an "interesting idea" in that most people really didn't know what the heck they were doing, or what problem they were trying to solve. All anyone really knew was that they got a boatload of money, and spent a lot of money to get color.com.
- alexqgb 14y ago
  Let's not forget: the product itself was hideously creepy. It was intended to be a Trojan horse designed to harvest semi-private data from previously inaccessible spaces / transactions / situations, etc, but the design made those intentions a bit to clear - at least to a critical mass of people who were actually paying close attention (not surprising giving the $ involved).
manuscreationis 14y ago

jpdoctor 14y ago

> This represents a rare (AFAICR) failure for Sequoia. ??? Too numerous to remember. My favorite is still WebVan: $200M flushed down the toilet.

bmm6o 14y ago

> I don't mean to be the naysayer but even at the time, for me, Color had disaster written all over it. I agree with you. I never knew what the investors saw in Color. But that's missing the point, really. Betting against companies is a sure thing - to a decent approximation, none of them achieve the kind of success that a VC is looking for.