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Is this investor at all experienced in funding technology startups? There is such a wide variation that there is no such thing as "similar". At year 3 Google wa

by aristus 18y ago

Is this investor at all experienced in funding technology startups? There is such a wide variation that there is no such thing as "similar". At year 3 Google was $50 million in the hole with no revenue in sight. The question is silly, but it's not useless. Think about how much you will charge for this thing, or how much traffic, etc. Make up a good per-unit revenue and multiply. Save it so that in 6 months (let alone 3 years) you can pull it out and laugh.

bravura 18y ago
This investor, a friend of mine, represents non-tech savvy high-net-worth individuals. Mainly financiers. (My advisors recommended I not shop for tech-savvy investors until my product is more mature.) How can I estimate traffic?
- pg_ 18y ago
  Do you absolutely need his money to launch?
  - bravura 18y ago
    I am not sure what your question is. Is there a problem with his money specifically? Unfortunately, I do need money to launch and achieve profitability. Search is funny like that. Rich Skrenta, founder of the Blekko search engine, made a big deal out of needing only $5M: “you don’t need a million servers and half of the phd’s in the field to build a search app. It takes 20 people and $5M of hardware…if you know what you’re doing.” $5M might be excessive for my tool, but $0 just won't cut it.
- aristus 18y ago
  You can't, not accurately. Everyone gets this wrong regardless of whether the business succeeds or fails. From your post it sounds like webmasters with "search boxes" are the ones who install this. So first estimate how many of these there are and what their traffic is. Then make up a nice-sounding rate for market share growth and plot it. That's really as far as anyone can tell you. You are the one with the most information. That process is useful because it forces you to really think about how your cool tech will actually operate in the real world. Why did your advisors tell you to go after dumb money first? What was their reasoning? There is a problem with "dumb" money -- it's not as useful as "smart" money. They can't do anything else to help you (contacts, expertise, advice) except write a check.

by aristus 18y ago

bravura 18y ago

This investor, a friend of mine, represents non-tech savvy high-net-worth individuals. Mainly financiers. (My advisors recommended I not shop for tech-savvy investors until my product is more mature.) How can I estimate traffic?

pg_ 18y ago
Do you absolutely need his money to launch?
- bravura 18y ago
  I am not sure what your question is. Is there a problem with his money specifically? Unfortunately, I do need money to launch and achieve profitability. Search is funny like that. Rich Skrenta, founder of the Blekko search engine, made a big deal out of needing only $5M: “you don’t need a million servers and half of the phd’s in the field to build a search app. It takes 20 people and $5M of hardware…if you know what you’re doing.” $5M might be excessive for my tool, but $0 just won't cut it.
aristus 18y ago
You can't, not accurately. Everyone gets this wrong regardless of whether the business succeeds or fails. From your post it sounds like webmasters with "search boxes" are the ones who install this. So first estimate how many of these there are and what their traffic is. Then make up a nice-sounding rate for market share growth and plot it. That's really as far as anyone can tell you. You are the one with the most information. That process is useful because it forces you to really think about how your cool tech will actually operate in the real world. Why did your advisors tell you to go after dumb money first? What was their reasoning? There is a problem with "dumb" money -- it's not as useful as "smart" money. They can't do anything else to help you (contacts, expertise, advice) except write a check.