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If you know you're screwed, and you've made a couple of million bucks, why aren't you just closing up the company and going home to have a money party? That pr

If you know you're screwed, and you've made a couple of million bucks, why aren't you just closing up the company and going home to have a money party? That probably sounds quite harsh if it's something you love, but a million bucks is like economic freedom for life, and you can try again with a different idea later where there's less active competition. Sounds to me like you did pretty well for yourself.

alsostayinganon 13y ago
We're not screwed per se, just treading water just below break even. We still have a significant paying user-base but our churn is higher than our new user acquisition rate. We keep trying to fix that but over the past year or two we've had little success. I like the team and we're working on another project that could potentially re-ignite the company so I haven't given up all hope yet. I committed a block of money back into the company when I decided to hire a team. We haven't burned through it yet (that's the 6-12 months runway that's left at this point) but once it's up I can't justify putting in any more and wouldn't feel comfortable asking an investor to put money into something that I wouldn't fund myself.
- 6d0debc071 13y ago
  Ah, as long as you know when you're going to get out if it goes sideways I feel a lot better about your sitch :) Best of luck!
kirillzubovsky 13y ago
In this day and age, a million bucks is not even close to an economic freedom. @webwright has a good post on what he calls "Fuck you money", the amount you'd need to retire rich. Well worth the read. http://www.tonywright.com/2010/no-you-cant-retire-rich-at-30-if-you-sell-your-startup/ http://www.tonywright.com/2010/no-you-cant-retire-rich-at-30...
- georgemcbay 13y ago
  That article may be worth reading, but it is about retiring "rich", not simply retiring. It assumes a yearly lifestyle cost of $200k per year, which is redonkulously high. You don't need to be "rich" to be economically "free". Most people can live quite comfortably for far less than $200k/yr when they are debt free and (figuratively) sitting on a giant pile of cash, especially if they aren't tied to living in SV, NYC, etc.
  - kyllo 13y ago
    Yeah, that sort of depends on how expensive of a house you want, and whether "retired" really means "zero work and zero income" or just means you have the freedom to work on whatever you want and never need to take a full-time day job again. If you're the "permanent vacation" type of retired then $200k / year fixed income might be low. Waterfront properties, luxury hotels and first-class plane tickets are expensive. You're at least 1-2 orders of magnitude from private jet money. If you're the "I paid off my mortgage and cars, set aside my kids' tuition account, and now my only expenses are food, utilities and taxes, and now I have years of runway to build my next project, plus free time to do hobbies, raise my kids, and enjoy life" type, then a 2-4 million payout is probably plenty to qualify for "FU money." That's more than most people make in a lifetime, so if you get it in a lump sum, you're set. It's all about what standard of living you want.
- clarky07 13y ago
  Sure it is. You just have to have more reasonable expectations. A million bucks can easily generate 30-50k a year in dividends, and without a mortgage, that is enough to live a comfortable lifestyle. You can't go on permanent vacation, but you can live and work on whatever you want to without needing a job. 200k is a silly number to use in this calculation. Most studies show that "happiness" stops having big returns past something like 70-80k. Could I spend 200k a year? Sure no problem. Do I need to? No way.
  - gaadd33 13y ago
    While 200K is silly, I don't think 1M is really enough to never have to work again assuming a family. You would have to purchase a house, it should be in a safe area with a good school district, so that's probably 200K? (I don't know what prices would be far away from the coasts) So now you have 800K generating dividends for you, plus you have to save every year to be able to cover your kids college tuition since you can't get any need based money due to your nest egg. Even assuming you somehow do that on 50K/year (or your kids get merit scholarships), in 30 years (by the time you are 60) your 50K has the purchasing power of ~25K.

alsostayinganon 13y ago

We're not screwed per se, just treading water just below break even. We still have a significant paying user-base but our churn is higher than our new user acquisition rate. We keep trying to fix that but over the past year or two we've had little success. I like the team and we're working on another project that could potentially re-ignite the company so I haven't given up all hope yet. I committed a block of money back into the company when I decided to hire a team. We haven't burned through it yet (that's the 6-12 months runway that's left at this point) but once it's up I can't justify putting in any more and wouldn't feel comfortable asking an investor to put money into something that I wouldn't fund myself.

6d0debc071 13y ago
Ah, as long as you know when you're going to get out if it goes sideways I feel a lot better about your sitch :) Best of luck!

kirillzubovsky 13y ago

In this day and age, a million bucks is not even close to an economic freedom. @webwright has a good post on what he calls "Fuck you money", the amount you'd need to retire rich. Well worth the read. http://www.tonywright.com/2010/no-you-cant-retire-rich-at-30-if-you-sell-your-startup/ http://www.tonywright.com/2010/no-you-cant-retire-rich-at-30...

georgemcbay 13y ago
That article may be worth reading, but it is about retiring "rich", not simply retiring. It assumes a yearly lifestyle cost of $200k per year, which is redonkulously high. You don't need to be "rich" to be economically "free". Most people can live quite comfortably for far less than $200k/yr when they are debt free and (figuratively) sitting on a giant pile of cash, especially if they aren't tied to living in SV, NYC, etc.
- kyllo 13y ago
  Yeah, that sort of depends on how expensive of a house you want, and whether "retired" really means "zero work and zero income" or just means you have the freedom to work on whatever you want and never need to take a full-time day job again. If you're the "permanent vacation" type of retired then $200k / year fixed income might be low. Waterfront properties, luxury hotels and first-class plane tickets are expensive. You're at least 1-2 orders of magnitude from private jet money. If you're the "I paid off my mortgage and cars, set aside my kids' tuition account, and now my only expenses are food, utilities and taxes, and now I have years of runway to build my next project, plus free time to do hobbies, raise my kids, and enjoy life" type, then a 2-4 million payout is probably plenty to qualify for "FU money." That's more than most people make in a lifetime, so if you get it in a lump sum, you're set. It's all about what standard of living you want.
clarky07 13y ago
Sure it is. You just have to have more reasonable expectations. A million bucks can easily generate 30-50k a year in dividends, and without a mortgage, that is enough to live a comfortable lifestyle. You can't go on permanent vacation, but you can live and work on whatever you want to without needing a job. 200k is a silly number to use in this calculation. Most studies show that "happiness" stops having big returns past something like 70-80k. Could I spend 200k a year? Sure no problem. Do I need to? No way.
- gaadd33 13y ago
  While 200K is silly, I don't think 1M is really enough to never have to work again assuming a family. You would have to purchase a house, it should be in a safe area with a good school district, so that's probably 200K? (I don't know what prices would be far away from the coasts) So now you have 800K generating dividends for you, plus you have to save every year to be able to cover your kids college tuition since you can't get any need based money due to your nest egg. Even assuming you somehow do that on 50K/year (or your kids get merit scholarships), in 30 years (by the time you are 60) your 50K has the purchasing power of ~25K.