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I'm a little bit curious if anyone knows or someone from the company is willing to answer: Magic charges the customer, then pays for the items. Since this was

I'm a little bit curious if anyone knows or someone from the company is willing to answer: Magic charges the customer, then pays for the items. Since this was a weekend project and they use Stripe (which pays in no less than 2 business days, and in most cases 7 days)...where did they get the money for such a large "float" at the beginning? They have to have the money to pay out in advance, well before receiving it back. Also, maybe Stripe should issue temporary cards instantly for just this sort of business. You charge a customer, then can get a one-time-use virtual card number to be able to order the items that you just charged the customer for, up to the amount you have in "escrow" with Stripe. People could do "roll your own" affiliate programs anywhere, with anything, without the cooperation of any other business.

chatmasta 12y ago
Not necessarily. They can negotiate custom payment schedules with the service provider. I imagine this investment will go a long way toward helping them form those partnerships.
beachstartup 12y ago
> where did they get the money for such a large "float" at the beginning i don't understand what the mystery here is. it could have come from anywhere. credit cards, savings, cofounder investment, mom and dad, etc. in major US cities regular professional people easily have six figures of cash in their bank account and the whole point of money is that it's fungible. also, after doing some reading, this isn't the ceo's first startup. maybe they just had the cash.
- 123452500202 12y ago
  Maybe I'm misunderstanding what you mean by "regular" or "professional", but the idea that normal professionals have six figures in their bank account is absurdly far from reality.
  - beachstartup 12y ago
    not every one, but plenty do. of course they're not going to tell you about it. let me ask you something - how do you think people are buying houses in these insane real estate markets? do you think they're royalty, or aristocracy? no, they're professional people spending their hard earned money. a good 30 year old lawyer easily makes 200k a year. the smart ones spend very little of that. the really smart ones invest the rest, and have been for years. if imagining a major city like LA or SF or NY where lawyers and bankers and entrepreneurs have six figures to their name is tough for you, i really don't know what to tell you, dude. even in tech, i personally know sysadmins and programmers who make ~100k but save most of their money and have done so for over a decade, who easily have 100k saved up. most of them are either trying to buy property, or pull the escape hatch with a huge cushion. quite frankly if you're a professional (a REAL, ACTUAL, professional, with a respectable salary) in your 30s and you don't have at least one account with six figures in it or a house to show for it instead, you kinda sorta fucked up somewhere along the way. where in the hell did ~$1M of cumulative gross income go?
    - downandout 12y ago
      Let me pause for a moment to let the class from this post wash over me.
      - beachstartup 12y ago
        not as classy as your ad hominem defense. if you are a working professional who is gainfully employed, it's not hard to save 10k a year for a decade. it just isn't. you're not thinking critically about this.
    - deleted 12y ago
      [deleted]
    - deleted 12y ago
      [deleted]
    - mikegioia 12y ago
      quite frankly if you're a professional (a REAL, ACTUAL, professional, with a respectable salary) in your 30s and you don't have at least one account with six figures in it or a house to show for it instead, you kinda sorta fucked up somewhere along the way. This is naive in a way where you probably can't be convinced otherwise. Is your worldview so limited that your only conclusion to draw from this scenario is that the person "kinda sorta fucked up"?
- downandout 12y ago
  They had 17K messages in the first 48 hours (I realize those aren't orders, but still). Let's call it 5K orders. Maybe $50 average order. $250,000, or $125,000 per day in required float - to wait 7 days for Stripe they'd need at least $1M. That's from the beginning - it may have grown by now. So we aren't talking about credit cards or mom and dad type investment, unless you have a stratospheric credit limit or mom and dad are very wealthy.
  - beachstartup 12y ago
    yeah, wtf indeed, i'm editing this because i gave away too much personal information in the post.
    - downandout 12y ago
      I think I speak for everyone when I say...wtf.
  - vidarh 12y ago
    Frankly, for a single professional person with a history of SV level salaries, covering several days worth of that on credit cards is not necessarily a problem.

chatmasta 12y ago

Not necessarily. They can negotiate custom payment schedules with the service provider. I imagine this investment will go a long way toward helping them form those partnerships.

beachstartup 12y ago

> where did they get the money for such a large "float" at the beginning i don't understand what the mystery here is. it could have come from anywhere. credit cards, savings, cofounder investment, mom and dad, etc. in major US cities regular professional people easily have six figures of cash in their bank account and the whole point of money is that it's fungible. also, after doing some reading, this isn't the ceo's first startup. maybe they just had the cash.

123452500202 12y ago
Maybe I'm misunderstanding what you mean by "regular" or "professional", but the idea that normal professionals have six figures in their bank account is absurdly far from reality.
- beachstartup 12y ago
  not every one, but plenty do. of course they're not going to tell you about it. let me ask you something - how do you think people are buying houses in these insane real estate markets? do you think they're royalty, or aristocracy? no, they're professional people spending their hard earned money. a good 30 year old lawyer easily makes 200k a year. the smart ones spend very little of that. the really smart ones invest the rest, and have been for years. if imagining a major city like LA or SF or NY where lawyers and bankers and entrepreneurs have six figures to their name is tough for you, i really don't know what to tell you, dude. even in tech, i personally know sysadmins and programmers who make ~100k but save most of their money and have done so for over a decade, who easily have 100k saved up. most of them are either trying to buy property, or pull the escape hatch with a huge cushion. quite frankly if you're a professional (a REAL, ACTUAL, professional, with a respectable salary) in your 30s and you don't have at least one account with six figures in it or a house to show for it instead, you kinda sorta fucked up somewhere along the way. where in the hell did ~$1M of cumulative gross income go?
  - downandout 12y ago
    Let me pause for a moment to let the class from this post wash over me.
    - beachstartup 12y ago
      not as classy as your ad hominem defense. if you are a working professional who is gainfully employed, it's not hard to save 10k a year for a decade. it just isn't. you're not thinking critically about this.
  - deleted 12y ago
    [deleted]
  - deleted 12y ago
    [deleted]
  - mikegioia 12y ago
    quite frankly if you're a professional (a REAL, ACTUAL, professional, with a respectable salary) in your 30s and you don't have at least one account with six figures in it or a house to show for it instead, you kinda sorta fucked up somewhere along the way. This is naive in a way where you probably can't be convinced otherwise. Is your worldview so limited that your only conclusion to draw from this scenario is that the person "kinda sorta fucked up"?
downandout 12y ago
They had 17K messages in the first 48 hours (I realize those aren't orders, but still). Let's call it 5K orders. Maybe $50 average order. $250,000, or $125,000 per day in required float - to wait 7 days for Stripe they'd need at least $1M. That's from the beginning - it may have grown by now. So we aren't talking about credit cards or mom and dad type investment, unless you have a stratospheric credit limit or mom and dad are very wealthy.
- beachstartup 12y ago
  yeah, wtf indeed, i'm editing this because i gave away too much personal information in the post.
  - downandout 12y ago
    I think I speak for everyone when I say...wtf.
- vidarh 12y ago
  Frankly, for a single professional person with a history of SV level salaries, covering several days worth of that on credit cards is not necessarily a problem.