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Totally agree about #3. Furthermore, after reading the post, I checked out the website to understand how their business model and core value proposition is diff
by malandrew 12y ago
Totally agree about #3. Furthermore, after reading the post, I checked out the website to understand how their business model and core value proposition is different from the other dating sites out there (tinder, okcupid, match, plenty of fish) and it's plainly obvious while it's not an investable idea in its current form. Their core value proposition is that they can provide better matches than automated systems by using skilled people to do the matching. If the skill required is a commodity (like driving or cleaning homes), then there is a potentially scaleable business model, but when it relies on specialized and uncommon skills, it's basically a consulting firm.
The only examples of a successful "consulting firm" that I can think of off the top of my head that has seen any sizable investment is Palantir. Their market may be very small, but each contract is worth so much that there is a huge opportunity. How big is the addressable market of $800/month dating consulting and dating life management? Seems more like a solid lifestyle business than the unicorns that most SV investors are chasing.
The mantra "do things that don't scale" really is about getting traction and growth to get the party started and multiply effectiveness. However, even those things that you initially do that don't scale should eventually be scaleable or else you have a permanent cost center that scales with the business. When your business model doesn't scale you need to rethink the business model.
Are there highly profitable businesses that are consulting firms? Totally. McKinsey, Bain, Booz Allen, Accenture, etc. are all large companies that are profitable and provide consulting services. However, the people investing in those types of business models are not the investors in Silicon Valley. Investors in SV understand software/hardware and using them to increase productivity, providing more value at a lower cost. Unless there is an alternative narrative they are telling investors about how they plan to pivot to something else, I can't help but wonder how such a business model scales to a high valuation in the time scales most venture capital funds have until they need to divest.
Lastly, who on the founding team has professional experience as an engineer? Only the CTO (who has a CompSci degree) has done any software engineering in a professional setting and that was as an intern for 3 months in 2007. Solid personal projects count too, but the CTO has only one repo on github that isn't a fork and it's a basic html/css/js github.io page. I'm not saying that you need to have a strong, experienced technical co-founder to found a successful company, but it's a huge strike against a startup for being investible if there isn't one.
https://www.linkedin.com/in/katiebambino https://www.linkedin.com/in/katiebambino
https://www.linkedin.com/pub/emma-tessler/66/b43/39a?trk=pub-pbmap https://www.linkedin.com/pub/emma-tessler/66/b43/39a?trk=pub...
https://www.linkedin.com/pub/lauren-kay/13/777/392 https://www.linkedin.com/pub/lauren-kay/13/777/392
https://github.com/kbambz?tab=repositories https://github.com/kbambz?tab=repositories