Don’t skip the start! There is a Plan B.

October 26, 2021

Pascal said that things are always best at the beginning. I suspect he was referring to math problems, but I think it works for startups. Raising venture capital at the VERY start is like skipping high school and going directly to college. You get done quicker, but miss some of the most important learning.

Okay, so you drank the koolaid and raised capital from the best VC in town, but realized very quickly that you made a mistake. Which would you choose? Plan A: just keep trying to make it work (i.e. the never give up plan) or Plan B: buyout your VC and start building something great (i.e. the I am done with you guys plan).

If you are Ev Williams, the founder and CEO of Odeo (according to Valleywag), you choose Plan B. Ev is buying back the shares his investors (Charles River Ventures) bought when they funded Odeo. It helps that he sold his previous startup to Google (Blogger). Ev figured out that Odeo wasn’t figured out when iTunes launched their podcast directory in November 2005. He was in a pickle, but he was stuck with his venerable VC partner (for almost a year!). He didn’t take his own advice in a blog post he titled, “Ten Rules for Web Startups”. I wrote about it in a post titled “Be Narrow, Be Tiny”: Don’t Raise Money!!” ~ at least at the start…

So what is next? Ev has announced that his new company, Obvious Corp., will acquire the assets of Odeo and Twitter. Ev explains,

Obvious has purchased all the assets of Odeo, Inc.—including odeo.com and twitter.com from the investors and other shareholders and will continue to run these services. Obvious is fully funded by me and, eventually, will create other things, as well.

Comments

One Response to “Don’t skip the start! There is a Plan B.”

  1. Vaibhav Domkundwar - Better Labs Says:

    This is awesome for Evan, and I totally believe in the model and everything he outlined on his blog post about Obvious.

    Its funny how I thought, I was reading my own thoughts as I read through his justification, as we have build exactly the same model at Better Labs (http://www.betterlabs.net) since Dec 2005. Most importantly, we have build this completely out of our Pune, India office which bring a lot more scalability for the experiments - what we call as the 12-24 month web service, beyond which the successful ones will thrive as independent companies. dealplumber (http://www.dealplumber.com), indiagoes (http://www.indiagoes.com), iNods (http://www.inods.com) are already in their 1.0 versions.

    However, there is a BIG CHALLENGE of how do you follow through after your 1.0 version to drive traffic and customer acquisition, which will make or break this model for everyone who attempts it.

    Its re-assuring though, to think someone else who is a lot more accomplished thinks the same.

    All the very best to Evan, and his team.

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