asterisk2a + fab.com   10

Fab Was Burning Through $14M/Month Before Its Layoffs And Pivot | TechCrunch
[operational cost low in Berlin. 'running out of cash before traction and revenue starts to climb'] “We have years and years of cash left,” Goldberg notes. It seems that even if there may be new kinds of overhead with the design, building, selling and distributing of furniture, it’s nothing compared to the burn of a startup with hundreds of employees and the challenges of grappling with inventory from dozens and dozens of suppliers. Real estate is one part of that cost base: in New York, Fab paid $250,000 per month for two floors of office space. In Berlin, the company spends $125,000 per year on rent. [min11 ... a choice you have to make about your business; scale with low margin ie Amazon, Zalando&co *commodity business. or the reverse. tight curated sought out offering with high margins with a shelf life of very few months *ie seasonal high end fashion, designer items of any kind, hand manufactured stuff] & techcrunch.com/2014/10/20/justin-kan-disrupt/ & youtu.be/CyIMNDCyuBM
Fab.com  Hem  Jason  Goldberg  Berlin  Start-Up  Scene  New  York  Start-Up  Scene  Silicon  Valley  burn  rate  runway  Lean  Start-Up  commodity  business  commoditization  Zalando  margin  Europe  Start-Up  Scene 
october 2014 by asterisk2a
Andreessen: High burn rates risk more than just running out of cash | PandoDaily
Bill  Gurley  Venture  Capital  hunt  for  yield  ZIRP  NIRP  QE  negative  real  interest  rate  equity  bubble  asset  bubble  bubble  speculative  bubbles  bubbles  Silicon  Valley  burn  rate  runway  Start-Up  advice  Lean  Start-Up  Start-Up  lesson  Berlin  Start-Up  Scene  London  Scene  Europe  Start-Up  Scene  New  York  Start-Up  Scene  cost  of  living  living  standard  living  spaces  living  environment  standard  of  living  Benchmark  Capital  San  Francisco  Palo  Alto  distortion  risk  taking  centralbanks  trust  trustagent  confidence  Wall  Street  Taper  discounting  risk  discounted  risk  risk  discount  timing  business  cycle  financial  cycle  GFC  unintended  consequences  unknown  unkown  unknown  unknowns  cash  flow  business  model  monetization  monetisation  Fred  Wilson  AVC  bootstrapped  bootstrapping  growth  round  Expenditure  Fab.com  sustainability  sustainable  a16z  Marc  Andreessen  Ben  Horowitz  SF  war  for  talent  labour  economics  labour  market 
september 2014 by asterisk2a
Winter Is (Probably) Coming (Soon) | TechCrunch
"The more you boost your burn, the more risk you take on. [...] The underlying point of Gurley’s and Wilson’s respective riffs is that many companies will have to reduce their burn in the future. And it won’t be easy. And the pair likely won’t be willing to give larger sums to companies that just torched their prior round in ways that they didn’t precisely approve of. Cash is the oxygen of business. When it runs out, the company dies." ... being nimble, frugal, Lean, conservative ... via https://news.ycombinator.com/item?id=8338411
Bill  Gurley  Venture  Capital  hunt  for  yield  ZIRP  NIRP  QE  negative  real  interest  rate  equity  bubble  asset  bubble  bubble  speculative  bubbles  bubbles  Silicon  Valley  burn  rate  runway  Start-Up  advice  Lean  Start-Up  Start-Up  lesson  Berlin  Start-Up  Scene  London  Scene  Europe  Start-Up  Scene  New  York  Start-Up  Scene  cost  of  living  living  standard  living  spaces  living  environment  standard  of  living  Benchmark  Capital  San  Francisco  Palo  Alto  distortion  risk  taking  centralbanks  trust  trustagent  confidence  Wall  Street  Taper  discounting  risk  discounted  risk  risk  discount  timing  business  cycle  financial  cycle  GFC  unintended  consequences  unknown  unkown  unknown  unknowns  cash  flow  business  model  monetization  monetisation  Fred  Wilson  AVC  bootstrapped  bootstrapping  growth  round  Expenditure  Fab.com  sustainability  sustainable 
september 2014 by asterisk2a
Burn Baby Burn – AVC
From one of the comments: "f you're backing companies that have bootstrapped their start, you get a different, focussed culture & attitude on burn rates and costs. It forces you to think twice about every cost item. You're running as fast as you can to get traction, customers, product, team, everything aligned within tight costs. It's not about frugality but more aligned to reality. " +++ via https://news.ycombinator.com/item?id=8324047 +++ !!! Fancy Offices - bit.ly/1piSnxO +++ !!! +++ "Gurley and Wilson point to sky high burn rates, not valuations as the red flag in Silicon Valley [...] Gurley and Wilson are lamenting the exorbitant burn rates that have become the norm among venture-backed startups and the lack of fear and accountability signaled by this hyper-aggressive approach." - bit.ly/1m93G0M +++ !!! +++ bit.ly/YQY2WS +++ !!! +++ "Which VCs Have the Most Portfolio Companies with $100M+ of Funding?" - bit.ly/1wo7BHF
Bill  Gurley  Venture  Capital  hunt  for  yield  ZIRP  NIRP  QE  negative  real  interest  rate  equity  bubble  asset  bubble  bubble  speculative  bubbles  bubbles  Silicon  Valley  burn  rate  runway  Start-Up  advice  Lean  Start-Up  Start-Up  lesson  Berlin  Start-Up  Scene  London  Scene  Europe  Start-Up  Scene  New  York  Start-Up  Scene  cost  of  living  living  standard  living  spaces  living  environment  standard  of  living  Benchmark  Capital  San  Francisco  Palo  Alto  distortion  risk  taking  centralbanks  trust  trustagent  confidence  Wall  Street  Taper  discounting  risk  discounted  risk  risk  discount  timing  business  cycle  financial  cycle  GFC  unintended  consequences  unknown  unkown  unknown  unknowns  cash  flow  business  model  monetization  monetisation  Fred  Wilson  AVC  bootstrapped  bootstrapping  growth  round  Expenditure  Fab.com  sustainability  sustainable 
september 2014 by asterisk2a
Drowning in venture capital, mobile startups are waging unsustainable price wars | PandoDaily
upside of this up-cycle/up-business cycle? everyone with a little bit of chops and a MVP with little bit of traction can get capital. Downside? Everyone spends their capital. Would never happen in a down cycle. Down cycles are great, you've got more time to build a great team, product and brand. .... "[L]ook at ecommerce 2.0 companies like Fab and EcoMom who blew millions in capital acquiring customers at unsustainable rates, hoping for some magic lifetime customer value to justify the spending. (It didn’t.) “There’s a tension between growing fast enough and having a disastrous bottom line,” Jeff Clavier, Founder of SoftTech VC, says. Clavier was an early investor in Fab, among others playing this game. “If you don’t have growth you’re stuck, but if you have growth with economics not viable in the long term, [you’re making] a real bet that you’ll be funded nevertheless.” [...] companies aren’t developing a sustainable business model. [Freemium works better with Software Product.]
Start-Up  lesson  Start-Up  advice  Lean  Start-Up  VC  Venture  Capital  hunt  for  yield  growth  round  Uber  Lyft  Fab.com  sustainable  sustainability  customer  acquisition  customer  retention  2014  asset  bubble  bubble  Silicon  Valley  Palo  Alto  San  Francisco  business  model  business  plan  user  experience  user  expectations  Amazon  Zappos  free  freemium  SAAS  on-demand  mobile  services  Industry  mobile  first  Uber  for  X  Groupon  Berlin  Start-Up  Scene  Europe  Start-Up  Scene  London  Start-Up  Scene  me  too  price  war  commoditization  commodity  business  differentiation  differentiate  brand  brands  branding  indefensible  values  defensible  values  business  management  management  economics  frictionless  friction  rackspace  training  your  customer  growth  crutch  growth  hacker  traction  Value  Proposition  long-term  thinking  long-term  view 
july 2014 by asterisk2a
Twitter / betashop: 1/ Say hello to Hem ...
@Fab announces @tweetsfromhem (hem.com) for customizable home furnishings; the new furniture site will be a spin-off from Fab; will launch in 30 countries in Sept; 'Hem is a full-stack design company: everything from design to product development to manufacturing to technology & logistics.. factory-direct, easy-assembly, speedy delivery, & mass customization,' Goldberg says [...] Someone said "If you didn't fail, you didn't try hard enough." Goldberg uses what had traction & what was loved by users of Fab, tries to build something new with the remaining capital, without the baggage of Fab.com. Interesting. #customisation #individualisation #appeal-of-luxury #hint-of-luxury #status-symbol #niche
Fab.com  Start-Up  advice  Start-Up  lesson 
july 2014 by asterisk2a
It’s Not A Bursting Bubble. It’s a Correction And It Will Take Awhile. | TechCrunch
the hunt for yield.

Late Stage ...
companies are still getting bid up “like insane.”
but .... “Like Icarus, they got too close to the sun.” (Zynga, Fb, Groupon)

still ... The best companies might even do better in a down market. (Linkedin, Monster energy drink company)

Early Stage investing ...
The impact on the early-stage market is the hardest to predict since these companies are valued more subjectively.

***

This is partly just natural market behavior. When things get super-hot, it’s smart to look elsewhere for less obvious opportunities.

Facebook IPO was just a good catalyst for reinforcing discussion about valuations.

Historical bubbles from the 17th century to 2008 have all sorts of bizarre characteristics. They tend to include masses of normal, unsophisticated investors and draw out unscrupulous and fraudulent actors.

Plenty of capital is still coming in ... The bigger firms are raising a billion dollars or more for their funds. mhhhhh ....
bubble  economic  history  investment-vehicle  investment  management  linkedin  IPO  Groupon  Fab.com  Twitter  seedfunding  venturecapital  Spotify  Zynga  Facebook  SiliconValley  2012  greatrecession  GFC  LTRO  monetary  policy  QE  ZIRP  unintended  consequences 
june 2012 by asterisk2a

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