
Yik Yak fires 30 of 50 employees - w1ntermute
http://arstechnica.com/business/2016/12/yik-yak-fires-30-of-50-employees-still-has-no-business-model/
======
randomdrake
Not too surprising. From a technology and hacker standpoint, I had a run-in
with one of their earlier developers that left a really bad taste in my mouth.

An ex-engineer from Yik Yak reached out while we were hiring a while back.

They proceeded to supply a .zip file of their entire source code repository
(yes, all of it). They said it was outdated now so it seemed okay in their
eyes.

This included all of the dot files for configuration: keys, passwords, email
addresses, Amazon instances where databases were at, and more.

I didn't ask for this .zip file, I was simply looking for some examples of
experience.

Needless to say, it definitely made me look at Yik Yak differently.

~~~
prodigal_erik
I know a guy who interviews ops people and asks for certain details of their
current employer's network security. The only answer he accepts is "no".

~~~
reikonomusha
Is it really wrong to give architectural considerations of the security of a
system? It seems like security is a _problem_ if having a discussion about
such things could lead to its compromise.

However, I have no expertise in the subject so I could be wrong.

~~~
rgbrenner
Yes, it is wrong. There's no reason to disclose the security systems of your
previous employer, and there's no reason for an employer to ask. Any security
question that can be asked specifically about one company, can be asked and
answered in a more general way.

It's the difference between - "What security controls were in place at Corp?"
and "What security controls would you put in place to protect X system?"

The 1st version is bad, not just because it discloses security controls at the
previous employer.. but also because it makes the candidate responsible for
(possibly bad) security decisions that were outside of their control and/or
existed before they were hired.

The 2nd version gives the candidate a chance to talk generally/ideally about
security.. even if the previous employer did something else.

~~~
Chris2048
> There's no reason to disclose the security systems of your previous employer

But isn't it relevant what technologies you used in your most recent roles?

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StevePerkins
I work nearby their Atlanta office, and about a six months ago I received
numerous phone calls and emails from an internal recruiter about a Go
developer job in that office. Speaking of fad flame-outs, his pitch kept
trying to link Yik Yak to Pokemon Go (i.e. " _one out of every eight yaks is
about Pokemon!_ "). Uhh, okay?

I never responded... because I heard that they had shot themselves in the foot
with recent app changes, and were dying. Obviously, now I'm glad that I made
the right call.

I've seen this happen numerous times in my career, though. I just don't
understand the sort of denial that keeps companies in "hire mode", even when
their internal metrics must make it obvious that things have turned south.

~~~
x0x0
I worked at a company in sf that went from bumping internal referral bonuses /
pitching the employees to push eng friends to apply to layoffs in the span of
a month. Including an h1b engineer that had been lured away from another
company _3 weeks previously_. It is, btw, completely legal to lure people away
from jobs knowing there's a good chance you'll have to lay them off in the
very near future. CEOs are happy to fuck employees over and we should never
forget it.

~~~
ithinkinstereo
> CEOs are happy to fuck employees over and we should never forget it.

_Jerk_ CEOs are happy to do that. There are plenty of ethical founders and
managers out there that loath this type of behavior.

Unfortunately I see more of this flavor at venture backed companies....

~~~
arethuza
By their very nature, VC backed companies are likely to get more unpleasant
surprises than "normal" companies due to their need for regular large
injections of capital from willing investors. Everything can look great until
a round of investment falls through or is delayed and suddenly things can
become unpleasant _very_ rapidly.

~~~
TheOsiris
that is definitely not true as a general rule for vc backed companies. this
might be applicable to companies that have no business model/non-revenue-
generating. but even then, any decent founder can do the basic arithmetic
needed to figure out burn and runway

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koolba
> Since it began in 2013, the company behind the purportedly anonymous
> messaging app has never had, and still doesn’t have, any obvious source of
> meaningful revenue. Yet somehow, Yik Yak was valued by venture capitalists
> at $400 million in December 2014 after Sequoia Capital invested $62 million.

Do investments of this size/nature typically have a raise-or-pay-us-back date
associated with them? i.e. are they usually done as a convertible note to
force the issue or pure equity?

~~~
greglindahl
Investments in money-losing companies have a natural raise-or-do-something
date called "zero cash day". And generally, the company can't raise new money
without having a majority of each class of preferred stock vote for it, i.e. a
majority of the money in every previous round. So if enough investors have
lost confidence in management, no matter how much board control management
has, investors can let the company run out of money.

~~~
koolba
> Investments in money-losing companies have a natural raise-or-do-something
> date called "zero cash day". And generally, the company can't raise new
> money without having a majority of each class of preferred stock vote for
> it, i.e. a majority of the money in every previous round. So if enough
> investors have lost confidence in management, no matter how much board
> control management has, investors can let the company run out of money.

I was thinking more about the situation where the founders fire all the
employees, run the operation as lean as possible (to maintain their
obligations), and stretch the $62M as long as they can. At $2M/year that's 31
years without accounting for any growth of the money itself.

Besides due diligence on the part of the investors to not give money to the
kind of person that would do that, what prevents that situation?

~~~
xenadu02
If the founders retain board control and don't run out of money there is
little the investors can realistically do. Both sides are taking a lot of
risk, I wouldn't rate this as a terribly concerning one. Far far more founders
spend too much money and nosedive into the ground.

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klinskyc
I have not used YikYak since they required me to add a phone number, it's so
antithetical to their entire point that, in hindsight at least, their decision
to de-anonymize it is unbelievable. Are any of the wave of anonymous social
apps doing ok or well?

~~~
abstractbeliefs
As far as I can see, none. There was some discussion recently about Secret
coming back into vogue, but that seems to have fizzled in the past fortnight.

The sad thing is, a lot of these apps are really successful in the outset, but
then end up burned as the companies try, heavy handedly, to monetise.

As much as the startup world sees themselves as morally above the like of
Google who will sell out customers, many startups seem to sell out both their
customers and their product, making fundamentally incompatible changes with
what they were built on in the pursuit of cash.

~~~
minimaxir
Speaking of Secret, the founder of Secret's subsequent startup just launched a
side project which is definitely not a stealth attempt at revitalizing Secret:
[https://bold.io/about-io-2016-12-06](https://bold.io/about-io-2016-12-06)

~~~
fitshipit
related [https://vimeo.com/179079175](https://vimeo.com/179079175)

~~~
randycupertino
Interesting seeing him shilling for Infinity, I thought he was all about
ferraris: [http://www.businessinsider.com/secret-founder-sells-
ferrari-...](http://www.businessinsider.com/secret-founder-sells-
ferrari-2015-4)

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throwaway_yak
At a Sequoia-organized hiring event (which was dubbed as a conference) in New
York this October, I got a chance to interact with over 10 of YikYak
engineers, their hiring manager (ex-Google) and the CEO.

The CEO had an unconventional background (was in med school at Furman), so I
was interested in knowing how he made it. I was shocked to see that he didn't
have any insights about how anything at the firm worked. I asked him how he
raised funds, he replied that he found a family friend who worked in startups
and everything was good from there.

I wasn't interested in getting a job as I already have one, but the arrogant
hiring manager didn't stop his attempts at (literally) pushing me towards a
computer and asking me to apply.

The (now, unfortunate) engineers were the only people who had some clue what
they were doing (they had some really decent cross-language optimization
problems)...

~~~
greglindahl
Furman doesn't have a med school. He was a pre-med.

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uncletammy
I saw two of the founders speak at an event during SXSW last year. They spoke
about the privacy and anonymity features of their app as if they added no
value and caused more trouble than they were worth.

To be fair though, half of the people asking questions during the Q&A were
angry teachers and parents, grandstanding about how they don't sensor enough.
I can see how that might wear you down.

I would have cut them a break if they hadn't generally come off as arrogant
pricks.

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Overtonwindow
This was sad to see. I work in their building and there were a lot of people
crying and unhappy and venting in the lobby.

~~~
Tempest1981
Unfortunately, the bad news hits hardest on those who believed the
managements' positive spin. You hope that the leaders were being honest with
employees as things began looking worse, so that it wasn't such a surprise.

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eschaton
People shouldn't say "fired" when they mean "laid off."

Being laid off means someone's position was eliminated. Being fired means
someone was terminated for cause, i.e. because of something they did (or
didn't do).

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Larrikin
What I don't understand are the people who still have it installed. They
ruined the only interesting thing about the app when they forced names on
everyone

~~~
icedchai
How's that? Just use a fake name.

~~~
TulliusCicero
The problem with pseudonymous account names is that if you post consistently
under one, it makes it possible for people to figure out who you are, people
who know you in real life can figure out the pattern. Yeah you could defeat
this by repeatedly creating new accounts, but that would be annoying.

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foxhop
Sorta related and not trying to pile it on, but I made a clone of Yik Yak
during a hackathon a couple weeks ago.

Share notes with people nearby

[https://unturf.com](https://unturf.com)

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ThatsEasyRight
I've always wondered what happens to all the private conversations, guaranteed
anonymized by the user agreement, when a company like this decides to start
selling off it's assets.

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OJFord
Yik Yak had 50 employees?!

I'd have thought anybody could tell them that was too many...

Wasn't Snapchat or Instagram at around that until fairly recently? Yik Yak is
no Snapchat or Instagram.

~~~
gaius
You're thinking of WhatsApp

~~~
OJFord
My point stands m.m.

~~~
gaius
Indeed!

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amingilani
> Yik Yak fires 30 of 50 employees, still has no business model

Oh, so what? Ars is trying to spin it off like the former caused the latter,
while it's definitely the opposite. They hired too many people and realized it
was time to let some go. There's absolutely nothing wrong with a company
trying to rectify its mistakes. Instagram had 13 employees at acquisition, Yik
Yak might have expanded too fast, but they're fixing it.

> still doesn’t have any obvious source of meaningful revenue. Yet somehow ...
> valued ... at $400 million in December 2014"

Plenty of companies have no revenue model initially, and can be valued at
millions of dollars: Snapchat $800m in 2013[1], Instagram acquired at $1b.

Maybe i'm too naive, but a company makes plenty of epic mistakes throughout
its lifetime, and can do some pretty outrageous things (Zuck's business cards
[2]) but that doesn't mean they're incompetent, just learning. This article's
trying to shovel as much dirt as it can on the company with cherry picked
incidents about trouble the company's run into, and it's not a lot of trouble
honestly. How is a company's experimentation with mandatory user handles part
of a post on its downsizing?

[1]: [http://qz.com/97467/snapchats-complete-inability-to-make-
mon...](http://qz.com/97467/snapchats-complete-inability-to-make-money-is-the-
reason-its-worth-800-million/)

[2]: [http://nextshark.com/heres-the-story-behind-mark-
zuckerbergs...](http://nextshark.com/heres-the-story-behind-mark-zuckerbergs-
im-ceo-bitch-business-card/)

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Tempest1981
Did they try running in-app ads? Why do they have "no business model"?

They should still have a big chunk of that $62 million left in the bank, if
they only had 50 employees. Cutting that to 20 should give them a few years of
runway.

~~~
azinman2
I'd imagine they might have spent a bunch getting into campuses across the
US...

~~~
mcintyre1994
They had a campus representative at my university (UK), not sure how that
worked. But if you had high 'yakarma' you'd apparently get free Yik Yak
socks/t-shirts etc. from them.

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kimshibal
Everyone is moving to Jodel

