

Ask HN: Our Startup is falling. Should I fall? - Crystalin

I&#x27;m CTO of a cool Startup. We got investments, a cool product that everybody said &quot;Whoohoo&quot; when we showed what we can do with it. But we never sold it...(its free but we never did marketing)<p>We don&#x27;t have money anymore and didn&#x27;t pay our employees the last month. The CEO fails to convince investors or buyers.<p>What do you advice?
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MalcolmDiggs
I think that decision is a very personal one, and only you can make it. With
that being said, here are a few points that should (perhaps) inform your
decision:

1\. How much institutional support (and energy) is there to get the paid
version shipped? Is everyone else burnt out and jumping ship, or could you
realistically stay the course and get that product out the door?

2\. Even if you shipped the paid version, would the revenue be enough to cover
the burn rate? It looks like you guys raised 3 million over the course of the
past year, and burned through it (correct me if I have that wrong, just
getting the data from your Angellist page). At that burn rate, your premium
version (at your stated price of $5 per user per month) would need to onboard
roughly 50,000 paid users to be at the break-even point (though probably more
than that since your costs would go up). Is onboarding than many users
feasible?

If you can ship the premium version and onboard a ton of users all before the
rest of the team throws up their hands...maybe you should go for it; give it
one last college try.

~~~
Crystalin
Thank you for your analysis and advice. Reaching the required number of paying
customers is not possible at the moment, that's why the CEO is looking for
other investments. The marketing we did was too small to reach that number and
we are probably bad marketers anyway. We were expecting for a buzz that would
make us famous and then become superstars. And that's why we tried to make a
better slack with our chat.

But I don't see that point coming. And I think it is the reason we are falling

~~~
brudgers
I don't see a clear market segmentation. Is it for 10 users or 10,000?

Five bucks per person-month doesn't make sense in either market. It's $5 too
much for people building their business on Drive and Evernote. It's too little
for 10,000 screen organizations...they know you will go broke. And then
there's an asterisk on the free plan and another deal for students, so I'm
left wondering if it's worth figuring out the value proposition before I think
about learning how to use it.

If it was an enterprise product, it might make sense but that's not live fast.
die young, and leave a good looking corpse business strategy compatible.
Students probably don't need mobile task updates for group projects. In the
middle, though, there are good user stories and price points. $400 per month
for up to 20 users...that sounds like a way to qualify businesses and reduce
the number of sales.

And if you can't make the bottom line $5000 per year better for 2000
companies, then it's time to throw in the towel.

Good luck.

~~~
Crystalin
Thanks. We never took the time to evaluate more our pricing and its impact. We
were focused on getting users so we can make them pay later

~~~
brudgers
Your company is building a business solution, not Pintrest. People are going
to live 8 and ten hour workdays in it. Sure there needs to be an "easy button"
to help people get onboard. Maybe that is training. Qualifying customers by
their willingness to invest in learning to use your product makes sense.
Project management is hard enough that investments in tool acquisition pay
off.

The wrong customers are worse than no customers because they look like success
but arent.

~~~
Crystalin
You are right and we didn't see it. We probably had wrong customers.
Identifying the good ones is however a hard process, specially for the service
we provide.

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JSeymourATL
No paying customers, no cash reserves, no investors/buyers lined up: you're
done!

Your mission now, (based on your skills & expertise)-- identify someone who
you can help and will pay you for your services. You can make this "pivot"
either individually or as a group. Put your heads together as the sales & biz
dev team. Get out there, start asking people what projects they might need
help on. Do it now!

~~~
Crystalin
We already started to talk how to sell the team, but it is a slow process we
can't afford. It is however our best option at the moment.

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manmeet
I advise not to take advice from random people on the internet who know
nothing about your company or your situation

~~~
Crystalin
Taking advice doesn't mean to follow them but open up your range of choices I
think.

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AznHisoka
WOw, your customer list is impressive(looking at your homepage).. Apple,
Starbucks, etc... If you can sell to those companies, why do you have trouble
selling to other businesses? is it more of an entreprise product rather than
consumer, and you're not charging enuff?

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mc_hammer
i would check out the talks by patio11 he has some good insights to
monitization, optionally: fire ceo, build another product, quit, dont work for
a place that doesnt have a business plan/monitization strategy, sell it to
another company on flippa

~~~
Crystalin
Thanls, I'm going to listen to those talks. Firing the CEO is too late :/ and
I'm sure he had a good business plan otherwise the investors wouldn't have
given us money.

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andrewchambers
What is the start up, or at least what does it do?

~~~
Crystalin
The startup is LiveMinutes, it is an real time collaborative platfom. We
started as a video conference service then we thought it would be cool to
store documents on it, to edit them, then to have a chat, then to have
Evernote, Google drive integrations... but never considered finding real
clients. We have a high traffic/users but not enough...

