
Color: We Are Not Shutting Down - wlue
http://techcrunch.com/2012/10/17/color-says-not-shutting-down/
======
olivercameron
How on earth did it take over 3 hours for someone at Color or Sequoia to
confirm the company is in-fact not dead? You'd think
employees/founders/investors would have been tweeting like crazy to deny the
rumor.

~~~
potatolicious
Because the last thing you want to do is have employees (even execs) shooting
their mouths off in the heat of the moment and saying something stupid.

You want to regroup, figure out WTF is going on and how the rumor started, and
figure out a sensible statement that is going to calm this down instead of
rile it up some more.

~~~
jonknee
> saying something stupid

What kind of stupid thing could you say? The company is either dissolving or
it is not. Seems pretty easy to figure out.

~~~
bduerst
In any normal population of sufficient size you're going to have some
screwball outliers.

~~~
potatolicious
And in any situation of sufficient gravity and chaos _everyone_ becomes a
screwball outlier.

------
richardjordan
Well, I guess they've found the person who leaks everything to the media... It
says VentureBeat confirmed the email was sent to just one person. I wonder if
this was a mole hunt.

Still, Color is gash and an embarrassment to the whole industry, and its death
would not be mourned by many.

------
AznHisoka
Unfortunately, not giving up and willing yourself to success isn't enough to
overcome an nonexistent business model.

~~~
orthecreedence
Why waste time on frivolities like a "business model" when you can dupe
investors out of $40M and spend it on a lavish office and developing a lame
photo-sharing app that could have been done with $100K?

If anything makes me think we're in a bubble, it's companies like Color and
the people who pump money into them.

~~~
DrStalker
But... with that budget how could possible afford to buy both color.com and
colour.com! Withour colour.com dozens of people around in countries using
British English won't be able to be confused by your app.

------
001sky
A similar pattern was recently in the news here: Onlive.

August 17, 2012 > _OnLive lays off all employees, assets sold to new company_
[0]

5:20 PM - August 17, 2012 > _OnLive Denies It's Shutting Down, Won't Comment
on Layoffs_ [1]

08/20/2012 10:11:33 AM PDT > _Game company OnLive reveals new details of
restructuring_ [2]

Winding down a business might mean they are trying to orchestrate a merger or
aq-hire. Or a whole host of other things. For which you would not want your
name in the news (sensitive negotiations, or wat-ever).

______________________

 _“We don’t respond to rumors, but the service is not shutting down,” OnLive
said._ [3]

______________________

[0]
[http://www.gamasutra.com/view/news/176180/OnLive_lays_off_al...](http://www.gamasutra.com/view/news/176180/OnLive_lays_off_all_employees.php)

[1] [http://www.tomshardware.com/news/OnLive-Shutting-Down-
Layoff...](http://www.tomshardware.com/news/OnLive-Shutting-Down-Layoffs-
Bankrupt-Statement,16993.html)

[2] [http://www.mercurynews.com/entertainment/ci_21351760/game-
co...](http://www.mercurynews.com/entertainment/ci_21351760/game-company-
onlive-reveals-new-details-restructuring?source=rss)

[3] "Just a short while ago reports emerged that the gaming and virtual-
desktop software start-up had issued pink slips to all of its employees and
was effectively shutting down the service. The first part, we’re told by an
OnLive spokesperson, is not the case." [http://allthingsd.com/20120817/onlive-
denies-reports-that-it...](http://allthingsd.com/20120817/onlive-denies-
reports-that-its-shutting-down/)

~~~
001sky
[update] > <http://news.ycombinator.com/item?id=4667217>

------
k-mcgrady
Assuming Color's statement wasn't a lie that's some pretty shitty reporting by
Venture Beat. Reporting a companies board has voted to shut it down is pretty
big news and should require much more verification that one single email. Tech
'journalists' need to do a better job when reporting this sort of thing.

~~~
pron
Absolutely. Both Color _and_ Venture Beat have some serious debriefing to do.
Assuming Color is right, a lot of damage has already been done. In that case,
in (serious, non-tabloid) print journalism, the publication's reputation would
be tarnished; in online journalism, it may be just the company's. Somebody
sure owes the public an explanation into what exactly just happened here.

EDIT: not _somebody_. It's Venture Beat that owes the explanation. Either they
stand by the story even if they're willing to do that without full
verification, or they must apologize for jumping the gun.

------
dcpdx
I would love to see an AmA with a Color employee to get the inside scoop on
what's going on there. It must be devastating for morale for a rumor to spread
that everybody assumed was going to happen at some point anyway (was anybody
surprised when their shutdown was announced? I didn't even bat an eye) and
then have to come out and vehemently deny the rumor. And all the while the
absentee CEO is galavanting around the world on some exotic "sabbatical" as
his company burns to the ground. Only a matter of time until this news
resurfaces again, only next time it will be for real.

------
modarts
My question would be: Why not?

~~~
mikeryan
Please correct me if I'm wrong, but my understanding is that most funds are
only allowed to invest capital once, so any of the $40M they get back (which
I'd hope would be a somewhat large chunk) can no longer be invested.

A smarter move may be looking at and pursuing several pivots, use that 40M to
create a few startups within a startup and see if you can get something
started that will provide a healthy return.

~~~
brackin
Exactly, although they have a tarnished brand. They could find the most
talented developer and become somewhat of a Mobile incubator. They've got a
lot of deals and scale having dealt with Verizon, physical space and
employees. They could use Color labs as the shell for lots of products.

------
tomasien
That email felt weird, didn't look like an email you'd send to employees to
tell them you were shutting down.

~~~
cube13
Then it's weird that the board did not go out and deny that the email was
authentic at all.

------
thelibrarian
As a slight aside - is it just me, or is their logo basically a rip-off of the
Royal Air Force roundel?

------
at-fates-hands
I'm still trying to figure out how a company who has $41 million in funding
and over 400K users can't seem to come up with a business plan that generates
revenue.

Is this another example of buyer beware when you invest in these kinds of
companies?

~~~
stevewilhelm
400K users? total registered users? surely that can't be active users.

~~~
pemulis
AppData says 460,000 active monthly users[1]. The original VentureBeat article
quoted AppData at 440,000, which is where the ~400,000 number is coming from.

Edit: In reply to the grandparent, because of the huge amount of money Color
raised, they would need to make something like ten thousand dollars per user
at their current user numbers to meet expectations. Since that's obviously
impossible, it makes sense for them to avoid revenue entirely until their user
numbers hit eight digits at least.

[1] <http://www.appdata.com/apps/facebook/200067376723055-color>

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zbowling
I bet color is getting way more traffic than normal with this stuff.

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zerostar07
In other news, Paris Hilton stated "I'm not quitting"

