

Ask HN: Reverse Accelerator - massappeal

Ok, so this idea&#x27;s been bouncing around in my head for the past 24 hours and I want you guys to tell me if I&#x27;m crazy or not.<p>They say that 3 out of 4 start ups fail. And they fail for any number of reasons; sometimes the market isn&#x27;t educated enough, sometimes the economy goes down, sometimes the founders can&#x27;t handle the business aspect of the company. Point is, a ton awesome start-ups fail for reasons other than the product.<p>So what if we put together a small fund, $2.5m. We went to every VC in the valley and asked them about their favorite investments that failed for reasons other than the technology. We put together a list of 100 such companies and approach whomever retained the rights to the tech after the company dissolved and attempt to acquire it for around $50k. 90% will turn us away, but there will be at least 5 who have some code sitting on a harddrive that will never be used again, or something similar. 5 pieces of technology that were vetted and funded by VC&#x27;s but failed to succeed as a company.<p>With those 5 pieces of tech we put together 5 companies, recruiting experienced entrepreneurs, developers and sales people, and give each company $250,000.<p>We just took $2.5m and created 5 companies with a combined valuation of roughly $10m.<p>I feel like these companies are more likely to succeed than the average start up because we know the tech is solid; we sourced it, and we wouldn&#x27;t fund it if we didn&#x27;t believe in it ourselves. And we assembled an experienced team to manage it. But if even one of those companies has a successful exit, than the fund will easily clear the $2.5m investment.<p>I called it a reverse accelerator because rather than the founders coming to us with an idea for mentorship and $ to help them build their company, we come to them with tech and $ and help them build their company.<p>Am I crazy?
======
djloche
Related: There is an opportunity for a company (or even multiple companies) to
build a suite of complimentary software and services from the IP and former
customer bases of failed startups. The trick (aside from having the funds and
clout to negotiate and keep the purchases at small dollar amounts) is to find
the areas where two (or more) unsuccessful businesses could have been
successful if they were run under the same house.

~~~
massappeal
exactly! theres a ton of good ideas and good work sitting on harddrives
because the original company didn't succeed, and I'm sure a lot of it has
value that could be recycled or reintroduced

------
abracar
You're not crazy but I'm not sure to see the added value over a normal
"company builder" (where the fund comes up with the idea). Are you sure the
idea/market opportunity was the most interesting thing about those failed
startups in the first place? They might have raised money for other reasons
(team, momentum) which are now gone.

~~~
massappeal
Well we could focus on ones that had those issues, but you're right, there
isn't much more value-add than a traditional company build, and I suppose I'm
not very well informed about those funds

