
How Google killed my startup - ahmacleod
http://www.theglobeandmail.com/report-on-business/small-business/starting-out/how-google-killed-my-startup/article25989574/
======
arihant
It wasn't the Google who killed the startup, it was the OP. YouTube is
_already_ a threat to gaming video services, even without a specialized
offering. Still, Twitch took off.

If YouTube was going to be YouTube of gaming, then OP could have been Vimeo of
gaming. I mean seriously, if Vimeo could be a profitable enterprise with a
_free, good enough_ YouTube, then so could them.

I'm not sure about other people, but events like these are usually more
telling of myself than the deterrent. Almost every idea would have extreme
challenges on the way. If I was the OP I would conclude that Google brought
out my own insecurity about the product to surface. Nobody gives up on the
castle they want to live in.

EDIT: The irony here is that he seems to have forgotten how YouTube was
successful despite Google Video.

~~~
ahmacleod
Just to clarify: I'm the OP, not the Author.

~~~
arihant
Yes, by OP I meant the original poster of _content_. You're a submitter.

So all my comments are directed to the author of that post, obviously. :)

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AznHisoka
"Along the way, we learned an enormous amount about building a startup,
pitching potential investors, and things such as cap tables, term sheets,
Series A rounds, company valuation. It felt like a real-world MBA crash
course."

You learned everything about building a startup except building a profitable,
sustainable business. Everything else is secondary.

~~~
baa555
I wonder why your comment is being downvoted. This is very true

~~~
orbitur
Because it's not secondary. They are equally important parts of running a
business. Just because the business didn't succeed doesn't mean they are
unimportant.

------
mladenkovacevic
TL;DR playing video games is easier than starting a real company so let's do
that instead.

His analogy of participating in a "boss fight" is flawed since it sounds more
like they just turned off the game system as soon as a hint of the boss
monster's first tentacle even appeared on the screen.

~~~
jakejake
I'd say it's more like they turned off the game after the opening cut scene.
This doesn't really qualify as a fumblebrag because they didn't actually
start.

They assume that funding was in the bag already, that the product would get
built on time (or at all) and that even 1 person would sign up. Maybe they
would, maybe they wouldn't.

They were right about one thing though, the timing was fortunate that it was
squashed just a little past the idea stage.

------
Mithaldu
Their description of the business model is to be gamefaqs.com, only with
videos instead of text. As an avid gamer, that sounds:

\- very niche, their intended content would only be a small fraction of what
yt gaming will offer (it focuses on live streams)

\- very unattractive, since learning how to play the game by exploring it is
the fun of it

\- very unmonetizable, given that people can get the very same content, for
free, in a format that's much easier to digest

I don't think they needed to invoke google to throw in the gauntlet.

~~~
savanaly
> very niche. Yes, but I don't think that means it's doomed. Every site
> doesn't have to be youtube or twitch.

> very unattractive. Your complaint is extremely subjective and evidently
> false for tons of people considering the brisk business game guide companies
> have done for decades and that streamers do on twitch and youtube today.

> very monetizeable. Yes.

~~~
Mithaldu
> Your complaint is extremely subjective and evidently false for tons of
> people

Possibly, but please consider this: Game guides and gamefaqs.com contain
reference works wherein one can go and look up details when one is stuck. One
doesn't usually read the whole thing to learn how to play the game in the most
efficient way (unless it's competitive or has complexity on the level of a
programming language, like Minecraft).

> streamers do on twitch and youtube today

I'm unaware of twitch streamers or youtubers who primarily teach how to play a
game. Can you point out examples of those? I'm really curious.

~~~
FilterSweep
> One doesn't usually read the whole thing to learn how to play the game in
> the most efficient way (unless it's competitive or has complexity on the
> level of a programming language, like Minecraft). I'm not sure about game
> guides, but:

1) Walkthroughs are absolutely not the only type of guide that GameFAQs
houses. It has never been only walkthroughs, even from its very early
beginnings. The easiest example of this is Fighting games, which will have in-
depth strategy and gameplay guides made specifically for each player.

2) GameFAQs has had a forum for ages, which also has this as the primary topic
of discussion. It was in fact the first forum that I ever participated in as a
young child, along with some #IRC channels.

> I'm unaware of twitch streamers or youtubers who primarily teach how to play
> a game. Can you point out examples of those? I'm really curious.

You're being facetious. Do you not know how to Google as well? I'm really
serious. :edit:In the offchance you aren't _feigning ignorance_ [0]

[0]
[https://www.youtube.com/user/OneHiveRaids](https://www.youtube.com/user/OneHiveRaids)

~~~
Mithaldu
> Fighting games

Those are competitive, which i addressed in my post. Note that the original
article specifically mentions the Elder Scrolls series as an example.

> GameFAQs has had a forum for ages

In forums you go in and ask your question. Again, it functions like a
reference work.

> You're being facetious.

That is a highly uncalled for accusation, and i am serious. (Though it may not
have been entirely clear that i was excluding the two categories mentioned in
the paragraph before that question.)

>
> [https://www.youtube.com/user/OneHiveRaids](https://www.youtube.com/user/OneHiveRaids)

Again, that is about a competitive game.

~~~
FilterSweep
This took me no more than 20 seconds of Youtube search.

As it stands, the author did not provide a specific Elder Scrolls game, he
generically referenced the series, but to take from the most recent RPG,
Skyrim, here's the secrets of lockpicking:
[https://www.youtube.com/watch?v=R5fZobDqQbU](https://www.youtube.com/watch?v=R5fZobDqQbU)

Heres how to make your wife hot: [https://www.youtube.com/watch?v=Ozn-
byvM8GU](https://www.youtube.com/watch?v=Ozn-byvM8GU)

For their newer, online MMORPG game, heres some strategy to increase your
income:

[https://www.youtube.com/watch?v=KtZpUPGxWzg](https://www.youtube.com/watch?v=KtZpUPGxWzg)

Oh, it's specific users you ask?
[https://www.youtube.com/user/deltiasgaming](https://www.youtube.com/user/deltiasgaming)

IGN Magazine has some good tips as well:
[https://www.youtube.com/user/IGNentertainment](https://www.youtube.com/user/IGNentertainment)

Full disclosure: I have never played an elder scrolls game in my life. But my
friends have. From the front page of my search results alone, I have a good
feel of how it works.

I don't mean to offend, but your comment betrays either laziness or profound
inability to run a search query.

~~~
Mithaldu
The middle two links are competitive, but the first two are legit.

I don't want to believe that there actually exists a market for people who'd
subscribe to such, but you are right that such content exists, and maybe there
is a market.

------
FilterSweep
GameFAQS.com has been around since the 90s. They housed both user-submitted
and commercial guides/tips/cheats/etc, and _free_.

Now, this guy has a great principle on the tech giants being a threat for a
competitive, efficient economy, but I'm just not with him on this one. His
only marketable niche would be to get the top paid gaming professionals (like
the Dota 2 team that won $6million this month), and provide a market place for
the top talent to coach, but he didn't see that, and it's a very small niche
to begin with.

~~~
TodPunk
I agree. The reason game guides make money at all is because they have shops
like Gamestop pushing those guides with every purchase. Not many a gamer is
going to pay even $5 for a video guide they have to watch the entirety of if
they just want to know how to do X thing when that's freely available in
multiple forms elsewhere. For specific things gamefaqs and achievement guide
videos are already a well established free "product".

A business is not just "people want X." It has to at least fit the "ENOUGH
people want X and are willing to pay for it or are valuable enough as users in
order to be sold to advertisers." The morality of that can be debated to death
and isn't very interesting, but the reality of it is something we seem to miss
a lot.

------
kifler
Their product wasn't really revolutionary - it didn't present anything new. By
their own accounts, there was nothing stopping Lynda.com from offering the
exact same service (along with a multitude of other online course/video
services).

Google didn't kill their startup, their own naivity did.

------
hlfw0rd
Seems as though the author got scared and gave up.

~~~
JoeAltmaier
And rightly so.

~~~
tptacek
No. It may have been smart to let this idea go, but "Google entered the space"
is not generally a good reason to give up.

For niche products, small companies are often in a surprisingly good position
to compete with Google (or pretty much any giant company).

Advantages small companies have:

* Much easier to change feature/function/benefit and packaging to adapt to the market

* Not competing with revenue from 1000 other internal projects for staffing

* Similarly: can sustain a business with tiny beachhead markets that Google can't waste time capturing

It seems like people immediately realize that Google _can_ own tiny markets
(obviously, if you can own the whole market, you should be able to capture any
subset of it), but don't realize that in practice Google _won 't_ capture
small niches, because it's irrational for them to deploy engineers to earn $10
when those same engineers can be deployed to earn $100 somewhere else.

Also: just because you have all the resources of Google doesn't mean you're
going to stick the landing on every project you start. On niche products, it's
not only possible but actually kind of likely that you can out-execute Google.

That doesn't make live gaming videos a great new startup idea. Just be careful
of the logic that says "Google entered a space and so now it's dead".

~~~
JoeAltmaier
I read the OP as thinking since Google would give away a good-enough service,
it would be very hard to find that niche.

~~~
tptacek
Yes, I did too. And I'm saying: it isn't universally, or even usually, the
case that Google giving something away destroys any market for selling
something similar.

------
edgesrazor
This reminds me of the story of Blizzard seeing Dominion Storm at E3 in 1996.
After seeing the demo, they felt like they should kill Starcraft because of
how much "better" Ion Storm's demo was than their own.

Turns out is was mostly smoke and mirrors, and Blizzard made an exceptional
game because of it.

[http://www.codeofhonor.com/blog/starcraft-orcs-in-space-
go-d...](http://www.codeofhonor.com/blog/starcraft-orcs-in-space-go-down-in-
flames)

------
OhHeyItsE
>After all, one solid axiom of business: It’s hard for your better, paid
service to compete against a “good-enough” free offering.

Hopefully for the sake of FastMail, Rackspace, et al, Google never tries their
hand at email...

------
dsugarman
Dropbox could have made the same conclusion with Google Drive and decided to
quit, instead they marched on.. to an 11 figure valuation

------
at-fates-hands
Had they followed the Lydia.com approach more closely, they could've competed
and done quite well.

If I want to learn how to program, there are a TONS and I mean TONS of free
resources everywhere on the internet - very similar to all of the game faqs
people keep referencing. And yet, Lydia still makes a ton of money because
their service is sold as a subscription based service which is much better
than other resources on the internet.

If you do a good job of marketing this and sell it as a premium service, I'm
sure they would've done just fine. Also, if they do make a dent in Google's
service, you can bet their ass, they'd be calling about acquiring them in
short order, which would have made a nice payday for them

Instead, they bailed at the first opportunity. To me, it doesn't sound like
their hearts were really in it.

------
jreacher
Your biggest problem is you tried to create a product out of thin air.

You want to monetize video content? Guess what the best platform to do that
is? YouTube.

I don't know why you would even consider building your own competing platform
when YouTube is right there waiting and offers everything you need. There are
countless examples of strong businesses that have grown out of publishing
YouTube video content.

If you really believe there is a niche for the content, then this development
hasn't changed that at all. If anything it just pivots you away from the silly
idea of building a platform, toward the real value of the offering.

I realize it's not as 'sexy' just to publish YouTube videos, but it's a far
more sensible approach.

------
vishalzone2002
although it might be heart sinking i don't think google really killed it in
this case. The company gave up at the threat of competing with google. Killing
something is more like what twitter did to meerkat to push periscope. My
personal opinion only.

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tmuir
How does an article simultaneously get upvoted to the front page, but
universally destroyed in the comments?

~~~
cpncrunch
I find the negativity weird, given that most of us here are (supposedly)
building things. I think his idea has merit, and is different enough from
Youtube Gaming that it can probably survive alongside. I think he perhaps just
made a few mistakes -- the biggest one trying to get funding before testing
the business model. (Although in his defence, that seems to be happening a lot
these days).

Anyway, rather than just whining uselessly here I'm going to actually find his
contact info and give him some suggestions.

------
baa555
Isn't part of writing a business plan doing the scenarios of what happens
should company X or any other competition enter the space and pitching what
would be your competitive advantage. Who plans a non-technical business on the
basis of 'no one else will have this idea'. It sounds to me like the OP had a
poor business plan to begin with. The fact that there were people willing to
fund this just shows that in this bubble will throw money at anything.

------
hartator
tldr; People came up with an idea of some kind of paying twitch and decided to
give up when Google might release something similar for free.

~~~
hobs
I think calling out that they specifically wanted to teach people to play
video games matters in the tldr.

Honestly, this sounds just like a feature that this company may have made
interesting with G will just kill off in a few years.

Reminds me of MS product announcements in the bad old days.

------
jsf666
So what is this about? The horror of competing with a bigger company? Google
didn't kill your startup, You did. You did that after You got scared and
didn't have nothing interesting/unique to compete with them. Stop crying, most
people are in debt to the rest of their lives after their companies fail.

------
omouse
Did they even have some of their product built? It sounds like they didn't,
but then I haven't had a coffee yet.

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shinratdr
There is so much I don't like about this article I honestly don't even know
where to begin.

~~~
cpncrunch
I think the article is more about free PR than anything else. Pretty awesome
IMO to get a write up in the Globe and Mail.

~~~
ahmacleod
This. The Author pulled a serious coup here, translating an aborted business
into a personal profile piece in a national paper.

~~~
cpncrunch
I'm not sure it's even aborted, possibly just on pause.

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boxcardavin
I think the comments on here would be a more valuable "MBA crash course" for
Mr. Maffin.

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mcguire
Ah, yes, the "our safety margin wasn't as secure as we thought it was"
situation.

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bg0
1.5 million is revenue and they decided to just end it?? :(

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ahmacleod
Title is from the article; I am not the author.

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amelius
> Our hearts sunk. They were pretty much already working on what we had been
> planning – and they are going to give it away for free.

Selling below cost price is considered anti-competitive, and is illegal in
many countries.

~~~
raldi
Which countries prohibit free websites? Do they block Facebook and GMail?

