
A Former Tesla Staffer Became an Internet Millionaire in His Spare Time - pdog
https://www.bloomberg.com/news/articles/2018-06-05/this-former-tesla-staffer-became-an-internet-millionaire-in-his-spare-time
======
sorenjan
Why are we singing his praises here? He sells a hangover drink, and in order
to not have to get FDA approval he calls it a dietary supplement. Chances are
this does not work at all, and he's selling something with false promises and
no regulation. Are we praising snake oil salesmen for their businesses acumen
now?

The Tesla connection seems like nothing more than click bait since it's not
related, except maybe gave him connections to be able to raise $450 000 from
angel investors.

~~~
modzu
hn eats up get rich quick clickbait

~~~
modzu
(yes i realize i clicked the article too). but really this is on the front
page?

ps: the cure for hangover is breakfast

~~~
tonyhb
Realistically speaking the correct hangover cure is n-acetylcysteine (NAC)[0],
vitamin C, thiamine [1], water, and activated carbon to absorb toxins from
alcohol breakdown.

NAC improves the performance of your liver enzymes, helping break down alcohol
and lessening alcohol-related liver damage.

Vitamin C helps replenish lost vitamins through alcohol consumption.

Thiamine helps replenish vitamins necessary for energy production in your
brain, lessening alcohol-related brain damage. And water. Cuz water.

This combo as you drink or after you've finished consumption will severely
reduce any adverse hangover effects. Maybe I should make a hangover drink.

[0] [https://medium.com/@researchangover/n-acetyl-cysteine-
hangov...](https://medium.com/@researchangover/n-acetyl-cysteine-hangover-nac-
for-liver-4c2278ee4e86)

[1]
[https://pubs.niaaa.nih.gov/publications/arh27-2/134-142.htm](https://pubs.niaaa.nih.gov/publications/arh27-2/134-142.htm)

~~~
IMTDb
Great, where can I fing a pill/drink/bar/... that contains a bit of NAC, vitC,
thiamine and activated carbon that I can just consume before going to bed when
I come home from the party ?

------
danso
Kudos to Tesla for not only being OK with this guy having a sidegig but also
not trying to be a jerk in demanding a cut. I know that seems like status quo
for companies not to demand control over what employees create outside of
work, but seems like that line can be blurred when there's enough money
involved.

(edit: not just having a sidegig, but being able to launch and run his startup
for ~1 year while employed at Tesla)

I also have a low bar after reading "Bad Blood", the book about Theranos. One
of Theranos's chief engineers, on his own time, came up with a cool idea for
bike lights and ran a successful KickStarter [0]. Elizabeth Holmes' response:

> _Kent told Elizabeth about his successful Kickstarter campaign, thinking she
> wouldn’t mind. But he badly miscalculated: she and Sunny were furious. They
> viewed it as a major conflict of interest and asked him to transfer his
> bike-lights patent to Theranos. The paperwork Kent had signed when he joined
> the company entitled them to any intellectual property he produced while
> employed there, they contended. Kent disagreed. He’d worked on his little
> venture during his free time and felt he had done nothing wrong. He also
> failed to see how a new type of bicycle light posed a threat to a maker of
> blood-testing equipment. But Elizabeth and Sunny wouldn’t let it go. In
> meeting after meeting, they tried to get him to turn over the patent. They
> ratcheted up the pressure by bringing Theranos’s new senior counsel, David
> Doyle, to some of the meetings._

Eventually Kent, the engineer, was allowed to go on leave of absence to work
on his bike-light. I don't think he ever came back, and he was the guy who was
the chief architect of the piece of crap that Holmes would later describe as
"the most important thing humanity has ever built".

[0]
[https://www.kickstarter.com/projects/revolights/revolights-j...](https://www.kickstarter.com/projects/revolights/revolights-
join-the-revolution)

~~~
maxxxxx
"Kudos to Tesla for not only being OK with this guy having a sidegig, but also
not trying to be a jerk in demanding a cut. "

Please don't give them kudos. This has to be normal behavior. Being employed
by a company doesn't mean being owned by them.

~~~
ryandrake
Sadly, I think the bad behavior is relatively common. Two of the last three SV
companies I’ve worked for assert ownership over everything you do or invent,
even on your own time and on your own equipment at home. I don’t know if this
is super common or not, or whether or not it’s legal, and I’m certainly not
going to spend $XXX,XXX on a lawyer to find out!

~~~
maxxxxx
That's why this needs to be illegal. The regular guy doesn't have the money to
fight stupid contracts.

~~~
thaumasiotes
It is illegal in Silicon Valley, which is governed by California law. (I'm
making an assumption about the meaning of "SV".)

But that just means they can't enforce the contract as to work it can't
legally apply to, not that they can be hit with penalties for drafting the
contract that way. If they choose to fight over it, you'll still have to
fight.

------
joncrane
Seems like this guy hedged his bets every step of the way:

\- kept his day job while working on startup \- did fake campaign on FB to
gauge demand \- got friends to try product \- croudfunded the first batch

This is a really risk averse guy who is making it big. Sort of the opposite of
the bombastic risk-it-all founder we often see in SV hero stories.

~~~
henrypray
One thing that Adam Grant writes about in his book, "Originals", is how it's a
bit of a fallacy that founders often dive head first and risk it all when
starting their companies. Could be somewhat of a confirmation bias but he
gives some great examples of how risk averse many founders actually are when
starting their companies (Warby Parker was the main example if I remember
correctly).

[http://www.adamgrant.net/originals](http://www.adamgrant.net/originals)

~~~
oakejp12
I came to say just this! He goes on to say that the great startup risk takers
are confused with great "risk mitigators" who often hedge these risky bets.
One example he gave was Woz who was working with HP when focusing with the
creation of Apple.

------
codyzazulak1
This is one of my most favourite "start up" stories ever. It almost feels like
the "millennial" way of starting any business nowadays.

Quitting your day-job, sitting in a co-op space, risking thousands of personal
funds, building, and building, and building, and building, and then finally
releasing something with no real idea of it's potential is an almost sure-fire
way of failing, and risking your well being at the same time.

This "prove-everything-at-each-step" side hustle method is how most businesses
should be started.

Take notes, well done.

~~~
tw1010
I don't get the obsession americans have with reducing huge demographics into
single buckets. (I think part of it is historical, but another part of it
might just be because the country is so big that you have to develop some way
of reducing all that complexity.) I don't want to be overly negative in
response to your largely optimistic post, but the behaviour of millenials lie
in a hugely diverse spectrum which needn't be reduced to a single canonical
element. Maybe a first good step is to dehabit yourself from always saying
"demographic X always seems to behave in Y manner".

~~~
brandonhorst
> I don't get the obsession americans have with reducing huge demographics
> into single buckets.

The irony.

------
crsv
Perhaps the most fascinating part (to me at least) in the article was his
second step - he knowingly and purposefully created a vaporware product and
took orders for it. He refunded the money from the customers, but used this as
a validation step.

I'm not sure if there's a moral judgement to be made here that's meaningful,
but it's an interesting approach to product validation. I feel like we see
this approach with Kickstarter style approaches, but without the refund step
(and without ultimately delivering the product), but this idea of getting
transactions and refunding them to validate interest is... well it feels a bit
off-putting(?), but interesting none the less.

~~~
jambo
It's called "dry testing", and the FTC might come after you if you're not
clear about what you're doing [https://www.ftc.gov/tips-advice/business-
center/guidance/adv...](https://www.ftc.gov/tips-advice/business-
center/guidance/advertising-faqs-guide-small-business)

------
nodamage
Headline is rather misleading as neither 1) hitting a $1M in sales or 2)
raising $8M in venture funding necessarily means he actually became a
millionaire.

~~~
mrkurt
Both of those things make a company worth more than $1 million. It's only
wealth on paper, but it's legitimate to call a person a millionaire who owns a
company who's done one of those.

~~~
BigCatStuff
I would disagree, and I believe that others would as well. A 'millionaire' in
my mind is someone with liquid assets of at least one million dollars.

The company isn't worth more than $1 million until someone else exchanges
shares or money for it for over a million dollars. VC funding does not make
someone a millionaire, except in rare cases where founders are allowed to sell
shares to 'take money off the table'. VC money is the hope that the company
will be worth $X in the future.

~~~
mrkurt
That's pretty much the age old debate about wealth. But the actual definition
of millionaire is "someone whose assets are worth more than $1 million".

A VC investment is literally the exchanging shares for money. No it doesn't
make someone liquid. Yes it does set something sorta like a market value,
though it's usually really high. In more meaningful terms, that company now
has $8 million in cash. There's almost no scenario where it's worth less than
$8 million now, because companies at that stage usually have very little debt.

~~~
jstandard
There are many scenarios where the founder is less than $8 million though,
even on paper. The article doesn't give details about what % of the company
Lee still owns or what their balance sheet or margins look like.

Based on that article, we don't actually know if Lee has assets worth $1
million. This is all before even bringing up how liquid he is.

------
schnevets
This kind of side-hustle is much more exciting to me than the "quit the day
job roll the dice" entrepreneur stories. It reminds me of the Shopify features
where team members proved the product by creating dropshipping side-hustles.

[https://www.shopify.com/blog/75644165-how-i-imported-
gaming-...](https://www.shopify.com/blog/75644165-how-i-imported-gaming-
glasses-with-alibaba-and-made-2-416-51-in-5-weeks)

------
s2g
Seriously?

For a hangover cure. The shit I can walk into half a dozen different
convenience stores and whole foods and find half a dozen varieties by the
front counter.

This person must have been a good PM.

------
neves
The step by step guide is a really great "how to become an entrepreneur"

------
kwillets
You can buy Hovenia Dulcis tea at any convenience store in Korea, or at most
Korean markets in the States. The studies do seem to show that it works for
hangovers.

[http://item2.gmarket.co.kr/English/detailview/item.aspx?good...](http://item2.gmarket.co.kr/English/detailview/item.aspx?goodscode=702630162)

[https://examine.com/supplements/hovenia-
dulcis/](https://examine.com/supplements/hovenia-dulcis/)

------
11thEarlOfMar
One factor that seems to have played in his favor is the unlikely pre-launch
competitive threat. The fact that no beverage company has emerged in the US as
a hangover cure till now gave him time to move deliberately, snake oil or not.

Many other startups (I'm looking at this week's LiDAR fundings) live in a
headlong footrace as they try to get to market sooner with a better solution.
No time to measure twice.

However, now that the cat's out of the bag....

------
foobaw
I've followed this company carefully since its start and also know the founder
when he used to work at Facebook. He's a talented PM.

I'm always curious how this company will truly scale? Having this club at
nightclub and bars is cool but what's next? How is it going to deal with
multiple competitors coming out with "better" drinks?

~~~
spdionis
Does it have to?

------
tmaly
Is it me, or does this process sound just like the one outlined in the 4 Hour
Work Week?

------
not_that_noob
The number one thing that kills a startup is lack of market demand. His real
genius is in determining market demand ahead of time, and in a low-cost way.
This separates true entrepreneurs from the wannabes.

------
brianbreslin
He should be distributing these in Ubers/Lyfts for late night on their way
home riders. $10/bottle people would eat it up.

------
tohmasch
Great way to build something in a very risk averse process. I wonder how
effective this will be as a 'supplement'?

------
kchr
Seems to me that 50% of the news lately has been business clickbait lately.
What's happening to HN? :-(

------
wfbarks
I hate that word "Staffer"

