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Color, Now Down Two of Three Leaders, Lesson in Lean Startup Philosophy (readwriteweb.com)
83 points by duzins on July 11, 2011 | hide | past | web | favorite | 42 comments

So I just fired up Color again, because every time I hear a gloom-and-doom story about Color, I feel the need to look at the car crash again.

And once again, sitting in my office, Los Angeles, a place where you would expect there to be some serious use of Color, I'm presented with, again, the exact same screen I saw when I first started it up a few months ago.

That is to say-- nothing.

Everyone talks about how the Color _technology_ is so revolutionary, but I have yet to see the thing actually work. I've gone to big concerts and fired it up. I've been to Disneyland and fired it up (don't laugh, other social-place apps are _huge_ at Disneyland. Foursquare gets massive traffic from The Mouse). All of these places, you would think there would be _something_ on Color. Nothing. Just that silly black screen with the guy taking the picture of the other guy's crotch. (Cannot unsee that image from the startup, now, thanks)

It's like the guys at Color built the product on the assumption that hundreds of millions of people would use it on day one. I'm sure the app works great in the densest portions of the Bay Area on Friday night after a Foocamp, but it is just absolutely useless on any kind of day-to-day, social sort of usage.

Path isn't much better, but at the very least I can see that there were photos last shared 21 days ago from friends, so there's at least a _little_ temptation to, you know, _actually use the app_. For all the love about Color's technology, I don't believe that they have gotten anything right at all. It would be so, so easy to just dynamically expand the breadth of the "anonymous social network" created around your phone, but the FAQ page is like a winning card for Web 2.0 Social Media Bullshit Bingo.

Seriously, here's the tagline for Color:

"It also means that any photo taken within about 150ft. of other users of the Color app are automatically shared to their devices."

There you go. One Geospatial query, form upload, and fancy Objective-C frontend, and you have Color.

No VCs have called to ask me my opinion, but I'm very ok with color.com imploding. IIRC, Paul Graham suggested that startups be described as questions. Color's question was, "Can we make ____, give it away for free, have it become really popular, and gather profile information we can monetize?"

So they now know that _____ is not really popular, and although they raised a tonne of money to do it, closing its doors quickly and moving on to other things is not a disaster.

Pivoting would be neat, but maybe they ought to just give the remaining money back to their investors and move along to the next idea.

Just out of curiosity, do VC's call you to ask your opinion on things like this?

Given my career, I would short the stock of any VC that asked me for investment advice.

Easier: short stocks that you think will go up. Avoid the whole VC problem entirely!

On the other hand, that just means you're statistically more likely to succeed on your next attempt.

I don't think that's what it means, statistically :)

Bayesian or frequentist? ;)

Doesn't matter, a bad history in investing doesn't statistically mean that you're more likely to get it right the next time, that would mean that everyone gets it right eventually if they just keep trying, which isn't really how investing seems to work.

Even if investing was a lottery, it past failures don't indicate future success.

Comments like this are why I love this site so dearly! :-)

> The reasons why Color appears to be imploding can't be known for sure.

I'd guess that it might have something to do with the lack of product...

or the fact that NO ONE is using it.

I wonder how they would have fared if it wasn't publicly known that they received zillions in funding or that they spent 350k on a domain name.

Had they been in stealth mode and didn't feel compelled to release as half-baked product too early, maybe it may have turned out differently.

Had the product been at all good, a million jaded TC/HN readers yelling bubble wouldn't have stopped them from succeeding. It was the half ass product too early that killed them.

Color 'launched' a few days after SXSW, and the founder wasn't particularly aware of the event or able to recognize the lost opportunity. SXSW would have given it the dense mass of people required to give a great first impression

I found Bill Nguyen's response quite strange when asked about this.


"Robert(Scoble) is right, everyone's right, we should have done it, we could have done it, we didn't because I don't like conferences. Again, my bad, it's my responsiblity, I just didn't want to do it."

Wow. I don't know if Bill Nguyen realizes this, but when you have a consumer based product, you NEED to launch it when there are a lot of potential customers to use it! That is without a doubt the worst thing that I've ever heard an entrepreneur say as long as I've been following tech. When this company crashes and burns, perhaps Mr. Nguyen will realize that being an entrepreneur sometimes means having to do things you don't want to do. Did you really think Steve Jobs was excited to go to Redmond, proverbial hat in hand to ask Bill Gates for a bailout? Of course not! But he did it because it was necessary for the long term health of the company. I truly think Bill Nguyen doesn't get it.

While Color has made a lot of mistakes, Bill Nguyen has accomplished more than 99.x% of entrepreneurs. He wanted something different from his product launch for whatever reason, maybe simply because he didn't feel like dealing with the madness of SXSW. It wasn't the best choice, but it's a far cry from him being clueless. I'm certainly in no position to question his abilities as an entrepreneur, and definitely not for one or two questionable decisions.

From his comments though, the only reason that they didn't launch at SXSW was bacause he didn't "like" conferences.

Honestly, it seems to me that he was either too hubristical or naïve.

It's not just the regular bump, but SWSX was practically made for this sort of app.

I only wish I could "short" these types of stupid startup investments.

I haven't used any of them, but you could try arbitrary betting sites. Someone has to be willing to take the bet, which would be an entertaining way of putting one's money where one's forum-mouth is. Betable.com seems like the best fit for non-sports actual-money bets.

Longbets.org would let you make an idealistic point. (They don't let you keep your winnings; they have to go to a charity.)

Smarkets.com plays with real money, but seems targeted towards sports and current events.

[Disclaimer: I'm an officemate of Smarkets.]

The reason for this is liquidity. You've got to have enough people interested in an event to get effective price discovery, and if you're making money on the commission then it's entirely about maximising traded contract volume.

Publicity is only any use if you have a good product.

See also: cuil.com

I'm always fascinated by journalists ability to take two distant factual details and design an entire plotline and article between them.

Same. Even better: http://xkcd.com/904/

One of the arguments for the high initial valuation was the 'rock-star' team : Which would lead to a decent purchase price for the company even if the product didn't take off.

However, the rock-star team is only valuable if it can stay together. Gathering up a bunch of rock-star soloists is much cheaper...

Alright from Color's perspective losing a couple of big names is bad. But from everyone's view their technology is cool (or interesting at least) and they've got a truckload full of money.

This could be a good thing, the three headed startup hydra could have been a bad thing - too many chiefs not enough indians and likely a lot of different product directions. This is a chance to hunker down figure out what people want and the right way to deliver it. They've got enough cash to keep user groups in testing for years. This can be fixed. Lean is good. Lean with 3-5 years of runway is even better.

I rarely say this. But seriously, this:

Lean Startup philosophy says the last thing you want to do is raise a whole lot of money, build a product in secret, then spring it on a world that may not want what you've built at all.

not all startups are lean. seriously, there is more than one way to skin a cat.

Some startups do need lots of money (think biotech, etc), but for the vast majority of software startups, Eric is dead-on. Too much money will cause you to say "Yes" to too many things, which then causes you to lose the focused precision that is (almost) required to succeed.

I've lived through the too-much money route. I'm living the scrape-by route. There is no doubt which one is more focused!

i always hate to see products fail, but it is kinda nice to see reality set in for Color, rather than a 2001-esque media frenzy and IPO. it gives me hope that maybe, just maybe, the bubble isn't as bad this time around.

Interesting, I came just to say that as someone who was defending the possibility that there may be a real company in there a few months ago, I'm now willing to admit this is definitely a credit on the "bubble" side of the argument.

I don't think there is anything wrong with over-funding a promising startup. With Color, the problem was in the vision and execution, which can happen no matter how much money is in the bank.

While I appreciate the mentality behind a lean startup, I can also understand the benefits of a "fat startup."

Color was entering a crowded space-- there were a ton of photo sharing apps, but nothing close to a clear winner. In theory, putting $41 million into one "killer" photo sharing app makes a lot more sense than putting $3 million into a dozen average photo sharing apps. Unfortunately, things didn't work out for Color.

A large number of start ups fail, merely because they don't have enough engineers. Companies like Google (Google+, Google Docs, etc) or even network TV (Hulu) have been able to buy their way into markets, merely because they can turn out a full featured product relatively quickly, and back it with proper bizdev and marketing.

Agreed, but Lean startup is not just about overfunding, it also means not building your product in secret, which is what they did, which is why they are in mess.

"Eric Ries, the Lean Startup philosophy says the last thing you want to do is raise a whole lot of money, build a product in secret, then spring it on a world that may not want what you've built at all"

They should not have built this product in stealth mode then release it at the wrong time(missing SWSX). Investors should be worried, what they thought is a great team is no longer there. One was fired, the other resigned now there is only Bill Nguyen. I think it will be hard to attract talented leaders after seeing cofounders leaving and being fired. Forget pivoting, Bill can't even keep his star team together.

It's really hard to estimate how a product to be successful in Silicon Valley. Take Google+ example, what's so novel about it? Nothing, i must say. Twitter integrated with Disqus by your address book. But first they get good reviews, and use old tactic of invitation only system like gmail.

As a weak social creature myself, i find the Color app idea very interesting. I eager to find someone take photo in the place i am in. I constantly open and refresh if someone took but none i find. Why nobody is using it? I remember once showing the app and its idea behind to my friend and he also find it very curios and love it. But where are the users?

Press takes what it wants, don't rely on them. They may interest in your investment or office furniture or whatever they want. Press might dumb your app almost instantly, but you have to respond to criticism very early. However, i see no app updated since months i guess.

Here is the road map for a loving user: bucket all criticisms that made to Color. prioritize according to who made them, their power in press/social media. change UI, revamp and go to real events. go to all Geek conferences after parties, music festivals and shout your app. This app needs on the ground fight not online tech bloggers.

Would it have been so hard to just put text labels on the buttons and release a new version of the mobile app?

I don't understand: DJ Patil joined Color five months ago (according to his LinkedIn profile), yet Color is more than one year old.

Why is he called a co-founder? He doesn't even say so on his LinkedIn profile (a lot of people claim to be a Color co-founder, though).

Funny to contrast this with their coverage 3 months ago...! (as I've done here: http://swombat.com/2011/7/11/color-com )

Note those two posts were authored by two different people at RWW. I wrote this one but not the one you reference 3 months ago.

Sure, but you're both prominent writers at RWW - I'm not criticising you guys personally, or even RWW.. it's perfectly fine for authors, or even a publication, to change its stance - just the apparent randomness and diametrical opposition of points coming from the same publication a mere three months apart...

As a person in the firing line, it feels pretty crazy to have the same site praise you as "the next twitter" one day and shoot you down with all they've got three months later.

I hope Color bounces back. I don't like all this hating on them based on pure speculation and no insider knowledge.

Color Funding literally took down the mood of Valley entrepreneurs who really work worth while :(

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