I’m on easy street now. We are about to release our new site and beta request invites are streaming in. Most importantly, on my desk right now, I have a offer from Google to buy our app. This will make me and the other cofounder rich! We are on easy street now.
Often, I wonder what happens to them. You know them; that random software company who just released or were going to release FooBar 9000, a revolutionary app for its time. At that most opportune time. The time right before they were going to release, they have been snapped up by one of the behemoth juggernauts for what seems like a small fortune.
Who is the real winner here? Is it the guy who has cashed out on what could have been a great idea? Is it the colossal company for adding another great application to it’s stable of offerings? Is it the users for having one less place to look to get the software they have been looking for?
My guess is there are no winners. No one wins, except for the company doing the spending. Seems a bit illogical, doesn’t it?
To see where, I’m coming from, we have to take a step back. Actually, we have to take a huge step back to see why you shouldn’t sell!
Generally, when Joe or Brenda Schmo sits down to write any of type of application, they take one of two positions. The first position is to write something to satisfy their needs. They put the features in that make it something they want to use. When the project is complete or ready for release, they can take pride in knowing at least it solves a problem of theirs, so they automatically get at least ONE user. These guys don’t usually sell out. Why would they? I’m sure they are profitable in their own right because they made something that people will use.
The other position isn’t one that I understand. There are actually people who write applications they will never use. gasp! They throw all the buzzwords into the pot, shake vigorously and release (maybe) whatever comes to fruition. And that isn’t even the best part! Now, they go on the hunt…not the hunt for users, but the hunt for more money. The VC roundup is what is what I like to call it. So, some chump in a suit believes in their causes, and gives them a few million.
What does the Schmo do next? Do they not accept the money because organic growth appears to be the best thing? No, that would make too much sense. They take the money, and they hire people. Marketers, PRs, Business Development Groups, Sales People. Oh My!
So, now what we have is an unnatural organism (business). The organism doesn’t exist because it grew naturally, it exists more like Frankenstein’s monster: all sewn together and expected to work like an oiled machine.
I originally started talking about winners and losers. And here is where it all comes together. When you sell your operation to a bigger organism (business), you are going to have to adapt to them and not vice versa.
Now, the monster shows it’s true head. So, Mr Schmo, you’ve just pocketed a cool couple of million. I’m sure it feels great. What about everyone else who you cobbled together? I’m sure they are going to want a cut as well, because I’m sure they figure they have added value to the organization. What about the people who will sure be laid off because of “redundant operations”? What about the culture of the previous company? Oh yeah, there most likely isn’t much of that due to fact you didn’t own your company in the first place. (those damn VCs)
So, what do you do? I surely can’t tell you. Just put the yourself in the position that leads to successes you want? You want money? Lots of money? At the expense of others? Do whatever it takes to get to that liquidity event. But, if you want something that is yours, and you get more joy out of offering a service that people want or need or like, I’m definitely not going to have to tell you want to do, but I’m sure you already know.
Read: The big payback. Selling your soul..er your company to the MAN
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