Color raised 82 times more money than Instagram. Why did it lose so badly?
It was supposed to be a Facebook killer. Mobile, social, and photos? Those are the kind of trends that drive cool billion-dollar valuations. In other words, the kind of trends that get venture capitalists to hand over blank checks. Okay, not exactly blank. But close enough. For the startup Color, it was $41 million, a record-setting pre-launch figure -- and from blue blood firms Sequoia and Bain Capital, no less. It was a perfect storm of hype.
And then they actually released their app.
There's a tension inherent to most startups. You're usually building something that doesn't already exist, and that people don't already know they want -- and then you have to iterate on what they tell you they want. To translate that into business jargon, you have to PIVOT. It's a messy, exciting process -- and a messy, exciting process that's best done in the dark. It's hard enough to make something that some people like. It's even harder to iterate and make something that some more people like. Just look at Instagram.
Before it became the go-to destination for rich kids to post photos of themselves, Instagram was not Instagram -- it was Burbn. What was Burbn? Good question. It was a location-based service kind of like Foursquare and Twitter. But there was a small problem. People didn't want it. But people did want to share photos -- that part of Burbn was taking off. So founder Kevin Systrom PIVOTED and Instagram was born.
Of course, it's not as if Systrom got a billion dollars from Facebook the next day. It just seems that way. Instagram had plenty of competitors, even ones that let you add filters to photos -- remember Hipstamatic? -- that it had to beat out. And it did, by taking what its competitors did and making it a little simpler and a lot more social. It helped that Systrom (and later co-founder Mike Krieger) started in stealth mode, figured out which parts of their intuitions were correct, built and tested their new app in private, and then launched. It was the right product, in the right market, at the right time. Which brings us to Color.
It's hard to do much in private when you raise $41 million before doing anything else. The good news is that kind of raise buys you gobs of attention -- and startups certainly need attention. The bad news is that that kind of raise buys you gobs of attention -- maybe before you're ready for it. Color definitely wasn't ready for it. When they actually did launch, nobody could figure out how to use their app, or even why they'd want to. (It had a two-star rating on iTunes). Rather than connecting you with people you knew or people you thought were interesting -- like Instagram -- Color connected you with people around you. It's an interesting idea -- the kind of interesting idea that might get you venture funding! -- but not the kind of interesting idea that people wanted. At least not now. That wouldn't have been such a problem if its user interface wasn't quite so indecipherable. It was. Users came, they saw, and they didn't come back. Color was stuck in what Y Combinator's Paul Graham calls the Trough of Sorrow -- and it was especially sorrowful because so many people had already written them off.
So Color pivoted. Well, not quite. There's a very fine line between "pivoting" and "flailing". The former is when you take the part of your business that is working, and focus on that. Think Instagram. The latter is when nothing about your business is working, and you frantically grasp for something new. That was Color. Less than three months after its launch, Color decided it might scrap the whole photo-sharing thing. Or it might not. In either case, CEO and founder Bill Nguyen -- who had just fired his co-founder -- told the New York Times he had a bold, new, grandiose plan:
Mr. Nguyen outlined an ambitious plan to compete with Apple, Google and Facebook by tying together group messaging, recommendations and local search, all while making money through advertising. He plans to build applications that will use data from Facebook to create temporary social networks, say at a conference or sporting event, to help users meet people who grew up in the same town or like the same band.
"It's literally going to turn your Facebook network from 500 people to 750 million people," Mr. Nguyen said.
Photos might not even be a part of Color in the future....
The only company Nguyen apparently didn't want to take on was the one that had just crushed him in mobile photo-sharing -- Instagram. I'll give you one guess how well this plan that substituted buzzwords for details turned out. Within six months, Color was pivoting again, this time into mobile video-sharing. In other words, Color went from trying to beat Instagram to trying to become the Instagram of video. It was quite a fall for Nguyen, who a year earlier had compared Instagram to "mice nuts." No, not like peanuts.
Still, obituaries for Color are a bit premature. But only just. They can certainly afford to flail pivot. Sure, they've burned through piles of cash -- Nguyen dropped $425,000 on the domain names color.com and colour.com -- but they still have piles of cash because they started out with such a huge pile of cash. That's how math works. Thanks to this looooong runway, Color has managed to reach a deal with Verizon over its video-sharing. Maybe Color will still end up making it. Or maybe not. This video explaining what Color is (now) and how to use it has a very sad 22 views as of pixel time. According to AppData, around 110,000 people use it every day. That's better than where they were back in March, but it's about two orders of magnitude below the big boys.
It turned out the hype was justified ... for Instagram. It was a Facebook killer, potentially. It took Facebook's killer app -- photo-sharing -- and created a new social graph around it from the post-PC web. In other words, big bucks. Facebook thought it enough of a threat to make a Godfather offer of $1 billion in stock and cash. (Which is admittedly worth quite a bit less now). Instagram was the perfect product in the perfect market at the perfect time. Color was ... not. It had bad execution, worse marketing, and a conceit that was at best ahead of its time. Its massive pre-launch raise didn't create those problems, but it did make them more likely. Color felt like it had to move quickly -- beta testing, what's that? -- and justify its big valuation with big talk. This was a company that Google tried to buy for $200 million before they even had a product! These massive expectations made its launch much higher stakes than if it been in stealth mode.
Although it's not as if the little-startup-that-could in our story was some kind of underdog. Instagram raised half a million in funding themselves, including from top firm Andreessen Horowitz. But staying in stealth mode let them do a lot of the dirty work of figuring out what people want without the inevitable missteps that occur getting dissected under the spotlight. That's not to say that Color would have succeeded with less money, but that having more money can make you think you can skip steps -- and you usually can't.
The Party of Lincoln's nominee returned to the site of his greatest speech, to attack the faith in democratic government that Lincoln so carefully fostered.
The world still judges Lincoln by his Gettysburg Address. Now, it may judge Donald Trump the same way—but with strikingly different results.
On Saturday, Trump spoke to supporters in the small Pennsylvania town where, a century and a half before, Americans met in battle. It was a speech that, as much as any in this campaign, offered the very best of Trump, underscoring why so many Americans are drawn to his candidacy. It also offered the very worst.
He began by invoking Lincoln’s fight against division, and framed his run as dedication to something larger than himself. “When I saw the trouble that our country was in, I knew I could not stand by and watch any longer. Our country has been so good to me, I love our country, and I felt I had to act.”
What use is there today for one of the oldest virtues?
As many Americans go about their days, I imagine they have two little angels perched on their shoulders, whispering conflicting messages about happiness and material wealth. One angel is embodied by James Altucher, a minimalist self-help guru recently profiled by The New York Times. Altucher claims to have only 15 possessions, after having unburdened himself a few months ago of 40 garbage bags’ worth of stuff and never looking back. As I read about Altucher, I rolled the numbers 15 and 40 over in my mind, thinking about the belongings in my bedroom and the garbage bags under my kitchen sink.
The other angel is Tyler Brûlé, the editor in chief of the fantastically high-end lifestyle magazine Monocle and a columnist for the Financial Times. He is the sort of writer who tosses off such lines as “I zipped along the autostrada through the Val d’Aosta with the ever-trusty Mario (my Italian driver for the past 20 years) at the wheel” with little regard for how privileged and pretentious he sounds (especially in his superfluous parentheticals). Still, there is something, I’m a little ashamed to say, that I envy about Brûlé’s effortless cosmopolitanism—which, it’s hard to miss, is only made possible by unusual wealth.
These are some reading recommendations that will hopefully provide a deeper look at some of these issues. Books may seem like small comfort. But in a time like this, when it’s hard to understand how American culture became so hate-filled, reading is probably the best possible option—to get off the internet, pick up a book, and think about how the country has gotten here.
Narcissism, disagreeableness, grandiosity—a psychologist investigates how Trump’s extraordinary personality might shape his possible presidency.
In 2006, Donald Trump made plans to purchase the Menie Estate, near Aberdeen, Scotland, aiming to convert the dunes and grassland into a luxury golf resort. He and the estate’s owner, Tom Griffin, sat down to discuss the transaction at the Cock & Bull restaurant. Griffin recalls that Trump was a hard-nosed negotiator, reluctant to give in on even the tiniest details. But, as Michael D’Antonio writes in his recent biography of Trump, Never Enough, Griffin’s most vivid recollection of the evening pertains to the theatrics. It was as if the golden-haired guest sitting across the table were an actor playing a part on the London stage.
“It was Donald Trump playing Donald Trump,” Griffin observed. There was something unreal about it.
Choosing a president isn’t easy in this election, but here are three ways a principled conservative might vote.
The day of decision is nearing. All the talk fades, and one mark must be made beside one box on the ballot. Many Republicans are agonizing. They reject Donald Trump; they cannot accept Hillary Clinton. What to do?
I won’t conceal, I’m struggling with this question myself. I’ve listened to those Republicans, many my friends, who feel it their duty to stifle their anger and disappointment, and vote for Trump; to cast a protest vote for the Libertarian Gary Johnson or the independent Evan McMullin; or to cross the aisle and vote for Hillary Clinton as the lesser evil. On the way to my own personal answer, I found it helpful to summarize the best case for each of these options.
Emphasize the word “best.” If your case for Trump rests on the assumption that America is hurtling toward national doom, if your case for McMullin rests on the hope of tossing the election into the House of Representatives, if your case for Hillary argues that she is a large soul eager to work cooperatively with those who think differently from her. I’d say you are not thinking very clearly. Despair and fantasy are misleading counselors.
Tristan Harris believes Silicon Valley is addicting us to our phones. He’s determined to make it stop.
On a recent evening in San Francisco, Tristan Harris, a former product philosopher at Google, took a name tag from a man in pajamas called “Honey Bear” and wrote down his pseudonym for the night: “Presence.”
Harris had just arrived at Unplug SF, a “digital detox experiment” held in honor of the National Day of Unplugging, and the organizers had banned real names. Also outlawed: clocks, “w-talk” (work talk), and “WMDs” (the planners’ loaded shorthand for wireless mobile devices). Harris, a slight 32-year-old with copper hair and a tidy beard, surrendered his iPhone, a device he considers so addictive that he’s called it “a slot machine in my pocket.” He keeps the background set to an image of Scrabble tiles spelling out the words face down, a reminder of the device’s optimal position.
Participants in the Church-sponsored Indian Student Placement Program have filed at least three sexual-abuse lawsuits.
Native Americans who were part of a little-known Mormon program from 1947 to the mid-1990s share much of the same story. Year after year, missionaries or other members of the Church of Jesus-Christ of Latter-day Saints approached these families and invited their children into Mormon foster homes. As part of the Mormon Indian Student Placement Program, Native American children would live with Mormon families during the school year, an experience designed to “provide educational, spiritual, social, and cultural opportunities in non-Indian community life,” according to the Church. Typically, the Mormon foster families were white and financially stable. Native American children who weren’t already Mormon were baptized. And some of them now claim they were sexually abused.
Why the WikiLeaks revelation about a “pay-to-play” deal with Morocco is a quintessential Clinton controversy
The chief complaint that critics make about the Clinton Foundation is that the former and perhaps future presidents engaged in a “pay-to-play” scheme, whereby donors—many of them foreign governments—would contribute money to the charity in exchange for access to Bill or Hillary Clinton, or worse, beneficial treatment from the State Department.
On Thursday, hacked emails from WikiLeaks suggest that is precisely what happened when the king of Morocco agreed to host a Clinton Global Initiative summit and give $12 million, but only if Hillary Clinton attended the May 2015 meeting.
“No matter what happens, she will be in Morocco hosting CGI on May 5-7, 2015,” Huma Abedin, a top Hillary Clinton aide, wrote in a November 2014 email to several other advisers, including campaign chairman John Podesta. “Her presence was a condition for the Moroccans to proceed so there is no going back on this.”
A neuropsychological approach to happiness, by meeting core needs (safety, satisfaction, and connection) and training neurons to overcome a negativity bias
There is a motif, in fiction and in life, of people having wonderful things happen to them, but still ending up unhappy. We can adapt to anything, it seems—you can get your dream job, marry a wonderful human, finally get 1 million dollars or Twitter followers—eventually we acclimate and find new things to complain about.
If you want to look at it on a micro level, take an average day. You go to work; make some money; eat some food; interact with friends, family or co-workers; go home; and watch some TV. Nothing particularly bad happens, but you still can’t shake a feeling of stress, or worry, or inadequacy, or loneliness.
According to Dr. Rick Hanson, a neuropsychologist, a member of U.C. Berkeley's Greater Good Science Center's advisory board, and author of the book Hardwiring Happiness: The New Brain Science of Contentment, Calm, and Confidence, our brains are naturally wired to focus on the negative, which can make us feel stressed and unhappy even though there are a lot of positive things in our lives. True, life can be hard, and legitimately terrible sometimes. Hanson’s book (a sort of self-help manual grounded in research on learning and brain structure) doesn’t suggest that we avoid dwelling on negative experiences altogether—that would be impossible. Instead, he advocates training our brains to appreciate positive experiences when we do have them, by taking the time to focus on them and install them in the brain.
Science says lasting relationships come down to—you guessed it—kindness and generosity.
Every day in June, the most popular wedding month of the year, about 13,000 American couples will say “I do,” committing to a lifelong relationship that will be full of friendship, joy, and love that will carry them forward to their final days on this earth.
Except, of course, it doesn’t work out that way for most people. The majority of marriages fail, either ending in divorce and separation or devolving into bitterness and dysfunction. Of all the people who get married, only three in ten remain in healthy, happy marriages, as psychologist Ty Tashiro points out in his book The Science of Happily Ever After, which was published earlier this year.
Social scientists first started studying marriages by observing them in action in the 1970s in response to a crisis: Married couples were divorcing at unprecedented rates. Worried about the impact these divorces would have on the children of the broken marriages, psychologists decided to cast their scientific net on couples, bringing them into the lab to observe them and determine what the ingredients of a healthy, lasting relationship were. Was each unhappy family unhappy in its own way, as Tolstoy claimed, or did the miserable marriages all share something toxic in common?