Interestingly enough, Sean Parker, the guy who told Mark Zuckerberg not to call Facebook “The Facebook,” has also decided not to dump endless money into his own four-month-old startup, instead cutting staff and tweaking its software. That’s an unusual move for such a young company in this business.
If anyone knows how to build a company, Parker (played by Justin Timberlake in The Social Network) certainly knows what he is doing, having become a billionaire a few times over from Napster, Plaxo, Causes, Spotify, Votizen, and Facebook. His recent venture, Airtime, a new type of video chat, was launched with much fanfare over the summer, so the decision to slow it down a bit came as a surprise to many.
I think the digital industry is going through the growing pains it probably should have experienced a few years ago. Nothing like a Presidential election to wake people up. Many re-evaluate their portfolios because they are not sure what changes may take place in the economy regardless of which candidate is elected. It is now time for reflection, new decisions and financial housekeeping.
We are going to see more and more of the money people start to give the geniuses deadlines. I’ve always wondered about that. We worked for so many companies over the years where the founders/inventors thought they were going to get funded forever. They never addressed time commitments and goals. It was always about making them look good during their journey of glory.
It used to be so cool to tell others at a dinner party that you were an angel investor in some genius startup. Today, I think a lot of people look at you and murmur “sucker” under their breath.
For purposes of disclosure, Eliot and I got suckered in a few times. Thank goodness for the ones that made some money and for our day job.