This post has been brewing for a while. There are a variety of factors that contributed to the untimely demise of disruptorMonkey. For what it’s worth (and there are some lessons here!) I figured I’d share.

The biggest single factor was a poorly timed co-founder disagreement. As some of you may recall, we were heading in to due diligence with a local Angel group. I’ll not go into gory details here, but suffice it to say that regardless of the merits of the issues raised, they were substantial enough that they had to be declared in the due diligence process. Any early stage company is a high risk investment and investors are understandably skittish about additional red flags. It became very unlikely that due diligence would proceed, and that was a huge problem.

But there were a number of other factors that compounded the situation. Without them, we might have survived…

#1: Holy Macro-Economic Factors, Batman!

I’m not much of an economics whizz kid, but the broad economic climate really caused some pain. Two issues: housing market and the credit crunch…

I relocated to North Carolina from Arizona. The housing market looked a little unsteady when I left Phoenix, but values in my neighborhood were staying strong. We had a bumpy start getting the house on the market, but it was finally listed in October 2006. Thanksgiving rolled around all too quickly and then we were into the holiday season slowdown. Come January, the Phoenix market was slowing down rapidly. We finally sold the house in April 2007, but we sold it for $50,000 less than the original asking price. This was no mansion — just a 3 bed house in a decent part of town. Of course we’d also been paying the mortgage for 7 months while renting a place in NC too…

Much of being successful with your startup depends on having enough runway. Losing $50k+ tends to shorten things up a bit… Not so good.

But compounding that pile of suckage is the closely-related credit crunch. I have pretty decent credit, but since I’m not a classically salaried employee, I’m now on the fringe and setting off warning lights left and right.

When we moved, I had to switch banks because my former bank doesn’t have branches here. But that means I only have a short history with my new bank. No overdraft protection, frequent holds on checks and a bunch of other pain-in-the-butt issues to deal with.

And all the credit card companies are reviewing their customers for warning signs. That translates to lowered credit limits, jacked up interest rates and other silly games.

#2: Gonna Need a Bigger Boat!

We were working on a big problem — how to solve all your information management woes in one tidy application. Our approach was pretty unique and seemed to be working.

Of course, one of the problems with being unique is that you’re marching out of step with the rest of the world. That makes fundraising a whole lot tougher. We were lucky to have the support of a number of folks locally and elsewhere, but it was still a tough sell.

And when you’re the only one singing a particular tune, there’s the very real risk that you’re just plain wrong.

I still believe we were on to something, but there’s always an argument for making a simple product that does one thing very well. We knew the risks, and we chose to build something big. But we underestimated how challenging it would be to raise money for something we could explain but not fully demonstrate

#3: You’re Building a What for My What?

As I said, we were working on a big problem. When you’re talking about something big, it can be hard to give a short & simple pitch. And if you make it too simple, folks simply aren’t going to believe you. It took a long time to find a pitch that walked the wiggly line between credible, useful & deliverable, and too big, too vague and too hard to deliver. When we had the pitch, we still didn’t have all of the product in place.

And that, as they say, is that. Early stage companies are always teetering on the brink — it’s part of what drives their founders to try and succeed — but part of being a good entrepreneur is knowing when to quit. With a shortened runway, economic clouds on the horizon and co-founder disagreements, that time had come for disruptorMonkey.

Categories: Live 'n' Learn..., disruptorMonkey
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You can find all the old posts from the disruptorMonkey blog here.

Categories: disruptorMonkey
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I mentioned a while back how I had become a very reluctant Blackberry user.  Well, the used 7290 I bought apparently had a sensitive soul: it upped and died very shortly after I wrote that post.

Since I still need one, I had two choices.  Buy another used Blackberry, or buy a new one with a cell phone contract extension…  I couldn’t bear the thought of being chained to AT&T for another two years, and eBay didn’t work out so well, so I turned to that trusty alternative bastion of used goods, Craigslist.

[A quick diversion.  I’m with AT&T because the idea of not being on a GSM network in the 21st century strikes me as crazy.  I go home to the UK often enough & have been a GSM guy for long enough, that the idea that my cell won’t work over there strikes me as just plain dumb.  For reasons I don’t fully understand, T-Mobile don’t operate in North Carolina.  Suncom do, but when I needed a phone plan, they were very expensive.  Since I moved here, T-Mobile announced that they are acquiring Suncom, so by mid-summer, I should be able to get T-Mobile service here too…and my contract with AT&T ends in the fall.  Since T-Mobile actually give a damn about their customers, I cannot wait!]

I ended up buying a more or less new 8800 model.  I know not from whence it came.  And I’m never going to ask.  But the price was right.

It’s all shiny.  Ooooh.  The backlight comes on when you use the keypad.  Aaahhh.  The screen rivals any handheld device I’ve used, and the weird nubbly trackball thing more or less works.  They put the call end key in a much better place, and generally this thing feels less like a UI designer’s nightmare.

Possibly most sexy, it has a built in GPS.  You can run the free Blackberry Maps application and it works with Google Maps too.  Not bad for a directionally challenged individual like me.

All in all, it’s a big improvement over the 7290.

But I still have a number of issues with it.  Still no inbox/sent sync unless I’m running Blackberry Enterprise Server (although I hear rumors of an app called BBerrySync that may save me).  Still no looping on menus, so if you get all the way to the bottom of a list, your only choice is to scroll all the way back up.  And the weird trackball thing highlights anything on screen, not just links/items you can click, which seems like an obvious UI flaw.  As with the 7290, the way it handles attachments is stupid too.

But at least it looks pretty.  All in all, I’d say the 8800 is the phone equivalent of a cliched trophy wife (or trophy husband, depending on your point of view) and I moderately embarrassed to be seen in public with it…

Categories: Thought o' the Day
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I spent Wednesday & Thursday last week at the Southeast Venture Conference (also known as SEVC).  The event started last year and was held near Washington DC this year.  It’s primarily for VCs, but a few entrepreneurs attended the event.

You never quite know if these kind of events are going to be worthwhile.  The SEVC folks were kind enough to offer some starving-entrepreneur pricing (thanks Eric!) and DC is an easy drive from Raleigh, so it seemed worth the risk.  One of my favorite bloggers was also listed as a speaker and I had arranged to meet him, although unfortunately he had a conflict and had to back out.

All in all, it was a very worthwhile trip.

Most important news first.  We raised our first VC dollar!  Sadly, it was only one dollar, but the first one is supposed to be the hardest, right?  I had a great catch-up conversation with a VC I pitched last year.  His firm passed, but we’ve stayed in touch and he’s been great at giving straight feedback (if you find a VC like this, hang on to him/her because they are a VERY rare breed).  The subject of customers came up, and I mentioned that we had a couple of folks that had been willing to pay at least a dollar.  He promptly pulled out a dollar of his own and handed it over.  We’ll be framing it and hanging it in our lobby (when we have a lobby)…

There was a great panel that included Scot Wingo (CEO/Founder of ChannelAdvisor) and Jim Steele, (President of Salesforce.com).  I’ve known Scot for a little while now and always enjoy seeing him on a panel — he’s adept at keeping things simultaneously humble, entertaining and informative.

There was also a classic "Oh no he didn’t" moment at the end of the panel with a very VERY pushy entrepreneur who spent 3 minutes introducing his company and 5 seconds on his question.  When he didn’t like the answer Jim Steele gave, he actually proceeded to berate him.  As a fellow early stage entrepreneur, I’d be a little more reluctant to tell the President of a $7B company that he’s a dumb ass… especially when in front of a room full of VCs.  I thought Jim handled it very gracefully.

Jim had another presentation later in the day.  Salesforce are branching out into web services with their "Platform as a Service" concept.  The basic thinking is similar to what underlies Amazon’s web services — "We’ve built all this infrastructure and can package it up so you don’t have to".  In principle, I think it’s a great idea.  From what I saw, Salesforce is a little more oriented towards application developers.  What they offer appears to be more "finished" than Amazon’s offerings, but there are clearly pros and cons to both approaches.

What impressed me most about Jim was that after both his panel and presentation, he hung around answering questions until every question was answered.  I talked to him for a few minutes about the ‘Monkey and picked his brains about channel strategies.  When we were done, he readily handed over a business card.  I’ve met a lot of executives from much smaller companies that wouldn’t be so accommodating.

There was also a fascinating presentation by John Sculley (ex-Pepsi, ex-Apple, among other things).  He started off pretty slowly.  Since lunch was being served, I have to say that my attention was elsewhere.  But when he got going, I was hooked.  Much of his presentation was about virtual supply chains.  Doesn’t sound interesting, I know.  But he talked about mass customization (ordering online and getting a customized product shipped from China to your door in 48 hours… at a profit!!!) and the new breed of companies working with wholly virtual supply chains.  Another company he mentioned was able to prototype a new consumer electronics product for a major cell carrier in 45 days!  The product will be launched later this year at 36,000 retail points-of-sale (those kiosks in the mall).  Back in the day, I did a lot of work with some major toy companies.  Their assembly/supply timeline was measured in calendar years, not days.  The toys for Episode 1 were regarded as a major security risk as they were being shipped from China 6+ months before the release of the movie (and were in manufacturing for many months before that).

I spent a few minutes in an elevator with Frank Bonsal.  Mr. Bonsal is regarded as one of the Godfathers of the VC industry and was a founding parter at NEA.  I was, of course, wearing a disruptorMonkey button.  The big news is that Mr. Bonsal liked the name so much he asked for an overview of what we do and my business card.  Take that, Monkey Haters!

I also chatted with some very interesting folks from the IPO group at NASDAQ.  Clearly some very  smart people working on some very interesting stuff.

On the negative side (you knew I couldn’t keep up this happy stuff for too long, right?), some of the presentations were between average and lame.  I was surprised at how many of the company presentations managed to break every rule of presenting — way too much info per slide, no rehearsal and getting cut off before you’re finished because your timing sucks.  Notable exceptions were local boys  Neal Page of Inlet Technologies and Ben Weinberger of DigitalSmiths, both of whom did an excellent job.

So all in all, it was a productive and useful few days. 

Thanks as ever to the folks at Square 1 Bank for numerous introductions.  Thanks to the folks at Hutchison Law Group too.

Categories: Business, Inside My Twisted Start Up Brain...
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Posting will be light (again, sorry!) today and tomorrow because I’ll be up at the SEVC conference in/near Washington DC.

You can read all about the conference here.

If you happen to be attending and would like to catch up, post a comment or send me an email.  I can be reached via the "Contact Us" link on the disruptorMonkey home page.

Categories: Business
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