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When Funding Spoils Startups

I ‘m reading about two startups this morning and I can’t help but draw a comparison.

TechCrunch features the two-way storage widget released by Box.net. I consider Box.net is a cool company, with an interesting product, even though they are in a crowded market.

Their story is that of the classic, frugal live-in startup model: few friends get together, build the product and business day and night, live frugally but have fun in the process. (The photo to the right is from the SF Chronicle that featured several startups living the frat-house culture).

I suspect Box.net may now have real offices, having received funding from DFJ, but somehow I don’t see them spending that $1.5M on luxuries. Certainly no reserved parking smile_wink

The other story is from Wired, about Socializr. The photo on the left shows their entire team. At first glance, a “typical” startup team – except their job titles. Toni Graham’s, in particular: Executive Assistant. No, it’s not a joke.

I had the honor (?) of discovering Socializr while they were still in stealth mode, based on a job listing for the Exec Assistant position. For a while I thought it was just a prank, but later on I confirmed they were indeed real, raising funds and actually hired Toni. While I still don’t know why a 3-person startup needs an Executive Assistant, at least I’m glad the search was thorough, and she has all the right qualifications: pretty, blonde, sings, in fact trained in opera!

I can’t really figure out what to think of this. I recall visiting some of the later stage startups, like Socialtext, JotSpot (prior to acquisition) already in decent offices,with larger teams, still no Exec Assistant to be found. What are they doing wrong? Or Atlassian, with revenues in the $16-18M range, hiring a VP Marketing for the first time, yet when you visit their San Francisco office, the President (or whoever) opens the door – no Assistant there, either.

You see, I am biased. Yes, it’s all about the product and meeting real market demand, but I admit I prefer following companies that are “likeable” in many other ways. My bias tells me when a startup’s first hire is an Executive Assistant, there is something wrong with priorities, and I don’t expect much. But of course, what do I know – and it certainly helps if your investors are your friends. smile_omg

Related post: Socializr, the “un-startup” on VC Ratings.

UpdateSocializr Lays Off Staff, On DeadPool Watch

Comments

  1. I just got a call from a CEO’s assistant, who then patched me through to the CEO (ie, the CEO had the assistant place the call on her behalf). Knowing that this is a 3 or 4 person company, the same thought ran through my head… what is this company thinking? I know, too, that they’re a frugal group, they watch their spending. Or so I thought.

  2. Zoli Erdos says:

    Let’s see: 1 person for development, 1 to place calls, 1 to run the show – nice balance :-)

  3. Speaking as an assistant that can proof some code, tweak a website, answer phones, find a supplier, get some lunch, handle interlopers and still not cost an arm and a leg, it seems to me that a start-up team could use help with the mundane things while concentrating on building!

    But I am underemployed, so what do I know!

  4. Zoli Erdos says:

    Tracy, don’t get me wrong, I’m not against assitants in general… just not too early. I’m sure in your past jobs you supported more than just 2 ppl. :-)

  5. Ok, it looks bad at a glance but it might be really helpful — I’m a very bright but way Aspergery kind of guy. On the few occasions I had exec-assistant help it was a HUGE help in my productivity as a manager/developer becuase even though I give good phone it is mentally very exhausting for me. Bill Gates was probably not the point guy on the phone at MS in the early days.

  6. Who knows web 3.0 might be like fashion and bring back all the old silliness of the last era. I personally can’t wait for the million dollar launch parties.

  7. Zoli,

    Your romantic (but naive) idea about what makes or breaks a start-up made me smile.

    However, there is not really anything to suggest that your chances of success increases the more laid back, unstructured and disorganised you run your company.

    An assistant is in fact a highly effective force multiplier that enables the manager to spend his or her time more cost-effectively and do more of what they are great at.

    Finding ways of levering the founder’s skills and vision to the max is always going to be a challenge for any start-up.

    I suspect the main difference between the two companies you describe is that the people from Socializer know this from experience while the others don’t. I’m sure they will learn it though.

    What is not clear from your article though is why you believe Socializer has been spoiled by their funding?

  8. I bet that payperpost guy with his RockStar reality TV show (or whatever) has an Executive Assistant.

    Tracy – if that’s the degree of your involvement in a startup, isn’t it somewhat demeaning to be just be considered an assistant? Executive Assistant seems like a poor descriptor for “Business Manager,” “Business Development Lead,” and “PR Hack,” and “Operations Manager.”

Trackbacks

  1. [...] but for many people it’s a true ritual.)   The company, which just a year ago was 4 guys cramped together in a two-bedroom live-and-work apartment has grown to 20 employees and picked up two rounds of [...]

  2. [...] Bias alert: I’ve been watching Box.net from the humble early days starting here: [...]

  3. [...] Box.net has certainly come a long way from the humble start [...]

  4. [...] come in all sizes. Some small, others large, some start small but grow large.   I’ve been tracking one since they were very-very [...]

  5. [...] so much about the service, rather a good startup – bad startup scenario, praising their frugality and focus on business first (link here). Back than all online storage startups were launched by college kids [...]

  6. [...] wasn’t so much about the service, rather a good startup – bad startup scenario, praising their frugality and focus on business first (link here). Back than all online storage startups were launched by college kids [...]

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