I would like to take this moment to announce PICPC-VC, which is an automatic follow-on investment, structured as uncapped convertible notes, of $50 available to any founder accepted into the PICPC program.
Does that mean that recipients can legitimately tell the press and other investors that a16z is one of their investors?
Assuming that the recipient can keep a straight face?
EDIT: Perhaps having a16z as the only VC in your seed is a very bad idea. Chris Dixon (now a partner at a16z) cautions enterpreneurs against the risks of having a sole VC in your seed round:
"I can think of about 15 founders I’ve spoken to recently who tried or are trying to raise Series As but are seriously hampered by the fact that a big VC invested in the seed round but isn’t participating in the Series A."
Excellent. Not too long ago I asked a partner at a very well known VC firm if they would consider investing a small amount ($x00) in many "startups" to see if the founders would use the money effectively and follow up with a more serious investment if so. He looked at me as though I was asking sarcastically rather than sincerely.
I'm confident that these six new Pinboard/Ptacek/A16Z companies will have excellent return on investment.
Humor aside, there are many smart founders but being brilliant and being money-minded are orthogonal.
I wonder how much having any amount from a top-tier investor like a16z is worth (since you don't need to reveal the amount, at least initially, and once they're already talking to you...). Presumably that $50 is worth more like $5-10k, unless someone reads this thread.
Are there any good "State Engine" packages for use with Ruby on Rails? I have been working in Javascript for the Windows 8 UI (and probably PhoneGap to make a quick Android port), but if it would help get the product done to go another direction, I am willing to consider.
I would like to take this moment to announce PICPC-VC-2, which is an automatic follow-on investment, structured as uncapped convertible notes, of $500 available to any founder accepted into the PICPC-VC program.
This much money, I mean... what would I do with it. I think I can build a sustainable business but I fear at this point that the sums involved are forcing me to give up too much control and to grow faster than will be sustainable. I have legitimate concerns that this will ultimately be bad for the company and that it's helping to fuel a salary bubble.
Already replied to this comment, but what the heck, I thought about what you said and had some more to add (since my original posts were "ha ha" funny, or at least I thought so).
I don't have startup credentials. My last startup was 10 years ago; I built a hosting company and sold it to a consulting firm for a couple hundred grand. I'm still in IT, so I clearly haven't made enough to cash out yet (I'm an IT operations lead; paid well, but definitely not F-you money).
I'll offer something better though; come to me with an idea I believe in, something that is going to change the world for the better. I'll provide free room and board for six months while you build it (my wife and I aren't great cooks, but practice makes perfect). If you get huge, awesome. I don't want any equity, I just want you to succeed. If it doesn't work out, head on over to a code school in SF that guarantees you a high five figure salary after your time with them.
I can't offer credentials; I can offer to give what I can to help someone reach their goals/dreams. The startup scene needs an airbnb.com for founders who don't need cash, just time and a place to live, and for people who are willing to host said founders at no (or very little) cost to help with their goals.
People seem to be missing the point. While the $37 is a gimmick, the reality is that this investment, in the form of advertising, is worth perhaps tens of thousands of dollars (I am not familiar with the intimate details of Pinboard's traffic, so I could be high or low on this). Google should adopt this model, since they have more advertising inventory than anyone and have the power to instantly propel promising startups to success. They could quickly obtain equity stakes in a vast number of startups that they deem to be promising, and throttle their "investment" based on analytics.
Can someone more in touch with corporate finance explain what an uncapped convertible note means for ownership and operation of a company? Serious question.
That $50 would be converted into stock at the time of their next fundraising. Uncapped means there is no cap on the valuation at the time of the next round. So if one of the founders raised money at a $100,000 valuation later, the $50 investor would get 50/100,000th of the shares.
If it were capped, say at a $50k valuation - the investor would get 50/50,000th of the shares, regardless of the valuation.
Thanks! I'll reiterate obilgic's question since I don't know if your showdead is on: what is the ownership situation before, or in absence of, subsequent fundraising? Would a company be considered automatically split into some number of shares at some point?
Then it's typically a loan with a pre-defined interest rate.
A convertible note does not buy equity - thats what 'convertible' means - and 'note' means 'loan'. So it's a loan that can convert to equity based on certain conditions.
As I said, all of this is overly simplistic. It's just a 30,000 foot overview.
Thinking of applying as a single non-technical founder. All I have is an idea but I am sure with the $37 dollars I could hire an awesome programmer to put it together for me!
EDIT: Seeking technical co-founder to help build out idea. Must be prepared to sign NDA before equity can be discussed.
Just a note on word choices... the "Greater East Asia Co-Prosperity Sphere" was the name of the colonial empire that Japan built through conquests and occupation starting in 1940.
I'm fairly confident Pinboard won't be raping hundreds of thousands (millions?) of people, engaging in wars of aggression on its neighbors, or conducting worse chemical warfare and other medical experiments than the Nazis. I can see how one might get confused though.
Nice troll, but one Marine in a large force committing a horrible crime and then being punished isn't really indicative of a national policy. If it were, the US would also be supporting killing US soldiers on military bases in Texas due to MAJ Hasan's spree shooting a couple years ago.
OTOH, it's crazy that that guy got only 4 years. 10-20 would be more appropriate. Hopefully being convicted under Japanese law doesn't prevent additional action under UCMJ to run consecutively.
Noticed this as well... "Co-Prosperity _____" should sound hauntingly familiar to anyone with any amount of knowledge about WWII.
It seems like the "Co-Prosperity Cloud" is a joke, but even if it is, it's a joke in poor taste considering the atrocities committed by Japan, and not even an especially clever one (annexation and abuse for profit is not really the same idea - I hope - that Pinboard is expressing).
Considering that > 90% of the people who witnessed said atrocities are no longer with us (and 100% don't read HN), the time for jokes has come at last. Actually there have been numerous humorous takes on WWII for decades now.
In "jokes", people often state propositions that seem opposed to what we would hope they believe.
Regarding atrocities, you clearly have no idea how deeply the wartime atrocities impacted many Asian families. Many Korean families I know refuse to buy Japanese cars or products (my mom is Japanese, so I've been told this many many times). My Korean father-in-law was an orphan because of the Japanese occupation.
In any case, the above fails the first rule of jokes... they're supposed to be funny. I thought the post was funny enough. But the reference to a co-prosperity system didn't add much (any?) humor to it. Just pointing that out to the OP...
That's not the 1st rule of jokes! The 1st rule of jokes is that there are no rules. The 2nd rule of jokes is that everyone finds different things funny. The 3rd rule is to break all the rules.
Repurposing the stilted propaganda of long-ago times, or of clumsy tyrants, for subtly absurdist/ironic humor value, does not in any way lessen the original horrors. It celebrates the distance we've achieved, while also offering a teaching moment by contrast/reference.
See also: "we will bury you", "let a thousand flowers bloom", "we had to destroy the village in order to save it", "i have in my hands a list of hundreds of known Communists", "the war to end all wars", "the mother of all battles", "this blogger has been harmonized", etc.
The anti-Japanese grudge does run fairly deep, but as far as I can see it seems to be slowing significantly in younger people. The parents of people I went to school with (graduated university 2010) might hold one, but my friends are much more moderate.
Personally I thought the co-prosperity added to the humour with an over-the-top name, and I detected a slight whiff of Eastern Bloc over-the-top naming, akin to Council for Mutual Economic Assistance or Polish–Soviet Friendship Society. But then my ethnic background is Polish and not an East/Southeast Asian one.
It was the name of an empire, but it was also the name of the ostensible ideology behind that empire as well. Did you read the whole Wikipedia article you gave a link to? What Pinboard is trying to do here actually does bear a resemblance to what turned out to be the empty rhetoric of the Japanese Empire, and so I don't think it's inappropriate for people forming a commune to call it "Communist" - despite the horrific atrocities perpetuated by real Communist states.
Check out the book Flyboys, by James Brady. (http://www.amazon.com/Flyboys-Story-Courage-James-Bradley/dp...). It gives some interesting background on why Japan did what they did (their expansion) and it also documents the atrocities committed by both sides. It was a very eye-opening book, and when you are done reading it, you will know why war is hell.
"The project aims to draw attention to the fact that if you have access to technical labor, the startup and operating costs for an online project in 2013 are negligible. The biggest obstacle to creating something useful is finding the time to build it and attracting an initial pool of paying customers."
Good thing that in the brave new future world of 2013 labor and marketing are completely free of all costs, opportunity and otherwise.
First, you should never accept angel investment from non-accredited investors (i.e., individuals with a net worth of at least one million cents).
Second, the real value of the investors is their network. In this case, Maciej Cegłowski's network is a collection of links featured in an indexed, polished, simple-to-use product. Why accept money from him when his network is already available for free?
Third, seeking outside investment prior to building a prototype has been heralded as a path to madness. You should at least have some sort of Bootstrap-based splash page on a .io domain before you accept his sizable investment.
The value in accepting $37 from pinboard or a16z is in getting a lot of exposure and not the money.
Are you serious or joking when you made this offer? Either you guys missed the point or you want to put your name on the meme of the day. Can you give me a compelling reason for me to accept the $37 from you?
My application: "I'd use the $37 to buy $20 worth of stamps and envelopes, then $17 for a disposable camera and photo development costs. I'd photograph myself putting the stamps on the envelopes and get the photos developed. Then I'd put the photos in the envelopes and mail them to you."
If you manage to get a photo of yourself sealing the envelope with said photo of you sealing the envelope inside of the envelope... then we might have a winner. Could call it EscherGram
"I just received an email that Buddy's Cannabis in San Jose is having a special. 27 different strains are on sale for $29.99 per 3.5 grams. I think I'll go for that, and give the remainder to the first homeless person I see."
Before I joined it sometime this year or last, I thought Pinboard seemed like the silliest, most likely-to-peter-out trifle of a service. But now it stands alone from all the other pinning services I used to use, including Instapaper.
In other words, I trust this guy with knowing how to execute (and to the point, probably recognize) successful minimally-viable products.
It does seem like cost are negligible today, but on deeper analysis theres a lot of costs beyond simply hosting.
Just from memory for my startup (Authy.com), initial costs were:
Domain: $1000+
Design: $3000
Video: $3000
Hosting: $400
Depending on your skills this initial costs will vary. An although I agree you don't need external investment to cover them, you should at least plan to invest $10,000US to cover your initial costs.
A lot of the things that you seem to think of as mandatory are not.
Domain: or get something longer for $9. E.g., authyapp.com or getauthy.com
Design: http://themeforest.net/ $15-$25, or DIY (depends on how much design matters for your niche--for Pinboard it clearly doesn't)
Video: You don't need no stinkin' video
Hosting: Maciej is recommending http://prgmr.com/xen/ for $32 (but can you actually run a modern app stack on just 128 MB of RAM?) Anyway, even if you need a gig, that's $100.
Ha, I'm aware that if you're careful, you can do it, but I was more thinking of a python or ruby stack with MySQL (or whatever) that most people would use :).
Not unless you consider every request needing to use disk swap "running" which I can assure you is orders of magnitude slower and terrible.
In my experience on Rackspace cloud 512MB instances are the minimum you should use for tiny production apps. Also, they're discontinuing 256MB on OpenStack - these were suitable for single-user dev instances, but I got more swap and or locking if ever attempting to run publicly with traffic. 512MB instances solved that issue.
Edit: Also I should mention I'm assuming you mean wanting to run a fairly standard stack, not a stack targeted toward tiny memory footprint.
I agree that getting things done "properly" still costs money. But every single item on your list can be done for at least one order of magnitude less in the MVP stage.
Unless Heroku has changed, you absolutely should not host a production site using a free account. If your site doesn't get any traffic for a certain period of time, they spin down your instance. This means that the next subsequent view will have an abnormally long load time as they wait for your EC2 instance to spin back up. The $20/mo at Rackspace (or any other provider) is well worth it.
App Engine has this problem too. The solution is to run a cronjob somewhere (App Engine has cron built in, so I've used that in the past) that hits your frontend every ~10 minutes or so. Instances never go stale, and on App Engine, you get 28 instance hours/day for free, so you can stay under the free quota as well.
On Heroku, you don't even need to manually run a cronjob or set up something that feels like you're consciously trying to game the system. If you sign up for the free tier of NewRelic that Heroku offers, it'll automatically ping your dyno often enough to prevent it being spun down.
"Authy is a simple API to add two-factor authentication to your website or app"
Two-factor auth is a thing where when you log in to something, you also get a text message, or open an app on your smartphone, and type that into the app you're trying to log into. The purpose of this is that even if someone figures out your password, they can't get access to your account, because they don't have the 2nd form of auth (hence two-factor.)
It's a way to add two-factor authentication to your website or app. Instead of having people log in with just username and password, they'll also have to enter a code. They get the code from the Authy app on their phone.
(PS I'm not affiliated with Authy, just trying to be helpful.)
Basically, yeah. Goes well with platform-as-a-service for software-as-a-service, full-text-indexing-as-a-service for software-as-a-service, payment-as-a-service for software-as-a-service, etc.
Easier to snap these components together than roll your own.
I don't understand people ridiculing him. This funding is for entrepreneurs and business projects with a particular profile. A project like Pinboard.
When Y combinator started the amount of money was also ridicule.
What you get with his funding is visibility and this is rapidly growing in value because everybody will now look with high curiosity what are the 6 selected projects.
It looks like he is attempting to undercut Y combinator and might succeed. Look how he targets a niche market that is discarded by Y combinator : single founder projet. He applies all the advises given by PG himself.
I'm looking forward to see how he will execute, but this is already a very good start.
If I had a close to finished project and no traction because of no visibility I would apply. Because the visibility will be much bigger than with an article in techcruch.
> I have no understanding of the concept of humor...
So it is a joke.. Or at the very least tongue in cheek. (With some exceptions,) I doubt hosting is what most VC funding is spent on.
Edit: as he said, "The biggest obstacle to creating something useful is finding the time to build it and attracting an initial pool of paying customers." If you have access to those you probably have $37. I get that he is trying to say technical costs can be negligible for startups. I fail to see how Investment Co-Prosperity Cloud helps anyone in anyway. And thus, I think it's a joke (even if the funding is real).
>If you have access to those you probably have $37. I get that he is trying to say technical costs can be negligible for startups. I fail to see how Investment Co-Prosperity Cloud helps anyone in anyway.
You've managed to recapitulate his point while simultaneously missing it.
As you say, costs are negligible. Time to build something is hard to find, but nobody can help you find it.
Attention is what's really valuable and really hard to get, as a startup. Maciej is highlighting this by making an offer to startups that puts what's really valuable for building a sustainable business (I'll drive attention your way) front-and-center, while mocking the valley's mentality of take-huge-wads-of-funding-cash-and-bet-it-all-on-winning-the-growth-lottery approach to business creation with his "I'll throw in $37" offer.
This is the value the winners get:
"What else will I get?
I will feature the six successful applicants on the Pinboard blog, and give them whatever additional help I can in making contacts in computerland and attracting an initial pool of customers."
His point is that a lot of money isn't needed, but publicity is (and a cool service of course).
Consider something like the start of instagram - no revenue and huge data transfer costs after getting tons of users. Although I realize OP is suggesting building something with revenue that is sustainable.
I'll wait for the blog post inviting hardware startups too, followed by a post about how $37 gives founders too much runway, and half as much ought to do it.
I'm announcing microcrowdfunding flush-investment platfrom Flushstart. We all have pockets full of change by the end of the day. To participate in Flushstart you you just flush all the change down the toilet and Flushstart employees collect your investments in the sewers. You automatically get equity in all projects listed in Flushstart. I just started the platform by flushing 10 cents.
I'd like to take this opportunity to offer PICPCReject membership to anyone rejected by the horrible elitists at PICPC.
We don't have any funding yet, so we can't make any specific promises, but I hear the dumpsters behind Denny's have a wide variety of semi-rotten food available for "Tuesday dinners".
My company will offer $38 to every PICPC reject (1) as a bold signal to the industry to not undervalue the vibrant entrepreneurial spirit our community is made of!
(1) requires additional investment criteria to be fulfilled, left to our descretion
I actually quite like this but what scares me is I see no mention of an export. A startup could never use this if there is no simple way to leave at some point in the future.
Someone should start a similar fund, but instead of just throwing large amounts of money at the companies like PICPC, they should help introduce them to their vast network of highly engaged people... perhaps on Twitter.
I have emailed and offered support of $20 per startup, plus use of my manufacturing facility. I think this is a great idea, and since I started my company with a credit card I can relate to the unfunded startup.
To take this to the next level, I vote for crowd-funding at the end of it all. I'd put $20 behind my favourite startup from the class and cheer them on. Almost like fantasy sports, but for startups.
This is flawless. I have a little script that I've been working on that has helped my life immensely and I know it could help others too. I've been too lazy to make it into anything more, though. This is giving me just enough to actually write down what it is and why it's helpful, and if I get it will totally make me go further.
There's a bit in James P Hogan's novel Code Of The Lifemaker about a charlatan mentalist, asking a crowd to pick a number under certain circumstances. Because of the way he structured it most people picked 37. See here for excerpt- http://jm.home.xs4all.nl/37/cotl.html
I got excited when I read that book the first time since I'd decided at about age 15 or so that 37 was "the most random number" and used it everywhere I could as some sort of odd prank.
This is $1 less than it takes to sponsor a child for one month through Compassion International (an organization that supports 1.2 million children in the most poverty-stricken areas of the world). Would the money be better spent sponsoring a child or sponsoring a startup?
What if this sponsorship enables an IT project that is then able to save the lives of two poverty-stricken children a month. Does that make it worthwhile?
More abstractly, what if this sponsorship enables an IT project to build a new kind of internet, that then enables Compassion International to work much more efficiently such that they are able to sponsor 200% more children on the same donations they currently receive?
I believe it is a one-time $37 investment, not monthly.
If I understood the discussion elsewhere in this thread, he states that the investment is a form that gets converted to $37 worth of shares at the next fundraising valuation.
So if you raised venture capital at a million dollars valuation, he would own $37 worth of shares, which later if the company was sold for a billion would give the investor a cool $37,000.
Basically he is trying to make a point rather than make big profits.
Wait, I'm confused - I'd at least expect you to mention something about us getting into the PR circle jerk as part of the program? Is that not part of it?
I applied. Anybody have tips for the interview??? Can any alumni put in a word for me??? What if I use my product to deliver a 6-pack to one of the pinboard founders, will that improve my chances??? Please help!!!
I've developed iMaciej, a PIC-PC interview simulator. It can help you prepare for your interview by asking you the same sort of hard-hitting questions Maciej has been known to ask in previous batch interviews such as "What?" and "I don't understand" and "Where's the tea?".
