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Reflecting on My Failure to Build a Billion-Dollar Company

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2101 points jamesjyu | 7 comments | 07 Feb 19 15:28 UTC | HN request time: 2.04s | source | bottom
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sahillavingia ◴[07 Feb 19 16:33 UTC] No.19106256[source]▶
Hey, #1 on Hacker News! I don't think that's happened since...I launched Gumroad back in 2011:

https://news.ycombinator.com/item?id=2406614

Thanks HN for being a part of my journey!

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ChuckMcM ◴[07 Feb 19 17:26 UTC] No.19106684[source]▶
I love your story Sahil, it is so true that people equate 'wealth' with 'success' but that is short sighted. If you step back and look at the big picture, you're on this planet for anywhere from 70 to 100 years, and at the end of that time there are two metrics, the number of people you helped and the amount of wealth you amassed and held on to, which number is a better representative of 'success'?

Working on things you enjoy, making a positive impact on people's lives, and raising a new generation to carry on where you left off, that is success.

Stay focused there and you might accidentally accumulate so much wealth you have to work at putting it to use helping people like Bill does!

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austenallred ◴[07 Feb 19 17:43 UTC] No.19106821[source]▶
Based on the revenue and growth rates of Gumroad my guess is Sahil will make more money from it than he would have at Pinterest. It will take longer but it will be on his terms.
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eanzenberg ◴[07 Feb 19 17:50 UTC] No.19106874[source]▶
How is that even remotely possible, unless he got no equity in pinterest? They are ~10b IPO'ing this year. Even 1 basis point of pinterest is worth more than what Gumroad brought in.
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austenallred ◴[07 Feb 19 18:36 UTC] No.19107272[source]▶
He owns the majority of Gumroad. Let’s say he had 100 basis points of Pinterest, call it 50% dilution, he’d walk away with $50m. That’s probably very generous, probably actually closer to $20m.

Gumroad will be worth that in a few years at this rate, and he could cash million dollar paychecks along the way if he wanted.

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1. frtcike89 ◴[07 Feb 19 19:33 UTC] No.19107779[source]▶
So he'll be worth $50M in a few years with Gumroad. Meanwhile his original investors lost all the millions they invested. His employees lost all the time and vesting. Ouch.

That's why it's way to dangerous to just follow any guy and do a startup and waste a few years of your life.

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2. austenallred ◴[07 Feb 19 19:41 UTC] No.19107850[source]▶
> So he'll be worth $50M in a few years with Gumroad.

That's my best guess, yes.

> Meanwhile his investors lost all the millions they invested.

Well, some sold his equity back to him for $1, so yes.

> His employees lost all the time and vesting.

Well the employees could have exercised their grants when they were laid off, but I doubt they were inclined to double down on what was then a failing company.

> That's why it's way to dangerous to just follow any guy and do a startup and waste a few years of your life.

I mean, the employees got paid all along the way, and probably not that much less (if any) than they would have working for another company, and they got to work on something they loved.

Sad that it didn't work out. These things are risky, but having worked at startups and not gained anything from the equity I would do it again in a heartbeat.

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3. numair ◴[07 Feb 19 20:02 UTC] No.19108027[source]▶
Actually, his employees got a ton of experience building systems and processes the “hard way,” from ground zero at a startup. This inevitably made them more attractive to whomever they decided to work with afterward — startup, large company, whatever — especially as they were let go into a frenzy of hiring by other firms.

And if, God forbid, they wanted to start their own company and waste a few more years of their life (your words, not mine!), well... Everything is easier when you’ve seen someone else do it.

4. wolco ◴[07 Feb 19 20:40 UTC] No.19108381[source]▶
The employees got paid less because of vesting. It is a gamble and this story shows different outcomes for employees. Pinterest paided off and gumtree didn't.

In both cases the founder made between 20-50 million.

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5. austenallred ◴[07 Feb 19 20:55 UTC] No.19108508{3}[source]▶
Both employees and founders vest.

Founders own more of the company than employees, of course. The good news is anyone can start a company!

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6. wolco ◴[07 Feb 19 23:40 UTC] No.19109812{4}[source]▶
Agreed but if you choose to be an employee opt for higher salary over vested future value for better game theory results.
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7. austenallred ◴[08 Feb 19 02:47 UTC] No.19111058{5}[source]▶
Unless the company is successful, in which case you should do the opposite