An Open letter to the VCs that invested in Quibi.
So Quibi is shutting down after raising ~$1.8B in funding.
I’m not privy to the details of this fiasco, but the massive red flag for me was bringing on the former CEO of HP.
When will boards & investors learn that you need startup people to run startups?
Don’t get me wrong, Meg Whitman might be amazing at business.
However, a startup is not a business.
A startup is a mess of experiments and tests and learnings until you figure out what’s going to work — and then you do it all over again when you need to tackle the next milestone.
Startups don’t pay $1M for each 10-minute episode when you don’t have the subscribers to justify that.
Did you benchmark your unit economics?
Did you understand your LTV?
And if that much investment into your product was the right call, did you invest the same amount into marketing?
The best product in the world gets beat by smart marketing every single time.
If it sounds like I’m upset, it’s because I am.
Every day I work with amazing startup founders that only need a tiny fraction of that $1.8B to build something amazing.
But they don’t have the network that comes from corporate life and politics and an Ivy-league education to make that happen.
Instead, they grind away every day to solve the world’s problems and try to create a sustainable business out of their solutions.
They empty their bank accounts.
They invest their life savings.
They run up massive credit card debt.
They tell themselves it’s a rite of passage, but it’s bullshit.
The truth is that investors could easily stop dumping hundreds of millions into the Juicero’s and Theranos’ of the world and start making more $500k and $1M investments into promising early stage founders.
But no one wants to do the work of finding great founders and nurturing those companies.
It’s easier to jump on the funding bandwagon as soon as one big name joins the round and then hope to ride the coattails.
And those big names meet founders through networks and warm intros because they are too busy to vet all the cold outreach emails they get.
But for what it’s worth, I will help you find those founders and nurture those companies.
Seriously, if anyone is interested, let me know.
It won’t take $2B to create the next unicorn.
It will take lots of small investment dollars, and lots more investment hours, but we can make it happen.