Are we in a bubble? This company got over 8 million in funding

http://www.redux.com/

by marketer • 18 years ago

15 36 18 years ago

redux.com

Source: http://www.crunchbase.com/company/redux

marketer2• 18 years ago

Source: http://www.crunchbase.com/company/redux

ojbyrne3• 18 years ago

It's cool how their unique visitors peaked the month they closed their Series A, and looks to hit zero within a month.

KirinDave3• 18 years ago

That's very typical of early startups who are still ramping up. I wouldn't read too much into it.

invisible• 18 years ago

We don't know their business plan. It might be so novel an idea that they can post huge profit margins, but at the face of the website it's very hard to grasp what they could do.

mrtron• 18 years ago

Exactly. It is extremely easy to toss a low blow at many companies that are kicking some serious ass on the revenue side of things.

If what they are doing is simple and you better deserve that 8 million to pursue the idea - go after it.

dmix• 18 years ago

These start-ups aren't being acquired and almost no one is IPOing, which means the only ones who will take a hit for any of these weak businesses will be the investors.

There may still be a VC bubble and its about time the kool-aid wore off, but from what I've seen the experianced and high quality VC's are not investing in these types of companies.

*correction, I just read the Crunchbase profile, and there are some good names behind this company. Hopefully the team is strong.

jakewolf• 18 years ago

Clicking on their mystery link enough times almost gave me a seizure. Don't even try it.

mattdennewitz• 18 years ago

i'd wager at least $2 mil went to fully developing that feature

KirinDave3• 18 years ago

I think it's kind of cute. Not enough sites do whimsical easter eggs anymore. It's one of those goofy things people do on a saturday afternoon that improve team morale.

Seriously, I bet "seizure" goes into their nickname for it too. :)

s3graham• 18 years ago

5M, if you read the sources linked from crunchbase.

Does seem pretty derivative, but might be a useful idea. Perhaps the website is mostly intended as a demo for their backend, which some bigger-viewer site could buy them for.

prospero• 18 years ago

Aggregators are the new portals.

metaprinter• 18 years ago

Speaking of which, what's up with popurls? Their traffic is down big the last two months.

tptacek• 18 years ago

"Welcome to Redux, our humble endeavor to change the world. Admittedly that does sound a bit cliché, and truth be told, we don't actually think that the world is such a bad place as it is, yet there are a few areas that we have chosen to improve. Namely, allowing you to discover entertainment, people, and products that actually mean something to you."

OW MY BRAIN.

spencerfry• 18 years ago

I think I just died a little bit inside by reading that.

thaumaturgy• 18 years ago

Didn't you read the warning labels that came with your internets?

WARNING: Exposure to large numbers of other people may cause cynicism.

swivelmaster• 18 years ago

I was having so much trouble finding entertaining things on the internet; Thank god these guys have come along to solve that problem.

/sarcasm

thwarted• 18 years ago

Create playlists. Buh. Just use an activity aggregator like friendfeed. I guess something like this would be useful if the actual content is kind of vacuous and you want to wrap it in something more interesting. I try to only show my friends interesting content though.

pjhyett• 18 years ago

I'd argue we're not in a bubble, because this company would have been able to raise 80 million in '99.

ordord00• 18 years ago

I am almost certain that this site is merely a demo for their backend. Look at their board... a former managing partner at In-Q-Tel is on it. My guess is the US government is a serious potential buyer based on that. But who knows, they have well connected investors who could also help them land deals with bigger content creators.

KevBurnsJr• 18 years ago

I interviewed with Redux in July and from what I gathered, they had a pretty good team together.

It's a python shop running either on a custom DB or on Berkeley DB. Their core business asset is the collaborative filtering mechanism that drives the Redux.com site.

I got the impression that the site itself is very much a proof-of-concept application of the underlying technology. They have a BHAG to become the default collaborative filtering mechanism for the internet. If they are successful, I consider it very likely that they will do so by licensing this technology to other companies.

It should also be noted that, as a company, they did not start out in the direction that they're going now. They've gone through several products and switched directions multiple times, eventually settling upon what they're developing now as a result of that process.

If I remember correctly, they are 11 employees, 8 of which are engineers and the CEO is a definite techy.

Smells like win to me.

marketer2• 18 years ago

Netflix can do collaborative filtering successfully because they have years of data. Amazon can also make recommendations because they know everyone's buying habits. Sounds like Redux is trying to abstract this to social media? It reeks of "technology in search of a problem".

aneesh• 18 years ago

Exactly. The collaborative filtering technology & algorithms is the easy part. The hard part is getting mountains of good data to apply it to. And by good, I mean monetizeable.

That's what Amazon and Netflix have done. They should solve the data problem first, and being yet another "interactive social media mashup web 2.0 social networking thingy" may not be the best way to get lots of data. The companies that have done this best have monetizeable data - Amazon can actually SELL you the book it recommends.

As for being a collaborative filtering platform: "1. If your idea starts with 'We’re building a platform to ...' and you don’t have a billion dollars in capital, find a new idea. Now." (http://diffle-history.blogspot.com/2008/06/postmortem.html)

bazookaaa• 18 years ago

Wait, what? When I heard about Redux way back when (http://www.techcrunch.com/2008/01/28/redux-discovers-friends...), it was for discovering new friends, which seemed like a good idea. But now it's this? Why the change [in the wrong direction]?

trevelyan• 18 years ago

The valuation of social networks went down. People out! Charm bracelets in!

DarkShikari• 18 years ago

Yes, we're in a bubble. More precisely, what's going on is that the majority of startups, numerically, do not need a lot of money; that is, most of the good ideas out there are best pursued with a small company with few employees, since there is little benefit they could gain from loads of extra cash. That, of course, is the idea behind YC.

But the VCs have loads of money, and they want to be able to use it. And when you have this situation where there are tons of small startups that need a little cash, they get overexcited, and throw too much money at them.

And you get stupidity like this.

netcan• 18 years ago

It's actually a little ironic. The Venture industry exists because big opportunities can be pursued with fraction (maybe 1/10) of their potential worth.

But now opportunities of the same size can be pursued with a much smaller fraction (say 1/100). As an investor, you're still willing to pay the 10th. Economics goes a little fuzzy around the edges.

tarkin22• 18 years ago

The whole US economy was in a bubble. Because of profitable investments in the housing market, made on faulty assumptions, and cash the mortgage owners had, there was a huge amount of cash circulating. It was profitable to invest in startups because investors knew that consumers were spending a sizable chunk of their cash on frivolities; the startup had a higher likelihood of income. Moreover, an increase in domestic demand means a buoyancy in the stock market; investors knew they could in future sell on these shares at a profit. Simply, investing in startups was a great idea.

Now banks issue fewer mortgages, after their faulty reasoning came back to haunt them, and current mortgage owners can't pay back their mortgages. Not only this, but, because banks have had to write off large swathes of their bad debts, they're less willing to lend money full stop. This hits domestic demand badly. Relates to startups, the profitability of startups has taken a hit at their prima facie and stock market value: a decrease in domestic demand means customers purchase fewer frivolities, and a decrease in demand always badly hits the stock market.

Not only are startups less profitable, but VC have less cash. VCs that invested heavily in the stock market, and particularly the housing market, now have much less cash than they had 4 months ago. Perhaps whoever's bought redux has seen some über filtering mechanism that will change the internet. But my point is that whoever's bought them has very likely far less cash to splash out on potentially rewarding, but less so because of a decrease in domestic demand, filtering mechanisms.

This all indicates that we are either at the bubble's apex or we are seeing its deflation. So, will investment dry up? I'd say not completely, but VC are going to be a hell of a lot more discerning in future, especially if they've invested heavily in the housing market, or stock market in general; they have less money to spend, ergo risk on startups.

dmose• 18 years ago

Anyone else think having 30 include files is a bad thing?

Allocator2008• 18 years ago

This is truly one of the worst startups I have ever seen.

Everyone in this forum is stupider for having seen it.

I award its founders no points, and may God have mercy on their miserable souls.

Are we in a bubble? This company got over 8 million in funding

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