SnapTalent (YC W08) Shuts Down

http://www.snaptalent.com/

by dannyr • 17 years ago

146 47 17 years ago

yan• 17 years ago

I'm sure the SnapTalent guys started working on something new before even posting that good-bye

jamiequint3• 17 years ago

It takes a long time to shut down a company. We stopped working on Snaptalent almost 4 months ago. I'm hoping to get some time in the near future to write some posts going into more detail about what went wrong. There are definitely a lot of takeaways that are being practically applied to my new project.

veteran• 17 years ago

are you selling assets/domain? or folding into another venture?

PStamatiou• 17 years ago

Best of luck with your future endeavors Jamie. Was a pleasure working with you and Snaptalent back in the early days. ;-) I still have one of the little post-it notes you guys sent with my checks.

jasonlbaptiste2• 17 years ago

Sumon and crew will be successful at whatever they do next, there's no doubt about that. By giving the money back to investors and being fully transparent, they've also shown that they're classy and full of integrity. Seriously, mucho respect for this move. Curious to see what they do next.

jacquesm3• 17 years ago

> Sumon and crew will be successful at whatever they do next, there's no doubt about that.

I don't know how you can make that statement unless you know something that is not public knowledge.

To repay your investors if it doesn't work out is class (though they say it was from 'money in the bank', it is very well possible that this was simply the easiest way of liquidating the business and that the founders let their share of the payment due to them go), there is no doubt about that.

But the fact is that this didn't work out, how the next project fares remains to be seen.

Past failures are not a guarantee for future success or something to that effect.

What impresses me most about this farewell note is that they decided not to go for mediocrity but instead decided to pull the plug.

That takes guts, and is on par with the repaying of the investors (which is relatively easy if you have the $, otherwise it is much harder and even more classy).

daleharvey2• 17 years ago

> I don't know how you can make that statement unless you know something that is not public knowledge.

Probably through personal experience, Ive met Sumon a couple of times and would happily take bets on him being part of something successful.

ynniv2• 17 years ago

Why is it classy to throw in the towel? The letter doesn't suggest that investors asked for their money back. This is the worst case scenario given my understanding of the VC market. It sounds like the team has lost their momentum, but certainly they have learned something in the process. If they dissolve the company and start something new which becomes successful, the original investors get nothing. There's nothing wrong with that from a morality perspective, but don't assume that investors want their money back - their reasons for investing might be complex.

dschobel• 17 years ago

I agree it's pretty rare to see a company fold before the money gives out. I suspect the "opportunity cost" which is mentioned in passing was probably a significant factor.

jasonlbaptiste2• 17 years ago

They had two years in the bank. They knew the risks and the likelihood of what would have happened. They could have been paid themselves for 2 years, tried a lot of different things, and potentially wasted the money. That is how it usually goes. Instead they cut their losses. I'm pretty sure the investors would rather have their money back than nothing at all.

sjsivak• 17 years ago

They did a good job by being honest and I think it is probably a great idea to get out of the online job recruitment sector.

I just wish they would have read over that goodbye note, or at least spell checked it.

benatkin• 17 years ago

It would be nice if they switched course without announcing they're going out of business. Reminds me of this:

http://www.paulgraham.com/die.html

AppJet did a good job following that advice IMO, but Heroku takes the cake. They didn't just change direction. They kept the old product alive, too.

Edit: I was wrong. AppJet kept some of their old stuff around, too! I can't wait to check it out. http://appjet.com/dev-archive.html

jacquesm3• 17 years ago

According to the letter they already switched course and it didn't work out.

ashishk• 17 years ago

Some term sheets may not allow you to drastically switch course. I'm guessing this is more likely the larger the round.

Either way, the right thing to do is to give the investors the option to cash out.

noodle• 17 years ago

too bad, undoubtedly a result of the collision of a bunch of bad circumstances.

good to see that they're able to analyze and learn from the situation at hand and have the fortitude and responsibility to make the call to shut it down before they crashed and burned.

wyw• 17 years ago

Except for a couple of typos ('are' instead of 'our'), this is an extremely articulate and informative statement which will no doubt help them justify this decision to future funders or employers. Very impressive.

sielskr• 17 years ago

If you think language like the following is "extremely articulate" or "informative", well, please do not send me anything to read.

The decision has primarily dictated by market conditions and opportunity cost which in aggregate would mean we probably wouldn't have been able to show the kind of results we wanted to make this a big company in this market.

viggity• 17 years ago

You gave it a go, which is more than you can say about most people. So, good job.

Good luck in whatever endeavors you head to next.

maurycy• 17 years ago

Finally, a failure. I'm tired with all the success stories.

pmjordan2• 17 years ago

Most failures just wither away and die. They rarely announce it.

jrandom• 17 years ago

And how many of those failures actually pay back investors instead of burning through all their cash first?

This is quite possibly the most responsible failure I've ever read about.

californiaguy3• 17 years ago

Recruiters and HR are the worst people to deal with in the entire technology industry.

DrJokepu2• 17 years ago

I have exactly the same experience, I have worked with some amazing HR people (as clients) at my previous job and we really made a good product that would have been impossible without their fantastic input. They are humans like everone else, and it's a job like any other.

pgebhard• 17 years ago

There seems to be a disconnect between your comment and that of the parent. Can you elaborate?

fallentimes• 17 years ago

Real Estate is close.

blang• 17 years ago

What about lawyers?

californiaguy3• 17 years ago

Depends on if you're paying.

javery• 17 years ago

HiddenNetwork (http://www.hiddennetwork.com/) which had a very similar business to SnapTalents first service also recently shut down. I think both of these affirm that advertising jobs to people who aren't looking for jobs isn't the best business model. (Job boards frequented by good people can be a lucrative business though, see 37signals, etc)

Maro• 17 years ago

"In November 2008, we transitioned from this product to identify an opportunity to try and focus on how recruitment products could be adapted for the Facebook generation. We hoped that our experience of consumer products and frustrations of this generation would allow us to deliver an amazing product."

Frustrations of this generation?

daleharvey2• 17 years ago

knowing the difference between how technology can work, and how it does work in real life.

at least for me.

Raphael• 17 years ago

The main frustration seems to be lack of jobs.

dmose• 17 years ago

Couple guys from my University started Jobloft.com and they were recently acquired - although this was before the recession.

ujeezy• 17 years ago

Good luck! It's never fun to read about a young startup closing its doors, but I'm sure you'll do great things with these experiences.

A quick question: I've been reading a lot about the theory of customer development lately (mostly via Eric Ries's blog and The Four Steps to the Epiphany). I know hindsight is 20/20, and I apologize in advance if it sounds like I'm just rubbing salt in your wounds, but I'd love to know what you think about this...

It sounds like your experience is a good example of a company that might have benefited by putting as much effort into finding the initial customers as in product development. Working closely with these earlyvangelists from the start might have helped you learn whether the product being built solves real pain points and to learn how and to what extent these earlyvangelists would be able to deploy the product internally.

I personally think it would be very difficult to do anything but build product in the three months leading up to demo day. The time it would take to locate and engage potential customers seems mammoth. Perhaps the product delivered on demo day is used to secure additional funding, and then as the demo product used to find market fit.

Anyway, I'm no expert in this stuff, which is why I'd really like to know your thoughts.

Best of luck with your next company!

jamiequint3• 17 years ago

We did start applying Steve Blank's stuff in Q4 '08 when we began to change direction to focus on college, but we applied it poorly. There are a number of reasons why, many are too long to explain here. I'll be writing up some posts on what went wrong and post them here so hopefully that will prompt further useful discussion.

willphipps• 17 years ago

so sorry to hear this.

rishi• 17 years ago

Does anyone know if they tried to sell the company?

aseidman• 17 years ago

Spent 1.5 years as lead Product for Yahoo HotJobs and this post is spot-on -- nicely captured. To put it rather bluntly there is more innovation happening in most small sized municipal utilities (see the Palo Alto Green program) then in the online job recruitment space. Given how incredibly important talent is to companies the CEO needs to reset incentive structures for their HR organizations.

SnapTalent (YC W08) Shuts Down

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