Yeah-yeah. Sure… http://trends.google.com/websites?q=yousendit.com

There is an advantage to be able to create a service that has minimum competition and grow prior to some big gun coming into the market with more money and resources. Ryan’s creativity and approach to promoting his service in my opinion had an indirect influence on the growth of the service.
if you look at ‘truemors’ and the negative press it got that contributed to its growth, the founder wells a personality well known to the online world therefore received the necessary publicity.

Start-ups although are creative need to look very much into the marketing model, it is essential and crucial to the success. There are plenty of sites that have made it to techcrunch, mashable, etc but have not survived or are struggling.

Sustainable funding is about not putting your eggs in one basket and Ryan’s exit strategy or contingency plan reflects diversity.

In conclusion this post has strengthened my stance on the ‘premium’ model from the outset. Thanks Ryan

Azzam

If, for example, £5k is large, and much of that is profit, then you could quite easily get to a £500k valuation based on a 10x profits multiple.

Working backwards, if Mike’s ‘low six figures’ is correct then perhaps Dropsend was pulling in only a couple of grand a month in profit, which doesn’t seem especially large (but a profit is a profit).

In any case, the sale makes sense for Ryan and his company and in the current climate I wouldn’t be surprised to see more sales like this going through. Take the money, move on, do something wonderful all over again…

I read Jason Calananis’ post recently about, well, effectively working every last drop of productivity out of your employees. Jason recommended in the falling economy that founders call a Sunday breakfast meeting to see who turns up – those that don’t are not committed and perhaps should be fired he suggested. He also joked that 9-5′ers are fine ‘for the post office’ – not startups.

At the end of the day both points are valid (though I do think the a sunday meeting thing is crosses the line of what is acceptable) – but assuming the quality of your idea is successful it is more likely that Jason’s approach will make you the 10’s(/100’s of millions). But at a cost.

It comes down to what you are content with. People like Jason Calacanis are not going to be interested in “low 6 figure” exits, nor is he the type of person who wants to work 4 days a week. On the other hand Ryan doesn’t strike me as the type of person who is working his way in life for that $100 million exit – clearly his goals are very different.

Everything is valid, you gotta choose what is right for you AND align yourself with like minded people.

Re the Carsonified working hours… The four day week is a great idea for employees. Startups can sometimes have too much of a culture where you have to be working 24/7. This is fine for founders who have a decent stake in the business, but it can be wrongly imposed on employees who may then become dissatisfied. But, giving employees a four day week must be a hard leap to take as there is always so much work to be done in a startup.

I am in France at the moment where the last vestiges of the 35 hour week are disappearing. Many French programmers came to London because the job market was good, but also because they felt that they could earn more by working more. Also, some people just like to work all the time, and you would not necessarily want to restrict these guys to a four day maximum.

As I recollect, you were chairing and the panel included Mike Arrington and Saul Klein.

Before the FOWA debate, on the UK vs the US start-up scenes, I did some research into what kinds of online properties had actually sold in the previous two years and how much they had sold for.

The sites were very functional – classifieds, recruitment etc – and selling for millions to major media companies, such as News Corp. The total amount of the sales was a staggering £274m – plus another £120m in the ITV/Friends Reunited deal

The list is here: Great exits for UK Internet start-ups

tinyurl.com/fowa-panel

But the developers seemed pretty indifferent. Then the penny dropped. The previous day, they’d all been cheering Digg founder Kevin Rose – and of course, they all wanted to BE Kevin, the rock star Web app developer. No-one wanted to make a boring jobs site and cash in for a few million.

Personally, I think much of the action is now shifting over to online video and Web shows, a part of the creative economy in which the UK has considerable strength – British television producers have a formidable record in exporting formats to the USA and there’s every reason to believe that they can replicate it on the Internet.

And as for Web apps, what did Kevin do next? Of course, he started his own Web show production company, Revision3, and now he’s an Internet TV star, too!

Creativity can so easily seep out of the skin like a tan when working in a corporate environment. You need stimulation that’s not governed or impeded by a bureaucratic organization, and that’s 95% of the reason why I freelance by night as I work full-time by day. If I had just the 9-5′er, I’d actually burn out much faster and easier.

Also, congrats to you Ryan on the sale… and curse you for offering the only 4-day week I’ve seen that actually seems to work. Oh, and those other little bonuses for new employees makes me want to be sick, but I mean that in the nicest possible way. In all seriousness I think you represent the way forward for the ‘next gen workplace’. Relaxed, savvy bosses who understand that the working environment is just as important as the work. Kudos to you and your team for inspiring others.

Cheers,
Jon

Taking outside investment works as long as you and the investor are on the same page. Not taking investment when you are trying to build somehting big will choke the business when you need to accelerate, taking investment when you want to grow more slowly will frustrate an investor who wants to scale towards a big exit.

Companies that follow this type of strategy have far better chances than free services hoping to be bought.

The content i read from them has encouraged me to bootstrap, hopefully grow while making revenue. Then i have the option to sell a business with revenue or keep making revenue.

Well done.

I like the idea of it because of the empowerment: I’m a designer working with developers, and as many ideas as I have, so too do developers, but struggle to get their ideas out because of management holding the creative reigns, or because the project is already so defined, there isn’t any space for anything new within it. So many people have started working at a company and been excited about it, but lost their spark after a while. Working on other projects gets you passionate about what you do again. I think many companies would really benefit from allowing small developer-led projects without “board/management” influence… if only because it means you can probably keep all your brilliant, creative employees.

We decided to sell because we could get a large infusion of cash into Carsonified right away, instead of having to wait for that revenue to come in over a period of time.

My hope is that this sale will encourage other European start-ups that they can do it! They can bootstrap, grow and eventually sell (if they want). Let’s get rockin Europe!

In these conditions an app without a solid business model is going to be a pretty hard sell. Maybe you can pull it off if you have a good network and track record in building apps like Ryan but not without.