dealing with failure - keith smith
DESCRIPTION
Keith Smith's presentation on the failure of Zango during the 2008 financial crisis and lessons he learned about minimizing the risk of failure. Given at StartupDay 2010. http://www.seattle20.com/startupdayTRANSCRIPT
Keith SmithCo-Founder & CEO
BigDoor
Keith SmithCo-Founder & CEO
BigDoor
What I want to talk about today…
• The story of my previous company - Zango• 7 lessons I never wanted to learn
NASDAQ Composite – 1999 to 2009The 10 Year Zango Story
A decade of utter joy, mixed with pain, covered with learnings.
Started Zango a “playroom”
startup
NASDAQ Composite – 1999 to 2002
Raised Our Series A
FinancingDivorce
“too broke to file for
bankruptcy”
Zango as the Startup
Raised a “bridge”
“Found” the right product
NASDAQ Composite – 2002 to 2008
Raised $40MM
Took on debt to buy companies
Zango as the Growth Machine
Hyper-growth begins
Debt covenant is tripped
NASDAQ Composite – 2008 to 2009
Zango sold in (very)
short sale
Zango Dies
Lender’s call our loan –
sweep cash
23 Consecutive Quarters of Profits+ 1 Quarter of Losses
= Death
Founders pour millions into the
company
1. Make a lifetime decision
“Never give in, never give in, never; never; never; never - in nothing, great or small, large or petty
- never give in except to
convictions of honor and good sense”
“Never give in, never give in, never; never; never; never - in nothing, great or small, large or petty
- never give in except to
convictions of honor and good sense”
2. Understand Your Equity Class
3. Interview Your Replacement
4. Know Your Core Values
4. Know Your Core Values• More Fun...More Money: We have and enable fun and in doing so we
help our customers and partners improve their businesses.
• Customers Are Our Priority: We are passionate about our customers and partners and endeavor to respond to any request from them within two hours.
• The Platform Matters: The BigDoor API is available, consistent, secure, extensible and clearly communicated. We use agile methods and continuous deployment to move quickly and prefer to use open-source and make our code open-source as much as possible.
• Meritocracy Is Our Way: We value our employees and their results. We aim to promote and compensate based on merit by placing a premium on results.
• Spend Time & Money Wisely: We are committed stewards of BigDoor's limited time and money and this is reflected in the frugality of our ways.
5. Build Your Team
6. Know Which Balls To Drop
7. Love Beats Money…Barely
Thank You
Keith SmithCo-Founder & CEO
206-769-3536skype: keithlloydsmith
follow me: @[email protected]
Keith SmithCo-Founder & CEO
206-769-3536skype: keithlloydsmith
follow me: @[email protected]