Color: We Are Not Shutting Down

Color: We Are Not Shutting Down(techcrunch.com)

70 points by wlue 13 years ago | 38 comments

How on earth did it take over 3 hours for someone at Color or Sequoia to confirm the company is in-fact not dead? You'd think employees/founders/investors would have been tweeting like crazy to deny the rumor.

potatolicious 13 years ago | |

Because the last thing you want to do is have employees (even execs) shooting their mouths off in the heat of the moment and saying something stupid.

You want to regroup, figure out WTF is going on and how the rumor started, and figure out a sensible statement that is going to calm this down instead of rile it up some more.

jonknee 13 years ago | | |

> saying something stupid

What kind of stupid thing could you say? The company is either dissolving or it is not. Seems pretty easy to figure out.

w1ntermute 13 years ago | |

Because people have work to do, rather than sitting around checking Twitter, HN, and TC all day long? It's not like something's going to happen if they don't respond ASAP. As long as they'd gotten something out by the end of they day, they'd've been fine.

smackfu 13 years ago | | |

Yeah, people have work to do... like the PR people whose job is to handle bad news about the company. And yes, part of their job is to monitor tech news sites like the Verge.

MatthewPhillips 13 years ago | |

I'm guessing because it took 3 hours to find someone who knew whether the company is dead or not. Since the founder is off vacationing/thinking in exotic places, I wouldn't be surprised if the employees heard the news and assumed it to be true.

pron 13 years ago | |

How on earth did Venture Beat run such a potentially damaging story if it may not, in fact, be true?

richardjordan 13 years ago |

Well, I guess they've found the person who leaks everything to the media... It says VentureBeat confirmed the email was sent to just one person. I wonder if this was a mole hunt.

Still, Color is gash and an embarrassment to the whole industry, and its death would not be mourned by many.

AznHisoka 13 years ago |

Unfortunately, not giving up and willing yourself to success isn't enough to overcome an nonexistent business model.

orthecreedence 13 years ago | |

Why waste time on frivolities like a "business model" when you can dupe investors out of $40M and spend it on a lavish office and developing a lame photo-sharing app that could have been done with $100K?

If anything makes me think we're in a bubble, it's companies like Color and the people who pump money into them.

DrStalker 13 years ago | | |

But... with that budget how could possible afford to buy both color.com and colour.com! Withour colour.com dozens of people around in countries using British English won't be able to be confused by your app.

grimlck 13 years ago | |

Color is the pets.com of the current bubble

chucknelson 13 years ago | | |

At least people could understand what pets.com was trying to do. Color was just some abstract idea that made sense because...color.com is a cool domain?

ahi 13 years ago | |

Nevermind a business model; do they even have a product?

001sky 13 years ago |

A similar pattern was recently in the news here: Onlive.

August 17, 2012 > OnLive lays off all employees, assets sold to new company [0]

5:20 PM - August 17, 2012 > OnLive Denies It's Shutting Down, Won't Comment on Layoffs [1]

08/20/2012 10:11:33 AM PDT > Game company OnLive reveals new details of restructuring [2]

Winding down a business might mean they are trying to orchestrate a merger or aq-hire. Or a whole host of other things. For which you would not want your name in the news (sensitive negotiations, or wat-ever).

______________________

“We don’t respond to rumors, but the service is not shutting down,” OnLive said. [3]

______________________

[0] http://www.gamasutra.com/view/news/176180/OnLive_lays_off_al...

[1] http://www.tomshardware.com/news/OnLive-Shutting-Down-Layoff...

[2] http://www.mercurynews.com/entertainment/ci_21351760/game-co...

[3] "Just a short while ago reports emerged that the gaming and virtual-desktop software start-up had issued pink slips to all of its employees and was effectively shutting down the service. The first part, we’re told by an OnLive spokesperson, is not the case." http://allthingsd.com/20120817/onlive-denies-reports-that-it...

001sky 13 years ago | |

[update] > http://news.ycombinator.com/item?id=4667217

k-mcgrady 13 years ago |

Assuming Color's statement wasn't a lie that's some pretty shitty reporting by Venture Beat. Reporting a companies board has voted to shut it down is pretty big news and should require much more verification that one single email. Tech 'journalists' need to do a better job when reporting this sort of thing.

pron 13 years ago | |

Absolutely. Both Color and Venture Beat have some serious debriefing to do. Assuming Color is right, a lot of damage has already been done. In that case, in (serious, non-tabloid) print journalism, the publication's reputation would be tarnished; in online journalism, it may be just the company's. Somebody sure owes the public an explanation into what exactly just happened here.

EDIT: not somebody. It's Venture Beat that owes the explanation. Either they stand by the story even if they're willing to do that without full verification, or they must apologize for jumping the gun.

dcpdx 13 years ago |

I would love to see an AmA with a Color employee to get the inside scoop on what's going on there. It must be devastating for morale for a rumor to spread that everybody assumed was going to happen at some point anyway (was anybody surprised when their shutdown was announced? I didn't even bat an eye) and then have to come out and vehemently deny the rumor. And all the while the absentee CEO is galavanting around the world on some exotic "sabbatical" as his company burns to the ground. Only a matter of time until this news resurfaces again, only next time it will be for real.

modarts 13 years ago |

My question would be: Why not?

creativityhurts 13 years ago | |

Perhaps they're waiting for the CEO to come back from his long vacation.

mikeryan 13 years ago | |

Please correct me if I'm wrong, but my understanding is that most funds are only allowed to invest capital once, so any of the $40M they get back (which I'd hope would be a somewhat large chunk) can no longer be invested.

A smarter move may be looking at and pursuing several pivots, use that 40M to create a few startups within a startup and see if you can get something started that will provide a healthy return.

brackin 13 years ago | | |

Exactly, although they have a tarnished brand. They could find the most talented developer and become somewhat of a Mobile incubator. They've got a lot of deals and scale having dealt with Verizon, physical space and employees. They could use Color labs as the shell for lots of products.

tomasien 13 years ago |

That email felt weird, didn't look like an email you'd send to employees to tell them you were shutting down.

cube13 13 years ago | |

Then it's weird that the board did not go out and deny that the email was authentic at all.

thelibrarian 13 years ago |

As a slight aside - is it just me, or is their logo basically a rip-off of the Royal Air Force roundel?

at-fates-hands 13 years ago |

I'm still trying to figure out how a company who has $41 million in funding and over 400K users can't seem to come up with a business plan that generates revenue.

Is this another example of buyer beware when you invest in these kinds of companies?

stevewilhelm 13 years ago | |

400K users? total registered users? surely that can't be active users.

pemulis 13 years ago | | |

AppData says 460,000 active monthly users[1]. The original VentureBeat article quoted AppData at 440,000, which is where the ~400,000 number is coming from.

Edit: In reply to the grandparent, because of the huge amount of money Color raised, they would need to make something like ten thousand dollars per user at their current user numbers to meet expectations. Since that's obviously impossible, it makes sense for them to avoid revenue entirely until their user numbers hit eight digits at least.

[1] http://www.appdata.com/apps/facebook/200067376723055-color

bpatrianakos 13 years ago | | |

Definitely not active. Can't be. I signed up. Used it 5 times to get a prize from some contest (never got it) then never used it again. I mean, the idea is cool but it doesn't seem like there's much interest in real time broadcasting. There's too much information flying at us and we're all too busy to remember to tune in to our friends' video streams live or even stumble across them by accident.

I don't really like Color just because its just not my thing but I don't quite get why everyone here hates them so much. There's a lot of vitriol spraying all over the place around here. Is it because they're super hyped and overvalued? I hate to break it to everyone if it is but most startups we read about here are overhyped and over valued. I don't get it. Seriously, I mean I get why people don't like Color but why does it seem everyone just hates them pretty severely around here?

zbowling 13 years ago |

I bet color is getting way more traffic than normal with this stuff.

zerostar07 13 years ago |

In other news, Paris Hilton stated "I'm not quitting"