Edgeio To Shut Down - In The DeadPool
Michael Arrington
172 comments »
Edgeio, a company I co-founded in 2005, had a final board meeting this evening and made the decision to shut down operations of the company. We are putting it into the TechCrunch DeadPool.
Edgieo first launched in February 2006 after a beta period. The company raised a small angel round of financing, then in October 2006 closed a $5 million Series A from Intel Capital and Transcosmos.
The company burned through that money according to plan, meaning they ran out this month. The product roadmap was fulfilled, meaning development lags didn’t hurt the company. But the revenues didn’t come in and user/partner milestones weren’t met. And that meant no one else was going to put more money into the company.
For the last few months CEO Keith Teare has been working on a number of plans to keep the company going, but none of them panned out. So tonight the board decided, appropriately, to shut the company down. This will be orderly - employees will be let go but will be fully paid. In this job climate, all of them will hopefully find work very quickly.
I’m obviously sad about this since I was one of the founders, although my involvement for the last two years has been as a board member only. But this is the way the startup world works. You win some, but you lose most. Edgeio wasn’t meant to be a success. And now Keith and the rest of the team can start the fight over again, and hopefully next time they’ll come out winners.
On a side note, our job site, which is run by Edgeio, will be transitioning over in the next day or two.
It’s very sad when a company closes. My best wishes to all the employees.
sincerely,
angela hayden
art goddess
Mike - in words that you posted not long ago and I think they are more relevant now than ever as Theodore Roosevelt:
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
ah yeah, I love that speech.
http://www.techcrunch.com/2007.....the-arena/
lol - mike’s human.
the entrepreneur god’s wouldn’t allow you to have more than one big hit(TC)
are any of the assets up for sale?
About time, I warned you people about this months ago!
But would you listen to me? Noooooo, we cannot listen to a fake blogger!
Well just so you know, I am not!
Mike, This reminds me very much of BANS (BuildANicheStore). Let me buy the asset.
Email me!
Yes, we need a few servers too, any them up for sale?
Yeap, why didn’t you ever listen to people’s malign comments?
Edgeio is going to fail. You know that… You can’t do different things and co-founded with partner. Techcrunch is your DNA body. About 80% entrepreneurs here got famous.
P.S. Techcrunch fans predict you are going to get nose punch. Facebook and Google is your worst enemy. They hate your guts too.
“Edgeio is going to fail.”
You are 100% right about that.
Mike - Are you guys reverting to the original job board software?
Mike,
Sorry to hear this. Are you guys planning to make anything opensource ?
Jay - haven’t decided yet. We’re dusting off the old code, which worked well, but we always had problems with the paypal API, which is a total piece of crap. Will decide tomorrow.
Wow, you went easy on this deadpool. lol joke
Sorry to here that. The startup up world is definately tough. At least they gave it a go. Gotta respect the effort.
Next Venture, THruDispatch - this one will make money Mike, with you raising the dough and me running the Product and market dev.
A real business with real users that have been surveyed and tested. A real niche with no entrenched competition from the big boys. Not a social network, not a video sharing site.
An open portal for independent automotive trades. http://www.squidoo.com/ThruDispatch
Come on Mr. Arrington, make it rain.
Uniseek will be taking over where Edgeio left off.
One big difference is we’re using a unique scoring system for search results. Spam will not be an issue, such as it was when Edgeio was first launched. There are many other differences, too, but we were hoping to have a little bit of competition from Edgeio.
Sorry, Mike. You win some and you lose some. I know you’ll get right back into it. Before we know it you’ll be fully disclosing your founding relationship with another innovative company.
good luck to the team in their next project. the deadpool posts are always solemnly humbling.
I tried using edgeio a few months ago. The most annoying aspect is that there seems to be no information regarding closing an account!???!! Now the classified board is linked to my website in the cloud out there. Will this data be removed once you shut down the edgeio servers? It’s akin to there being no way to delete a Facebook account.
Mike,
Surprising! It seems to have decent traffic!
Were there any buyers? I am sure it could be have sold for at least 2-5x return.
Mike, I am sorry to hear about this. I always like the original concept of aggregating meta data at the edge using RSS in a smart way. It seemed like a really nice Web 2.0 way that moved in a useful way to the dream of the Semantic Web without using RDF, OWL or Microformats. I would like to beleive that you weren`t wrong on your vision..I guess you were just a little ahead of your time.
aauuhhh… thats so sad. I never had a chance to try it out.
Cheers
Startup failure — “$5 million Series A from Intel Capital and Transcosmos.”
lesson to learn for every entrepreneurs:
Never use VC for your startup and ask for huge rounds. Next year’s tax break You can lose your beautiful home, saving, your cute girlfriend, etc… Most of money belong to wealth banks. It’s too much risk.
How to get money?
Apply Financial Aid for College and Drop out. You have $ 1,000 startup money. If you start company with less than $100. you create stupid lame killerapp. Techcrunch is going make you star.
- We like to read rocky balboa startup.
- We need legend.
- We need startup Icon.
- We need an Asshole too.
I could sense that the bubble has started bursting……………….
Sorry bout your founding company, mike.
Nothing is better than Techcrunch..afterall??!!
“Edgeio wasn’t meant to be a success” - what’s that supposed to mean? Predetermined fate? Ha.
Sorry to hear the news. And, wow, that is a great TR speech posted in #2. First time I ever “heard” it and I am glad I did, as a struggling startup founder in the earliest of early stages. You done good and your blog and staff are inspirational to me. Thanks!
what exactly did you spend 5 million dollars on?
Your startup should look like this:
http://upload.wikimedia.org/wi.....ish%29.jpg
This is your future startup and your enemy innovator (facebook, Google,etc)
http://www.youtube.com/watch?v=K5fXbEivWec
Andrew - parties, scotch, hookers, blow. you know, the usual.
This proves that if you have a company and rely on web 2.0 companies like Edgeo you have a problem. Edgeo provides a jobboard and now they shut down. Where does that leave all the companies that have build for example a jobboard?
And this isn’t happening the first time. There are many samples.
Wasn’t it ironic that you, Michael, are so well versed in understanding how Web 2.0 startups succeed, but for whatever reason decide that pouring money into a project with no revenue (dot com bust era style) was the way to go?
Shouldn’t you know better?
Jono - that is indeed ironic.
Hard luck Michael. Yeh….you tend to lose some and win some. Look at the bright side. At least now you know one idea that would never work
Michael, didn’t you make a video on this a few days ago about the web 2.0 bubble? Didn’t I see Edgeio’s logo in there somewhere? I could have sworn I did.
I would love to write at length about some of the struggles that happened at board meetings, but sadly I told myself those facts off record. When Keith writes a blog post summing up Edgeio, perhaps he’ll go into detail.
In general I’ll say this - it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself.
Sad to see it go, a site so well designed with the right balance of graphical and textual UI, and with Intel vc behind it..
Really wonders, what’s the difference between kijiji.com (if indeed successful, not so sure) and edgeio.com (more of a search engine for local stuff)..
Implications being, adsense and equiv (adbrite, eg.) isn’t really the savior solution to all?
And, the effectiveness of this 125×125 tiles miniature display ads (on any site)..
/ac.
Sorry to hear about that - the paid digital content platform was something I wanted to play with. In general it looked an interesting solution for digital content - simplifying both the transaction and search/discovery pains.
Dear Michael,
Sorry news.
I think that’s not the first startup Keith Teare is involved in and shutting down (although the product seems to have a bright future).
I am suspicious that his management skills are not very good when it comes to management of finance. In daily life, you can see people can succeed much more without so much capital.
Btw, i really think that focusing on the “core” skills and assets is always the right thing to do, for any individual or company. You are really, really very succesfull with TC. Although it is never the end of the world, i think you do not deserve being listed as a board member of some failure.
Best wishes for all people involved in Edgeio.
What was the business model Michael? UI is clean, proposition nice… But it seems you relied on the listing sites to post vs. trye aggregation.
Sorry first time I looked at it.
Freaking typo… vs. true aggregation.
@ Mike
“In general I’ll say this - it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself.”
Words to write in gold letters on any “Startup 101″ book
but, ’tis better to have etc etc
Too bad this startup didn’t make it. I used their services a few times with FreeAdLists. I thought it was an intriguing concept (meta data aggregation), but I guess it wasn’t meant to be.
Its always a sad day when people lose their jobs that way. I went through it myself back in April and it was the best thing that has happened to me. There is so much work out there at the moment these guys will get jobs no problem.
On a side note, Mike maybe you should grab some of the tech guys to start up your own ad network for the topend bloggers and replace FM…
Also makes people thing, UI design, while important, is not the real maker or breaker..
A site that went dead last month was this http://www.findory.com (can no longer see their swift ui).. all text, rss based, well sprankled with adsense, but drop dead.
Re EdgeIO, looking forward to some rise-from-the-dead glory later.. or if for sure not, mightbe yes open source it is a great idea.. when (hp’s) OpenMail went dead, its later-came open source became Scalix, if i remember correctly.. And before Zimbra’s 350M acquisition, ppl were comparing Scalix to Zimbra…
In any case, was saying, still lots of remaining values (to the community, or to the owners) (or future owners)…
I’m sorry to hear that, it would be amazing to read a post about exactly what went wrong and where that money was spent for us all to learn from.
Sorry to hear it’s going down.
But I did find it amusing and annoying that you worded this post remarkably different to others that have gone to the deadpool. With your founding interest you made this look like a nice graceful exit. I wonder if it had be another company that the angle may have been different about how the money was burned through, or if there was just too much competition etc.
Either way, sorry to hear about it going under… I still find it amazing how a company can ‘burn’ through 5 million and not work, but those that have a few $ and their own time become the best successes
@ alan p
Great quote, and should go just under the plaque which has the motivational text of “Do it fucking now”.
So I guess if “Edgio wasn’t meant to be a success” you’ve succeeded?!
Mike,
It’s sad to see Edgeio in the deadpool. I use to use them in my pitches all the time when I spoke about our company partnerships and distribution channels for our merchant-built coupons.
Our Series B and new partnership with Citysearch will help fill the void left by Edgeio.
Thanks for previously covering our Series B. Good luck to all the folks at Edgeio.
Kevin
http://www.merchantcircle.com
Strange but did anyone of us hear about this company before. Surprising ! I dont think it makes any news about a blog classifieds company nobody ever used, or had any use for, or ever returned any relevant results.
Well what else would you expect from a company where the CEO (Keith Teare), did not update his blog since September 6th.
Pity !!
Parul
http://www.bhopu.com
“then in October 2006 closed a $5 million Series A from Intel Capital and Transcosmos.”
They blew 5M in a year?
That’s pretty bad.
Michael, you say the product roadmap was fulfilled, obviously the revenue model wasn’t (or perhaps relying on paying subscribers to understand the vision of a paid model).
I think everyone would agree TechCrunch is your Rembrandt, but like any business you are not involved with at least on a weekly basis, your enemy is the mediocrity of others.
But, fuck dude, $5M….
“Edgeio wasn’t meant to be a success.” - I’m sure you’d prefer to rephrase that. At first glance it reads like Edgio was built to fail. Which I’m sure isn’t true.
Jeez, that’s alot of money spent on the company. I got some business associates who are planning in invest $1m into a new social media company..
What do you do with the money other than advertising?
“Edgeio wasn’t meant to be a success.” - I guess Mike meant this in the sense of “We tried but it wasn’t meant to be”, not: “We planned to fail.”
ouch.. burned a lot of money though.
I guess what pisses me off most of all, is that unless you’ve gotten a funding round, then you’ll probably never get mentioned in either TechCrunch not GigaOm.
Example us: We’ve bootstrapped our company to become the third largest Advice community on the web. We’re profitable from day one. We’re well over a million unique visitors per month.
Did we have an Angel round? A series A? A B round? What the holy crap! What happened to people making a good company without VC participation Mike? Is TechCrunch really saying that VC financing is the only arbiter of success of a business?
We make real money. Spend thousands monthly on employees, hosting and all the other stuff that makes a modern Web company run, and we manage to have pretty decent funds left over.
We see the trend and have long ago realized that companies like ours will never get covered by the A-list bloggers. We’ll continue to toil in silence and sleep very well at night.
It’s a bloody shame you pissed through 5 Million on this donkey.
How can a company piss through so much cash in such a short period of time, with no established revenue model in place, and no proven plan.
Its been a bad day for TC with the loss of Ben and Edgeio… yet you are a player in the deep end and you at least the experience that comes from being in the ring.
I guess since it was build not to be a success, you guys succeeded in failing?
Rock on, Mike. Godspeed with your other ventures.
Bottom line: Edgeio SUCKED from the beginning.
I did not get it from day one.
I did not get the elevator pitch.
I don’t think the founders really got it.
I think Keith (who is really smart btw) was just being too much of a visionary.
The fact that smart people can create such a crap product and that some money is just so bloody dumb is very revealing about SV.
I was always confused by Edgeio. After visiting the site two times I still didn’t understand the message or the value of the service. Apparently, neither did anyone else.
It should have had a wordpress plugin option like I suggested to them. That would have made a lot more people use it. It was simply too confusing to set up. Its not that it was hard, it just could have been much simpler.
classifieds is a tough nut to crack. now i don’t feel so dumb because I guess nobody else understand the point of edgeio either.
Given the earlier post by Loic Le Meur, it would be interesting to see a similar post from you coming out of this venture.
Hi Mike, Do you think that SimplyHired’s Jobamatic system is running into the same issues?
Thanks
heeheeheehaahaahaa..
What goes around comes around..You kept predicting a deadpool for PayPerPost, and while that has continued to grow, look at what you have done for yourself
:D
What was that thing: “People in glass houses…”
I hear theres some money in this new fangled thing called “weblogging”, I think you could be awesome at it!
It takes guts to announce a failure. Hope you saved some scotch, hookers and blow for your next venture.
@.. well, everyone who said “I knew it sucked all along etc..” - funny how you saved your inciteful predictions til after the fact.
Michael, It will be very useful to know what caused the failure apart from “money ran out”. Was it a bad idea in the first place? Right idea, wrong time? Killed by competition?
sorry to hear about this. if the right business model isn’t in place, vc funding will burn you up. good luck to all the employees.
The site must have some value, and has to have some capacity to make money even with one resourceful tekkie running the place. Adsense ads would at least cover the guys cost while you seek a buyer for the assets or stock.
makes no sense to shut it down other than the VC’s dont need the headache.
It’s impossible the site today as it stands has -0- value.
Mike,
I am glad you can be upfront and honest.
Regards
you succeed you fail that is life
let us all learn and move on
Well now mike you are a bit wiser like all the people who read this and got this imp lesson
“it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself. ”
youtube was burning through cash like there is no tomorrow were saved by the google acquisition from heading towards the deadpool
couldn’t youll get somebody to acquire edgeio ?? if it is really biting the dust I would suggest open sourcing the technology powering edgeio
to see if someone can innovate on top of it
In my opinion edgeio failed because of low market visibility
anyway gd luck for your next venture since now you have one less board meeting to attend you have spare time to co found another venture
Disappointing. Wonder if Oodle.com is quietly suffering the same problems, or conversly, happy?? As for “vic” - no, trust me, AdSense would not cover the costs, because it takes more than one person to keep all the buttons pushed. I know this, becuase I am a one person shop running CollegeClassifieds.com. Too much to do, too little to no money. That being said, I would love for Arrignton to invest in me, 1/20th the money and or attention he gave Edgeio. Mike??
How many people did edgeio have ?
Other than people, what did they spend $5M on in 12 months (or $416,000 each and every month). Almost half a million bucks a month!
In light of the upcoming Holidays, I thought I would share some thoughts on the personal side of such loss…
I’ve noticed in my own struggles and setbacks that the inevitable suffering involved in startups has a potential silver lining.
To be sure, the pain we experience forces us to realize that there are always lessons to be learned…how better to focus on the needs of the customer, how better to manage personnel, how better to manage finances, how better to predict the future, etc.
But the one universal benefit I’ve noticed is the ‘benefit’ of suffering itself.
It seems that when suffering for whatever reason, we tend to focus on something that has been taken away - loss of opportunity, loss of money, loss of a job or promotion, loss of a hard fought battle, or (often the most painful) loss of pride.
But over time I have come to believe that the real benefit of suffering comes not in focusing on what is lost, but instead in realizing what remains.
If I pause long enough to realize what is going on in my head, what I am always left with is the realization that no matter what has changed or what the consequences of it are, there are two untouchable things left.
I will always have others. Others that personally care, no matter what has happened. Family, friends, partners, supporters.
And, above all, I still have faith.
It seems strange, but I never really *get* this underlying foundational reality unless the other ‘more important’ things have been temporarily stripped away.
In painful moments I am reminded anew that those are the only things that truly matter. And I am rejuvenated to prioritize on them going forward, using them as a guide in my work ahead. And, in my experience, I am always the better for it.
So…maybe it was the Season, maybe it was a little recognition and compassion for what Mike is likely going through today, but I felt compelled to take my armor off for a moment and share the thought.
Warmest holiday wishes to you, Mike, and to all on this board…
-Tim
PS. 2008 is going to be great! (I hope)
i was really intrigued by the concept. But honestly, i think the name had something to do with it. It just wasn’t that sticky. I kept typing in “edigio” or”edgeio” for some reason. “edgeio” was just to many vowels to consider. Sorry to hear the news. My Dad is running a start up and I pray everyday he doesn’t meet the same fate.
Just curious to see where the 5 million went to. Online classifieds is tough market to be in. The ones that make it seems to be the ones that are linked to an established site and not startout on their own. The ones that do startout on their own were there first (like craiglists).
Personally there wasn’t anything behind Edgeio in the first place. Where (and what) was the differentiator? It looked like a Web 1.0 styled company trying to be Web 2.0. The search was not real good too as I would click on a suggested term and it would come up with no results. With the $5 million given, how much of it went into the development.. because I didn’t see any major changes to it from when I went there year ago and now.
Just curious to see where the 5 million went to. Online classifieds is tough market to be in. The ones that make it seems to be the ones that are linked to an established site and not startout on their own. The ones that do startout on their own were there first (like craiglists).
Personally there wasn’t anything behind Edgeio in the first place. Where (and what) was the differentiator? It looked like a Web 1.0 styled company trying to be Web 2.0. The search was not real good too as I would click on a suggested term and it would come up with no results. With the $5 million given, how much of it went into the development.. because I didn’t see any major changes to it from when I went there year ago and now.
i guess the employees will be getting a check from EdgeI-O-U bwaahahaha
seriously though i’d like to see a postmortem on this and why it went kaput.
anytime today is fine.
Thank you to all for this conversation. I woke up this morning (play blues riff) tot his and I feel better already.
I will post something more substantial later today but my first focus this morning is going to be on the edgeio people and customers.
For those thinking about the assets, open source isn’t a possibility because Intel want to bring in a liquidator to sell the assets (not my first choice as you can imagine).
If you think you might want to buy them contact me at keith [at] teare dot com.
Keith Teare
ceo/co-founder/edgeio
Ted Murphy #68 is not me.
I would never celebrate the failure of another startup.
Condolences to all of you at Edgeio.
The sideline barcalounger pundits commenting here have no idea of the devotion and dedication needed to dream up a novel concept, fund and execute on it, of the long months of maniacal single-mindedness exclusion of everything else in life involved.
It must be incredibly tough to have to recognize that ones ideas are not going to take flight after all and walk away.
Congratulations on a good run, and better luck next time to all of you.
Marc at Activeweave
> is that unless you’ve gotten a funding round, then you’ll probably never get mentioned in [...]
That is very oftentimes true.. my conclusion has always been, no vc, no noise, no deal, no exit. (doesn’t mean the converse is true).
Re edgeio name, well, kijiji is equally great, or blogspot (oftentimes typed blotspot)… but well, craigslist isn’t much better.. (craiglist)..
I would love to see this domain for sale on eBay! I would make a pretty nice bid too.
I attended a meeting at googleplex a couple of years ago. Both Keith and Craig (from oodle) were in the penal discussing future of online classifieds. I was impressed by shrewdness of Craig and beautiful UI of Edgeio (I like the geo slinding bar). The only thing I didn’t like at that time was the name of Edgeio. Two years later, oodle seemed to have taken off (any news?) and sadly, edgeio went to deadpool. But it was a good try.
“Other than people, what did they spend $5M on in 12 months (or $416,000 each and every month). Almost half a million bucks a month!”
That struck me too.Living high on the VC pigs I guess.
I watch other VC funded people like the head of FM on jaunts to Mexico and rock concerts almost half the calender year it seems.
What ever happened to hard nosed day to day working?
I did not understand the statement, “we burned through the money as planned”.
It must be nice to be able to work with other people’s money!
The common bug (or feature) of the VCs are, imho, they’re oftentimes too rational, and oftentimes, too irrational - at the same time.
Boils down to, who they like.. (thus, “beauty contest”..) very subjective thing.
Hey Keith - pls answer this, it has been asked enough here:
HOW DID YOU BLOW 5M in 12 MONTHS (~half million bucks/month)
HOW MANY EMPLOYEES?
WHAT WAS YOUR SALARY?
WHAT WAS MIKE GETTING PAID ?
WE ALREADY KNOW YOU WERE PAYING 10K / month on a 125 x 125 ad on Techcrunch but what else did the cash go on?
COME ON HALF A MILLION BUCKS A MONTH!!! DID EITHER OF YOU STUDY BUSINESS 101 ?
So sorry to hear it.
I have been following this company since the beginning. I read the first post on the edgeio blog and I couldn’t agree more: “it is our belief that services that try to restrict how users create and consume information cannot ultimately be successful. Users own their data, and services exist not to silo that data, but rather to add value to it”.
http://blog.edgeio.com/2006/02/11/the-beginning/
Today some companies still don’t understand (and suffer because of it) what Edgeio already understood almost 2 years ago. Edgeio was a forerunner and a great idea. A risky and a brave bet. At Tractis, we talked several times about the Edgeio service and its potential.
I wish all the best to the Edgeio team and look forward to their next bet.
I am only interested, sincerely, in two things: (I don’t think I will get an answer):
Was Mr. Arrington hands on in stewarding the venture? Day to day? It would be of great concern to me that a man of his acumen could not have negotiated contingencies that would have resulted in a somewhat less ignominious conclusion.
Secondly, what was the compensation for the founders, was there a draw for salaries? I ask these questions because I in or might someday be in such a position.
Apparently they’re still http://wiki.edgeio.com/display/ExternalWiki/Jobs
DO you know what ThruDispatch could have done with 5 million dollars? (picture mini me with the pinky):
1) A real software engineering staff
2) Comcast local ad campaign, ideal for the towing and local automotive service trade but too expensive for a bootstrap.
3) oy! 1 million could have comfortably launched.
With some start ups that end in the dead pool, you feel sorry because they got unlucky, had tough competion, or had a good idea but executed poorly, or had a good product but could not monetize, etc. etc.
With edgio it’s hard to feel sorry. They was nothing about it, no real product, no traction, no business model, no audience, they couldn’t even come up with a good company name or tag line!!
With 5M of VC raised I think edgeio is more than a dead pool company, its a case study.
I hope the founders will be supportive in sharing with us the lessons learned. At least there may be some value in that.
Hi, I am new to startups world and I have a question :
When a startup like Edgeio fail, do the founders have to pay back the money they were given by VCs?
If yes, what happen if they don’t have the money?
I’ve seen the ads for edgeio for months now and I still don’t know what the company even did. Sounds like a good recipe for failure to me.
Sorry to hear about the shut down, Mike.
RUMOR: I overhead at Gawker that a deal between Valleywag and Techcrunch has been struck. Valleywag will not cover the Mike Arrington Edgeio failure as a favor to Mike. Expect a deal soon between the two sites. Rumor is that Valleywag wants the Deadpool rights.
Why didn’t Mike help save the company? That is the big question? Why isn’t anyone covering this story (wink wink valleywag)
“You win some, but you lose most.” - It all depends on how do you play the game… When Google project was started in 1996 by two Ph.D student from Stanford University, did anyone know that it will reach to the level where it is today ?
Google base does something similar or better (in terms of more attributes) and it hasn’t had a major success either. So, I guess there’s something missing in this model.
this must be the formula for success in silicon valley:
mike arrington+venture capital=bankruptcy.
keith, pull your head out of arrington’s ass.
for one, for all, for ever.
rb.
“this will be orderly - employees will be let go but will be fully paid. In this job climate, all of them will hopefully find work very quickly.”
Mike, any chance you guys can send some of the former employees our way? We’re hiring like crazy.
Ray
Well, hold on, as far as ‘no product no business model’; that is not true.
The idea was that if you tagged a listing with a key, or the word ‘listing’ and you had an account, Edgeio would suck the listing into the engine.
Theoretically many blogs would feed in from the Edge, hence the name (violating the branding rule for obscure names), and you build a big business. The mechanism worked. The business model failed, but who knows, given more time might have been able to get more networks to feed on.
My question to the crowd here: Are there other ad networks that aggregate classifieds ? I think that there are automotive classified networks that have actual API for bulk posting of large inventory publishing sets.
I turn my attention again to the question of stewardship.
Great job on getting out there and getting some funding and trying to make it work. Getting a Wordpress blog and talking about others doing stuff is easy, but starting a company, getting funding and really trying is the difference between you and 95% of the people blogging. Much respect and I’m sure you already have some other things in the works.
I would say that I’m sorry Edgeio failed but I’m not. Every failed attempt teaches us a little more about life and how to deal. These efforts also teach us how not to make the same mistakes over and over again.
Like I said congrats on what you did achieve with Edgeio and I’m looking forward to more web properties coming from you soon.
you win some you lose some… How many employees did it have?
This was not a garden variety termination of a Silicon Valley startup; it was a startup run and funded by the insiders of insiders.
I would commend Mr. Arrington for even posting the status of the venture in a public news organ that he owns! It is editorial transparency at its best.
But this is not a simple story. This story deserves a real post-postmortem.
Hey Mike,
It was a pleasure working with the edgeio staff. I deal with a lot of Internet companies, both startups and old media and edgeio really had some sharp marketing people and engineers.
Good luck on your next venture.
Guns of August. Tuchman book about how generals often fight to win the LAST war where they were majors. Me? I fight like a corporal on the front lines whose captain died before winter hit in full force
Did tag spam kill Edgeio?
Michael, people don’t start companies because they have courage, they develop courage in the fear of starting a company. Admitting failure in this cold world of business is also surely building your courage. Plenty of people walk around honoring themselves for their success. We honor you, Michael, for the honesty of failures.
Its actually rather one of the better stories you have posted in a long time.
Its bad when you have failure but at the same time for us its great news to learn from. It shows that no matter how much money you have in the bank , or whom you have on the team ( even somebody like arrington who has all the contacts you could need to launch,promote,sell a web based business ) and despite lots of PR hype it didnt work because it didnt provide what customers wanted.
It gives hope to all the small people .
What failed mightbe the VC money per se… unless of course if the founders and/or board members of edgeio took no salaries no compensations and whatnot.. $5M is no small amount (for 12 months).. certainly sad that it didn’t succeed in terms of some 350M or 1.6B exit, but having the power and luxury of $5M to wield with for a few months isn’t really a bad idea.. (and, does Intel mind? don’t really think so…)
Sad. very sad. Wishing all the best to Keith and his team.
what should be discussed is why you kept spending at say $3 million of $4 million.
Wasn’t it obvious by then that you were going to fail?
Mike, sorry to hear that, It’s even more sad for the employees.
As a learning lesson for the entrepreneur readers, a few questions:
Number of employees?
Percentage of cost spent on salaries, rent and servers on a monthly basis?
Did you try to raise more money before shutting it down?
If you were doing that again, what would you do differently?
This interview is over.
I’m not sure if other readers noticed that Edgeio seemed to advertise a lot on Techcrunch.
Weren’t people clicking on their ads?
If people were clicking and edgeio.com evidently wasn’t converting the leads, why wait so long before doing something about it.
If nobody was clicking, why didn’t they change their strategy by advertising elsewhere or at least changing the ad?
This can be a good case study for other entrepreneurs.
On a last note, it is ironic that Edgeio seems to be getting more publicity now than ever.
Not to pry but how did you “burn” 5 million dollars in a year? You should be able to keep a Web 2.0 company afloat for half a decade on that much capital.
Hello:
You put the reason of failure as:
“it is unwise for a company to spend a lot of money building out infrastructure before a product proves itself.”
Do you mean the infrasture of the company or pure product infrastructure”
I’d love to know the answer…
I thought the interface and idea were actually pretty terrific. There is a similar, philadelphia based company called beyond.com that has been very successful by managing thousands of niche job sites. I was just about to move one of my real estate classified site to edgieo, so if there is a competitor worthy of my attention I could appreciate a link.
I do hope people refrain from too much criticism of management, unless you’ve lived it first hand you’ll never know what the challenges, opportunities and mistakes led to the failure. I suspect even those who lived it may not agree on the cause.