Making acquisitions the default goal for new software companies is nothing more than demoralizing.
For the unfamiliar, Everpix is a freemium photo hosting service that has six employees and 6,800 paying users. Everpix recently announced that they’re shutting down in grand fashion, after running out of money. The final straw? Their inability to pay an estimated $35,000 monthly hosting bill from Amazon AWS.
Contrast that with Snapchat–the 20-plus employee, zero-revenue, temporary selfie app that secured a huge $60M round of funding in June, got swanky new office digs in Venice, and supposedly is in line to get even more money!
Everpix’s fatal flaw in the eyes of a VC
Well-known start-up blogger Andrew Chen had a few things to say about the Everpix postmortem, with this gem in particular catching my eye: Focusing on monetization too early can lead to a white flag, since it’ll mean the entrepreneur is thinking small rather than focusing on winning the market.