There was a lot of commentary about Fab.com last week and it’s reported sale for $15 million to PCH. When a company goes from being worth $1.2 billion on paper to just a fraction of that in less than a year and a half, it naturally gets some attention. A lot of this attention was negative and seemingly reveled in Fab’s failure.
And then were some posts like this one by Jordan Cooper or tweets like this one by Nabeel Hyatt of Spark Capital which lamented or decried the vitriol.
The reality is that most startups that fail don’t see a lot of negativity. This sort of harshness is reserved for select startups that seem to meet a few criteria:
- The founder has a big personality (often seen alongside big ego, arrogance)
- Where the company’s primary business model seems to be raising VC, i.e. they raise a lot of money with no clear plan to turn into a a business
- Where the founder(s) take money off the table or burn through a lot of cash quickly. Remember, Fab was burning $14 million per month.
What do you think? Do Fab and other high profile failed (or failing startups) deserve the critiques and criticism they get? Leave your comments below.
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