Re: Firedrop + $90 million = ??!

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From: Mike Masnick (
Date: Tue Oct 17 2000 - 23:26:17 PDT

At 02:59 PM 10/17/00 -0500, Adam Rifkin wrote:
>Question mark. Question mark. Exclamation mark.
>> From: Technologic Partners <>
>> Subject: VentureWire, Tuesday, October 17, 2000
>> o Collaboration Technology Firm Zaplet Gets $90 Million

My comments as posted to Techdirt late last night:

Throwing Money At Zaplet
 Contributed by Mike on Tuesday October 17, @02:34AM
from the sucker-money dept.
Okay, for anyone who has spoken to me about Zaplet (formerly Firedrop) they
won't find my reaction to this a surprise. However, the fact that Zaplet
just raised $90 million more proves to me that investors are still throwing
way too much money at ridiculous ideas. I've already convinced two friends
not to go work there, but Zaplet has all the makings of a major flameout.
It has huge backers and lots and lots of hype, though a lot of the hype is
about the CIA history of one of the founders (warning sign: hype about
entrepreneur, and not the company) However, I don't know anyone who
actually wants the product. It's an idea that a couple people think is cool
in search of a market (warning sign: who the hell actually wants this?).
When Zaplets first launched I never received one. Not that I'm the standard
for what's hot, but I'm out there enough that, if something is really
catching on, I tend to hear about it. All I heard from a few friends was
"What the hell is this? It's basically HTML email and it doesn't even
work." All of the hype was written up in magazines that were "friendly" to
the investors of Zaplet (warning sign: no "ground up" demand hype). They
also claim they're going to change the way people do business, but if you
look closely it means they need to change a lot of behaviors to get this to
catch on (warning sign: changing behavior is damn difficult). Finally, it
appears that the $90 million they've just raised is being used to convert
the company from a "consumer" perspective to an "enterprise" one (warning
sign: that's what struggling companies say to convince their investors they
have a chance). One final scary note, the quote from President Alan Baratz
is one of the key quotes that any experienced fundraiser will tell you
never to say to an investor, as it shows your inexperience: "All these
companies are potential partners, not competitors." Anyone want to tell me
what I'm missing here?


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