Monday, May 20, 2013

Building a billion-dollar enterprise, 17 - a mega-deal sparks questions

Well, we haven't have had any "They're-spending-a-billion-dollars-for-WHAT??" deals lately, so I guess we were due for another one:

Tumblr, like Instagram, the last billion-dollar acquisition in the tech space, is not making money. Will Yahoo make money with it? Who knows?

I don't even have a response for this. Well, actually I do: deep skepticism, fueled by the simple fact that I don't see Yahoo being smart with what they already have, so I don't see any particular reason to believe that they will be smart with Tumblr.

But I still have a Yahoo account or two, so I will keep up with what they're doing as a user.

For me, the news of the deal sparks a conversation with myself that I've never really had before, fueled by questions like:
  1. How much would an investor pay for Homewood Nation?
  2. Would an investor pay anything for Homewood Nation?
  3. How can I get a credible answer for either of those questions? - and the real biggie:
  4. How can I make Homewood Nation more valuable to an eventual buyer?

I call #4 the biggie because while I don't particularly intend to sell Homewood Nation itself, Homewood Nation is part of the package that I do want to sell in - a little less than four years now. Or that I iwant to sell pieces of between now and then.

I think #3 is the place to start.

These questions are not just mathematical. They pierce. I have spent countless hours on Homewood Nation (and its predecessor, "My Homewood,") but my bank accounts suggest that in the end, I have only created stuff, without creating value. I am broke. As in, "Can I make it through the month without overdrawing my accounts?" As in, "Do I need to tap my IRA to keep going for another three months?" (It's a tiny IRA. I've made many mistakes.) And being broke pierces, because it says to me that in my 61 years, I have in sum taken more value from the world than I have created for the world. And I don't wanna be that guy. On the contrary, I want to be the guy who creates insane value. I've always wanted to be that guy; why haven't I become him yet? Is it too late to become him?

I believe I have created value. Perhaps I need to believe that I have created value, in order to keep breathing.

But so far, no one is saying so with dollars.

A friend said on Facebook once that every man woman and child in Homewood should give me $5 a month for Homewood Nation. I took that as a great compliment, and as encouragement to place a "Donate" button on the website, and to run my first donation-seeking campaign.

Over the course of a month, one person donated $50. He does not live in Homewood.

I am self-conscious about talking about my finances, but it seems important to note where I am now, as part of the story. Let it go on record: in February 2013, Green entered a prolonged period of something that he said might have been depression. For months, he was haunted by the failure of his PeaceBuilder game, which he had hoped would be Luminaria's first moneymaker, and would fund the further development of Homewood Nation.

During this time, every item that he posted on Homewood Nation "seemed like an exercise in futility. Who was reading? Who cared?" This was despite the fact that the website had attracted new contributors such as C. Matthew Hawkins and Joshua Devine. While he dreamed of growing the website, Green despaired of ever being able to pay writers to produce the robust content that he felt Homewood deserved.

When he wrote the blog entry on May 20, the first draft of which included a section written in the past tense that ended by describing the shutdown of Homewood Nation at the end of that month, "I told myself that this needed to be part of the record, too, so that when people came along later to see how to build a billion-dollar company, they would see that sometimes it meant just slogging through my own internal shit. In fact, it meant that A LOT of times.

"Make no mistake about it," he said. "Building a business of any size, from the ground up, will absolutely turn you inside out."

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