Throwing Money At Zaplet

Venture Capital

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?