Ask HN: What can Color possibly accomplish with $41 million?
After seeing what Color is all about and reading about their $41 million funding, I do not understand why such an exorbitant amount is even necessary for their application. It seems simple enough. Where will this money go? Realistically, could they not accomplish the same with $1 million, even $100,000? Color is clearly no Facebook or Twitter. Any insight would be greatly appreciated!
Comments
My first thought when I read about the funding was that they would need a pretty robust back-end. Not only are they storing pictures to relay to other people in an area, but Color also has to catalog them several ways: geographically, by privacy settings, by groups, by time, etc.
Being able to do all of that with a minimum of fuss and delay all over the world will probably take a lot of stuff behind the scenes that I can't imagine. On top of that, staff to support it.
But yeah, 41 million seems a bit excessive.
Let's say you're a founder. You know that it only takes $X to develop and market a given app. So you go out shopping, asking for $(1.3X)MM( the estimate plus a small buffer )at a Y% dilution.
You pitch your idea to Trust Fund Baby Ventures, LLC, and they shit their pants and offer you $(5X)MM, but at the exact same dilution, Y%.
You've just been offered far more money than you think your business is worth. What do you say? No?