Comments on: The-$700-Million Question of The Day: http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/ Business, Internet, Technology & Strategy Wed, 15 Jul 2009 07:13:40 +0000 http://wordpress.com/ hourly 1 By: 100 M&A Deals. 100 Startup Lessons « FoundRead http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873970 100 M&A Deals. 100 Startup Lessons « FoundRead Thu, 03 Jan 2008 16:41:44 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873970 [...] been written about here, or at the mother ship, GigaOM. (For example: Club Penguin by Disney, also here; Photobucket by Fox Interactive; and StumbleUpon by eBay). Steve includes links to many other [...] [...] been written about here, or at the mother ship, GigaOM. (For example: Club Penguin by Disney, also here; Photobucket by Fox Interactive; and StumbleUpon by eBay). Steve includes links to many other [...]

]]> By: leecastle http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873964 leecastle Fri, 17 Aug 2007 19:31:50 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873964 Cool. That makes Disney more attractive.} Cool. That makes Disney more attractive.}

]]> By: webwright http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873965 webwright Tue, 07 Aug 2007 15:55:55 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873965 Uh, what? There are plenty of non-profits out there and causes to support. If you really want to give back to the world, ad-free web sites isn't really touching on the worst problems on this planet. Other people have a stake in your company (friends, spouses, children, family, co-founders, angels, VCs, whatever) and you've made a promise that there would be financial success (or other types of prosperity) at the end of the rainbow. Your responsibility is to pursue that. If you have a compromise between you and a financial windfall, you need to evaluate how that compromise will effect your stakeholders when COMPARED TO THE RISKS AND REWARDS OF THE ALTERNATIVE. Taking the money might hurt the users in the short term, but if the pain is acute enough someone else will respond and build what they want. In the meantime, you can spend your time doing REAL good.} Uh, what?

There are plenty of non-profits out there and causes to support. If you really want to give back to the world, ad-free web sites isn’t really touching on the worst problems on this planet.

Other people have a stake in your company (friends, spouses, children, family, co-founders, angels, VCs, whatever) and you’ve made a promise that there would be financial success (or other types of prosperity) at the end of the rainbow.

Your responsibility is to pursue that. If you have a compromise between you and a financial windfall, you need to evaluate how that compromise will effect your stakeholders when COMPARED TO THE RISKS AND REWARDS OF THE ALTERNATIVE.

Taking the money might hurt the users in the short term, but if the pain is acute enough someone else will respond and build what they want.

In the meantime, you can spend your time doing REAL good.}

]]> By: sbyrnes http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873966 sbyrnes Mon, 06 Aug 2007 12:52:28 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873966 I have to agree with Doug, with the amount of money at stake I doubt many people would be able to prioritize the corporate principles over the financial reward. At the end of the day, the founders started a for-profit company in order to make money. In the end, that's what they did.} I have to agree with Doug, with the amount of money at stake I doubt many people would be able to prioritize the corporate principles over the financial reward. At the end of the day, the founders started a for-profit company in order to make money. In the end, that’s what they did.}

]]> By: doke01 http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873967 doke01 Mon, 06 Aug 2007 12:39:43 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873967 This is not just some money. This is money that will change their lives and the lives of their future generations. They would have been foolish not to take it. Also, keeping Club Penguin commercial free seems to be a core component of their business model. I am not sure they would have fought hard for it if it wasn't one of the key reasons that people joined. If this version of Club Penguin doesn't live up to the founders expectations they have more then enough money now to start over again and fully fund it themselves. Some opportunities you just can't pass up. - Doug K.} This is not just some money. This is money that will change their lives and the lives of their future generations. They would have been foolish not to take it. Also, keeping Club Penguin commercial free seems to be a core component of their business model. I am not sure they would have fought hard for it if it wasn’t one of the key reasons that people joined. If this version of Club Penguin doesn’t live up to the founders expectations they have more then enough money now to start over again and fully fund it themselves. Some opportunities you just can’t pass up.

- Doug K.}

]]> By: theunknownfounder http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873968 theunknownfounder Mon, 06 Aug 2007 09:36:49 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873968 If a company is formed for the purpose of "altruism" then it should be formed as a non-profit.... but that was not the case with Club Penguin. Club Penguin did give a significant portion of it's profits to charities (which is supposedly why Sony passed on buying them) but is that being a good corporate citizen or is it good marketing... or is there even a difference? The founders of Club Penguin found a market, not in children, but parents that were more than willing drop $60 a year for an online social experience that was guaranteed to be commercial, adult language and violence free. As long as the suits at Disney understand that this is the allure of Club Penguin, things should stay the same... I'm not sure if I give the House of Mouse that much credit though. My understanding is that Disney will stay mostly hands off especially since it was $350 million now and up to an additional $350 over the next three years based on performance. The founders haven't lost interested, in fact, I'm sure they are now more interested than ever on landing that additional payoff three years from now.} If a company is formed for the purpose of “altruism” then it should be formed as a non-profit…. but that was not the case with Club Penguin. Club Penguin did give a significant portion of it’s profits to charities (which is supposedly why Sony passed on buying them) but is that being a good corporate citizen or is it good marketing… or is there even a difference?

The founders of Club Penguin found a market, not in children, but parents that were more than willing drop $60 a year for an online social experience that was guaranteed to be commercial, adult language and violence free. As long as the suits at Disney understand that this is the allure of Club Penguin, things should stay the same… I’m not sure if I give the House of Mouse that much credit though.

My understanding is that Disney will stay mostly hands off especially since it was $350 million now and up to an additional $350 over the next three years based on performance. The founders haven’t lost interested, in fact, I’m sure they are now more interested than ever on landing that additional payoff three years from now.}

]]> By: adambenayoun http://gigaom.com/2007/08/05/the-700-million-question-of-the-day/#comment-873969 adambenayoun Mon, 06 Aug 2007 08:21:26 +0000 http://foundread.wordpress.com/2007/08/05/the-700-million-question-of-the-day/#comment-873969 Carleen, Very interesting article, I hope that we will all face this decision some time near. From my understanding, it is quite clear that if you hit the limit where you cannot scale or develop your business anymore, then it is time for you to find someone else who can help you execute your vision. I believe that this decision wasn't purely about the money but rather based on "Can Disney take this business and get it to the next stage?" and a little bit of "Holy cow they're offering us lot of money". They could easily crash with their business if they couldn't scale it properly. They have enough paying customers and traffic I think to double or even triple their value within a year if they wanted, and I think Disney know it and that's why they offered that amount of money. I honestly think that they should sell a big chunk to Disney and remains with some share in the business, be involved in the execution.And with the help of Disney network and infrastructures, scale Club Penguin to the next level. Might be that sometime founders lose interest in their business and want to pursue other paths in their life. Anyway, I think this is their decision to do what they want to do, I understand that sometime people may think that by selling your company and the user base, your betraying your core community, but let's remember that this is strictly business and there's lot of opportunities ahead. Anyway congrats for the Club Penguin team!} Carleen,
Very interesting article, I hope that we will all face this decision some time near.

From my understanding, it is quite clear that if you hit the limit where you cannot scale or develop your business anymore, then it is time for you to find someone else who can help you execute your vision.

I believe that this decision wasn’t purely about the money but rather based on “Can Disney take this business and get it to the next stage?” and a little bit of “Holy cow they’re offering us lot of money”.

They could easily crash with their business if they couldn’t scale it properly. They have enough paying customers and traffic I think to double or even triple their value within a year if they wanted, and I think Disney know it and that’s why they offered that amount of money.

I honestly think that they should sell a big chunk to Disney and remains with some share in the business, be involved in the execution.And with the help of Disney network and infrastructures, scale Club Penguin to the next level.

Might be that sometime founders lose interest in their business and want to pursue other paths in their life.

Anyway, I think this is their decision to do what they want to do, I understand that sometime people may think that by selling your company and the user base, your betraying your core community, but let’s remember that this is strictly business and there’s lot of opportunities ahead.

Anyway congrats for the Club Penguin team!}

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