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Summary:

The co-founder of venture fund and incubator Bootup Labs has apologized publicly for the failure of the company’s Y Combinator-style startup camp, which fell apart last week after it failed to raise enough money to back all of the startups it had accepted into the program.

Danny Sullivan Robinson, the co-founder of venture fund and startup incubator Bootup Labs, has apologized publicly for the failure of the company’s Y Combinator-style startup camp, which fell apart last week after the fund failed to raise enough money to back all of the startups it had accepted into the program. The story came to light when one of the entrepreneurs who had sold his belongings and moved across the country to join the Bootup Labs project in Vancouver, British Columbia was told his company could not be funded, and wrote a blog post calling out the venture fund for making promises to entrepreneurs that it couldn’t keep.

In a blog post of his own, Sullivan Robinson admits that would-be startup founder Jamie Martin was right, that Bootup Labs didn’t have the money to fund his and several other companies when they were accepted into the program. “This was my gravest of errors and seems pretty obvious now,” he writes. “I sincerely apologize to the founders who were affected by this. It will not happen again.” He also admits that he and the rest of the Bootup Labs team made some serious mistakes, including:

  • Getting defensive: “I should have done a better job responding to Jamie’s concerns on this blog. At the time, I felt everything we have worked for was being questioned, and I got defensive and it made things worse. Jamie didn’t do anything wrong, and I apologize to him in particular.”
  • Failure to disclose: “I should have announced the downsizing of the cohort as soon as it happened. We actually tried to hide it, hoping that people wouldn’t notice and it would just go away. That was a big mistake that I should have known wouldn’t work.”
  • Leaving startups hanging: “I should have done a better job listening to the personal concerns of the founders who were cut. If I had thought more about that, I would have worked harder to help them in other ways.”

The Bootup Labs co-founder adds that he feels a “stronger and better Bootup Labs 2.0 is emerging” from the wreckage of the entrepreneurship program, and that to help prevent any further such incidents, “new controls have already been instated at the board level with addition of [venture investor] Boris Wertz, and more announcements are coming soon.” He says he hopes that the startup community will give him the chance to “work hard to earn your trust and respect back.” Wertz’s addition and financing from venture fund Growthworks were announced shortly after last week’s blowup.

Some of the comments from users on Hacker News, where the link to his post was shared, show just how far he and the Vancouver venture fund have to go in order to do that. One asks: “Why is this guy any more trustworthy today after issuing an artfully written apology, that was clearly crafted by a PR professional skilled in crisis management communications? Startups, do yourself a big favour and steer clear of this underfunded, unprofessional slow motion train wreck.” Another writes: “Bootup Lab’s reputation has still been badly damaged. An entrepreneur’s commitment and sacrifice to their business is very serious and they took a very nonchalant approach to handling this situation.”


Post and thumbnail photos courtesy of Flickr user Autumn Bliss

By Mathew Ingram

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  1. Think the various references to Danny Sullivan should actually be Danny Robinson?

    Still, this is a harsh reminder to startups – it must be flattering and exciting to be selected for an incubator project, but without something solid on paper, it, it ain’t worth squat…

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    1. Thanks, Chris — name has been fixed. A mental lapse on my part. I guess Danny isn’t the only one who needs to apologize :-)

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  2. That’s the kind of guy I want to do business with. Learned from his faults and made his mistakes public. Many old economy guys take their golden parachute and hide away. Just to re-appear and making the same errors over and over again.

    Danny Robinson’s apology makes me feel humble.

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  3. I am a fan of Bootup Labs and think what they are trying to do (and doing) in the Vancouver area is very important. They made a mistake (like lots of companies do) and as long as they learn from it they should not be held over the fire about it.

    I know the companies directly affected will dissagree, and they are being punished quite publicly (rightfully or wrongfully) but in time I feel their work and success of the companies they work with will shadow this unfortunate time in their history.

    Just my .02

    Saul Colt

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    1. Thanks for the comment, Saul. They have an uphill climb ahead of them, no question.

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  4. Have to admire them for admitting in public that they made mistakes.

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  5. [...] post that was welcomed by some who say now Bootup Labs can move on. Others, as GigaOm points out in a post, may not be as quick to forgive and [...]

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  6. In the investment industry, reputation and character is everything. Suggesting errors in judgment or misrepresentation like this are acceptable is simply wrong thinking. Entrepreneurs, think about it for yourselves. Help like this you don’t need. Anyone who suggests that you do is either a buddy helping with spin control, or the have a screw loose.

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  7. Am I the only one who thinks their biggest mistake was accepting startups BEFORE funding was in place?!? Come on seems like investing 101 stuff and guys don’t get that most basic of rules, well…

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  8. I generally admire loyalty from supporters but in this case frendship and a desire to keep Bootup’s fun clubhouse alive are interfering with clear logic and good judgement. Let me put it simply. Startups don’t need any additional risks from dealing with unstable, inexperienced and unfunded funds or investors of any kind. Bootu’s performance record of successful exits is Zero (or minus 4 if anyone’s counting) and there is clear evidence of gross errors in judgement, if not fraudulent misrepresentation. Not a company for any rationale entrepreneur to do work with. Just sayin’

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  9. Hey, isn’t this Robinson guy the same one who was posting all over the internet about how “Venture Capital is broken – lets fix it”?

    Right!…. Guess Danny found a way to break Venture Capital even more!

    Seriously micro-funds like Bootup have no chance of carrying their overhead. Its a flawed, bad idea. Startups just bootstrap and find your own angels. There are lost of angel groups and forums when you’re ready.

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  10. This isn’t a comment but more of an observation. It is interesting (to me at least) that all the negative comments are from people with no last names and no email links.

    My opinion is an unpopular one in this post but still I stand by it.

    S!

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