Two different products for iOS have come onto the scene recently — Albumatic debuted last week, and Cluster plans to launch Wednesday morning. Both take a modern approach to sharing photos with friends, and they look different from most everything we’ve seen before. The apps themselves are simpler (they involve minimal instructions or tagging), and they make it easy to save photos shared by friends that you want to keep to your camera roll and invite people to albums. Within a few seconds of opening both apps, I clearly understood how they worked and I was able to get something out of them pretty quickly.

The problems with group photo-sharing are clear. I spent Thanksgiving this year with six friends here in San Francisco, and we were all snapping photos on our iPhones throughout the day. By the end of the night, we all wanted each other’s photos for Instagram or Facebook, for sharing with absent friends and parents. But there wasn’t an obvious way to dump all our photos into one big album. We investigated Dropbox and Flock, but neither seemed like a fit, and we ended up using Apple’s photo stream, although it was a clunky solution.

So what could we have used instead? As of this week, we’d have two new options:

Albumatic

With Albumatic, which launched last week, a user can create an album at the beginning of an ongoing event and add friends who are located nearby to contribute photos as the event happens. Users can like or comment on photos, and if your friends are creating events in distant locations, you can follow along and get notifications when they add the the album (although you can’t contribute if you’re not physically there).

It seems like it might contribute to some serious FOMO, but could also be a fun way to keep up with far-flung families, groups of friends in other cities, or destination weddings you can’t attend. And for the event participants who are present and adding photos, it could be a good way to create a record of the event that you can easily share. Albumatic is clearly meant for in-the-moment sharing.

Cluster

Cluster takes a slightly different approach to photo-sharing that I found immediately easier to use, compared to other options, after opening the app. Instead of trying to collect photos from party attendees as the party is happening, Cluster wants you to create an album when you get home that night and let everyone add photos after the fact. It’s a different approach that could work for different people.

Once you create an event and pick your photos, you tell the app which friends were there, and it notifies them to add their photos (using the time and geolocation to suggest photos they might want to add). In testing, the app was quite accurate in picking up which photos I should contribute to events I attended, even in months past.

Cluster seems like it has more post-event potential than Albumatic, but it will be interesting to see how both play out at SXSW in Austin next week and whether one is more conducive to sharing than the other.

This story was corrected at 10:37am to note that you can upload photos in Albumatic from the camera roll as well as take them in the app.

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The Apple note is just a one part of a bizarre story outlined in the court filing below. The document also contains jarring accusations leveled by Color’s cofounder, Adam Witherspoon, against CEO and founder Bill Nguyen. In his suit against the company, Witherspoon accuses Nguyen of retaliation and causing him emotional distress.

The details are pretty awful: Witherspoon accuses Nguyen of  ”creating an extremely hostile, unsafe and harassing atmosphere” and of bringing an “armed crony” into the office to intimidate anyone participating in an internal investigation into Nguyen’s alleged misuse of company funds. He also says Nguyen ”threatened violence against Witherspoon’s young son,” and blocked Witherspoon’s job opportunities at Apple when the company was sold.

There are a lot of other accusations as well, including Nguyen pressuring an employee not to file a workers’ comp claim, of Nguyen beating his children, and monitoring Witherspoon’s child’s behavior at school and through a counselor — it just gets weirder as you read it. The accusations are just another chapter in Color’s increasingly bizarre history.

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But the company isn’t dead yet, said a spokesperson. “Color is not shutting down,” the spokesperson told me.

UPDATE II: The Next Web, quoting trusted sources, reported that Apple is about to buy Color for a price in the high double digits. Apple bought Nguyen’s previous startup Lala for $80 million and Apple SVP of internet services and software Eddy Cue knows Nguyen. (Original story continues below)

The report of Color’s closure was first reported by Venturebeat, which cited a company email sent to employees. In it, the company apparently announced to employees that “last week, the Board and major shareholders voted to wind down the company.” But we’ve heard from a couple of people who said that employees there have not received the email. The company is now trying to investigate where the email information may have come from.

UPDATE I: Venturebeat said the email was sent by Color’s vice president of finance Andrew Urushima and that it can’t confirm that more than one employee received it.

Make no mistake, Color is going through a lot of upheavals. Nguyen hasn’t been with the company for about three months, though he continues to retain the title CEO. The size of the staff has fallen from about 50 people earlier in the spring to a staff somewhere in the 30s now. And morale took a hit after Nguyen stepped back from day to day duties, sources have told me.

But the company has a deal with Verizon signed in May to embed its mobile video sharing app on certain Android devices. I’m told that the deal is still in place and Color is working on new product plans. It’s still possible, of course, that Color or its backers could call it quits all the same. But a lack of money probably isn’t the issue. Nguyen said earlier this year that Color had enough money for five or six years.

That’s as a result of Color’s huge $41 million funding last year from Sequoia, which was trumpeted at the same time it launched what was originally a photo sharing app. The app’s failure to catch on with consumers and the cocky promotion-style of Nguyen made Color the startup everyone loved to hate. But does it mean Color is doomed? It might be ultimately if no one can make Color’s pivot toward live video sharing work. And now with more founders stepping back, it doesn’t inspire a lot of confidence. But it sounds like people will have to wait a little more before they break out their favorite Color jokes.

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And yet, the man is unfazed. Here is what he told Liz Gannes:

Running a start-up is like eating glass. You just start to like the taste of your own blood. We are iterating on our approach… Airtime is finally getting around to some of the bigger ideas that got me interested in this project in the first place… Now is the most toxic time ever in Silicon Valley…Startup team are always in flux, so like all startups we’re always talking to candidates for various key roles… At this point nothing definitive has been decided….It’s only 12 weeks from launch…I’ve only been running the company since March.

I added up all those random quotes from Gannes’ post so you can see what he is saying: absolutely nothing. Airtime really is a house of cards standing on a handful of matchsticks. The company has 10,000 monthly active users — and that is generous by any stretch of imagination. There is a steady exodus of executives, co-founders and smart people. Madness, I say!

And no, it is not just an opinion. I have talked to folks intimately familiar with the company and have heard similar stories Liz has outlined in her post. Parker in the past has attached himself to working and growing concepts, most famously Facebook and lately with Spotify. His talents helped those companies, but frankly, starting a product from scratch and building into a have-to-use fast growing service is easier said than done. In other words, let’s just face the facts: growth happens, for inexplicable reasons and you can’t draw it on a whiteboard.

Airtime suffers the same malaise as Color, the other liberally-funded startup: they don’t really solve a problem that is acute or hasn’t been solved before. Sarah Lacy in a post about Color wrote:

People no longer get told what products to use in a Web 2.0 era, they use them and spread them to their friends if they’re good. Color wasn’t– as was evidenced by its two-star rating. Money and grand articulations of a vision can’t shortcut that. The Web has become too crowded and users are too smart.

She might just be writing about Airtime. If Color’s Bill Nguyen boasted about the $41 million he raised from Sequoia Capital, then Airtime talked about its $33 million in funding, celebrity launch event and bold claims that sounded hollow from day one.

I didn’t really see what Airtime was for when it launched — I am sorry, there are already many tools that do a better job than that service. Skype, Facebook and Twitter – they were like nothing before and hence they grew so fast and swept the world. They were communication revolutions and the consumers rewarded them with attention.

For now, Airtime wants to be a next generation Skype! Sure, and I want to be a latin lover. The fact is that in today’s attention starved world, if you miss the chance to make an impact, the world moves on to something new. It doesn’t matter who you were, how great your resume is and how many billions you have in the bank.

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The exclusive partnership is just the first step for Color, which will later this year embed its app even closer to the hardware of Verizon’s 4G phones, allowing users to broadcast in live 720p at first and potentially 1080p in about a year. Users will be able to pick out particular frames from the video that can be shared as photos. That, said Color’s CEO and co-founder Bill Nguyen, will enable users to experience live moments in high-quality video and will change the way people think about sharing through pictures and video.

“What you really want to get to is a point where the video camera can show what you’re seeing and act like a teleporter for people,” said Nguyen, who sold his previous start-up Lala to Apple.

30 seconds of live video

Color launched in March last year as a proximity-based photo-sharing network, but the service never caught on, in part because it was trying to create a new network for people to use. The company changed course in September, announcing that it was integrating its app into Facebook. That’s when it showed off the ability for users to share 30 seconds of live but silent video to their friends, who would get notified when a user was broadcasting live. Users can view live video on Facebook or their Color app or they can come back to the video and view it if they missed it live.

Technically, anyone with a 3G or 4G Verizon phone will be able to make use of the enhanced Color features. The app is available in the App Store or Google Play or users can call “COLOR” on their phones and get a text message link for downloading the app. Verizon is looking at pre-loading the app on select phones.

Showing off the network

Verizon’s strategy is to highlight examples of what faster 4G wireless networks can allow people to do, reminiscent of the work the carriers did to show off 3G networks years ago. And it’s also harkens back to the big push Verizon gave to the Droid lineup of phones, which became a big seller thanks to Verizon’s marketing muscle. There should be lot of similar marketing support for the Color integration as well.

Lewis said we can expect more partnerships in the future aimed at highlighting Verizon’s network. The company last year opened an app innovation center in San Francisco to encourage more app development.

Photos vs. video

Nguyen said he was inspired to reach out to Verizon because of the emergence of high-end video cameras like the RED digital camera, which can shoot in 4K and can produce high quality still shots as well. That helps solve the question of how to capture moments because one device can produce both video and stills, he said. Since photos are still preserved, it opens up the potential for live video to become more of a unit of sharing. Ultimately, he believes this type of live video will displace pictures as the way we preserve moments. This is what Nguyen wrote in a blog post about the news:

There’s something special about live. It’s spontaneous. You never know what to expect so you watch in anticipation. Live is also shared. A feeling of community, you’re experiencing something in real-time with other people. Family reunions, concerts, or ball games, we come together for live moments.

Questions ahead

There are still a lot of questions to be answered. It’s unclear which phones will get the deeper integration of Color, though it will likely be quad-core Android devices. It’s also not how Facebook will feel about the upgrades to Color, which will mean a lot more storage of videos and pictures. Also, we still have to see how well Nguyen and his team of 50 engineers can pull this all off. Lewis said some of the more ambitious plans are somewhat experimental so there’s no guarantee that it will happen exactly like Nguyen is describing.

But it’s still an intriguing future that Nguyen is proposing. I’m personally interested in sharing more live video but I’m not sure I’m ready to have that replace photo sharing. With photo sharing, I get to self-edit and choose what images go out. Live video sharing means you don’t know what people will see at the end of those 30 seconds. It could be completely boring or very embarrassing. Of course, you can choose to delete after broadcasting. But the idea that we can move to a model where the distinctions between video and photos get blurred has a certain logic to it. Why capture just one or the other when we can capture both?

If this works, this could be a big turnaround for Color, which still hasn’t shed its rap as an overhyped bubble startup with its $41 million in funding. Though Color still has a lot to prove, its second act is proving more promising thanks to a big assist from Verizon.

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Still, that intense competition doesn’t seem to have shaken off the belief of wave after wave of startups that think they can stand out from the crowd and become the next Instagram. Next up? French service Sharypic, which has just gone live on the iTunes store.

The site, which is based in Paris but was funded by pan-European incubator HackFWD, offers a twist on the formula by focusing on events rather than people. The system is organized around real-world happenings, with pictures collated into albums that build events either by taking your location data or by users explicitly adding their images to a particular event.

Right now, for example, you can see lots of photographs from Mobile World Congress in Barcelona, or the recent Rio Carnival. Navigating through the albums is easy and fast, and discovery of events — both through the app and the website — is smooth and intuitive.

I suppose that makes it not entirely dissimilar to Color, the crash-and-burn startup that raised $41 million, flamed out with the press and users, and then shifted gears to become a Facebook photo and video app.

But where Color had an expensive team and a bucket of money so large that left it vulnerable to launch hype, Sharypic is running lean and mean. And unlike, say, Instagram — which lets users apply retro filters to their photographs but really has no memory of what happened yesterday — Sharypic is centered around actual nostalgia. It wants to be there when you look back over photos, or help you discover what other people were doing at the same time as you.

That’s an important human emotion, and while Sharypic’s approach to it is not unique, it is at least defensible.

The site currently offers event owners and planners the chance to use a Pro version that will help them engage with attendees and collate photographs afterwards — something that gives it an actual business model, unlike many of its peers.

But still, photo apps are so numerous that it still feels like a crap shoot. I don’t know whether Sharypic can make an impact. It’s a nice app, and with some smart event partnerships, it may stand a chance of making some headway. But at some point there will be a massive amount of consolidation or collapse: perhaps the best objective for anyone wanting to be in this space right now is to build a strong user base for when it all shakes out.

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Color will add some useful features that make it more than just another Facebook photo browser. It lets you Like and comment on photos, just like you can on the web, but it also introduces the ability to create and share group photo albums with multiple people, which is more than Facebook currently offers through its own service.

It also lets you view your Feed and the new Timeline history of activity as pure photo streams. And there’s the “visit” feature, which lets you request access to live-streaming video from either friends, or anyone who has their permission settings arranged such that you can see their content.

You can request visits whenever you want; someone doesn’t have to be online. If they aren’t, they’ll receive a push notification from Color on their iPhone (or Android device). Live streams initiated through the app can be viewed either through the app itself, or on the Facebook website. It sounds a little bit like the new approach Google is taking with its ability to broadcast through Hangouts. It’s not exactly video chat, and it’s more interactive than straightforward video posting. It doesn’t currently allow video recording or audio, but that could come in future versions.

Color’s problem was that it was too ephemeral and too small. It couldn’t muster a large enough group, even at major events, to be relevant to any users. Facebook’s network means it shouldn’t have a problem when it comes to users. But its differentiating factors still depend on being in the moment; without the real-time elements of visiting and live streaming, it seems like little more than a Facebook photo browser.

The new version of Color will remain in private beta for a while longer, and then move into a larger, invite-based testing phase. The broadcast angle is interesting, and could make Color a very useful Facebook feature. We’ll see if Color can thrive using the network of another, where it failed trying to curate its own.

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In reality, though, the fact is that almost everyone is looking for something else: a way out that changes their life. Whether it’s going public or getting acquired, everybody wants a return on their investment and the big exit. The life-changing sum of money is, ultimately, the pot of gold that drives startup culture.

But how do you make your dream exit a reality?

I spent yesterday at an event in London run by Seedcamp, the pan-European seed investment program, where an interesting discussion emerged about the nature of acquisitions, and how to achieve them. It started with a to-and-fro between insiders at two of the biggest potential buyers for most web startups, Facebook and Google. The question: how do they decide which companies to buy? What is it that they are looking for?

Christian Hernandez, Facebook’s head of international business development, pointed out that although Mark Zuckerberg’s company has made more than its share of purchases over the last couple of years, most of them were not obvious purchases.

“We think about either acquiring talent or actually looking at technologies that we can bring in and build products on,” he said. “We don’t usually acquire products.”

“There’s very few,” he pointed out, referring to a couple of recent transactions. “There’s Beluga, which we launched as Messenger recently; there’s Snaptu in Israel, which is a simplified low-end phone application. All the rest have been talent acquisitions. Expensive acquisitions, but…”

This is a tricky situation to navigate. In fact, perhaps it’s impossible. After all, you need to be successful to get interest from acquirers — but looking at what he said, there’s a subtext: that if you’re too successful, you may end up pricing yourself out of the market.

Even most product purchases are small

Conversely, Google has bought in a lot of products — Maps came from buying Australian company Where2; Analytics was built on the work of acquisitions like Measure Map; Android, meanwhile, was an eight-person outfit when Andy Rubin (pictured) sold it to Google in 2005. But Anil Hansjee, who ran Google’s acquisitions team across Europe, Africa and the Middle East for five years, pointed out that the vast majority of its purchases actually fell into a similar category to Facebook’s: talent.

“Eighty five percent of all Google’s deals since day one have been sub-$50 million transactions,” he said. What did that mean? “You have to think about what kind of company you are, and what kind of money you take on board.”

This, he suggested, meant understanding the way your incentives change over time. It’s easy to imagine that there is one easy answer for getting acquired: build a prototype, raise money, scale, profit, exit. But, in fact, there are two paths for entrepreneurs to follow, he suggested.

On one side there’s a track followed by those who are either early in their lifecycle or who have not taken large rounds of funding. This leaves the door open to a talent acquisition (but probably means your product dies). On the other side, there’s a route followed by those who take — or need to take — some sort of significant investment. The size of the acquisition that investors require to make their money back means that many companies will have probably already reached the point where they need a big exit. And that means they have to be one of those uncommonly large acquisitions that fall into the 15 percent category.

In some ways this may sound crazy — that raising money reduces your chances — but Hansjee was circumspect.

Misaligned incentives

He pointed out that it was simply that more entrepreneurs needed to understand the consequences of their actions; that they needed to think about how the incentives for founders and investors changed as money comes in. Bottom line: take significant venture capital — $5 million or above, say — and your board is much more unlikely to get the deal they want from an acquirer like Google or Facebook.

In some extreme cases, this is obvious. Look at the famous example of Color, which raised so much money it immediately priced itself out of the acquisition market.

The discussion also turned to Path, which rejected a reported offer of $100 million despite the fact that the service has not got a lot of traction. In both cases, the founders and investors had different incentives which meant that most of them had already decided to play the long game. But not everybody is in that position, or has the luxury of personal wealth.

So is it possible to be too successful? The answer — thankfully — seems to be no, at least if you measure success by the size of the business you build, not the amount of venture funding that you raise.

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