There were a pair of stories this weekend about divShare co-founder David Altschul’s unusual decision to put his company’s assets up for sale on an auction site called DNForum. Founded in December 2006, DivShare is a site where users can share all kinds of media with one another, including audio and video files.
Altschul’s move to salvage (any?) value from his year-old baby earned him a ribbing from TechCrunch’s Michael Arrington, who responded by putting divShare in TechCrunch’s DeadPool. Mike also thinks Altschul’s method could actually harm his future prospects, should he ever try founding again.
…posting your company for sale on a forum and then not talking to users to explain what you are up to suggests that you are not very serious about building community trust. People may not treat whatever founder David Altschul does next very seriously based on how this situation is being handled.
Dan Kaplan over at Venture Beat asked Altschul why he went this route. Altschul’s explanations are a bit fuzzy. (Like: “the sale was originally intended to be private.” On a web forum?) He also claims the company is profitable, that they’re just trying to maximize value with this method of sale, and that his move is misunderstood.
But Altschul isn’t all wet, and demonstrated an astute perspective on his little business that many starry-eyed founders lack, when he told Kaplan:
[DNForum] is a legitimate forum where buyers in our price range are located…I was simply reaching out to those in our price range so we can make sure we have the right owner. Unfortunately, every site doesn’t sell for hundreds of millions of dollars.
I hope, for Altschul’s sake, that it is true he was “on [his] blackberry all day” fielding calls from interested parties.
Regardless, the divShare discussion got us thinking. We’ve written a lot about when founders must see the writing on the wall and pull the plug, or sell. We’ve not written much on the question of how founders can best-handle the uncomfortable process of doing so — especially in a “fire” sale. Can there ever be dignity in letting go this way? So this forms our…
Question of the Day:
Are there right and wrong ways to sell your startup and its assets?
- Can you do-it-yourself, or is it better to hire professionals? (Altschul says they have a professional broker handling the sale on DNForum — but does that count?)
- Is a web forum ever an appropriate place to sell, even if your company is proftable? Or does this smack too much of a fleemarket fire sale?
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