Ringside Networks, a Marlton, N.J.-based startup that raised an undisclosed amount of seed funding from Matrix Partners in January, has closed its doors. News of the move came via a blog post authored by the company’s CEO and co-founder, Bob Bickel. The fact that Ringside, which was making an open-source social networking server for the enterprise, shut down isn’t that big of a deal. The reason why, however, offers an important lesson for all startups hoping to get bought by one of the big web companies.
Apparently Ringside was in the process of looking for Series A funding back in May — and getting funding offers from top-tier VC firms — when it received a tentative acquisition offer from a big web company. It opted to go with the acquisition offer, only to have the big web company change its mind.
After dragging out the process for most of the summer, the non-evil company decided that they really did not want to acquire the company after all. Recommendation: always beware of wolves dressed as Grandma, they may be more like Microsoft than they admit.
The company got some bridge loans from Matrix but failed to get more (Series A) funding, even as it finished up its SocialPass technology. The clock, however, kept ticking.
We can’t simply blame non-evil companies, however. The building of a company requires so many things to come together. Good ideas, good target markets, good people, good business models, good timing. I think we just missed on the final ingredient – good luck…
Bickel, by the way, uses the term “non-evil” to describe the onetime potential acquirer, in what seems like an obvious nod to Google, which has long claimed to do no evil. Of course, I can’t say for sure that he meant Google — and you guys can decide for yourselves.