I have never met a person who loved their rental car company or the experience of turning up at an airport, waiting in line, paying a huge fee and then dealing with returns, airport shuttle buses and so forth not to mention half-washed and smelly cars. I think the closest parallel I have is the feeling I had for taxi cabs (inconvenient, smelly, expensive) before Uber. The rental car companies have a million scams to get more money out of you – mostly notably the gasoline scam. They either ask you to fill up your tank before returning the car (and gauge you if you don’t) or they pre-sell you “cheap” gas but when you factor in that you never return your car with a totally empty tank is also a scam.
And leave aside the fact that it’s very hard to rent cars if you’re below 25.
You simply can’t build a long-term great company by duping customers and with the top three rental car companies controlling 90+% of the market their behavior won’t change. It’s a classic “innovator’s dilemma,” making this market ripe for disruption.
Surely the startup can do better. I’ve looked at many companies trying to disrupt this market and I’ve seen very interesting solutions and feel certain one or a few will stick and become big. But it wasn’t until I met the team from Skurt that I felt compelled to invest. They found a model to transform the entire experience and deliver a mobile-first product that is as good as using Hotel Tonight or Hipmunk (in fact, the founder & CEO of Hipmunk liked the product so much he invested!).
The founder & CEO of ProductHunt loved it, too.
Like many of you I read the Is Web Summit a Scam article making the rounds this week. I have attended Web Summits three times – it is not a scam. Let me get that out of the way. It’s a big conference and all big conferences charge money, make money and serve a diverse set of needs.
I even wrote about my experiences attending Web Summit, something I rarely ever write about. I have absolutely no affiliation with the event, no economic interests and had no other reason for writing about Web Summit other than as a person who has to attend many events for my professional life I found it to be the most meticulously plan and run and intent upon serving its audience of any major event I had attended. There is simply no way that an event grows from 400 people to 22,000 in 4 years without doing some things right.
The founder of the event, Paddy Cosgrave, smartly responded to the critics in a post I just read this morning.
What Can You Do if a VC Pulls Their Term Sheet?
I was asked to answer this exact question on Quora and I did so some time ago. The beauty of evergreen content is that it resurfaces all the time and it is as relevant today as it was years ago when I answered it. One of my favorite ways to resurface content is when I see people on Twitter put out a Tweet linking to an old post. Tech Tidbits did this with this Quora answer and also linked to a Pinterest board with my quote, which I love.
Sorry for using fuck two posts in a row. This isn’t Dave McClure secretly taking over Mark’s blog. I’m just writing verbatim what I wrote in a Quora response years ago.
So, what can you do?
Legal actions = zero.
A term sheet is not a legally binding document.
Retribution actions = lots.
But why bother. There are bad people in life, yes. But the negative cycles you’ll spend on trying to bad-mouth somebody aren’t worth the effort.
Something is rotten in tech startup land. Don’t call me a hater for saying so. It’s not that I’m anti innovation or a disbeliever in disruption or calling it a full-scale bubble or saying every darling startup is going to fail. None of those.
Somebody posted too many party fliers. The uninvited crowds have all turned up. The people here don’t respect your parents’ furniture, are throwing beer cans in your back yard and there’s a dude passed out face down in your sister’s bedroom. About an hour ago he thought he was invincible. That he defied the laws of gravity. He turned up for the fun but went too hard, too early.
There’s no one sane I know any more who doesn’t privately say that things have gotten out of hand. Few like to say so publicly.
And I blame unicorns.
Not the successful companies themselves but the entire bullshit culture of swash-buckling startups who define themselves by hitting some magical $1 billion valuation number and the financiers who back them irrespective of metrics that justify it. Unicorn has become part of our lexicon in a sickening way and will no doubt become part of the history we tell about how things got so out of control again.
One of the least understood parts of the venture capital industry and venture capital firms is how investment decisions actually get made. The truth is that each firm is different and there isn’t one standard but over the years I’ve talked with enough of my peers to get sense of how many firms work.
Often if it’s a bigger firm (say 4 partners or more) and it’s a super small investment for their fund size (let’s say $250-500k when they normally invest $5-7 million) they will just require 1 or 2 partners to decide. For anything that would be considered a normal investment for the partnership most firms try to make sure every partner has seen the deal and has a chance to weigh in. That’s why the investment process begins with a partner meeting and if they really believe in your business then they “champion you” by inviting you to a full partner meeting.
What happens next feels like a black box to outsiders. They only know if they get a yes, no or “I need to do more work” after that process. Some firms have formal voting structures but in my experience most don’t.