Kin Lane

Expressing My Concern About Startup Dependability When I Talk To VCs

I talk to venture capital (VC) folks on a regular basis, answering questions about specific API-centric companies, all the way to general trends regarding where technology is headed. This week I was talking with a firm about the viability of one of the API companies I work with regularly, and the topic of startup dependability came up, as we were talking about the challenges this particular startup is facing.

While I am using this particular startup in my business operations I expressed concern about the viability and stability of the startup in the long run. This concern has less to do with the startup, as I fully trust the team, and the technology they develop, it is more about the nature of how investment works, as well as the looming threats for the 1000lb pound gorillas in the space. I just do not trust that ANY startup will be around in coming months, and I craft my API integrations accordingly--always with a plan b, and hopefully a plan c waiting in the shadows.

This isn't just me. I've had similar conversations with companies of all shapes and sizes, university technology groups, as well as government agencies. After each wave of startups failing or achieving their exits, us end-users who are often in charge of purchasing decisions are suffering from whiplash, and our necks hurt. Every time there is a new tool on the table, we are asking ourselves whether or not it is worth it this time. Should we be investing in yet another software as a service that will likely go away in 12 to 24 months? The burden on us has been too high, and we are left feeling like the startups and their investors really do not give a shit about us--they have their own business model that they are moving forward with, where we are just a number.

There are no guarantees in business, but startups and VCs aren't doing enough to address the dependability of their portfolio companies. At some point, it will catch up with them, if it already isn't. As the API Evangelist, I am already toning down my excitement over new startups because I really do not want to be responsible for helping convince people to adopt a new tool, and then be held accountable when the startup goes away. Each week I have an inbox full of startups asking me to write about them, and most of them are unaware of how much my neck hurts, they are narrowly focused on their vision, with little concern for the rest of us, as long as they get their payout.