Received XMarks’ notice that they’re folding, and their story is excellent reading. Here are a few of my observations.
First, it’s very well-written and has an excellent tone. I hope never to fold a business, but if I had to, I hope I’d bow out as gracefully as they are.
Hats off to them for knowing when to quit, and letting us all know with this much advance notice.
We’re not in another dot-com bubble. Without a convincing plan to turn a profit, investors won’t bite. Two million users (astonishingly!) seems not to be good enough.
Technically, it’s an excellent product. I’ve used it for some time and it works great. Shouldn’t that be enough?
Entrepreneurial authors like Guy Kawasaki say that a product based on something you’d want yourself is a better way to go than an anticipated audience. And that’s exactly what they had.
Your competition isn’t far behind. If they’d started a “freemium” service early on, would they have built a loyal customer base that despite the free competition?
I don’t mean this harshly: the CEO couldn’t conjure magic. The engineers couldn’t find a working business model, but neither could he. I suppose I’m biased toward engineers, and CEOs exist because the engineers too often can’t do it without them. But it’s not a slam dunk for anyone.
I’d love to hear their experiences after some time has passed. Would it have been a viable business for a leaner team? What if they’d geared toward a smaller long-term revenue stream from the start?
Of course, if this farewell is really XMarks’ maneuver to get their customers’ attention (and it turns the business around), the CEO has earned his keep right there.
Fare thee well XMarks. You have an excellent product.
Update, 12/18/2010: Xmarks gets acquired by LastPass. Ok, so was the good-bye post a ploy? (And if it was, did I call it or what?!) Either way, I’m glad they’re still around, for everyone’s sake.