A great post by Noah Kagan : "Why I Quit Mint.com (and lost out on $1.7 million)"
NOTE: the following post is by Noah Kagan ( http://okdork.com/2013/06/25/why-i-quit-mint-com-and-lost-out-on-1-7-million/ ). It was a great post, so i just thought i should share it.
I particularly like point 3: "Do the math in your biz"
Without further ado, here it goes:
My friend Jonathan Abrams (a great dude who founded Friendster) and I have a running joke that if a company wanted to be super successful they should hire me…and then fire me.
First it happened with Facebook (read about the day I was let go).
Then it happened with Mint.
Mint is a free personal finance tool and was bought by Intuit for $170 million less than two years after it started. At the time I owned 1% of the company.
While I was at Mint I was #4 and in charge of all things marketing. Fact: Before we launched we had more traffic than all of our competitors combined. Here’s how we were able to grow a huge waiting list before we launched. Now it is true that Mint was and is a great product.
Marketing is easy when you have a great product. (click to tweet)
Stop. Read the sentence above again.
So why would I quit and leave money on the table? Here are four things I learned by quitting Mint:
1. Know what you want.
I wanted to run my own company and specifically wanted to be location independent. It was a dream of mine to work remotely on the beaches of Thailand. If I stayed at Mint, I would never be able to do that. By quitting, I was able to work on my Facebook games company (another story for another day) from Buenos Aires, Argentina.
Chilling in Buenos Aires
2. Don’t take risks.
I am not a risk taking entrepreneur. While at Mint I started building Facebook apps at night. Until I could cover my minimum costs ($3,500/month) I had no intention of quitting. This meant many late nights, but it goes back to #1. It was very clear to me that I was going to do my own thing and it’s what I wanted.
3. Do the math in your biz.
I figured the company would sell for around $200 million. In a startup you get stock that takes four years to actually own all of it. If we sold for $200 million and I stayed around, I would make $2,000,000. Sounds sweet right? When you consider time and taxes it’s not so sweet.
Here’s what I mean by “do the math in your biz”:
- $200,000,000 * 1% = $2,000,000. (My ownership at 1%)
- $2,000,000 * 50% = 1,000,000. (The Government takes half for taxes)
- $1,000,000 / 4 = $250,000. (The total spread out over 4 years)
Plus I would have had to stay at the new parent company, Intuit. So I figured that within a four year window I could come close to making $1,000,000. After four years I didn’t quite make a million but with Gambit (the Facebook app company) I ended up making a few hundred thousand dollars (AFTER taxes).
4. Keep Learning.
When I started at Mint I learned a shit ton. The founder was extremely liberal in allowing me to do what I wanted to do. We had town halls with our users, we did user experience testing (completely new to me at the time), a content network, spending on advertising, and more. It was all new. But towards the end it was less and less new things. You could say I became too comfortable and stopped growing. And then they hired someone above me. In hindsight, it was my ego that said I had nothing more to learn and I’d be a gopher for the new person. But I probably could have learned something from her too.
Feel free to visit Noah's blog at: http://okdork.com/