aravilare wrote:
Thomas Gerlach wrote:
No doubt on the face of it, without looking into the details of the program it seems expensive but we don't know what the true numbers behind the program are, what the motives of the company are, etc. Silicon valley has been doing this for years. Throw money at things, grow as fast as possible, increase valuation as much as possible, exit. I just don't think we can say that this is a huge money loser when we don't understand the long-term strategy of said Competitive Cyclist.
Citing what venture capital-backed startups do is a terrible justification as to what sound business decision-making is. Even Andreesen (despite being a complete hypocrite) readily admits that startups are hemorrhaging cash in this overfunded market. Competitive Cyclist's business model isn't disruptive and isn't well-suited to that sort of landgrab market acquisition approach; it's an online bike shop.
Now we are going into a different area of debate that I don't want to get into. Quickly I would say paying people to "bike" is acting more like a disruptor - I don't see your local bike shop offering this promotion. And remember, Competitive Cyclist was bought already by Backcountry who knows what they are doing as an exit strategy. Unfortunately if a company isn't profitable or even if it is, it is often valued/traded on some other metric, sometimes it is sales, users, or some other metric. I guess my point being that as it stands it seems like a PR stunt that coincides perfectly with weather getting nice and people getting outside to ride. Maybe there was some aspects that were not thoroughly thought out and they had to pull-out, just seems like bait-and-switch to me.
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