A Terrible, Horrible, No Good, Very Bad Hardbound Update

Here’s the situation:

A couple weeks ago I had to tell the Hardbound team that I need to start helping them look for other work. We weren’t going to be able to pay them for much longer. Our bank account was running dangerously low, and although I had been 100% focused on fundraising for a long time, it wasn’t going well. I talked to 72 investors, but I wasn’t able to close the round. We were making about $2,500 a month (better than zero!) …but spending around $13,000 a month. So we were a long way from profitability.

Why didn’t the fundraise work?

It’s impossible to know for sure why investors said no, but the explanations they sent me usually fit one of these two themes:

  1. We had OK but not amazing user growth. About 7k people were reading our stories every week, but that number wasn’t growing fast enough to get people really excited. Our theory was that if we were creating a lot more content (and started to invest more in marketing) then the numbers would improve, but many investors saw that as too risky.
  2. It takes a lot of time and money to make a Hardbound story. Each one needs to be researched, written, edited, and illustrated. With a team of 3 part-time freelancers, we could make one story a week. Any faster, and the quality would suffer, alienating our users. (We tested this. And besides, we’d rather die than turn into yet another shitty content farm. The world doesn’t need any more of that.) Many investors thought it would cost us too much money to make enough content to satisfy user demand. Our theory was that the content we’re creating (book summaries) is evergreen, so it should be judged completely differently than a digital media company that has a content farm churning out hundreds of posts a day. Unfortunately, investors didn’t buy that story.

So, what am I going to do now?

I see a huge range of possibilities:

  1. Try to get acqui-hired and pretend I didn’t fail to fundraise, as is the tradition in our industry (“our incredible journey!”, etc).
    Hint: I’m not going to do this.
  2. Go it alone with the same model as before, except now I make all the stories myself, slowly building the business.
  3. Reflect on everything I’ve learned, and experiment with making fundamental changes to our model.
  4. Press “pause” for a minute to catch my breath.

I want to use technology and storytelling to help people widen their perspective, deepen their empathy, and sharpen their knowledge.

There’s an image in my head that helps me make sense of this:

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