Those Pesky "Low Seven Figure" Distractions

Do you remember Chipin - the grassroots fundraising widget that I reviewed a while back?  Well they recently decided to sell off their stable of moderately successful Facebook apps including Pirates vs. Ninjas and Vampires vs. Werewolves.

Here's Chipin founder Carnet Williams on why the widget maker sold their suite of Facebook Apps to Buddy Media for an amount "in the low seven figures":

“For us, Facebook applications were like a drug,” Williams tells the Inc.com reporter. “They were loads of fun and making a little bit of money. But in the end, we want to make hundreds of millions of dollars, not millions of dollars. And I didn’t think Facebook could do that for us.”

While it's easy to make fun of somebody complaining about a business that is only making millions of dollars, you can understand the thought process here.  Grassroots fundraising doesn't have a lot to do with Ninjas, Werewolves, Vampires, OR Pirates.  Managing multiple completely unrelated businesses is no fun for a small team, and you can see why Carnet and his team would feel the need to focus.

Plus, for a start-up, selling some peripheral assets for cash is kind of like raising a round of funding, but without the annoyance of giving up equity.

This story is interesting in another dimension as well - it's the first example that I've seen of a company shifting resources away from Facebook, and back to widgets.  To date, it seems that the opposite has been true.

Comments

[Ming]

This is a smart move for them. You really hit the nail on the head. A small start-up, or for that matter any company, has to stay focused or risk losing their business entirely.

In this particular instance it's not a small distraction, it's a completely unrelated side track. Pirates vs. Ninjas and Vampires vs. Werewolves have absolutely nothing to do with the ChipIn core business.

However, if you are going to be distracted this is the way to do it. The infusion of no strings attached capital is a nice outcome for this side project.

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