I'm in for assisting with this concept. This idea could either be the smallest niche that the internet has ever seen, which I highly doubt or it can gather the low quantity, but high quality traffic and end users that most of the Web 2.0 companies we see (and their advertisers) dream of. It's worth a shot and it certainly fits in with my larger strategy of "outsourcing" the business development and financial structure of Web 2.0-type companies that I've been toying with myself.
The downside is that if this doesn't take off, you'll be forced to liquidate by selling on eBay.
But in all seriousness, I think it might work, assuming you keep costs low enough. I remember after the first dot-com implosion there was a company that would buy all of a failed company's equipment (computers, furniture, etc) and sell it to other eager startups. Sort of like how a vulture works.
Christopher: With due respect to vultures, I don't know that I want to be one. :)
My thinking here is to create an efficient market (much like eBay does for niche market goods) but make it more focused so that it delivers additional value to buyer and seller (more than just providing the listing and bringing buyer and seller together).
I like this. I hear about a lot of student projects with some promising ideas but no way in hell to contact Sand Hill road. Sounds like a level playing-field at any rate.
Dharmesh, if someone decides to go with this idea would you transfer the domain over to them? (Not sure how its supposed to work)
Ali: Yes, I'd expect to transfer the domain over to whoever was pursuing the idea.
However, candidly, I don't know that the domain name is worth all that much. The real value is in the execution of the idea, not the name. There are tons of other naming possibilities.
I'm very interested -- and I just started as an EIR at Kodiak Venture Partners -- so we're in the same city. Maybe we could meet up and talk about it.
interesting idea, but i'd be skeptical if really solid businesses routinely chose to exit via this route. it seems it would create even more of an incentive for an entrepreneur to "build-to-flip"; taking egregious shortcuts/technology debt to get to market faster, build some hype and put up a good facade. even the kiko guys decided to ditch and sell via ebay because they wanted to work on something else and they didn't want to fight a long uphill battle against google et al. i can't imagine that the recent rash of me-too auctions would be successful.
on the other hand, there may be a market for entrepreneurs who have profitable but modest businesses (e.g. "lifestyle" businesses) that are too small to be of interest to the usual cohort of large acquirers.
still, i wonder how much value these small businesses have, or at least the software, brand, and user base, when separated from the founders and their passion, intimate knowledge of the market and personal relationships with key partners/suppliers/etc.
It would be ironic if you were to sell StartupAuction on StartupAuction if StartupAuction is not successful.
I think the idea certainly has its merits. Yet personally, I'm cautious on those match-making ideas that rely on network effect to succeed. They require much more resources to bootstrap that I can reasonably provide.
Why limit to startup? Guess it would be a good idea if this can be extended to all kind of technology company or any company for that matter.
All sort of companies running out of cash, or wanting to sell out can come and auction it off.
GoldenFeed is such a joke that I don't think you can really use it as a datapoint to say that this is a trend.
I do think it's a trend, but that isn't valid supporting data since the site isn't even relevant and looks like a weekend project.
I like Muthu' idea.
Expand the coverage to any small business in any industry that can't afford to spend much to sell themselves.
Think of it, why help to sell, maybe they can also ask for funding/resources to survive.
Build the "wisdom of the crowds" into the site and help the startup.
The crux is how much are startups worth and what is the difference in value between what people currently sell startups for and what people could potentially sell for if the right people knew about them. Kiku seemed to have a lot of value and ebay+blogging gave them an avenue to quickly get the word out. They made more money then they would have by marketing to the world.
My intuition is that this is the exception and most startups are worth nothing. They have a product that doesn't work, doesn't do anything useful, or no one knows about it. If this is the case then an online auction to sell worthless products won't do well. If on the other hand startups, even failed unknown ones, are worth something, then it is an interesting idea that could pan out in the right hands.
What about a small stock market for startup companies?
This way outsiders could invest in promising ideas instead of having to go through a startup fund.
Step 1: talk to bloggers, entrepreneurs, communities to gather feedback(part 1)
Step 2: post notice note on blog, wiki, Enterpreneurial clubs, sites with the intention of gathering information/getting feedback on the site's purpose(part 2)
(once worthiness is confirmed in terms of traffic)
Step 3: seek help on who would be interested in this project
I would be interested in helping out with the coding. The idea intrigues me, because I have contemplated auctioning off my new site... but I think you are right about being a slate of imitators and it's hard being in a pack of me too's (been there at a couple of startups!).
I am bootstrapping and it costs virtually nothing to run, so I am keeping it. Bootstrapping is making my mistakes pretty cheap :)
But I suspect there may be an emerging market for a new type of entrepreneur, one who develops an idea into a working site who then sells that site to a company that can do business development and marketing.
The developer takes the development and technical risks up front and moves the challenge of developing the market around that site to a company that presumably has experience doing that.
This would provide value and reduce risk for both parties and should be worth something.
There are a few sites that do auctioning of domain names, but these are more than just a domain.
I am also intrerested by the idea of a startup stock market!
Not an auction site, but a place where people can post companies for sale: http://www.venturebeat.com/ventureboard/
The idea of a start-up stock market sounds great to me.
It would be great for start-ups, as they could raise finance quite easily if they have a sound idea and action plan without risking their house. If a startup needed say $200,000, this investment could be spread over hundreds of investors, although one person could invest the whole amount if they wanted.
Ideas could be thoroughly discussed and rated by the community before being 'floated', changes could be made by the entrepreneur in response to feedback. Interesting ideas, would be great if someone started it (I'm busy with another start up at the moment though).