The article's main point seems to be that Everpix could have done well by paying employees well under (half?) market rates and succeeded. Maybe by handing over a lot of equity to employees (probably most of it), it may have even worked. But I think the author is missing the opportunity cost here. All of these Everpix employees could likely have easily found employment in other startups with more VC money and received twice the pay Everpix could give them. This is the market in action - we have enough of these photo sharing gimmicks already. Those employees are better used in other startups who can actually make enough money (read: fulfilling market needs better) to pay them properly, and so I think it was the right move to shut down and move on.
RE: "we have enough of these photo sharing gimmicks already"
RE: "I think the author is missing the opportunity cost here"
The fact that there's already entrenched photo sharing kings means that you don't have to be first to market, overspend, or rush. There's no time crunch here, meaning that a great product could have been built well - over time - on budget, and still have had success.
Did you even read the article? The photo storage / sharing / librarian market is HUGE. Definitely large enough to support multiple players, even marginal ones that make $3-400k/yr.
Instead of paying employees half market rates, those employees can go and work on creating a VR app that could be used by millions of people, or some other opportunity. And they could receive full pay.
Why should these employees need to receive half pay when there is opportunity for them to receive full pay working on a different problem? I'm sure they could make great waiters at a local restaurant and receive a livable wage, but is it the best use of the opportunities they have? I'm going to go out on a limb and assume those 6 employees were excellent given how well Everpix was run.
> Instead of paying employees half market rates, those employees can go and work on creating a VR app that could be used by millions of people, or some other opportunity. And they could receive full pay.
Yes, you're right. But does a photo sharing service really need those kind of employees? Is there a need to be located at a technology cluster like the SV where developers are expensive and a scarce resource?
Services like Everpix are - in terms of technology - pretty trivial. They can be built anywhere in the world by average developers. No need to hire expensive Stanford PHDs to do a job a kid from the local community college in Kentucky could do.
