More Awesome Than Money (35 page)

“Your personal website should not be your Facebook profile.” With this new approach, users could do what Facebook and Google did with their data: auction it off.

“You have your own website, you tweet about it, you get more people
to sign up. You get your analytics. You get your payoff. It's really pretty simple. You own your shit. You go from there,” Dan said. “It's what people want. WordPress proves the business model.”

Max, who had raised a few objections to the plan, balked at invoking WordPress. “Every time I ever mentioned WordPress to a VC, they were always like, ‘Okay—they don't kill it,'” he said.

WordPress was not, in other words, a monster generator of revenue, nor did it have the prospect of becoming one, even if it was a dominant presence. “For being six out of ten website installs, they are not killing it,” Max said.

This puzzled Dennis. It was one of the most important tools to have emerged from the twenty-first century. “How are they not killing it?” he asked.

“They make enough money to be a sixteen-person company,” Max said.

This did not trouble Dennis.

“Maybe that's what we are going for,” Dennis said.

Dan said, “They're not killing it because they are not social and everything is social.”

“That's fine,” Max said.

They could not, in fact, sit around much longer debating the perfect approach, the best website.

“We've got four months,” Dennis said, calculating his savings.

“I'm applying for jobs in three months because I will be flat broke,” Dan said. “What we have right now, it's not going anywhere.”

They had just burned up a month changing background colors, making avatars with rounded corners, trivial pursuits.

“We can't keep pixel pushing,” Dan said.

Rosanna had mostly been listening since it was evident that she was not needed to back up Dan, who was making the case and had Dennis on his side. But she made it clear that she, too, was through with pixel pushing.

“I don't want to,” she said.

“Rosanna doesn't want to pixel-push. I don't. Like, I changed the mobile site. Nobody gives a shit,” Dan said. “We need to do something that's completely different. Twitter can change their design. Facebook
can change their design. They can't do this. Nobody can do this, except for us.”

Dennis sketched out work plans for the next week, including dealing with a persistent porn poster on the JoinDiaspora website. Dan said he would take care of it—after they ate.

“I forgot to eat breakfast and dinner,” Dan said.

“It's lunchtime,” Max said. “Why don't we just eat?”

“I'm hungry,” Dennis said. “Hella hungry.”

T
hey looked through all the name tags, about 150 for every start-up except them. One that had a plan to sell empty seats on airlines. Another that was making an app to record game playing on mobile devices. An app that would connect truckers with shippers, bypassing brokers. A custom-sizing program for T-shirts.

Nothing for Max or Dan, Dennis or Rosanna. Not one person in their group had a tag.

“Oh,
you're
Diaspora,” the administrator said. “We heard all about you last night!”

It was early May 2012, and the Diaspora team was in Mountain View, California, with the summer class of start-ups at Y Combinator, the incubator in Mountain View, California. Ever since February, when Dan had his epiphany about making Diaspora a social network of personal web pages, they had been going guns blazing.

One evening in March, Max brought Dan to dinner with a friend named Jessica Mah. She was a prodigy entrepreneur who had started her first business at thirteen, graduated from high school at fifteen, and at age nineteen created inDinero.com, a thriving bookkeeping, tax-filing, and payroll business for start-ups and small businesses. The Diaspora saga was well-known in the Bay Area; if more than a few of their contemporaries took thinly disguised pleasure in their being brought to earth, Mah was not among them. She knew Max and liked him. And two years down
a path of failures, misfortune, dumb mistakes, self-inflicted injuries, and naïveté, they were sitting in her living room, talking about how they would make it work.

“You should apply to Y Combinator,” Mah told them.

Y Combinator start-ups came to Mountain View for three months, got some money and mentoring, and at the end of the semester presented their ideas at Demo Day, a beauty pageant attended by hundreds of investors.

Mah herself had been through the Y Combinator a few years earlier. And the Diaspora crew knew it well. It was the same program they had begun to apply for two years earlier, back in 2010 when they were still at NYU, but had given up on because the process was too much of a hassle. Max had actually read about it when he was eighteen, seven years earlier, and decided then that it was just what he wanted. At that point, he did not know how to write code and did not have a start-up idea, but he was excited by the possibility of creating a business. He quickly spun up an idea to create a web app for taking notes. He was not accepted.

It was a mark of prestige to spend a few months being mentored and measured by entrepreneurs and VCs. In fact, bringing in companies that were on the verge of collapse was a recently developed specialty of Y Combinator. The most famous of those was Airbnb, started by two young guys in San Francisco who could not meet their rent, and in desperation decided to advertise to attendees at a design conference that they could accommodate a few people on air mattresses. They had discovered a business linking convention visitors with residents who had extra space. They imagined a market for leisure travelers looking for accommodations that were bargains or less antiseptic than hotels. To raise money, they custom-made cereal boxes of the 2008 presidential candidates. For forty dollars, people could buy a box of Obama O's or Cap'n McCain's. This brought in more than thirty thousand dollars. It was enough to keep them going until they got into Y Combinator, where they patched together real money for a successful global business.

Ten minutes into the conversation with Mah, both Dan and Max realized they should apply. It would mark them, once again, as full of promise, not the fools who failed to kill Facebook. If they got into Y Combinator, over the course of the summer they were all but guaranteed
about $175,000, in exchange for shares in the company. With Dennis and Rosanna, they quickly knocked out the application.

The interview was a disaster. In the car on the way down, Dan tweaked the coding for the new photo uploader on their demo pages. It didn't work when they set it up in Mountain View. The new Diaspora couldn't run.

Could they explain the point of the product in a sentence?

Max said he didn't think that was possible.

Dennis chimed in. “We want to help people make things and share them,” he said.

That view resonated with one of the Y Combinator partners, Garry Tan, who was not much older than the Diaspora group and was interested in the evolving social media world. He had been a cofounder of Posterous, a clever blogging platform that had been bought and folded by Twitter.

“This is cool,” Tan said. “You guys are cool.”

None of the other interviewers showed enthusiasm. Certain they had crashed again, the group left Y Combinator and treated themselves to (fully clothed) massages in a strip mall, a twenty-dollar indulgence that was an occasional treat and team-bonding exercise. Right after that, they got an e-mail from Tan, confirming what they already knew: they would not be accepted.

They continued on with their work anyway, realizing that their cash was draining away.

One Sunday afternoon, Dan ran into Dennis in the locker room of a climbing gym. Dennis wanted to know why Y Combinator had turned them down. In his message, Garry Tan had not spoken about their dreadful presentation. The problem, he said, was that their corporate structure was so tangled, it was hard to tell where an investor could fit in, and what shares were available.

“That reason is bullshit,” Dennis said. “You can reallocate the shares. That's not a reason not to fund it.”

“Totally,” Dan said.

“Why don't you write to Garry Tan and tell him that?” Dennis asked.

Dan agreed. Why give up? But Max said it would look like they were making excuses for their poor performance in the interview. Dan was adamant.

“We were hoping you would ask us about that,” he wrote to Tan. “We had that answer. We can totally fix it.”

There was no reply for a few days. Then Tan called.

If you're going to do this, he said, you have to do two things. You have to listen to what we say, and you have to fix the structure.

They had a deal. But they still had to write their own name tags when they arrived for orientation the next day. They had been added to the class so late, no one had had time to print them.

—

Nearly two years to the day that Max and Dan had graduated from college, the morning they had appeared on the home page of the
New York Times
and their Kickstarter campaign had erupted,
Bloomberg Businessweek
published a long profile of the group.

“In about a year, they had successfully built a social network that functioned more or less like Facebook but let people own their data,” Karen Weise wrote. “Without any real marketing, more than 600,000 people used the site, but it was a narrow slice of the population, attracting lots of distrustful techies and Europeans.”

That a journalist was there to praise them, and not bury them, was astounding. By then, any article about Diaspora could have been its obituary. It should have been a chapter, or a page, in the encyclopedia of Silicon Valley failure. Half the original team was gone, with Rafi back in school and Ilya dead. The project shot like a comet through the venture capital wings of Silicon Valley, but flamed out. They had lost a CEO who believed in their mission and had seen to forests of details. It was true that they had long ago kept the promise they had made on Kickstarter: to build a code base and get it out to the open-source community for hacking. Still, as of February 2012, just three months earlier, Dan acknowledged openly that he never used Diaspora outside of work. No one in his non-nerd life did. Max's feelings were complicated, but he himself turned to Facebook for the bulk of his social networking. By all rights, the last days of Diaspora should have come and gone.

Yet out of all the failure, they had come up with wisdom that no one else had. Personal websites “were an outlet for true self expression; they were what the internet was made for,” Dan wrote in an unpublished essay. But, he said, they were not built for feedback, for dialogue, for comments.
They had the charge of human expression, but lacked the voltage of social connections. “Even now,” he wrote, “the personal websites of the Diaspora Core Team are desolate places.

“Loneliness killed the personal website.”

The idea of the new Diaspora was not just data ownership but creative ownership, too. There was no point in making a clone of Facebook that sat atop code gears that happened to be called “open source.” Diaspora might just as well be Facebook if it was going to dictate to people how large their pictures could be, or that all emotional states, all thoughts, had to be captured in identically sized Lucida font, rendered in blue and white: the songs of the world sung in a single visual key.

A page on Diaspora would not be a regulated space that limited what and how the users spoke. Dennis and Dan were rewiring the Diaspora site so that a user with a lot to say could display comments in three columns, like a newspaper; someone with just a few lines would be able to render it in minimalist type. The
Businessweek
writer clearly liked what was happening: it was fresh thinking, a second idea, of creativity flexibility, atop the data ownership and privacy that first drove Diaspora.

“We are giving you both emotional and technical investment in what you are creating,” Max told the reporter.

There was a great, hopeful development,
Businessweek
reported: “If anything can help Diaspora fulfill its ambitions to make a popular product out of its alluring ideals, it's the startup accelerator Y-Combinator.”

It made perfect sense. Except that the first thing that Y Combinator did was virtually shut down Diaspora.

—

At the beginning of June, Max and Dan, Rosanna and Dennis, all moved into a rented house in Sunnyvale. Their first order of business was to outfit the garage as workspace with furniture from Craigslist.

The second order was kicking Diaspora to the curb.

That day, they had their first session with Paul Graham, start-up guru and creator of Y Combinator. Within a few minutes, Diaspora would come to an end, at least as a start-up.

At that meeting, Graham said they should put Diaspora aside, and concentrate on perfecting a set of tools—playthings, really—that they had developed in the days immediately after Ilya's death. At the saucecon
gatherings in Max's apartment, visitors were sharing increasingly foolish texts and tweets; someone hacked together a way of creating GIFs with captions. A natural, organic network of jokes emerged. It was a kind of meme-generating process. The new version of Diaspora had incorporated these tools, but Graham said they ought to be stripped out of it. Then the team could spend the summer perfecting them, and putting them on a web platform where users could test them. Maybe the tools would amount to something on their own.

Graham strongly advised a clean break from Diaspora. They called the new app Makr.Io. The new web page was up on June 4. A press release went out the following day: “Users on Makr.Io can combine photos and text to create funny, unique posts, which they can invite friends to remix. A ‘remix' simply allows users to change the text or photo of another post to change the context and give it their own meaning.”

In an e-mail to me, Max explained: “Trying separate server to see how people like new ideas separate from d* (although code is 100% d*). Paul Graham's orders.”

It was the start of another excruciating summer.

—

By the end of the month, there were quarrels over what they should be doing, and Dennis, the newcomer, was caught between Max and Dan. On the evening of one especially stressful day, he dug up a camouflage-patterned skirt that he had brought to Sunnyvale. It was a relic from the early days of the gay liberation movement, when someone had the notion that by feminizing war making, wars would come to an end. Dennis put it on and went for a walk in the evening air with Rosanna. They had not gotten very far when a car rolled alongside and a guy inside rolled down the window.

“Whores!” he screamed at them. The drive-by vitriol had nothing to do with the work, of course, but added a toxic splash to what was already a dreary experience. During their next meeting at Y Combinator, Garry Tan suggested that Dennis would be happier leaving. The team had only about six weeks to get ready for the Demo Day. Dennis agreed.

His departure solved nothing. The meme-generating project was inherently ridiculous, with vague ideas that groups of people would get
together online to simultaneously pass around the remixed memes. Dan was miserable.

“Stuck in a house in the suburbs where the weather never changed, constantly around the same people, without a car,” he said.

“Add the fact that we kicked Diaspora to the curb and were working on something that I thought was so dumb, I couldn't see a jail cell being any much worse.”

Max soldiered on. Y Combinator was premised on relatively small bets spread around a bunch of start-ups. If only one from each batch succeeded, the funders would do well. Dropbox, for instance, had been a Y Combinator company.
By the spring of 2012, companies that Y Combinator had nurtured during its first seven years were worth $7.8 billion in value. It had, to that point, no involvement with not-for-profit projects, no experience nurturing or sustaining them. (The fund supported its first nonprofit in January 2013, helping a site called Watsi, billed as a Kickstarter for medical care.)

Diaspora had no business being at Y Combinator because it had no business. And if it had prospects of a business—like the hosting services—it was hard to see them generating the explosive returns that drove the hedged bets being made. “Start-ups are an algorithm for solving problems,” Max said. Though not the only algorithm, and not for all problems.

Makr.Io was a thin notion that would have been invisible had it not been attached to Diaspora. By August, it was clear that the team could not present Makr.Io at the Demo Day beauty pageant.

—