June 20, 2011
Color's photo-sharing app, a bubble in start-up investing
In March, Color unveiled its photo-sharing cellphone app — and revealed that it had raised $41 million from investors before the app had a single user. Despite the company’s riches, the app landed with a thud, attracting few users and many complaints from those who did try it. The New York Times reports.
Color spent $350,000 to buy the Web address color.com, and an additional $75,000 to buy colour.com. It rents a cavernous office in downtown Palo Alto, where 38 employees work in a space with room for 160, amid beanbag chairs, tents for napping and a hand-built half-pipe skateboard ramp.
Since then, Color has become a warning sign for investors, entrepreneurs and analysts who fear there is a bubble in start-up investing.
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