Monday, September 11, 2017

The downside of writing up demo days



Tech writers are invited to a lot of demo days, as you might imagine. Sometimes, these presentations are very long, with many startup teams taking the stage to pitch to investors and the media. Sometimes, they’re shorter, featuring a more concentrated group of founders. But always, the pitches are concise. In fact, most incubators or accelerators take their cue from one of the original incubators, Y Combinator, which gives each of its startups less than three minutes to dazzle the crowd.


As a result, what makes it into TechCrunch (and other outlets) on the heels of these demonstrations are very much first impressions of companies —  vague outlines of what’s interesting about them. Perhaps naturally, too, these first impressions are often appropriated by the companies themselves and turned into endorsements to gain traction with early customers.


Such is the case with Vacayo, a startup that recently passed through the 500 Startups accelerator program and which last month presented to a crowd at the Computer History Museum in San Jose, Ca., alongside 28 other startups.


On the heels of the event, we included Vacayo in our coverage of the event, explaining its proposal to become a kind of property manager to homeowners who have extra space (or extra homes) their hands, property that the startup says it can furnish and find tenants to fill.


Vacayo has since used that coverage, including linking to it on Facebook, to solicit customers.


The problem, as reported in a recent CNBC story, is that Vacayo is being highly deceptive in how it’s landing some those listings. For example, Vacayo founders Isabel Berney and Truth Oladapo rented the Miami Beach home of Bay Area entrepreneur and investor Drew Grewal, then listed the home on Airbnb without his permission.


Because of strict regulations around short-term rentals in Miami, Grewal was subsequently fined tens of thousands of dollars. After evicting the pair, Grewal tells CNBC he saw some of his furniture featured in two other Miami Beach Airbnb listings. Oladapo told CNBC that Grewal asked him to take the furniture.


Another Miami Beach property owner, Rula Giosmas, told CNBC she similarly had Airbnb-related problems at two of her four properties. She said in one case, she’d been led to believe she was renting the property to a couple from New York who have a child. The tenants, she discovered, were Oladapo and Berney. Giosmas now plans to sell the property, which she says was turned into a “flop house,” and which has also attracted fines to the tune of $20,000.


Neither Isabel nor Truth Oladapo responded to requests for more information from TechCrunch earlier this week.


500 Startups declined to comment.


Maybe in an age where founders are encouraged to stretch the truth, to fake it till they make it, and to be resourceful above all else, Oladapo and Berney rationlized their approach to securing properties as unremarkable. Maybe they reasoned that as long as they were building up a client base, it wasn’t so wrong, despite the painful financial consequences their actions created for the property owners.


We disagree. In fact, we’re writing this post now because we don’t want potential customers to see our coverage in Vacayo’s marketing materials and interpret it as a kind of seal of approval. It is not. We do not know the company. We in no way sanction its reported approach. In fact, we found CNBC’s report fairly disturbing.


The truth is that we can’t really know any team that presents at a demo day. We presume that readers understand the point of these pieces: that we’re trying to bring you with us to presentations you might otherwise miss.


We continue to think these wrap-ups are useful, too. “It’s difficult to validate the claims a startup makes in a brief two or three minute pitch,” says TechCrunch writer John Mannes, the colleague who wrote about Vacayo. But “as long as we can keep everyone on the same page that we’re evaluating the pitches of mostly pre-seed startups, there’s still value in highlighting standouts.”


In the meantime, for anyone who might construe our cursory interest in a team or a technology at one of these events as anything more than that, we apologize for the confusion.


Featured Image: Gary John Norman/Getty Images

Share with short URL:

GET 25$ WITH MASTERCARD

Total Pageviews

Popular Posts