Starredreviews prediction of Solvate Comes True
On June 6, 2011 starredreviews had predicted failure of Solvate – a company which had raised $6.3 million venture funding from DFJ Gotham Venture and RRE Ventures. Less than 9 months into prediction – Solvate packed it bags bringing huge losses to its investors. Had Gotham Ventures and RRE Ventures listened to starredreviews, they could have saved or diverted the investment amount elsewhere.
The problem with Solvate was that – it was venturing to connect two asymmetrical demand groups. While the workers are available in abundance in the down economy, the employers looking for workers in is minority. There is very rare demand of workers and if they choose a freelancer, it is because of the cost advantage – in which case sites like freelancer.com or elance.com are working better.