Just yesterday, Karhoo announced the closure of its services as it looks “at the next steps for business”.

Just a quick FYI, Karhoo raised an amazing $250M in funding. There’s 2 key takeaways every founder can learn from:

Don’t Burn Your Cash – Karhoo burned through $250M in 1 year. Make sure to have a solid financial advisors on your team as there’s absolutely no reason to burn through all your cash so quickly. Whether you’re working with $100k or $250M, stay nimble and prepare to have cash on hand. Don’t plan on spending more than 50% of your cash reserves unless you have enough cash coming in.

Don’t Be A Copycat – Karhoo came into the market as an Uber copy-cat. They were taking 10% fees from drivers, where Uber takes 20-25%. They made the same critical error many founders make: trying to beat the competition by severely undercutting the competition. Instead of coming out with a copy-cat product that’s cheaper than competitors, focus your efforts on an unserved niche and build from there.

 

About the Author: Ali Taghikhani is Co-Founder of Synapse International. As a growth catalyst, Synapse assists startups with recruitment (full-time + contract) and project-based development services. Get in touch today for a free consultation – ali@synapseint.com