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July 16, 2007

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Jane

Henry,

I know the Backfence founders pretty well--and I'd pin the pathology of their demise on a common start-up disease: the inability to listen to outside advice. In other words, chalk this one up to management weakness rather than a lack of market opportunity. (I'm posting this message not for vindictive reasons, but rather to help them take stock and do better the next time). In Susan's (one of the co-founders) previous venture that involved creating a woman focused community site, she ignored the advice to to follow the hipper/more upbeat/fun tonality of Oxygen and iVillage, and instead stuck with her serious WomensConnectOnline.com site that was clunky, boring, and far too narrow. Somehow she was smarter than all of the people that were trying to help her, while her company was losing the investor's money. With Backfence she and her partner continued the pattern, not realizing that start-ups need to learn and adjust, and often the best ideas originate from outside the company's walls.

The best entrepreneurs are synthesizers of the idea pool that's available them. Unfortunately Backfence's tombstone reads "They Didn't Listen".

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