A to Z: Alphabet and Zirtual

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

A to Z: Alphabet and Zirtual

Google re-organized yesterday. Without a rumor about it escaping beforehand. (It shocked even Fred Wilson.) So the re-org puts Sergie and Larry in charge of Alphabet, the new holding company that now owns Google and all of the other stuff. Health, Labs, investments come out from under Google and full under Alphabet.


For investors, they get to see a transparent view of Google versus the rest going forward. For the co-founders, I think they get to stop worrying about Google and go do other things, the other things that Google funds. They have been running Google since 1998 and probably thought after hiring Eric Schmidt in 2001 and the IPO in 2004, they could have stepped back, Now they can about 2 feet. Good luck!

Meanwhile, a lot of noise (in my social feed) around the abrupt closing of Zirtual, a virtual assistant service. The 400 employees were emailed this morning about the company pausing-- as were the customers. It seems that they had $1M per month burn rate and revenues running from $8M to $11M -- the math doesn't work.

Snarky comments I have seen: (1) foreign labor is cheaper. Well, I haven't seen any complaints about the pricing or the work product for the VA's. There are other company's out there, including RedButler. So the model can work.

(2) It can't be done in California. Well, it wasn't. Zirtual was a Vegas startup.

They had US-based employees instead of contractors. They grew really fast.

I feel sorry for Zirtual CEO Maren Kate Donovan, because she was in the media leading up to this and now they are going to pick her to death.

You know what? Startups fail. SunRocket, anyone?

You know how many CLECs failed or went bankrupt? LightSquared, PSINet, NetRail, Birch, MCI, Norvergence and Adelphia to name just a few.

Growth is a challenge to manage, especially the cash flow side of growth. Because growth means hiring and hiring means CAPEX for office space, furniture, laptops, cell phones, etc. Who knows what happened? Certainly not investor Jason Calacanis. An autopsy would be beneficial to other startups I am sure.

On the one hand, one of the largest tech companies re-orgs without a peep -- a big re-organization actually, while a startup closes without a tweet.

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