The color of money

The launch yesterday of a new photo sharing app yesterday called Color has garnered quite a bit of attention, not so much for the app itself but for the staggering sum of $41 million invested by venture capital firms prior to the product's launch.

The most intriguing part of the story thus far, we believe, was contributed by Matthew Ingram's blog entry on GigaOm this morning in which he posited the following radical explanation for the out sized investment:

"Is this new app really as revolutionary as that implies? Maybe. But what’s more likely is that the VCs involved are betting the team behind Color will come up with something worthwhile for that $41 million, and they don’t particularly care what it is."

Think about that: the team is more important than the product idea.

We couldn't agree more.

To get a group of people with complementary talents together, with a lot of drive and self confidence. and persuade them to leave their personal egos at the door  -- that's a challenge.  If you succeed in doing that, there is a high probability that the team will do something great, even if it takes a lot of failure to get there.

Having said that, $41 million can fund a lot of failure. A hungry team, on the other hand, operating with limited resources, tends to be more focused in its thinking.