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This sounds cruel, but Everpix was effectively operating as a Ponzi scheme. They offered services (photo storage) that they couldn't afford unless new money came in. Then the money stopped.

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Actually, Everpix was making around $40K / month from subscription revenue covering the infrastructure costs for both free and paid users with some margin. The problem is (obviously) having enough to cover fixed costs as well i.e. mostly personnel costs.

Shouldn't that be factored into the cost structure? What does it matter that the margin on the storage costs was cash flow positive?

The personnel costs of a 7 person startup really jumped out at me. Am I the only one that was surprised?

No, I thought the personnel costs / salaries was bonkers too.

EDIT: I read some of the comments on the Verge's page and it seems that the salaries were over a few years, and apparently that isn't bonkers money! I must be out of touch.

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