Is Color's Team Worth $41 Million, Even If Its Idea Isn't?

The launch on Wednesday of a new mobile app called Color has sparked a lot of buzz—not so much because of the app itself, but because of the massive sum of money the company raised before the app was even launched.A group of funds, including Sequoia Capital, gave the company $41 million, and Sequoia's chunk (as Color proudly noted) is more than the fund invested in Google. Is this new app really as revolutionary as that implies? Maybe. But what's more likely is that the venture capitalists 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.

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