Monkey-read, monkey-do entrepreneurship(ambershah.com) |
Monkey-read, monkey-do entrepreneurship(ambershah.com) |
Regarding the post she's replying to, she didn't provide any evidence that she's succeeded while ignoring the advice of experts.
Her one example (which was 75% of her post) would be more convincing if it didn't seem like she was rationalizing her preexisting view point. She also describes that she has someone who is co-founder in all but name, which weakens the argument further.
I have to admit that I'm uncomfortable with how much of PG's advice I agree with. There are probably a lot of little things I disagree with, but I can't think of any big ones. Between the previous thread and this submission I was hoping to have at least a few nuggets of disagreement to hold on to. Unfortunately that's not the case.
I also agree with PG more than I agree with most people. The dude is smart and I'm happy to learn from him. It's the premise that I shouldn't sway from his advice that I was rejecting.
My experience doesn't qualify as success yet but more as 'so far ao good' but there are plenty of single founders who are so that condition is already satisfied.
It might not be what YC is after but I don't think it they'd consider it a failure either. Am I wrong?
The best illustration of the distinction between no plans to exit and no exit occurring is 37signals. Jeff Bezos's investment in them is a sign that he believes there will eventually be an exit. As far as I know he didn't insist on them paying him dividends; that would have been very unusual; so without an exit there would be no way for him to get his capital back.
We too would have bet on 37signals, because it's hard for technology companies to stay medium-sized. They either peter out, in which case exits are a moot point, or they grow so large that they either go public or eventually receive an acquisition offer the founders are willing to take.
edit: this seems to me like she's confused. YC's preferences on companies that they would like to invest their time and money in doesn't necessarily equal "the best way" for all entrepreneurs under all situations and circumstances.
That is certainly true. We would never claim otherwise. YC invests in startups, and only a tiny fraction of the millions of small companies in the US are startups. Nearly all are service businesses whose prospects for growth are minimal.
Startup founders are a very small subset of entrepreneurs.
It's "This is the way to do business."
That's the issue.
There are a few lessons that I have taken from browsing HackerNews over the last year. Two of them come to mind.
The first is that it is not simple to do everything involved in creating a startup. Even if you know what you are doing. There are factors to hinder great products and great people, from reaching the consumer.
The second is that there is no shortage of great ideas for startups. The real bottle neck seems to be the execution of great ideas.
If you are capable of doing it by yourself, but you take on a partner, you do lose out financially or you could create complications. But no one ever said it had to be your last startup. You can always take on of the great new ideas and branch out again.
Even if it is a disaster, you will discover that you can do it alone.
Or the other scenario, you discover that you work well together. Now, you have have too much brain power, time, energy and money. These resources are incredibly useful at expanding your startup, starting a second, or just making life easier.
I like her cynicism about everything she reads. That is just a normal part of rationality. Even if it is aimed against the mighty Paul Graham. However, I have to disagree with her assertions. I believe teams are greater than the sum of their parts, even if team member can do all work alone.
I have notice that people repeat exactly what pg says and nothing else. I don't have a problem with repeating, but I think they also need to add to what he says.
I kind of carry around a formula: 95% copy and 5% innovation. Innovation should be low because it reflects taking a risk that by simply copying would mitigate. But, Innovation should never be zero as you effectively don't add anything to the community and become less competitive.
Currently, pg might have a set of belief that he has found empirically to be true. But if you consider the search for the optimal set of rules for forming a start-up, I think pg might have reach a local maximum and it is necessary for start-ups both in YC and out to search this space that defer from pg current views, so a new higher local maximum can be achieve for the entire community.(Think Particle Swarm Optimization)
Anyway, the terms they offer don't give them any way to demand anything. They are a common shareholder in the company with 2%-10% of the shares and no seats on the board. They can't steer the boat, they're merely passengers. So, it makes sense for them to choose companies that the most obvious outcome is one that will be profitable for them.
EDIT: Updated for clarity.
It looks like the definition a lot of people use is one that includes your startup as a subset.
I find it so frustrating reading through threads like this that get all bogged down in semantic nitpicking. It also opens a door to a particularly annoying type of quasi-trolling or baiting. Maybe 'startups that exit' or something
Or perhaps better phrased, do you see dividends playing a role in angel/YC-like investment decisions anytime in the nearish-term?
If people interpret what I say more broadly than I mean, there's not much I can do about that, but if you go back and look at the actual words I use, I could not be more explicit.
I wish you'd be either less contentious or less mistaken. It would be fine if you were one or the other, but having to deal with both simultaneously gets kind of wearing after a while.
In standard usage, a startup does not mean any newly created company. It means a newly created company designed to scale dramatically. Most of the 20 million businesses in the US are not startups, because they aren't designed to scale. They're either service businesses or niche product businesses.
This is a two way street, since investors have an incentive to push for swinging for the fences even when a bunt would be life changing for the founders. Consider a two man team who hits a million in sales, but seems to stall out (say, ran out of channel, but has good ongoing relationships with customers). Pivot and risk company to hit ten million, which would justify exit, or continue executing and make two families rich with little risk? Not hard to see dynamic.