Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Dear Startups: Here’s How to Stay Alive

heidiroizen.tumblr.com

Post reply on HN
Print view View original

81–90 of 200 posts

Re: Dear Startups: Here’s How to Stay Alive

#81

Post by guessbest »

lowglow wrote: post #63
dsugarman wrote: post #57

> If you are in Silicon Valley and your customers are mostly well-paid consumers with no free time, or other venture-backed startups, well, I’d be worried. That's the most beautifully I've heard this thought articulated. I constantly hear people in SV talk publically talk about how they're living years in the future due to getting services from startups that haven't yet hit other markets. These people are very wealth…

I've called these the 10% startups. They typically only serve people in the top ~10% of earners in the US.

It is like fishing. When you are fishing for smaller fish, people wonder if they have a shoe on the end of the line. Nobody ever questions the whale.

Re: Dear Startups: Here’s How to Stay Alive

#82

Post by mineshaftgap »

AndrewKemendo wrote: post #65
lowglow wrote: post #63

Earlier quoted context omitted.

I've called these the 10% startups. They typically only serve people in the top ~10% of earners in the US.

So basically any startup with an iOS only product (disclaimer our's is iOS only).

There are very good reasons besides demographics to start with iOS. Stability, consistency, lack of piracy etc.

Re: Dear Startups: Here’s How to Stay Alive

#83

Post by arihant »

>If you are in Silicon Valley and your customers are mostly well-paid consumers with no free time, or other venture-backed startups, well, I’d be worried.

This is the most shallow statement I have read this year. The needs of the rich today would be needs of less rich tomorrow. The author clearly missed out on the whole American dream concept. I'm sure some people felt the same way about refrigerator and cars.

You'd almost never create a market segment starting with the bottom end. Almost every product you touch, including the very screen you're staring at, was once made for the 1%.

And almost always the version for the 1% is expensive, won't see a version 2, and is a one time sale. It doesn't matter if your initial rich/busy customers are going out of business. If you found a need you're fulfilling, you will with a fairly high probability will continue to find customers through the generation.

Dot com bust did not kill Network Solutions/Verisign. Very, very important.

Re: Dear Startups: Here’s How to Stay Alive

#84

Post by nostrademons »

aledalgrande wrote: post #78

This is based on the "Techcrunch" concept that being successful and continuing business for a startup depends heavily on external funds. That couldn't be farther from the truth, for a real startup with a real business. Maybe growth will not be as fast without VC funds, but I don't think real businesses will notice shrinking investments. Correct me if I'm wrong.

They won't. They might notice shrinking revenues if some of their customers were VC-funded startups or other people in that ecosystem, but the decline of funding is at worst irrelevant and at best good for them. (Less funding means less competition.)

But then, since it's irrelevant, bootstrappers have little incentive to comment here, other than a few folks for whom HN has become a habit. From where I sit the bootstrap startup world is actually significantly larger than the VC world, but the incentives are different: it is not to a bootstrapper's advantage to publish what they're doing to people other than their customers.

Re: Dear Startups: Here’s How to Stay Alive

#85

Post by glomph »

dsugarman wrote: post #57

> If you are in Silicon Valley and your customers are mostly well-paid consumers with no free time, or other venture-backed startups, well, I’d be worried. That's the most beautifully I've heard this thought articulated. I constantly hear people in SV talk publically talk about how they're living years in the future due to getting services from startups that haven't yet hit other markets. These people are very wealth…

What do you mean by jump the shark there? Jumping the shark is normally a bad thing. It is a sign of the beginning of the end for a TV show or franchise.

Re: Dear Startups: Here’s How to Stay Alive

#86

Post by CamatHN »

aledalgrande wrote: post #78

This is based on the "Techcrunch" concept that being successful and continuing business for a startup depends heavily on external funds. That couldn't be farther from the truth, for a real startup with a real business. Maybe growth will not be as fast without VC funds, but I don't think real businesses will notice shrinking investments. Correct me if I'm wrong.

Usually startups, defined roughly as young companies with extremely high growth creating something new, to start off with are running at a negative cash flow to sustain their growth or development and plan to capitalise on the position later.

These companies would struggle to operate with positive cashflows as their products/services and growth hasn't matured to allow for it yet. Perhaps they are building their product and/or are still in the early stages of iterating on their idea. Just because they have a decent business doesn't mean straight away they can consolidate right away on their business in terms of running a profit.

A lot of decent future businesses could die if startups are forced to consolidate. However in instances this may be a wake up call to keep them accountable to the financials of their business.

Re: Dear Startups: Here’s How to Stay Alive

#87

Post by [deleted] »

Ftuuky wrote: post #20

What? One of the advice is to get cash flow positive with the money you already have. Isn't that basic knowledge? You can't spend more than you have and you only ask for other people's money when you don't need it. Idk, maybe this is an american thing, with all the capital you have but here (Portugal) you can't get series A funding without being at least cash flow positive, no way.

[deleted]

Re: Dear Startups: Here’s How to Stay Alive

#88

Post by dhaivatpandya »

Ftuuky wrote: post #20

What? One of the advice is to get cash flow positive with the money you already have. Isn't that basic knowledge? You can't spend more than you have and you only ask for other people's money when you don't need it. Idk, maybe this is an american thing, with all the capital you have but here (Portugal) you can't get series A funding without being at least cash flow positive, no way.

There's no inherent reason why being cash flow positive is such an important consideration for a venture capital firm.

A startup that's not cash flow positive right now but could be massively so in the future (or, atleast, the market expects it to be massively cash flow positive in the future) is significantly more valuable than a startup that is cash flow positive right now but with not a ton of room for growth.

In fact, placing the requirement of cash flow positivity right at the beginning of the startup would probably squash a lot of good (i.e. valuable in the long-er term) ideas.

Re: Dear Startups: Here’s How to Stay Alive

#89

Post by [deleted] »

ChuckMcM wrote: post #73
dsugarman wrote: post #57

> If you are in Silicon Valley and your customers are mostly well-paid consumers with no free time, or other venture-backed startups, well, I’d be worried. That's the most beautifully I've heard this thought articulated. I constantly hear people in SV talk publically talk about how they're living years in the future due to getting services from startups that haven't yet hit other markets. These people are very wealth…

I agree with that, but I also have the experience of visiting my sister in 1995 and asking her if she understood the funny string at the bottom of a Toyota commercial that was a URL. She did not. And her only email address was one she had for work, because everyone else either wrote letters or talked with her on the phone. The point I'm trying to make is that many things of the current wave will pass into obscurity a…

[deleted]

Re: Dear Startups: Here’s How to Stay Alive

#90

Post by zepto »

AndrewKemendo wrote: post #65
lowglow wrote: post #63

Earlier quoted context omitted.

I've called these the 10% startups. They typically only serve people in the top ~10% of earners in the US.

So basically any startup with an iOS only product (disclaimer our's is iOS only).

Given that iOS has a 40%+ market share in the US, no.
Post reply on HN