11–20 of 161 posts
The startups who turn down acquisition offer do better thing might have a bit of reporting bias. ie. the ones that fail, we never think about. Except of course, there was a big famous example -- Friendster. http://www.nytimes.com/2006/10/15/business/yourmoney/15frien...
Perhaps an enterprising Angel Group can try to package or commoditize the process of making Angel-sized (six figure) investments. I'm not sure the term "Angel Group" would still apply after adopting this model, but Angel Groups seem well-positioned to evolve into this new "new venture animal."
Traditional angel groups have so far been a complete disappointment. They're more conservative than VCs. But I would not be surprised if a new form of angel group starts to emerge. There are a couple syndicates of ex-Googlers that look very promising. They have lots of money, and they were all smart enough to get hired as early employees at Google.
> The reason there aren't more Googles is not that investors encourage innovative startups to sell out, but that they won't even fund them. This goes for YC as well. Surely there are some technically innovative applicants that don't fit the mould of web sites to make quizzes or 10-second cartoons or other such dubious acceptees. Google itself would have been rejected on at least a couple of grounds: project being too…
pg, can I ask for examples ? I am genuinely curious.
This is a very true statement. The danger that I've seen is so often people think, "My idea seems bad to most people, ergo it must be good!"
How do you separate the seemingly bad from the actual bad? Figure _that_ out, and you'll make something of yourself.
1. Every logical mind (even within Google) in 1999 would have seen that Google was heading for failure - there was no money in search. They got lucky in finding one -adwords - that worked. 2. Had the timing of their discovery been off, or had the dot-com bubble busted a few months earlier, they would have died.
In saying that, they are useless as a measure of anything because they are such an anomaly that they shouldn't be used as a guidepost to success. In other words: If you were to operate the way Google did today, 99 times out of 100 you would fail. They are the exception to the rule.
Although, PG's comparison to Facebook is apt, as they're also in the same position as Google was. I'll put my money on them being in the majority though.
I did like Paul's point about VC's, but then again, you could extend that to how pretty much any industry operates. That's why innovation is so profitable, after all.
> The reason there aren't more Googles is not that investors encourage innovative startups to sell out, but that they won't even fund them. This goes for YC as well. Surely there are some technically innovative applicants that don't fit the mould of web sites to make quizzes or 10-second cartoons or other such dubious acceptees. Google itself would have been rejected on at least a couple of grounds: project being too…
You're wrong. We care mostly about the founders. And we have funded projects so ambitious that they've taken 2 years to build.
All your non-defunct fundees are still "building", but that's not the same as accepting groups you know are going to take two years and a lot more funding right at the outset.
As for caring about the founders/investing in people instead of ideas, that doesn't hold up for several reasons: 1) If you really end up changing the idea so often anyway, as often claimed, the idea proposed wouldn't be grounds for rejection if the founders were otherwise good; 2) Many founders don't have track records, thus you have nothing to judge them on; 3) Some applicants do have track records, but you reject them without reviewing the stuff they've done due to lack of time or other reasons.
I think I see that because I assume that PG is not being hypocritical; ie. VC's should make bold investments -> YCombinator must already be making bold investments.
I am not under the impression that this message is intentional, it just seems that the argument flows to that point.
Earlier quoted context omitted.
You're wrong. We care mostly about the founders. And we have funded projects so ambitious that they've taken 2 years to build.
From your previous letter: "We rejected a lot of proposals [...] because the project seemed too big to start on only three months of funding." All your non-defunct fundees are still "building", but that's not the same as accepting groups you know are going to take two years and a lot more funding right at the outset. As for caring about the founders/investing in people instead of ideas, that doesn't hold up for sever…
And by building, I meant two years to launch. There's a startup we funded two years ago that's launching in late spring or early summer.
"the kind of founders who have the balls to turn down a big offer also tend to be very successful" Or they tend to fail spectacularly. The more risk you are willing to take the more you will tend to go towards the extremes: One extreme is huge succes, the other is bankruptcy.
P(COMPANY TURNED DOWN BUYOUT OFFER(S) | COMPANY BECOMES LARGE SUCCESS) = 1.
But the reverse wouldn't be as good a predictor as PG feels.