Reflecting on My Failure to Build a Billion-Dollar Company • Hacker News Board

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#231

Post by rdiddly » Thu, Feb 07, 2019, 9:50 PM UTC

ilamont wrote: post #196

I was basically alone. I didn’t have a team, nor an office. And San Francisco was full of startups raising gobs more money, building amazing teams, and shipping great products. Some of my friends became billionaires. Meanwhile, I had to run a “measly” lifestyle business. It wasn’t what I wanted to do, but I had to keep the ship from sinking. There's that term again, "lifestyle business." Uttered like a dirty word, wh…

Isn't it just a VC term that has snuck into the vernacular? As builders and creators of value, we do ourselves a disservice by using the same language as that used by those who only deploy value - or more accurately who rent it out opportunistically - and have different values and priorities.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#232

Post by Swizec » Thu, Feb 07, 2019, 9:51 PM UTC

ilamont wrote: post #196

I was basically alone. I didn’t have a team, nor an office. And San Francisco was full of startups raising gobs more money, building amazing teams, and shipping great products. Some of my friends became billionaires. Meanwhile, I had to run a “measly” lifestyle business. It wasn’t what I wanted to do, but I had to keep the ship from sinking. There's that term again, "lifestyle business." Uttered like a dirty word, wh…

I also use Gumroad and also used to think lifestyle business is bad.

But really it just means “business that supports a lifestyle”. Which a “startup” does not.

In that light, startup is the bad word when you think about it. What, you run a business that can’t even support your lifestyle? LooooooL

And yes if I’ve learned anything about silicon valkey in the past 4 years of living here is that people are elitist as fuck, hate their lives, and grab onto any little thing to make themselves feel better than others. It’s what they need to endure the grind and that’s okay. I get it.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#233

Post by anongraddebt » Thu, Feb 07, 2019, 9:55 PM UTC

ilamont wrote: post #210

Justsignedup wrote: post #201

Earlier quoted context omitted.

"lifestyle business" is really just a small business that works, is self-sustaining, and not overly bloated to attempt to make obscene amounts of $$$. I feel like this is exactly what most companies should strive for. They'll make better decisions that way.

Most businesses should strive to be self-sustaining. And if they make obscene amounts of money, all the power to them. What I dislike is A) the view from startup land that there are only two types of new businesses, "startups" and everything else ("lifestyle") B) and the "everything else" category is somehow inferior or even some sort of hobby or vanity project. Sahil used the term to describe his own company, and at…

I agree about the unjustifiable dichotomy much of the tech scene holds between "startups" and everything else (as you describe it).

I think it's funny, though, that non-tech industry leaders critiqued Bezos in the past for running a 'lifestyle business' when in fact Amazon was always a technology company and has become dominant and successful to boot.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#234

Post by adventured » Thu, Feb 07, 2019, 9:55 PM UTC

rement wrote: post #169

phkahler wrote: post #155

I struggle to see how this story is one of failure. A kid launched a business that is still going 8 years later. He learned that VC funding is a double edged sword and was able to shed some of that burden - buying them out for $1. In the beginning he speaks of building this thing and having it be his lifes work - which it may well be if he keeps going. And yet there was all this talk of being a billion dollar company…

He "failed" to build a billion dollar company.

The most interesting thing about the setup premise, is that it should have a "yet" attached to it somewhere.

Unless something terrible has happened in the last few months, their recent November 2018 numbers indicate that at a continued reasonable rate of growth over another decade, they'll have a sizable business and a large number of creators utilizing it (which is one of his goals). It would be worth at least a hundred million dollars. If the growth spikes upward even a bit on average (maybe they garner more interest with scale or the market expands faster), it could get them to between a $500m and $1b valuation a decade out. Modest compounded growth with even a small kicker, from where they're already at, will produce a big outcome over time. So he'd be a sub 40 year old with an extremely valuable company and a lot of people that use what he created (and which I assume he owns a large part of at this juncture).

Given time and their history of slow but steady growth, Gum is more likely than not to produce a homerun. The continued growth over many years is a stellar signal that they're already winning as a business. You can get there slow or fast. The VCs want it fast, Sahil can afford to take his time, he's still quite young and Gum is his.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#235

Post by ricardobeat » Thu, Feb 07, 2019, 9:56 PM UTC

nabnob wrote: post #145

crispyporkbites wrote: post #117

Earlier quoted context omitted.

If gumroad became a billion dollar company you'd be retiring on that 9 months of work with even a tiny bit of equity. I bet there are plenty of people that bailed out of google, facebook or other similarly positioned startups at that stage and regret it.

This is the type of reasoning that startups use to justify making employees work 60+ hour weeks for a tiny amount of equity and below-market pay. Most startups will not become billion dollar companies.

You are both right.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#236

Post by trhway » Thu, Feb 07, 2019, 9:58 PM UTC

Justsignedup wrote: post #201

ilamont wrote: post #196

I was basically alone. I didn’t have a team, nor an office. And San Francisco was full of startups raising gobs more money, building amazing teams, and shipping great products. Some of my friends became billionaires. Meanwhile, I had to run a “measly” lifestyle business. It wasn’t what I wanted to do, but I had to keep the ship from sinking. There's that term again, "lifestyle business." Uttered like a dirty word, wh…

"lifestyle business" is really just a small business that works, is self-sustaining, and not overly bloated to attempt to make obscene amounts of $$$. I feel like this is exactly what most companies should strive for. They'll make better decisions that way.

>"lifestyle business" is really just a small business that works, is self-sustaining, and not overly bloated to attempt to make obscene amounts of $$$.

I guess it sounds too bourgeois for the young (and not so) SV rebels who are in to change the world and make some billions along the way.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#237

Post by lordnacho » Thu, Feb 07, 2019, 9:58 PM UTC

Why would KPCB sell back their stake for $1? Why not just hang on to the stock just in case it turned around? The explanation that they didn't want the overhead of appointing a board member sounds strange. If you don't like the company, send a junior person who can learn board membering in an unimportant firm.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#238

Post by mikeg8 » Thu, Feb 07, 2019, 10:02 PM UTC

michaelbuckbee wrote: post #214

ilamont wrote: post #196

I was basically alone. I didn’t have a team, nor an office. And San Francisco was full of startups raising gobs more money, building amazing teams, and shipping great products. Some of my friends became billionaires. Meanwhile, I had to run a “measly” lifestyle business. It wasn’t what I wanted to do, but I had to keep the ship from sinking. There's that term again, "lifestyle business." Uttered like a dirty word, wh…

I like and use the term "Bootstrapped Business" -> smaller, tight focus on profitability, trying to meet real needs.

I agree and use it sometimes too but hearing "bootstrapped" applied to companies outside of tech doesn't feel right. Example: my dad owns a 20 person small business selling commercial doors and hardware - we are in the construction industry. Saying he has "bootstrapped the business" still feels weird.

That's when good old "small business" should be sufficient enough IMO. It has a stigma but it shouldn't.

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#239

Post by [deleted] » Thu, Feb 07, 2019, 10:04 PM UTC

lordnacho wrote: post #237

Why would KPCB sell back their stake for $1? Why not just hang on to the stock just in case it turned around? The explanation that they didn't want the overhead of appointing a board member sounds strange. If you don't like the company, send a junior person who can learn board membering in an unimportant firm.

[deleted]

Re: Reflecting on My Failure to Build a Billion-Dollar Company

#240

Post by beatpanda » Thu, Feb 07, 2019, 10:04 PM UTC

David Heinemeier Hansson gave this speech at one of the early YC startup schools and he's still right about everything. This feels like such an impossible relic now that YC is firmly part of the grow-like-cancer VC universe. How things change.

https://www.youtube.com/watch?v=0CDXJ6bMkMY