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Hard Startups

blog.samaltman.com

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Re: Hard Startups

#181

Post by scottlocklin »

pjdemers wrote: post #7

The problem with startups building hard tech is it takes a long time to fail. Failures that take decades doesn't work in the startup model. Image working on a fusion reactor. It might take 25 years to fail. The failure may not be that your idea doesn't work, but because some other kind of reactor comes along that is a better business (ie, cheaper). At this point, you are now a world class expert at a technology that…

> The problem with startups building hard tech is it takes a long time to fail

No, not really: you know pretty much from the outset if a venture will fail because nobody knows how to do it. Altman has staked his career on an idea that is guaranteed to fail, for example. There is no step-1 towards a definable goal. Not even sure there is a real goal!

There is no example of a "hard startup" like this in the history of the human race. Only silly con valley hubris could imagine a different outcome than total failure. This sort of thing is what governments are for.

Re: Hard Startups

#182

Post by adenverd »

travisl12 wrote: post #168

> An easy startup is a headwind; a hard startup is a tailwind... Is that backwards? Wouldn't a tail wind represent "easier"?

Not backwards. The point he's making is that hard problems attract talent and capital, which makes them easier to keep going.

Re: Hard Startups

#183

Post by pnako »

1996 wrote: post #156
marcosdumay wrote: post #153

Earlier quoted context omitted.

> It helps pretend government research and alliances always produce the best outcomes. Well, at least on this case government research did produce the best outcome. By far. So far no comparison even makes sense, and people don't even remember there were other attempts.

So you mean, when something fit their narrative (here: government research is better) people forget about other attempts? And counter examples in similar domains (here: wifi) are also dismissed? Color me impressed!

Wifi is not a counter example. The underlying technology was invented at CSIRO, the Australian government research agency.

Re: Hard Startups

#184

Post by yummypaint »

pjdemers wrote: post #7

The problem with startups building hard tech is it takes a long time to fail. Failures that take decades doesn't work in the startup model. Image working on a fusion reactor. It might take 25 years to fail. The failure may not be that your idea doesn't work, but because some other kind of reactor comes along that is a better business (ie, cheaper). At this point, you are now a world class expert at a technology that…

This model of making incremental progress still exists, it's called research. Startups couldnt be further from the optimal tools to solve those kinds of problems. In my mind, startups are for problems that can be solved by plugging mature tech A into less mature tech B and turning the crank. If someone's first priority is to make the world a better place and expand human knowledge, they should stay away from the business world.

Re: Hard Startups

#185

Post by brandmeyer »

aogl wrote: post #147
jedberg wrote: post #119

Earlier quoted context omitted.

It's 1/2 way between. Back in the day all the big "tech" firms had long term R&D. You could spend years working on tech with no commercial viability as long as you could keep making better demos. You were most likely an employee with a PhD and a pension. But then wall street started demanding quarterly growth and they all cut their R&D departments. Think Bell Labs or Xerox PARC.

I wonder how different interviews were back then by comparison.

Reputation. Who you knew and who knew you.

Re: Hard Startups

#186

Post by keenmaster »

jariel wrote: post #131

I find these 'Valley Koans' popularised in the last long while to be a little troublesome. Things like 0->1->n Do things that don't scale Andreesen Horowitz bit on 'The Good Ideas That Seem Bad' Paul G's essays. They all have nice little nuggets of wisdom, but what the almost always lack are good examples and concrete evidence. Funny that many HN comments are better researched than a lot of these 'Deep Thoughts'. Sin…

The biggest "deep problem"-type leaps in the past few decades have been due to innovations in technological infrastructure: the advent of the internet, GPS, and smartphone for example. All three innovations benefited from the positive externalities of government funding, as well as routine R&D and large corporations. The entities that collectively solved those hard problems only captured a fraction of the profits/benefits of their innovations.

The quickest route to success for a "hard problem" startup is to see the obvious Next Big Thing that is still in early adoption phases, and find the best way to translate it to the broader market. I know, that's not solving a hard problem in the same sense as the OP, but I think it's an underrated strategy with a quicker feedback loop and higher likelihood of success.

What's the Next Big Thing? One of them is AR combined with AI, cloud-computing, and 5G for real-time rendering of 3D objects. That will enable so many incredible things. Imagine the most profitable possibilities, for software, peripherals, physical objects that play a part in the new physical-digital realm, etc...and start hacking now. By the time AR devices are mainstream, you'll be ready to profit immensely while everyone else is scrambling to learn the fundamentals of AR.

VR is fairly mediocre right now. Of course, you know it will get better. However, do you think you correctly predict the magnitude and speed of that change? It's fairly likely that VR will be very, very good in the next ten years. If you're ready for that scenario, you can strike gold.

Self-driving cars are another Next Big Thing. Right now all the attention is on Velodyne, Waymo, etc...and those are promising companies. However, there's plenty of room for startups in that space. Anticipate how self-driving cars will change the world, and profit off of that change. That can make you rich.

I'd rather ride the tsunami of new technologies than try to capture the energy from late-stage ambient tidal waves (such as making another camera app, or a niche ERP tool for enterprise). On the other side of the spectrum, it's noble to try to invent the Next Big Thing yourself, but the odds are against you even if you're extremely smart. You might be just as likely to stumble into the Next Big Thing doing routine work at a big company.

Re: Hard Startups

#187

Post by pfdietz »

DrNuke wrote: post #79

Sometimes it is serendipity that makes the biggest breakthrough, though... see for example the Ebola drug now, this same evening, seeming effective against Coronavirus... you as a VC can neither plan for nor invest in any given lab or boutique consultancy worldwide... and the bigger and bigger hammer thrown at hard nuts is just another way, a very expensive one and possibly unsustainable by VC?

They tested that drug against Feline Infectious Peritonitis, and it was highly effective (turning a cat death sentence into a 80% cure rate), but decided not to commercialize for that because the market was too small. I bet they're kicking themselves now.

Re: Hard Startups

#188

Post by tikirey »

sp527 wrote: post #9

It’s odd (read: motivated by self-interest) that he didn’t make any attempt to establish the failure rate of these startups and the distribution of outcomes for employees. Further, he didn’t even argue for a referendum on equity comp. He’s blatantly peddling the same broken model of “sell them your fugazzi so they can’t tell their talent is being plundered for (founder/investor) economic gain”. It’s downright insulti…

> Don’t fall for their “mission” nonsense. It’s a monstrous lie designed to keep funneling tremendous amounts of money to the people at the top.

100% For some reason, it is so easy to believe in it but the fun part will eventually come in a form of VC asking where is the money. "When someone says "I am not doing it for the money" he (she) is doing it only for the money." - Nassim Nicholas Taleb.

My opinion is that it is some form of common sense going around in societies that contains binary statements like money = root of evil or save humanity = a good deed. Reality is full of nuances though.

From history, the best businesses always have a good business model first and "mission" always was only a nice side effect.

Re: Hard Startups

#189

Post by appleshore »

throwaway8291 wrote: post #165
arkades wrote: post #55

Earlier quoted context omitted.

Strong agree. I found Sam Altman's writing on quora and followed it off-and-on long, long before I found out "who he is." And his advice is so overly-positive and one-note that, honestly, I thought he was a snake oil salesman or self-help guru. I would never have guessed he was actually a VC / successful entrepreneur. Frankly, his arguments and writing continue to sound like Self-Help Guru shined through the lens of…

Agreed. I remain amazed until today about his progression. He founded a startup to solve a white upper middle class "problem", raised millions for that, was lucky to get a little bit more when he sold out his startup's users' data to the greater fool and now runs around and tries to get rich off other peoples creativity and sweat through the VC vehicle. When I learned that he actually founded OpenAI that org lost alm…

As opposed to what, being a financial engineer or wealth manager? Or maybe he should be a real entrepreneur and open up a well managed brand of gas stations? Or build a better kitchen utensil? Or maybe leverage political relationships for tax abatements for major real estate deals?

Vs pushing people to strive for grand ideas, restructuring the greatest accelerator in SV history towards big, bold ideas.

Re: Hard Startups

#190

Post by Arelius »

Animats wrote: post #171
FiatLuxDave wrote: post #63

Earlier quoted context omitted.

Former fusion startup founder here. This is a very good point. My startup took 6 years to fail and much of our competition at the time is still at it 20 years later. There are a number of things which are also impedance mismatches between the typical SV startup mode and hard startups. One of these is the failure path. When an adtech startup fails, the founders just go get well-paying jobs at a FAANG, or at least that…

That came up recently in connection with a VR-related startup. They've been working for years, and they just canned the project and laid off about 60 people. It's all in-house code. So now the people laid off have to find new jobs. They don't have any of the buzzwords resume scanners want. Heroku? No. React? No. Unreal Engine? No. Unity? No. SpatialOS? No. WebAsm? No. Kubernetes? No. Docker? No. AWS? No. Javascript?…

Meh, I've worked 15 years almost entirely at companies using almost entirely in-house technology. Maybe it's because I don't interview for web-tech roles, but I really have never had any problems getting opportunities, and I don't think I'm unique. I think buzzwords are less relevant if you have any amount of specialist skills or significant experience.

For instance, I constantly head hunted for jobs with Unreal Engine and/or Unity, and the fact that I haven't used them significantly doesn't really affect that much.

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