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Startups are pummeled in the ‘great unwinding’

nytimes.com

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Re: Startups are pummeled in the ‘great unwinding’

#211

Post by [deleted] »

0x0001 wrote: post #107
scarface74 wrote: post #84

Earlier quoted context omitted.

You weren’t around in 2000 or 2008 were you? Your startup is only in “better shape” as long as VCs are willing to keep funding you. VCs are only willing to keep funding you if they have confidence that you will have a profitable exit.

Not all startups require VC capital, some of us are just running without venture funding just clients money, some startups are in better shape because are on right market on the right time. You just need to be in the right time.

[deleted]

Re: Startups are pummeled in the ‘great unwinding’

#213

Post by shoo »

filmgirlcw wrote: post #138
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

This strikes me as wishful thinking and also incredibly myopic about the realities facing many startups. A startup that recently closed a big round (and the need to close the round wasn’t necessitated by massive debt or existing expenses — so think almost all of the money can be used as future runway) might be in a better short-term position than a business that is relying on net-30 or net-90 payments from clients th…

> Plus, they get the additional disadvantage of trying to figure out an actual business model during a recession.

this has a bit of a silver lining: it'll help filter out bullshit business models that appear to work in the times of plenty.

Re: Startups are pummeled in the ‘great unwinding’

#214

Post by jaggederest »

closeparen wrote: post #150
jaggederest wrote: post #137

Earlier quoted context omitted.

Work remote, move to the midwest (or, really, anywhere outside of the bay area or NYC), own your house outright. The idea that the options are "get paid usurious amounts of money" or "live 90 minutes from work with a bunch of roommates" is a false dichotomy.

Interesting perspective. My employer entertains remote workers and satellite offices only to the extent that it feels the Bay Area is “tapped out.” If that thinking is at all representative of the industry, I think we’re likely to see those options evaporate rather than grow. There are definitely IT jobs “native” to the Midwest, but they’re overwhelmingly seen as cost centers to be deskilled/automated/offshored rathe…

I mean, I've been doing it for the vast majority of the last decade, so my feeling is that it can only increase. The housing prices and the sheer stress of living in bay area / nyc are so overwhelming.

Re: Startups are pummeled in the ‘great unwinding’

#215

Post by sethammons »

axiom92 wrote: post #209
irrational wrote: post #184

I work for a Fortune 150 company as a programmer. I've had lots of people ask me why I don't move to California and work for a startup. The main reason is because I'm risk adverse and I really don't like the Bay Area (I spent many years living in San Ramon, Alameda, Newark, etc. in my youth and have no desire to ever return). Now I have a new reason to be grateful I work for a Fortune 150 company. I've been able to w…

>I spent many years living in San Ramon, Alameda, Newark, etc. in my youth and have no desire to ever return I understand that this is not center to the point you're making but I am curious! What makes you hate the Bay area? I lived there for ~4 years and recently moved to Pittsburgh. I can't wait to move back. In fact, the mere mention of these places evokes a strong sense of homesickness in me for some reason.

Not OP. I've only visited the Bay Area a few times. Human filth, needles, and just so many people packed into the space. I can't imagine raising a family in that situation. Contrast that with where I am now: I have a very large house on 10+ acres of land on the edge of a lake. Each of my kids has their own room and there are lots of rooms and corners to "get away from each other". We have room for food storage, a home gym, and are not dependent on the city for water or gas (though we do have to fill our propane tank a couple times a year). If I walk to the edges of my property, I can see a couple other houses. We have bon fires, ride ATVs, go fishing, shoot guns and bows in the back yard. We have full on seasons (granted that winter is the largest, but we like cold and snow). Not to even begin talking about the political differences.

The few things I liked about the Bay Area: lots of economic opportunity (esp. as a software dev), nearby greenery, and lots of food options. Oh, and the ability to find others who would like to play board games. I can't find anyone to play board games with out in the middle of nowhere (my family is not interested in any).

Re: Startups are pummeled in the ‘great unwinding’

#216

Post by brianwawok »

ghaff wrote: post #186
hodgesrm wrote: post #152

Earlier quoted context omitted.

The term "lifestyle business" really annoys me. It's Silicon Valley propaganda. There are better ways to build companies than taking hundreds of millions or billions in funding. Pre-crisis startup funding was largely decadence enabled by cheap money. By contrast early generation SV companies took relatively small amounts of funding if at all. Intel for example took the equivalent of $18.4M US in 2019 dollars prior to…

The thing that annoys me about "lifestyle business" is that it also suggests this idea of short days, tons of vacation, etc. Which is usually not the case.

Honestly I think it’s a way for those that owe million to VCs to feel like they have one over us businesses that grew at a healthy pace, have money in the bank, and money in the bank goes up not down every month.

At least that is how lifestyle business is slung here. No one in my local business association would scoff at businesses growing at a healthy pace and no debt. Also nice if no VC gives me another round, I don’t have to shut down tomorrow.

Re: Startups are pummeled in the ‘great unwinding’

#217

Post by throwaway2048 »

thethethethe wrote: post #180
TheOtherHobbes wrote: post #161

Earlier quoted context omitted.

Anyone who thinks FAANG will survive without a contraction is deluding themselves. What happens to the ad market during a depression? How about luxury IT hardware? Entertainment subscriptions? Web services? If there isn't a bounceback in three months or so, the entire tech sector will deflate like a balloon. FAANG will probably survive in some form because of cash reserves, but there will absolutely be cancelled proj…

> FAANG will probably survive in some form because of cash reserves, but there will absolutely be cancelled projects and mass lay-offs. And those will have an effect on the the property and rental markets, on startup funding, and on everyone's cash flow FAANG will lay off their armies of contractors before down sizing FTEs. Google has 125k FTEs but over 300k temps. Will it get to the point where FTEs are laid off? I’…

contractors aren't summoned from the aether, they still live in houses.

Re: Startups are pummeled in the ‘great unwinding’

#218

Post by sumedh »

marcosdumay wrote: post #118
closeparen wrote: post #106

Earlier quoted context omitted.

Why is it so offensive to people in this industry that our skills are valued? Sometimes it seems a little crazy to me too, but I'm not, like, excited to need to live with 5 roommates 90 minutes away from work again like you seem to be.

The GP is not complaining that our skills are valued, it's complaining that those companies have an awful low productivity. You know, people filling low productivity jobs means that our skills aren't valued enough.

> it's complaining that those companies have an awful low productivity.

That is just human nature, once the company starts going big and has the funds, the managers start empire building.

Re: Startups are pummeled in the ‘great unwinding’

#219

Post by Aeolun »

bob33212 wrote: post #63
hn_throwaway_99 wrote: post #17

> For start-up workers, the past few weeks have been sobering. Many had bought into the tech industry’s change-the-world ideals, had few boundaries between their work and personal lives and hoped for big payouts if their start-ups went public. This saddened me, because it's a refrain that we hear over and over and over. Same exact thing happened during the .com bust (which scares me to believe that was 20 years ago a…

Good start-up CEOs struggle with this because many of them do care for their employees at a personal level, but they also have an obligation to the owners/investors to be financially successful. And the most findnacially successful CEOs are going to put investors first when they are up against the wall. I assume they rationalize it by saying that if the company is successful that is better in the long run for everyon…

I’m not sure how they’re putting investors first? Maybe they’re putting the employees remaining after the cut first?

Of course you can alternatively say to everyone the company will be dead in 3 months, but I’m not sure that’s better.

Re: Startups are pummeled in the ‘great unwinding’

#220

Post by aphextron »

axiom92 wrote: post #209
irrational wrote: post #184

I work for a Fortune 150 company as a programmer. I've had lots of people ask me why I don't move to California and work for a startup. The main reason is because I'm risk adverse and I really don't like the Bay Area (I spent many years living in San Ramon, Alameda, Newark, etc. in my youth and have no desire to ever return). Now I have a new reason to be grateful I work for a Fortune 150 company. I've been able to w…

>I spent many years living in San Ramon, Alameda, Newark, etc. in my youth and have no desire to ever return I understand that this is not center to the point you're making but I am curious! What makes you hate the Bay area? I lived there for ~4 years and recently moved to Pittsburgh. I can't wait to move back. In fact, the mere mention of these places evokes a strong sense of homesickness in me for some reason.

It all depends what you want in life. Pittsburgh you can afford a beautiful home and support a family on $100k. That's studio apartment survival money in the bay. The portion of us who will ever make it to the big leagues and land that $300k FAANG job that allows you to buy a home and raise a family in the bay is infinitesimal. But if you just want to live that single lifestyle, enjoy the big city, and play the startup lotto, then go for it.
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