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Why There Aren't More Googles (2008)

paulgraham.com

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Re: Why There Aren't More Googles (2008)

#11

Post by praptak »

chrisco255 wrote: post #3
adamsmith wrote: post #2

> I've tried to explain this to VC firms. Instead of making one $2 million investment, make five $400k investments. Would that mean sitting on too many boards? Don't sit on their boards. Would that mean too much due diligence? Do less. If you're investing at a tenth the valuation, you only have to be a tenth as sure. This turned out to be absolutely right, and the That said with the benefit of more hindsight I think…

Well, yes, but do they have that stronghold on the future of technology markets? I'm less convinced of that.

They filled the feasible niches for "internet-based monopoly". The next Google will have to find another way to get big.

Re: Why There Aren't More Googles (2008)

#12

Post by bertr4nd »

Something I don’t understand in this article is the “People won’t understand your ideas if they’re any good.” Like, the idea behind Google is, “Let’s make another search engine, but make it really good.” That’s not a crazy idea, is it? Was the problem that VCs thought existing engines were good enough and that Google’s wouldn’t be enough better to be worthwhile?

Re: Why There Aren't More Googles (2008)

#13

Post by andrewjl »

chrisco255 wrote: post #3
adamsmith wrote: post #2

> I've tried to explain this to VC firms. Instead of making one $2 million investment, make five $400k investments. Would that mean sitting on too many boards? Don't sit on their boards. Would that mean too much due diligence? Do less. If you're investing at a tenth the valuation, you only have to be a tenth as sure. This turned out to be absolutely right, and the That said with the benefit of more hindsight I think…

Well, yes, but do they have that stronghold on the future of technology markets? I'm less convinced of that.

I don't think they do, at least in the long term. In the short and medium term its arguable either way. We're still at the very beginning of the era of truly distributed computing and what it tends to do when it spreads is replace centralized entities with protocols.

If this sounds like a very played out line of thinking, that's because we're now in the trough of disappointment of the hype cycle. You can't expect any fundamental new tech to live up to its hype only a few decades after invention. Also not all the pieces needed have been invented yet.

Re: Why There Aren't More Googles (2008)

#14

Post by laurent92 »

benlivengood wrote: post #4
adamsmith wrote: post #2

> I've tried to explain this to VC firms. Instead of making one $2 million investment, make five $400k investments. Would that mean sitting on too many boards? Don't sit on their boards. Would that mean too much due diligence? Do less. If you're investing at a tenth the valuation, you only have to be a tenth as sure. This turned out to be absolutely right, and the That said with the benefit of more hindsight I think…

> That said with the benefit of more hindsight I think the reason there are no more Googles is that FAANG has a stronghold on the largest technology markets. And the FAANGs are willing to pay very large amounts of cash to acquire promising startups. EDIT: Also why is it that the majority of the large tech companies are essentially marketplaces? Is there really that much friction in traditional markets (physical goods…

Isn’t it Paul Graham who also wrote a blogpost saying “How to make a trillion dollars? Build a platform.” ?

Re: Why There Aren't More Googles (2008)

#15

Post by bryanrasmussen »

bertr4nd wrote: post #12

Something I don’t understand in this article is the “People won’t understand your ideas if they’re any good.” Like, the idea behind Google is, “Let’s make another search engine, but make it really good.” That’s not a crazy idea, is it? Was the problem that VCs thought existing engines were good enough and that Google’s wouldn’t be enough better to be worthwhile?

That's not really an idea though, that's a goal, the idea is the description of how you will reach your goal, which in Google's case was PageRank.

Re: Why There Aren't More Googles (2008)

#17

Post by roenxi »

> From the evidence I've seen so far, startups that turn down acquisition offers usually end up doing better.

I bet causality is reversed from what he is hinting at. Startups that can see a pathway to becoming insanely valuable are more likely to turn down offers. Startups that see no path and that are, effectively, putting on a brave face do not turn down a profitable escape route.

By that dynamic alone, you'd expect startups turning down offers to be a very strong signal of success. How many idiots are there with the wherewithal to run a company but then try and turn down money in the face of going bankrupt?

Re: Why There Aren't More Googles (2008)

#19

Post by bruceb »

boltefnovor wrote: post #16

I often think about how YouTube was the bargain of the century. YouTube would be one if the biggest companies ever if it had remained independent.

Problem with them was the massive about of money they were burning on servers and being sued by RIAA (Music companies) and MPAA (Film companies) among others. They needed a big infusion of capital.

Instagram on the other hand could have remained independent and succeeded.

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