He obviously has got people working for him, that filters prospects before they get to him. I am sure they read both business plans and balance sheets.
I have never read a business plan or balance sheet
81–90 of 346 posts
Re: I have never read a business plan or balance sheet
#82It makes complete sense. I come from a geographic area where the immediate response to my job description is "here's my startup idea". There have been very few I feel passionate about and want to get involved. The rest I ask for a contract few and my counter is always $0 and a partnershie of ownership.
Re: I have never read a business plan or balance sheet
#83Earlier quoted context omitted.
People really struggle to recognize context. I assume most people who are getting so upset about pg’s tweet are reading it as “business plans are stupid. Balance sheets are stupid. No company should ever make one because no one should ever read it. Anyone who reads one is stupid.” It should be implied that his advice is only relevant the type of investing which pg does. pg tweeted later on that his solution is someth…
I founded a company without a business plan. Raised money without a business plan. Ran the business profitably for a long time and then sold the majority of it without a business plan. I don’t see the value in a formal business plan at all and so I would almost agree with your made up quote there. I mean obviously you need to have a plan for your business. But writing it down in some formal way seems like a waste of…
Recording it in some form (written or otherwise) seems useful if you need to share it with lots of other people.
Re: I have never read a business plan or balance sheet
#84Earlier quoted context omitted.
Ummm...in order to know what the company looks like after the investment, you need to know what the company looks like before the investment.
In PG’s era of YC, it generally looks like 2 guys with 2 laptops in the cheapest apartment in Mountain View.
And that two guys with laptops in a cheap apartment in mountain view might be a majority of the cases they see, but how will they know unless they see it? I've seen plenty of fake-it-til-you-make-it startups that immediately go out an sign a lease for AAA office space because they think they need a cool office before anybody will take them seriously. And that is a massive red flag to a VC...one that shows up on a balance sheet.
For an early stage company, nobody cares about your assets or your shit estimates of the value of your intellectual property or goodwill. But payables and receivables can definitely be a dealbreaker, and I've never known a single VC that would sign a check without an understanding of where the company, no matter how new, stands with them.
Re: I have never read a business plan or balance sheet
#85He says he interrupts the founders during live presentations instead of reading balance sheets. Founder: So we’re doing this rad new architecture- Paulg: In Lisp. It’s in Lisp, right? Founder: Huh, fuck no, it’s 2022, dude- Paulg: (frowning) Out. Thumbs down.
We need to stop treating people as unfallible. I used to idolize so many people when young. I still respect a lot, but now I understand that everyone is human and everyone has differing motivations, especially people in power.
Re: I have never read a business plan or balance sheet
#86He says he interrupts the founders during live presentations instead of reading balance sheets. Founder: So we’re doing this rad new architecture- Paulg: In Lisp. It’s in Lisp, right? Founder: Huh, fuck no, it’s 2022, dude- Paulg: (frowning) Out. Thumbs down.
We interviewed in late 2008. Then as now, it’s a conversation not a presentation. We were using PHP/Symfony then (changed to Python/Django later) but he didn’t ask anything about what language or platform we were using. He did care a lot about the fact that we had users who were excited and unique insights into what was overlooked in the market.
Thanks for being the single datapoint of rationality in a sea of madness. It must be pretty surreal to read these comments as a founder. It certainly is for me, as someone who grew up with HN.
Re: I have never read a business plan or balance sheet
#87Earlier quoted context omitted.
People really struggle to recognize context. I assume most people who are getting so upset about pg’s tweet are reading it as “business plans are stupid. Balance sheets are stupid. No company should ever make one because no one should ever read it. Anyone who reads one is stupid.” It should be implied that his advice is only relevant the type of investing which pg does. pg tweeted later on that his solution is someth…
I founded a company without a business plan. Raised money without a business plan. Ran the business profitably for a long time and then sold the majority of it without a business plan. I don’t see the value in a formal business plan at all and so I would almost agree with your made up quote there. I mean obviously you need to have a plan for your business. But writing it down in some formal way seems like a waste of…
Your last paragraph sounds the most correct to me. It's a drafting exercise that helps a person get a deeper understanding of the value added, the marketing of, the selling of, the delivering of and the financing of said value add. It's necessary for a business like a mind mapping diagram is necessary for an essay.
Re: I have never read a business plan or balance sheet
#88[deleted]
Re: I have never read a business plan or balance sheet
#89Earlier quoted context omitted.
Please don’t start comments in that patronizing way. This field is highly counterintuitive. It’s easy to feel smart by parroting the obvious-seeming positions whilst being utterly wrong. To your point: when YC interviews companies, they are mostly very early stage and pre-revenue. What YC cares about is how much money they could make if everything goes right, and whether the team is capable of making everything go (c…
Even if you are an early stage company, you've still got to have something resembling the concept of a balance sheet, even if it's an excel spreadsheet with a list of two computers, a bank account, and an AWS bill that hasn't been paid yet. Maybe he's right that he personally has never read a balance sheet, but for literally any company that has already formed before the investment, they would be extremely foolish to…
I feel like this is something that’s really important to you for some reason, and as such you’re getting more wound up about it than necessary.
Yes, companies need to mindful of their finances and cashflows. Everyone knows that, PG included, as I conveyed in another comment.
The real point that PG is making here is that an early stage company with perfect books but no exciting product or market opportunity is dead, whereas one with incomplete bookkeeping but an incredible product and market opportunity is much more likely to be a good investment.