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I have never read a business plan or balance sheet

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Re: I have never read a business plan or balance sheet

#261

Post by bordercases »

throw100g wrote: post #194
s1artibartfast wrote: post #166

Earlier quoted context omitted.

For what it is worth, The most common technical definition genius is an iq of 140, or 1/400.

I think that is an important fact to know considering the confusion in this thread. There are people commenting that pg surely can't be a genius because this or that he engages in isn't ethical (to them). But that's the thing, the IQ says absolutely nothing about ones ethical responsibility or the amount of empathy one has. It is purely measuring "logical thinking ability". Things like "continue this sequence", "reco…

No post body was provided.

Re: I have never read a business plan or balance sheet

#262

Post by ComradePhil »

I read through the thread and his tweets.

He's saying that he doesn't read the business plan, balance sheet or the pitch deck. He just asks them questions, answering which would answer everything in those documents.

So, basically, in addition to writing all these things, you have to read it out to him because Mr. rich guy investor doesn't want to read it himself.

Re: I have never read a business plan or balance sheet

#263

Post by lumost »

ComradePhil wrote: post #262

I read through the thread and his tweets. He's saying that he doesn't read the business plan, balance sheet or the pitch deck. He just asks them questions, answering which would answer everything in those documents. So, basically, in addition to writing all these things, you have to read it out to him because Mr. rich guy investor doesn't want to read it himself.

It’s a time saver, if people don’t have a good answer to a question they are likely to write a lot of info which doesn’t answer the question.

In conversation you can pick up the BS a bit more readily than in a document.

Re: I have never read a business plan or balance sheet

#264

Post by oaiey »

ComradePhil wrote: post #262

I read through the thread and his tweets. He's saying that he doesn't read the business plan, balance sheet or the pitch deck. He just asks them questions, answering which would answer everything in those documents. So, basically, in addition to writing all these things, you have to read it out to him because Mr. rich guy investor doesn't want to read it himself.

I would argue that this is far more complex than he being lazy. A slide deck or any document is well curated, optimized and spin'ed in a way that the creator wants it. Same reason why I actually prefer to write meeting minutes.

He does what anyone sane would do: ask the question and get real reactions. Most people are much better in lying (aka optimizing) on documents than in real life.

Re: I have never read a business plan or balance sheet

#265

Post by tomhoward »

NoLinkToMe wrote: post #216
tomhoward wrote: post #112

Earlier quoted context omitted.

You keep throwing barbs around but missing the important point. He specifically didn’t want to see balance sheets or income statements as he knows they can be full of bullshit (FWIW my only university qualification is in accountancy, so I know what he means). All he cared about the bank balance and whether it was going up or down, because that’s what indicates whether the company would survive or not. He still cared…

> Balance sheets or income statements as he knows they can be full of bullshit Agreed. However, I do have a question for you: what do you think can be more full of bullshit, an oral financial statement by the founder during a conversation, or his audited financial statements? Yes, the notion that balance sheets and income statements don't tell the whole story and can be misleading is a fact. It's also a fact that the…

I'm not sure how much you know about YC's history or PG's approach to investing, but in this and your other comment in this thread, you seem to be under a misapprehension.

The types of companies PG has normally invested in were barely even companies yet. They were small teams with an idea. Maybe a prototype. Maybe a few users. Often they were not incorporated as companies when he agreed to invest, or if they were, they weren't old enough to have audited financial statements. He didn't do "due diligence" as there was nothing to do diligence on; pretty much everything to know about the company was sitting in front of him.

Did he have to have a good bullshit detector? Yes, absolutely. But that was a skill he and the YC partners learned from doing thousands of interviews over many years. But also, it didn't matter if a few dud companies slipped through; they were investing such small amounts it didn't matter. That's the whole point of YC.

In another comment you wrote "at the scale of PG's investments...". That's what says to me you're misunderstanding things. PG's investments have always been very small. He just did many of them.

Re: I have never read a business plan or balance sheet

#267

Post by gabrielsroka »

eloff wrote: post #254
guynamedloren wrote: post #106

I’m surprised the YC application hasn’t been more of a focus in this discussion. The following questions are pulled from the application (perhaps an older version): What is your company going to make? Why did you pick this idea to work on? Do you have domain expertise in this area? How do you know people need what you're making? What's new about what you're making? What substitutes do people resort to because it does…

It's tough to be properly nuanced and specific in a tweet. "I've never read a business plan , but I ask all the big questions that should be answered in a business plan." Just isn't pithy for a tweet. Honestly Twitter is a terrible idea in most cases that just leads to people shouting at each other - because 140 characters isn't enough to communicate anything in a balanced way.

> 140

It's been 280 for a while, but your point still stands.

Re: I have never read a business plan or balance sheet

#268

Post by aaaaaaaaata »

pbhjpbhj wrote: post #258
viraptor wrote: post #227

Earlier quoted context omitted.

PG knows how to write good content. This tweet was just-vague-enough that people can both claim he did and that he didn't and many other things and argue and explain the view, etc. He got engagement - maybe that's all it was about. Or maybe I'm wrong and it was a random tweet. But what I'm sure about is that if he wanted this to be an idea that's well communicated and important, it wouldn't be ambiguous like this.

So basically, it's flamebait? That'd be a pretty disappointing circumstance. I don't know pg but the HN brand is certainly to rise above stating disinformation to start arguments and drive engagement. I guess maybe that's what Twitter is for, but then maybe the mods should stop that sort of thing leaking to HN ... Any chance you're mistaken?

Many of pg's writings could be categorized as flamebait — if you're not listening closely.

Re: I have never read a business plan or balance sheet

#269

Post by ptero »

ignoramous wrote: post #180
austenallred wrote: post #159

Seems like a lot of people are missing the point of this one. PG/YC invest at the earliest stages. The information they need is pretty much: 1. What are you doing? 2. Do people like it? 3. How big is the market? 4. What are you/team like? Could you cover all of those in a formal business plan? Sure, but you can also do so in a short-form application that's 1/20 the length or in a 10-minute back-and-forth conversation…

Gotcha. YC Continuity, otoh, surely evaluates go-to-market / business plan?

One of the things PG reiterates is that at the early stage what the startup is doing changes rapidly. Many companies that end up being very successful have a product that looks quite different from what they set out to achieve. In such a setup, half-life of a business plan may be measured in weeks and its rigorous analysis may be a wasted time.

Instead, I believe YC is trying to focus on finding good teams under the assumption that a strong team that can execute well has a higher chance of success than a worse team with a better starting plan. If anything, the business plan's value is to indicate that the founding team can think logically and realistically map products to market. Once the investment reaches 100M (YC Continuity's stated higher end), they probably focus more on the marked and business plans. Just my 2c.

Re: I have never read a business plan or balance sheet

#270

Post by aaaaaaaaata »

ImaCake wrote: post #257
eloff wrote: post #254

Earlier quoted context omitted.

It's tough to be properly nuanced and specific in a tweet. "I've never read a business plan , but I ask all the big questions that should be answered in a business plan." Just isn't pithy for a tweet. Honestly Twitter is a terrible idea in most cases that just leads to people shouting at each other - because 140 characters isn't enough to communicate anything in a balanced way.

Yeah politics on twitter is awful. For outsiders like me it is often hard to even understand what a popular political tweet is even about. Twitter is good for pictures of nature though. And somehow a great deal of decent scientific discourse goes on twitter without descending into the crap that political twitter does.

Outsider, as in, not a person bubbled into social media derived feuds regarding politics?
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