The “industry where 80% of bookings were still done using pen and paper” seemed like a red flag to me. To my eyes that means they don’t need/want/buy tech solutions to this problem and it’ll be a huge uphill battle to convince them.
I lost $209k of my own money trying to start a business
41–50 of 229 posts
Re: I lost $209k of my own money trying to start a business
#42There is something I've been repeating to people younger than myself lately (and I'm only in my early 30s): don't be a contrarian in your career. The so-called mainstream is mainstream because it works. Anyway, why isn't the main lesson "not doing a travel business in the middle of a pandemic where we are trying to implement world-wide lockdown for the first time in human history" ?
Because the business would also have failed if he had started it at any other point in time? This is a simple case of "more money than sense". Even the lessons he learned strike me as wrong. The lessons read as insight porn, the kind of stuff you use to get subscribers to a newsletter.
It's not about having too few or too many features. Nor is it about proving product/market fit. The guy didn't have the technical skills or the hustle to bootstrap a marketplace. Does he even know two-sided marketplaces get bootstrapped with some kind of cheating/trickery/naughtiness? From youtube to linkedin to reddit to quora to airbnb to tinder. They all "cheated" in a specific way that worked for them. And that's no coincidence, because nobody wants to use a social or networked app without other people on it.
Re: I lost $209k of my own money trying to start a business
#43You mention to not build the website, iOS app, and Android app all at once before getting market fit. Which of the three would you start with to quickly iterate and get feedback? When you mention that you had to often walk into like a scuba shop to try to get a sign on, were people more receptive if you 'had an app for that' already?
why not just a progressive webapp at first? if you don't have massive native requirements like reading text messages, and don't want to shell out $200k, and are not pressed for more distribution channels like appstores...
Re: I lost $209k of my own money trying to start a business
#44I have a very high level of scepticism towards non-technical founders without deep pockets: 1. There's an agility to being able to change things yourself, at 2am if necessary. That's very important to startups. 2. There's a discipline to not accruing unreasonable technical debt of the type that will sink you two years in that you can't expect from someone who doesn't deeply care. 3. Managing devs generally requires u…
Fair enough, but my level of skepticism for non-technical founders WITH deep pockets isn’t much better:
1. Deep pockets can mean a non-viable business model can survive longer before going completely bust, simply because the founder can afford to continue shoveling money into the furnace, and build the illusion of success.
2. If the deep pockets are the results of inherited wealth of some sort, many of these founders are just engaging in success laundering where the startup is really a shitty business but its existence implies an alternative story for how their wealth was obtained and gives the prestige of appearing “self made”. Or the founder doesn’t care about the business at all and just wants the title of “entrepreneur”.
3. Often a deep pocketed non-tech founder’s only tool for solving tech problems is money, which doesn’t lead to truly innovative solutions.
Re: I lost $209k of my own money trying to start a business
#45The first heading reads “marketplace for last-minute tours and activities”, followed by a paragraph that says “industry where 80% of bookings were still done using pen and paper, months ahead of time” How is something done both “months ahead of time” and “last-minute”?
The answer is: he didn't understand the business. There tens if not hundreds of competitors, and yet the tour operators still taking bookings over the phone. That tells you a lot.
The market is ruthlessly efficient. If something has a low barrier to entry, like his idea, then it's absolutely 100% guaranteed that someone else has tried it. Would-be founders need to do a brutally honest assessment of why they are going to succeed where others have failed.
Re: I lost $209k of my own money trying to start a business
#46Where do people even get this kind of money to lose
Re: I lost $209k of my own money trying to start a business
#47I have a very high level of scepticism towards non-technical founders without deep pockets: 1. There's an agility to being able to change things yourself, at 2am if necessary. That's very important to startups. 2. There's a discipline to not accruing unreasonable technical debt of the type that will sink you two years in that you can't expect from someone who doesn't deeply care. 3. Managing devs generally requires u…
I think the reality is Startups are hard enough as-is and non-technical solo founders are doing something already difficult with one hand tied behind their back. The successful ones I’ve seen almost always operate in a domain where they’re subject-matter experts so while they’re not technical they have a deep understanding of the problem and can communicate it clearly to a developer.
It’s also more difficult these days to be a non-technical founder because hiring technical staff is still challenging despite all the layoffs. I’ve seen them make some really bad hires.
Re: I lost $209k of my own money trying to start a business
#48> I'll never depend on a 3rd party dev as the main means of production again. He spent over half of his money on it as well. I've had more than one person come to me with their business idea, and they have a terrible website (or app) that they have spent 100, 200, or even 300k on. And it doesn't even work. If you aren't staring out WITH customers, you either have to code it your damn self, or have a technical co-foun…
Seriously, sign me up for that contract. Give me 100k-300k for a single website? That website is gonna be a thing of beauty.
You say that now, but in my experience most people able to shell out this kind of money very often doesn't really have a clue about what it is they actually need and have no reasonable go to market strategy beyond "let's just build it and they will come", and then it fails spectacularly.
I've been on the receiving money end of this kind of project several times in the past and as much as you try to help and guide, there's almost always an atmosphere of "I'm the one paying the invoice so let's just do as I say" even though everything points to them being absolutely wrong.
I've also been on projects like this where the buyer has a strong vision, is able to communicate it, but is also very hands off when it comes to implementation. With regular reporting (weekly or bi-weekly being ideal) to do course correcting they've gotten tremendous value out of the $100k-$300k spend.
To be fair, being a buyer for tech projects is really quite difficult – especially if you don't have a very clear and communicable vision of the end goal.
Re: I lost $209k of my own money trying to start a business
#49Lost is a wobbly word.
If we put $200k on the table, in stacks of crisp clean bills, and said "This money is going to found a start-up", then four years later there's nothing left.... that stings.
On the other hand, suppose you (foolishly) frame things like the RIAA/MPAA do, that every lost opportunity is a real financial loss. And suppose you're smart enough to go and work for BigTech pulling in $100k/pa. But instead you take a part time job making $50k. You live on your wits while growing a business. If it doesn't work out after 4 years you still "lost" $200k. But it doesn't feel so bad. We chalk it up to "learning". That's what the University of Life charges for a full time course on Applied Entrepreneurship.
I'm guessing a lot of HN readers are of a similar mind, and I try to see the following your own map lifestyle that way. We all pay a lot for the privilege of creative freedom and opportunity risk.
Re: I lost $209k of my own money trying to start a business
#50I have a very high level of scepticism towards non-technical founders without deep pockets: 1. There's an agility to being able to change things yourself, at 2am if necessary. That's very important to startups. 2. There's a discipline to not accruing unreasonable technical debt of the type that will sink you two years in that you can't expect from someone who doesn't deeply care. 3. Managing devs generally requires u…
And from experience, a technical person still needs some deep pockets to really take an idea to it's potential. Personally I forget that selling and marketing is a massive overhead that is generally not solvable by some clever code and long/hard work.