21–30 of 321 posts
I remember hearing PG comment that as a founder you need just a few million from a startup. That's as true today.
Perhaps the relationship between exit valuation and wealth created is elastic. If the goal is to make wealth, perhaps lots of 10-100M startups has a bigger impact on society than a couple of billion-dollar startups.
If there's only one winner in a class, at best, does it matter if the class is 10 or 50? 50 isn't going to give 5 winners, is it?
Is the idea that 50 gives a 5 times higher chance of finding the 1? Is that really true, though?
Would focusing on a smaller number of potentials actually be better for finding the 1? Thinking through the scenarios more thoroughly?
Earlier quoted context omitted.
Can you honestly not tell the difference between Facebook and Geocities? Also, the fact that Dropbox and Facebook were "unoriginal" is exactly what made them seem like bad ideas at the time. I saw Dropbox present at demoday, and the main question on my mind was, "How is this different from the million other attempts at online file storage? (xdrive, etc)".
If I had the time, I would do a bunch of research into trying to determine what made Dropbox, Facebook, AirBnB, et al, succeed in their markets. I assume the answer involves the founding teams, but what traits did these founders have that others did not? I don't have the time though, so if any bloggers/journalists are reading, this could be an interesting article, or even book, if you get enough info. Whether or not…
The big successes that I've seen all have exceptional founders, but that's clearly not enough. Timing is a huge component as well. Often a good idea will fail simply because the market or technology isn't ready. My own experience with Gmail reflects some of that. When we decided to write the whole frontend in JS, everyone said that it was a bad idea doomed to failure. It had been tried before (e.g. desktop.com) and had always been a disaster. They were right about the past, but wrong about the future. We released Gmail right around the time that browsers were finally getting good enough, and were were very careful to keep our code as fast and slim as possible.
* Dropbox used rewards for more storage, as well as its fundamental file-sharing tools, to encourage users to sign up their friends and family.
* Airbnb gamed Craigslist [1] to encourage property owners to signup on Airbnb. With a strong supply of rental properties, Airbnb was able to build a true case for its value in the minds of travelers.
[1] http://venturebeat.com/2011/06/02/airbnb-admits-gaming-craig...
I disagree with some of the meta-cognition. Take the "seems like a bad idea" bit. Many of the big hits are really well-worn ideas done with better marketing, better timing, and a user experience which makes it available to new markets. Dropbox? File sharing. Facebook? Geocities. Both are interesting in that they take something that was a giant pain in the neck but useful enough to put up with anyway, and then they ma…
Can you honestly not tell the difference between Facebook and Geocities? Also, the fact that Dropbox and Facebook were "unoriginal" is exactly what made them seem like bad ideas at the time. I saw Dropbox present at demoday, and the main question on my mind was, "How is this different from the million other attempts at online file storage? (xdrive, etc)".
It seems to me that both Dropbox & Facebook are example of companies pursuing good ideas that lots of other companies were also pursuing. They just happened to be the ones that executed the best (and possibly also had the best luck) so they were able to win the market.
If this is the case then your job as a funder of startups might be to try to identify the companies capable of out executing everyone else on a good idea that a lot of people are working on.
This is much different than the great idea that looks bad phenomenon that pg discusses in his essay.
I disagree with some of the meta-cognition. Take the "seems like a bad idea" bit. Many of the big hits are really well-worn ideas done with better marketing, better timing, and a user experience which makes it available to new markets. Dropbox? File sharing. Facebook? Geocities. Both are interesting in that they take something that was a giant pain in the neck but useful enough to put up with anyway, and then they ma…
Can you honestly not tell the difference between Facebook and Geocities? Also, the fact that Dropbox and Facebook were "unoriginal" is exactly what made them seem like bad ideas at the time. I saw Dropbox present at demoday, and the main question on my mind was, "How is this different from the million other attempts at online file storage? (xdrive, etc)".
There's a pretty interesting lesson for potential YC candidates, particularly the ones that get turned down, here. When you interview a startup and think "they seem likely to succeed," it's hard not to fund them. And yet, financially at least, there is only one kind of success: they're either going to be one of the really big winners or not, and if not it doesn't matter whether you fund them, because even if they suc…
Granted when they initially pick your business it is probably by because you explained what a great lifestyle business it will be.
Is it possible that this is simply just the effect of a Bell Curve (i.e, the normal (Gaussian) distribution of a field)?
I think that's the exact opposite of what pg means. pg is basically writing http://blakemasters.tumblr.com/post/21869934240/peter-thiels...
Meanwhile, throughout his lectures, Thiel seems to emphasize that with enough focus on the right people. important projects, and right 'secrets', outcomes are not as random as they seem... and both individuals and investors must concentrate on some big bets rather than endlessly diversify.
Quoth pg: It would hurt YC's brand (at least among the innumerate) if we invested in huge numbers of risky startups that flamed out. Paul, you're sounding like a venture capitalist who is worried about whether he can find investors for his next fund. I would posit that the people whose opinions you should care about are potential founders ; and that their primary concern is themselves , not the performance of a fund…
What strikes me about Dropbox and Airbnb more than anything is that they had incredibly strong growth strategies. * Dropbox used rewards for more storage, as well as its fundamental file-sharing tools, to encourage users to sign up their friends and family. * Airbnb gamed Craigslist [1] to encourage property owners to signup on Airbnb. With a strong supply of rental properties, Airbnb was able to build a true case fo…
That said, it often isn't obvious from the beginning. When I met Dropbox at YC, I don't recall them having any great plans for how to grow. I think that was discovered later on.
Also, that often-repeated Craigslist claim about AirBnB is actually false. They got very few listings from Craigslist.