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Hackers can be business guys, and other lessons from Paul Graham

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Re: Hackers can be business guys, and other lessons from Paul Graham

#41

Post by DanielRibeiro »

This interview contains some pretty amazing gems. This part[1]:

So, really good sofware is software that embodies an idea, some fabulous idea for some new thing that is possible that maybe only the guy writting the software realizes is possible. And maybe people who hear about it while he's working at it think it is the stupidiest idea

... reminded me of Peter Thiel's famous quesetion[2]:

what important truth do very few people agree with you on?

[1] http://www.youtube.com/watch?feature=player_embedded&v=B...

[2] http://blakemasters.com/post/22866240816/peter-thiels-cs183-...

Re: Hackers can be business guys, and other lessons from Paul Graham

#42

Post by wordplay »

r0s wrote: post #16

As an aspiring business guy, my biggest problem seems to be accessing information about different models. Say I want to build a web community around a particular kind of video game. Estimating the value of that market is pretty damn opaque to an outsider.

I've been thinking about the general business plan problem for years. Not only because it's a very real problem, but also because as I'm walking through a swap meet or a grocery store I'm perpetually curious about margins and return on capital for the many tiny to medium businesses for which almost no intelligence exists. If I could figure out a way to bootstrap a crowd sourced resource for these I'd be working on it right now...but alas.

In your case, if you haven't done so already, I'd suggest attempting to buy advertising from a site similar to the one you'd like the build. Maybe even invest some dollars advertising your own product (non-profits are interesting guinea pigs too) to get some idea of the volume of traffic they enjoy and the prevailing rate that advertisers are willing to pay for access to their audience. Once you have data you can start building some models and establishing ranges inside which the business makes sense to pursue. I've done this kind of research myself and for clients on multiple occasions, it's not bulletproof but it's a valuable start.

Re: Hackers can be business guys, and other lessons from Paul Graham

#44

Post by SatvikBeri »

manmal wrote: post #24
pud wrote: post #20

Earlier quoted context omitted.

The flip side is, when you're naturally good at something, it becomes fun to do. So you do it a lot. I tried for 2 years to get good at guitar. Never got good. But didn't practice very often either. Then one I sat down at a drum set and was immediately better than the drummer in my band. I had a knack. It was so fun to play those beats that I practiced almost every day for many years, and still do. And have gotten pr…

Considering myself an above average guitar player - I'm not sure whether guitarist vs drummer abilities carry over to hacker vs business skills. Your problem with playing the guitar was most probably related to left-right-coordination or some physical feature (like joint flexibility), right? Or maybe you did not "hear" the notes? I think that both good/x10 business people and hackers need similar personality traits (…

Based on my reading & observations, skill at the upper end of a creative/intellectual domain seems to range from about 5-20% talent and 80-95% practice-related factors. A lot of people don't realize how important different types of practice are. The Talent Code cites a study where researchers found that students who believed they would practice an instrument for all their lives learned nearly 4 times as quickly as students who thought they'd play the instrument for a few years-with the same amount of practice!

The one consistent element of natural talent that comes up in intellectual/creative pursuits is working memory. The average person can hold roughly 7 "units" of information in their brain[0], which is why phone numbers are 7 digits long. When sightreading, pianists with a high working memory effectively have an advantage of a few extra years of practice[1]. I would imagine that a high working memory is also helpful in programming, as it determines how large a program you can easily hold in your head.

[0]: it's a little more complex than just 7 pieces of information, see http://en.wikipedia.org/wiki/Working_memory#Capacity

[1]: http://pss.sagepub.com/content/21/7/914.abstract

Re: Hackers can be business guys, and other lessons from Paul Graham

#45

Post by pshin45 »

I don't know if anyone here is a fan of MMA aka Mixed Martial Arts (as I am), but I think the parallels between the startup/hacker world and MMA are fascinating.

Not unlike startups, success in MMA requires proficiency in several very different disciplines including wrestling, Brazilian jiu-jitsu, boxing, Thai boxing (Muay Thai), karate, etc.

In the early days of MMA, fighters were very one-dimensional and the dominant champions tended to be wrestlers, reason being that while a wrestler could reasonably defend against a (kick)boxer's strikes, (kick)boxers were generally powerless to do anything once a wrestler took them down, which they inevitably did in the course of a fight.

I believe this is the case with hackers vs. business guys as well. Hackers can generally become very proficient in business in 3~5 years on the job, but a business guy would need 10+ years of focused practice in order to become equally proficient in hacking, and until they learn will be absolutely clueless when working with hackers.

And in the early wrestler-dominated days of MMA, people envisioned a future where every MMA athlete would be equally well-rounded in all of the disciplines and such distinctions would become unnecessary. But as is often the case, the reality has turned out a bit differently.

A strong wrestling base is still a huge plus and a strong indicator of success - There are 8 weight classes in the UFC and 5 of them are wrestlers. But in general, what has happened is that in order to be a champion or championship contender, one needs to be minimally (i.e. above average) well-rounded in every discipline, but every champion is exceptional in at least one discipline. For example, non-wrestler champions like Anderson Silva (185 lbs) and Jose Aldo (145 lbs) are outstanding kickboxers who are competent enough in wrestling to be able to avoid being taken down. The days of only-specialists are gone and the days of only-generalists never came; the reality has turned out to be a combination of the two.

I expect to see the same dynamic in the startup world. Hackers are becoming more business-minded and business guys are (maybe less so) starting to realize the "power" and importance of hackers, but I don't expect the two worlds to ever completely converge. It will be important to be world-class in at least one discipline (hacking or marketing or whatever), but everyone will need to be at least above-average in all disciplines to expect to compete at all.

Re: Hackers can be business guys, and other lessons from Paul Graham

#46

Post by jarek »

lifeisstillgood wrote: post #34
jkuria wrote: post #26

Earlier quoted context omitted.

I don't think anyone should try to follow Branson's example. The man is gambler and an extreme case of return on luck. One early success and some antics that catapulted him into fame, then this notoriety allowed him to hire good managers (Ex-McKinsey types) to run and launch new businesses under his name. Read his book 'Losing My Virginity' and you'll understand why.

Let me out it another way - high school drop out commits to startup career, fights through years of slow growth, relentlessly resourceful in finding new ways to keep afloat, then has break through, willing to risk capitalising on break through, then manages cash flow from that to diversify and repeatedly identify and create new businesses, brining in talent and nurturing it to maximise return So this is what the YC a…

I would think the trouble lies with the fact that, with some frequency to be debated, a high school drop out commits to startup career, fights through years of slow growth, relentlessly resourceful in finding new ways to keep afloat, then doesn't have a break through. It's not clear that a break through always happens, and we risk into getting no true Scotsman territory with "well, if you were resourceful enough it would have happened."

Winning the lottery (by buying a lot of tickets, trying to find patterns, fighting through years of middling returns, relentlessly resourceful in finding new ways to not go bankrupt) is great if you do it, but expected outcomes are better for just plain working.

Of course, the whole VC scene is based on getting people to try to win the lottery...

Re: Hackers can be business guys, and other lessons from Paul Graham

#47

Post by krakensden »

jusben1369 wrote: post #30
jiggy2011 wrote: post #22

Earlier quoted context omitted.

I don't know, even before YC a lot (most?) of the prominent successful tech startups were started by pretty technical people Microsoft , Apple , Yahoo , Google etc.

That's why I emphasized "wide spread". And Google and Yahoo bought in "mature businessy" CEO's. And Jobs to me was always a business guy wrapped in the cloak of dev but that's a whole other discussion!

Eric Schmidt isn't just a suit- he wrote (co-wrote?) lex.

Re: Hackers can be business guys, and other lessons from Paul Graham

#48

Post by hkmurakami »

arjunnarayan wrote: post #38
jusben1369 wrote: post #17

I always thought this was PG's greatest gift to the tech world. To horribly generalize - prior to YC "business" people had a patronizing attitude toward developers. They were expensive assets - comparable to hw/sw and data-centers - that were required to successfully launch and grow a startup. But they weren't invited to the strategic table too often. They didn't get business. I don't know this to be a fact but I alw…

While I agree with you, I wouldn't attribute the entire effect to Paul Graham. There's a steady progression: Phase 1 was Larry and Sergey: they tried their hardest to stay in charge, but the powers that be (i.e. the money) forced a CEO on them. The best they could do was limit the damage by making sure the CEO had as much technical chops as possible. In retrospect, Eric Schmidt was great: a real hacker in background…

>I think we can credit this to Peter Thiel: since Thiel had first hand experience at PayPal, he probably has tremendous respect for hackers (I don't know what his personal hacking skills are, but I suspect they are good).

Peter Thiel's educational background is in philosophy and law [1]. There's been no public demonstration of hacking ability from him. I'd suspect that his respect for hackers was (if it didn't exist from earlier years through his personal relationships) grown from his partnership with Max Levichin in founding PayPal and keeping it afloat during those tumultuous years via multiple technical breakthroughs (including fraud detection, researched and developed by Levichin).

[1] https://en.wikipedia.org/wiki/Peter_Thiel#College_and_law_sc...

Re: Hackers can be business guys, and other lessons from Paul Graham

#49

Post by paulsutter »

jusben1369 wrote: post #17

I always thought this was PG's greatest gift to the tech world. To horribly generalize - prior to YC "business" people had a patronizing attitude toward developers. They were expensive assets - comparable to hw/sw and data-centers - that were required to successfully launch and grow a startup. But they weren't invited to the strategic table too often. They didn't get business. I don't know this to be a fact but I alw…

Come on guys, Hewlett and Packard were engineers, and they _slightly_ predated pg, Larry, Sergei, and Mark Z. Even their mentor was a professor, not a "business guy". From Wikipedia[1]:

"Bill Hewlett and Dave Packard graduated with degrees in electrical engineering from Stanford University in 1935. The company originated in a garage in nearby Palo Alto during a fellowship they had with a past professor, Frederick Terman at Stanford during the Great Depression. Terman was considered a mentor to them in forming Hewlett-Packard. In 1939, Packard and Hewlett established Hewlett-Packard (HP) in Packard's garage with an initial capital investment of US$538."

Drones in khakis and blue shirts have been trying to infiltrate the valley ever since. It's true that their influence waxes and wanes, but they've never been the ones to drive things here.

[1] http://en.wikipedia.org/wiki/Hewlett-Packard

Re: Hackers can be business guys, and other lessons from Paul Graham

#50

Post by yuhong »

arjunnarayan wrote: post #38
jusben1369 wrote: post #17

I always thought this was PG's greatest gift to the tech world. To horribly generalize - prior to YC "business" people had a patronizing attitude toward developers. They were expensive assets - comparable to hw/sw and data-centers - that were required to successfully launch and grow a startup. But they weren't invited to the strategic table too often. They didn't get business. I don't know this to be a fact but I alw…

While I agree with you, I wouldn't attribute the entire effect to Paul Graham. There's a steady progression: Phase 1 was Larry and Sergey: they tried their hardest to stay in charge, but the powers that be (i.e. the money) forced a CEO on them. The best they could do was limit the damage by making sure the CEO had as much technical chops as possible. In retrospect, Eric Schmidt was great: a real hacker in background…

Nowadays there is even Marissa Mayer of Yahoo and David Marcus of PayPal. I hope that this kind of CEO becomes more common.
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