Live data from Hacker News

Lecture 8: How to Start a Startup

startupclass.samaltman.com

11–20 of 38 posts

Re: Lecture 8: How to Start a Startup

#11

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

> DoorDash adds value by delivering more efficiently than small businesses can on their own...DoorDash is competing on one main dimension: cost. And how do they achieve lower cost than a mom & pop macaroon shop? By scaling. Operating at scale is their main competitive advantage.

You make some good general points in your comment, but since you're holding up DoorDash as an example of success, I thought I'd point out that DoorDash is just one of a number of "on demand" companies that are currently en vogue.

In many cases, their ability to scale is heavily dependent on their ability to shift major costs (taxes, vehicle operation, commercial auto insurance, etc.) onto their workers, who they classify as independent contractors. The big question is whether the workers are actually independent contractors. This is a topic of discussion in legal circles[1] and the trend does not look favorable for many of these companies[2]. Uber is already being sued for misclassification[3] and the same attorney says she's looking at Homejoy[4].

One adverse outcome in a legal action could change the economics of these businesses significantly, and potentially even put some of them out of business.

[1] http://www.pepperlaw.com/publications_article.aspx?ArticleKe...

[2] http://www.msnbc.com/msnbc/fedex-loses-court-case-against-dr...

[3] http://uberlawsuit.com/

[4] http://www.washingtonpost.com/news/storyline/wp/2014/09/10/a...

Re: Lecture 8: How to Start a Startup

#12

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

he said it in the lecture: it's more important to go fast than to worry about scaling when you're trying to get your first users/customers.

of course you need to scale later, but the activation energy of getting users/customers is high and you will likely need to try many solutions to overcome that activation energy, so fast is better than scalable in the beginning.

Re: Lecture 8: How to Start a Startup

#13

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

> DoorDash adds value by delivering more efficiently than small businesses can on their own...DoorDash is competing on one main dimension: cost. And how do they achieve lower cost than a mom & pop macaroon shop? By scaling. Operating at scale is their main competitive advantage. You make some good general points in your comment, but since you're holding up DoorDash as an example of success, I thought I'd point out th…

>In many cases, their ability to scale is heavily dependent on their ability to shift major costs (taxes, vehicle operation, commercial auto insurance, etc.) onto their workers, who they classify as independent contractors.

well, probably time comes for a "collective bargaining on demand" startup and an app for it

Re: Lecture 8: How to Start a Startup

#15

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

You raise a good issue, the role of mobile phones.

Okay, I heard that point in the lecture and read it again in your post.

Okay, now for me -- I'm slow this evening, and I still just don'e get it on the crucial role of a mobile pbone. A phone, sure. But what's the crucial role of the mobile part?

A guess: For a given delivery job, the candidate drivers typically are not close to a land line or desktop phone. Instead they are out and about typically in the car they will use for the delivery. So, the fact that their phone is mobile, that is, with them always, is what is crucial. A guess.

A second guess: The phone should be not just mobile but also smart so that it has GPS to say where the heck the driver is currently. Then, with an app on the smart phone, could let the central office or dispatching system pick the driver closest to the location of the pickup. But this would meant that they have an app, and I thought that maybe so far they didn't.

Gee, I had heard that it was standard for taxi services to be willing to pickup from a restaurant and deliver the food.

And I'm confused: Where I've lived in the US, it has long been standard for pizza shops and Chinese restaurants to be willing to deliver. So, sounds like the problem of delivering food for such restaurants had long since been solved.

Apparently there's going to be more of this stuff of a customer pushing some buttons and have some product delivered within, say, an hour. So, apparently one goal of Amazon is to have warehouses in major cities so that there can be same day delivery of orders. Okay, then, Doordash could be looking to do those deliveries?

There should be some economies of scale here: That is, for five pizzas, have two ways to proceed. First way, just pick up the pizzas one at a time and deliver them. The second way is to pick up all five pizzas and deliver them using a solution to the traveling salesman problem with six stops, the pizza shop and the five customers. So, of the pizza shop is busy, get to pick up several orders there within, say, 5 minutes. Or, maybe pick up from several restaurants in the town center and deliver to the surrounding houses and offices -- one Doordash with nearly all the restaurants in the town center would have an economy of scale.

Doordash got such fast response from their simple landing page that maybe a lot of taxi drivers, some of which are just sole proprietorships anyway, and, sure, now likely making heavy use of cell phones, that they could just offer a service like Doordash for any pairs of customers and restaurants that want a delivery. I'm failing to see why the taxi drivers in Peoria need Doordash to follow the same idea.

Re: Lecture 8: How to Start a Startup

#16

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

Non-scalable things usually can still scale to tens or hundreds of customers, and those first tens or hundreds are the hardest customers to acquire for startups. The hardest thing for startups is to get started (hence gain insights to what problems are most important to solve first), and these non-scalable things are the fastest/easiest ways to start. For typical hackernews readers, solving problems and scaling are usually not too hard (challenging but quite doable), but getting started fast and finding THE problems are very very hard and often not fun to do.

Re: Lecture 8: How to Start a Startup

#17
post #9

I don't understand why there's so much emphasis on doing things that don't scale. Here's why: In this lecture, we heard about DoorDash, a successful delivery business that is now expanding to multiple cities. DoorDash adds value by delivering more efficiently than small businesses can on their own. An example of a small business that benefits is a Palo Alto Macaroon store. Before DoorDash, the Macaroon store took ord…

If you hadn't read yet, read the original Paul Graham essay on this: http://www.paulgraham.com/ds.html The idea is part you must do whatever it takes to have your first users/clients and keep growing from there (as the guy from Teespring says) and part is that you must first know what to scale. Sure, startup = growth, no one starts a startup without imagining it will grow a lot . But that is why this advice is partic…

Here's an analogy: Have some URLs of some Web pages and want to extract the links from those pages? Okay, first do it by hand! So, have a Web browser save the HTML and CSS, JS, files.

Then use a good editor to look at the HTML and see how to parse the thing and extract the links.

Write some code to do this and try on some more of the URLs. When see are not parsing the files just right, tweak the code.

Finally, get some okay code and get and parse all the HTML files from all the URLs with the code -- scalable!

So, start by hand and see how to automate the work and then have a scalable solution.

I just did that for a collection of about 5000 URLs!

Re: Lecture 8: How to Start a Startup

#18
Do things that don't scale is a great. An approach we took to heart. However, we're now ripping apart at the seams and this is negatively affecting our members. So now I need to go out and raise capital so that we have more bandwidth, but in doing so I exacerbate the problem because when I'm away lose 1/3rd of our team. I can't way I would have done anything differently, but if the capital is not there when you need it, then things start to break down with this approach.

Re: Lecture 8: How to Start a Startup

#19
post #2

I've been eagerly watching/reading all of these lectures. Top quality content. Many thanks to YC for doing this - I look forward to the beneficial impact that spreading this knowledge will have. My only complaint is that many of these things are easy to hear, and agree with - i.e. talk to users first, of course! Yet, it can be hard to bridge the gap between what we agree with, and the actions we take. Much easier to…

Wow, I had no idea about typeform before you comment. Awesome stuff there.

Re: Lecture 8: How to Start a Startup

#20
DoorDash should team up with Uber, Lyft et al. Or the other way around, Uber or Lyft could do what DoorDash does.

On another note, home delivery has been in Japan for many years, but there, the density of population makes it feasible - someone at the restaurant just loads the trays of food onto a special spring-suspension tray holder on his bicycle and makes the delivery. After finishing the meal, the recipient leaves the trays, dishes, and bowls outside for pick up the next day. Usually, there is no extra charge, and tipping isn't common in Japan, so it's a good deal.

See http://books.google.com/books?id=kJ3TAgAAQBAJ&pg=PT116&lpg=P...

Also, for some history, http://books.google.com/books?id=OT8OSoiYyagC&pg=PA38&lpg=PA... q=demae%20japan%20delivery&f=false

I don't know if this is still possible, but apparently you can order take-out using a Wii catering channel: http://www.destructoid.com/japan-order-pizza-with-your-wii-i...

Here's an example of the take-out offerings from restaurants in a particular area (postal code): http://demae-can.com/search/delivery/today/13110013001/

There are ratings listed. Heh, maybe there's another teaming possibility ... Yelp.

Post reply on HN