As a 32 year old owner of 2 failed and one successful startup, I can say without hesitation that this is by far the most insightful piece I've read on the topic. It was not just an essay, for me this was a trip down memory lane. Thanks to the author for a very insightful and enjoyable piece of literature, I hope to see this selected as its been submitted to Slashdot.
Why to Not Not Start a Startup
121–130 of 142 posts
Re: Why to Not Not Start a Startup
#122A sad thing about life is that after squandering ten years on playing in bands and stuff (point 11), if you eventually do get your act together and go to university and then (point 16) take the default route to a job in a big company, happy to make a living at all; after a while, if you have half a mind, you'll end up realizing that you're getting dumber by the year (point 14), but by then you've also stumbled into a…
Or alternatively you spend 8 years in the military, 4 years in a big national Telco and then you're 33, with a family, and even PG saying you shouldn't start a startup.
Re: Why to Not Not Start a Startup
#123Earlier quoted context omitted.
That may be true, but you can work for 5+ years at a problem, fully supported by your university, without having to worry about pleasing anyone in the short term. There is no need to worry about releases or fickle customers. And in the end, success is virtually guaranteed. So I would have to agree that grad school is more "friendly" than starting a startup, where you have to start worrying about the viability of your…
In the end though, is it not all about money? As far as I am concerned, grad school is something you do for fun, and which costs a lot of money. Even if you receive a minimum paycheck, you have to take the opportunity costs into consideratiosn, so five years of grad school cost several 100000$, or am I mistaken? Why then do you worry so much more about starting a startup? The differences in maximum loss seem marginal…
At least where I go to grad school (Ohio State University), grad school does not cost anything. You either win a Fellowship, you teach a class, you help a professor with his research, or you do grunt work like grading papers and labs. In any case, tuition, fees, and 80% of health insurance is covered, in addition to a $1600-1850 per month stipend. That works out to a respectable $20k/yr.
If you do not get a Fellowship, you are expected to perform 20 hours worth of work per week (which you actually receive credit for), in addition to your time spent on classes and on your own independent research.
In other words, grad school is more like a low-paying job than a cost. You could make the case that you could be working a higher-paying job in that time, but then you are missing out on the flexibility of being a Ph.D., which allows the possibility of being a professor or getting hired for a pretty high income. Additionally, you have the opportunity to leave your mark on the field with your research.
Even more interesting is that Ph.D. work could lead you to your startup idea, as you unveil a new use of existing technology or a new approach altogether which leads to a money-making possibility. Furthermore, if you are exceptionally driven, you may be able to get some work done on your startup idea while attending grad school, because at least so far, I have found grad school to be significantly easier than my undergrad was, because I am taking less "real" classes.
Re: Why to Not Not Start a Startup
#124Provoking my thoughts to start a Start-Up again (I already failed twice). I will.
- Prabu
Re: Why to Not Not Start a Startup
#125Count me as one of the (apparently) very few who had a terrible time with my startup. The one thing that I really didn't count on his how hard the government makes it. It is a REAL pain in the butt to handle all the paperwork to create an LLC and then it gets worse when tax time comes around. I tried to do it all on my own and I would NEVER do it again without hiring both a lawyer and an accountant. How one-man operations do it, with all the legal and accounting plus doing their actual jobs of running the startup is unfathomable to me.
Re: Why to Not Not Start a Startup
#126The time span cited in that study was an aberration; anyone with an idea was getting money thrown at them. There is also a great big chasm between "still in existence" and success. If you sell-off assets for the benefit of creditors your company can still exist but it would be hard to call that a success.
The numbers I hear from my VC friends is that around 50% are out of business after the 2nd year. They see more of teh picture than I do so I trust they are better qualified to make teh call.
My opinion is that more companies fail because of incompetence than insufficient funding. If you really have a great idea you can make it work. The trouble is that most make some big mistake and spoil the well.
I think starting a company is one of the most exhilarating things you can do. I wish more people would try it. I also wish more of them would try to understand the basics of business operations. This is where I disagree with Paul. I have seen too many $100 million ideas ruined by founders mistakes. Too often the time has past before they can regain their opportunity.
I still encourage everyone to give it their best shot. It's a great ride, up or down.
Re: Why to Not Not Start a Startup
#127"[2] The best kind of organization for that might be an open source project, but those don't involve a lot of face to face meetings. Maybe it would be worth starting one that did" Mitch Kapor's OSAF (profiled in the excellent book Dreaming in Code) is an example of the pitfalls of doing this. I'd say the primary pitfall is the lack of hard deadlines which it itself caused by the lack of 'hunger' because profit/existe…
Hence the Cathedral and the Bazaar rule "release early and often".
Re: Why to Not Not Start a Startup
#128Hypothesis: "I'd rather work on hard AI problems at Google than create a startup and bitch about how Safari is not rendering my site properly." What do you think? I haven't tried either, but working on cool problems ought to be worth something. Most startup work seems rather mundane.
Other posters show an inability to engage in a sufficient level of abstraction. Original post is an interesting question that has nothing to do with AI, Google, or Safari. The point is that at a startup (especially the two guys and a laptop variety) you do absolutely everything yourself, while at a big company you are supported by IT, QA, custodial services, etc, etc. The interesting question is whether there exist j…
The Big problem with a Big company: Let's say you're working on a great project and you know what the next step should be to make the project even better. But, management disagrees and pursues a direction that you know will diminish the value of the project. Your options are to suffer and watch your energy go to waste, quit and work for another company (repeat the above), or to start a start-up and do the job the way you know it needs to be done.
There has been nothing more stressful for me than having this scenario happen - I just can't stand by and watch my efforts go to waste. (The Big company context for me was in the Architecture world, but you can substitute any profession you like in the above scenario) The best stress-reduction decision I have ever made was to start my own company. It was very difficult financially at first, but it was completely worth it.
Re: Why to Not Not Start a Startup
#129The success rate Paul has had is actually lower than average success rate of small business startups (with more than one employee) Everyone always quotes a 10% success rate after 1 or 2 years. That is, as Paul suspects, a myth. True success rate is around 66%. Y-combinator's success rate was 50% 66% OF SMALL BUSINESS STARTUPS LAST 2 YEARS http://www.smallbiztrends.com/2005/07/business-failure-rates-highest-in.html
Survival and success are two different things. The 50% PG referred to are for the founders becoming "rich" by their standards, not just staying in business.
Re: Why to Not Not Start a Startup
#1301. the best piece I've ever read on startups.
2. These ideas don't just apply to technology startups. They apply to new businesses generally.
3. Walt Disney couldn't make it on his own, knew this and got his brother Roy out of hospital (!) to work with him. Roy outlived Walt. Walt painted castles in the air, Roy built the (economic) foundations. = Co-founder good, Creative+Executor great :-) = There has to be real trust/loyalty between the founders. With enormous wealth on offer, enough people go crazy & try to take it all. A partner you don't know well can take you down easily.
4. 'Founders', a.k.a. entrepeneurs, are more willing to take risk than most people - which means they get pretty comfortable with failure. They are also a special breed. = Comfort is the enemy of Change. = Change is Risk, but the only way forward. = Comfortable people won't pursue a startup vigorously...
5. How do you get your Founders to "put skin in the game"? To have a personal stake in the outcome? (Besides losing their dream - or is that generally enough?)
6. One of the most important personal traits of a great entrepeneur - keeping a journal... Gotta write everything down. Crops up repeatedly in biographies. Richard Branson is quite clear about it - but doesn't relate it to his success. There is supposedly some research that says 1.5-3% of all people write down their goals. Once there was a long-term Ivy League school study (is this apocryphal?) showing that people who wrote down their goals out-performed others by 5:1 or 10:1
7. People are different. Some are shy/introvert, many extrovert. Shy people don't sift through the large numbers needed to establish 'good networks' and check-out who'd make a good partner. Many of the best geeks are quiet & retiring folk. They will, by definition, find it hard or impossible to bring along a partner. But forcing someone on them won't work either. This is a hard problem to solve. = A solution is something like your "Startup School", but a little more frequent, to provide a mileu in which these people can mix and hook up. [As conferences and User Groups can do.]
[For a great example of this, see how Paul Allen was treated by Bill Gates and Steve Balmer on his last project at Microsoft.]
8. The Internet changes everything. But the VC process is still face-to-face personal contact... Silicon Valley was caused by VC firms like "Kleiner, Perkins, Caufield & Byers" bringing money from The East into technology. Even with the hordes of imititors and rip-off merchants, greedy investors flocked and made out well... Because the place had critical mass - in people and places to meet, and the culture to support it. These comments are peppered with genuine frustration (& longing) from would-be entrepeneurs. = How can the Internet overcome this tyranny? = Business is about personal relationships. Can the Net ever replace or augment that critical factor?
9. Technology support. Finding someone who is fluent with a key technology, like hardware hacking, can be critical to the success of a project/startup. When it's not your field, how do you find a way in? Then how do you get taken seriously by an expert??
10. Scaling: small trials and growing entrepeneurs. My belief is that good entrepeneurs are grown, not born. And that there are predictable growth stages for all companies. A wealthy friends' advice is: Never attempt anything more than 30% larger than you've done before. = Have you thought of building a process to train up entrepeneurs before they enter your funding process? = I'm thinking graduated funding levels, starting low ($10k) and in a couple of stages getting to $500k or so.
11. For solid research on what makes great employees, see Robert E Kelley's book "How to be a Star Performer" [http://www.kelleyideas.com/pages/howtobeastar.htm] Number One Quality: Initiative. Sounds the same...
12. One of the prime causes of some recent major corporate collapses here in Australia was: "Ignorance, Arrogance and Self-Delusion". They are a powerful triplet that can't be broken through. Witness the non-musical entrants in "American Idol" who honestly believe they are brilliant. = How do you sort these out? They'll always have a high opinion of themselves, their abilities and a string of huge accomplishments.