151–160 of 175 posts
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Jack Dorsey often says. You don't need to be first to market. You just need to be best to market. Demonstrated through Twitter, and now Cashapp
I'm reminded of the scene in Margin Call[1]: "There are three ways to make a living in this business: be first, be smarter, or cheat." [1] https://www.youtube.com/watch?v=Hhy7JUinlu0#t=6m22s
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> However, "customer acquisition cost" seems to imply that that customer is now "yours" I’ve confused a few people this ways in conversation lately and I’m not sure what the solution is, but it’s a case of saying, “even the most optimistic scenario is still very bad”. Keeping someone’s attention is never going to be cheaper than getting it in the first place. The best you can do is spend a maintenance cost to retain…
Thanks. Subscriptions always seemed to me like they were for the business' benefit, not for mine. I'm sure it does make the growth models look really good; you've got this nice, regular stream of money coming in. However, it does nothing for the customer. I refuse to subscribe to anything, as a rule. Deliver some value, and I'll pay for it when I need it. YMMV.
Have you never spent money at a company precisely because you hope it’ll stick around? Companies you only really need every three years have a hard time sticking around, and you may find that when you need them most they’re having a going out of business sale.
Patronage. Patronage is more than a purely transactional relationship with a company.
So I am a Silicon Valley outsider. I live in the northern EU and work with project management in the construction industry representing the owner. It’s mostly infrastructure, roads, water. Old industry, conservative, we basically hate new things. On my spare time I tinker with my computer, learn assembly or whatever. Hence HN. I have recently started a course in corporate finance at my local uni because my new role r…
> a lot of theses articles are pretty basic corporate finance One take: yes, and venture-backed companies often forget or ignore the basics of corporate finance. Another take: orthodox corporate finance isn’t tailored for start-ups. If you’re developing a product, GAAP income is meaningless. So we bootstrap interim financial metrics, e.g. eyeballs and ARPUs and DAUs (oh my!). In truth, the latter dominates at the ear…
AirBnB hasn’t had a long stretch of profitability. But I will give it the benefit of the doubt that it can maintain profitability.
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Most innovation of internet and computer-related business come from Silicon Valley, so it seems reasonably clear to me that investors there are doing the right thing. To be honest, I find it hard to name any highly successful EU companies whose main business is internet-based or software-related, at least not in the b2c sector. There are some, but the major players seem to come from the US and more recently also from…
Skype, Spotify. But both grew with SV venture. EU venture is not as good for early companies because they are much more conservative.
It’s contractually obligated to give its suppliers 70% of its revenue and its major competitors consider its whole reason for being just a tiny feature.
Streaming music is a “feature not a product”
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Can we at least agree that any profits above zero are actually profits? And the question of just how profitable is a different financial metric?
No? Because if you need tons of capital to make a minuscule profit your company is worth nothing. (A company has to outperform at least the interest people can get on bonds plus some equity premium.) Amazon could make a significant profit, if Bezos wanted. But that’s a different question.
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So far, my experience has been that business as a start-up is basically about surviving long enough to make a profit. Of course, some ideas are just bad, but I'm convinced loads of start-ups that failed could have been made to work given sufficient time. This doesn't work so well if you take a pile of capital, but if you go for organic growth it is more plausible to survive hand to mouth for a while.
>> Of course, some ideas are just bad, but I'm convinced loads of start-ups that failed could have been made to work given sufficient time. Are some businesses under capitalised? Sure. Could "loads" be saved with more capital? Well yes, for some definition of "loads". But annedotally I'd suggest that "most" are just bad ideas. Or perhaps more accurately "incomplete ideas". To be a success business you need; A) a prod…
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I'm reminded of the scene in Margin Call[1]: "There are three ways to make a living in this business: be first, be smarter, or cheat." [1] https://www.youtube.com/watch?v=Hhy7JUinlu0#t=6m22s
That line was specifically about financial markets, not products.
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> a lot of theses articles are pretty basic corporate finance One take: yes, and venture-backed companies often forget or ignore the basics of corporate finance. Another take: orthodox corporate finance isn’t tailored for start-ups. If you’re developing a product, GAAP income is meaningless. So we bootstrap interim financial metrics, e.g. eyeballs and ARPUs and DAUs (oh my!). In truth, the latter dominates at the ear…
Actually the problem with startups is that they focus on corporate finance too much. When in reality they should be acting like a small business e.g. florist. Often these startups are failing because of basic cash-flow management.
GAAP accounting is for stable cash flows in well understood businesses. Bootstrapping (funding growth with revenue) isn't the silicon valley way; the silicon valley method is as follows: 1. get funding 2. grow team/build product 3. raise more funding and find product market fit 4. seize control of market / make large top line moneys 5. repeat 3/4 a as necessary. 6. acquisition/IPO, shareholders payout.