Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Success, and Farming vs. Mining

blog.wilshipley.com

Post reply on HN
Print view View original

21–30 of 48 posts

Re: Success, and Farming vs. Mining

#21

Post by nanoanderson »

One thread that is interwoven throughout the piece but surprisingly not called out explicitly is the role of the tech media in the glamorization of high-growth, high-exit-return startups and their investors. Nostrademons has some good points about the virtues of startups that Wil didn't touch upon (though I'm sure he's aware of them. His piece doesn't strike me as though he's blanket-bashing venture-capitalized startups).

The dollar amounts attached to these "lottery" startups (whether in investment or in exit) are awesome, but not outrageous, especially given who the investors are. The one thing that Wil said that did bother me was his assertion that a funded started is necessarily a "mining" startup, to use his metaphor. I see it his way, and it brought me down a little bit, even though I already knew it inside.

Re: Success, and Farming vs. Mining

#22

Post by jrspruitt »

The miner in this reminds me of the movie Easy Rider, make a big score, then take the money and do what ever you want, which in the end turns out to not be what they thought it was. I've never had the fortune of making it into the industry, so from an outsiders perspective. I wonder since it seems a lot of what internet start ups are based on, is having a following, as in, your app is useless unless its got users to go with it. If some of the mining is similar to creating a product and selling it to someone with the ability to manufacture it. Like if I thought of a cool toy, patented it, and then sold that to Mattel, because I don't have the resources to capitalize on it. In the start up internet world, to prove the worth of the design, you need users. So the mining concept is just the adjustment needed in the internet world, for inventors to sell their inventions. Seems kind of similar. For me at least, I would probably want out as soon as possible, the business side of it, isn't as interesting as the building side of it, I would loose money on a successful business for sure, but it would give me the lateral mobility to pursue my interests, which are not being a CEO of a company.

Re: Success, and Farming vs. Mining

#23

Post by crasshopper »

The stock market ... what’s important ... is the potential growth of your sales, not your current sales, since the point of buying stock is to sell the stock to someone else later on, at a higher price.

Or to receive dividends. Heard of blue chip investors? Buy-and-hold strategy?

"Mining" versus "farming" is disputed in the stock market as well. That's why people talk about P/E ratio.

Re: Success, and Farming vs. Mining

#24

Post by fleitz »

No when you're mining you use the capital you acquired to start more mines. There are lots of unprofitable mines, software is much more akin to mining in that your market is generally unknown, it requires a lot of capital cost and the the payoffs if you strike gold are enormous, however most will not strike gold. As we've discovered in Canada once you've dug that hole you can make decent coin by allowing cities to fill it with their trash.

Producing software is a capital intensive business with large pay offs that are irrespective of the amount of labour/capital inputted, consulting is a business in which one makes a slight profit over labour. Software that you own outright is a labour intensive capital good. If you're advocating the farming market of the software business then you're advocating consultancy which if done right can make you decent coin, the problem is that if you can actually make software that people want to use then you're generally better off moving towards the mining market.

What the OP is talking about is largely the difference between owning a mine and being a mining industry consultant / mine worker. Mining is an industry that is unpopular and his impression of farming is largely that of something that last existed in the 1920s.

Modern farming has nothing to do with returning the land to it's native state and has everything to do with pumping it full of nitrogen, spraying it with pesticides and hiring low wage workers, applying for gov't subsidies so that you can eek out 1-3% profit with enormous capital costs. The picture in the supermarket of a farmer is not reality.

Re: Success, and Farming vs. Mining

#25

Post by bigiain »

fleitz wrote: post #24

No when you're mining you use the capital you acquired to start more mines. There are lots of unprofitable mines, software is much more akin to mining in that your market is generally unknown, it requires a lot of capital cost and the the payoffs if you strike gold are enormous, however most will not strike gold. As we've discovered in Canada once you've dug that hole you can make decent coin by allowing cities to fi…

"As we've discovered in Canada once you've dug that hole you can make decent coin by allowing cities to fill it with their trash."

Ah ha! The mining industries version of a "pivot" huh?

Seriously though, I assume that actually means "you can attempt to recover some tiny part of your existing loss" instead of "make decent coin".

Re: Success, and Farming vs. Mining

#26

Post by schwabacher »

kujawa wrote: post #19

I come from Montana, and I hate this dichotomy. The fundamental law of resources in this world is: if you can't farm it, you must mine it. They're a yin and yang. I come from Montana, a state which basically has only two industries: farming and mining. When you live that close to the land, it becomes very apparent who the actual producers are. Everything else is wanking. Productive wanking, but wanking nonetheless. T…

Miners use software to find minerals to mine, farmers use Combines and harvesters run with software. The farmers plant seeds and use fertilizers and pesticides that were created with the help of software. Mining and farming equipment is designed and built using software. If a farmer or miner gets sick, a doctor might use software to display and interpret their MRI or ultrasound.

We have come a long way from subsistance farming, and computers, software, and the people who create them have helped make miners and farmers (and everyone else's) lives much easier and better than they would be if people only mined and farmed.

So, congratulations for doing important work!

Re: Success, and Farming vs. Mining

#27

Post by nkurz »

stray wrote: post #18
avolcano wrote: post #13

Earlier quoted context omitted.

Oh, many a time. Spent a couple days just browsing eBay for Mac Minis. Truth is, though, I really won't have the kind of money to drop on a system for quite some time. Hell, I wouldn't even have a laptop if I wasn't lucky to enough to receive a CR-48 :p Some day, when I have money, I'll probably sell off the CR-48 (it's a nice little system, once you get the BIOS flashed and ChromeOS replaced) and put that towards a…

How much [cw]ould you pay for a mac mini? I have one sitting across the room from me that I hardly use. It's an early intel model with 1gb. I want to buy a new one to run OpenCyc (which requires 4gb) on but I can't bring myself to just scrap the old one.

Just give it to him already. Ask him to pay shipping, and bask in the good deed while you wait for your new machine. Rather than asking him to part with a small amount of money he probably can't really afford and you likely don't really need, tell him to pass the favor on to someone else someday.

Re: Success, and Farming vs. Mining

#28

Post by donnyg107 »

It seems this guy is basically just describing the markets and calling traits problems. Obviously you need to invest in a company before its popular for it to be a good investment. A company with a fully stable profit won't even take your investment most of the time. "Mining" is just the process of investment! However, I do not think this is the point. The important point I think he's getting at is not that the markets are evil, but that founders shouldn't be investors. If you start a company, you should be interested in BUILDING A COMPANY, not selling a big company and making a boatload. Obviously, people want to make money, but for some reason the misconception that the cash in hand for a crappy company is worth more than the cash in stock for a great and growing company. And even further, the founder interested in building a great company is more likely to reach that amount of money faster, just because they are invested in making a good company, and will make efficient and secure progress toward his or her vision with every day of work. Great companies start with people who want the company to succeed and investors who wan to make a buck, not the other way around.

Re: Success, and Farming vs. Mining

#29

Post by donnyg107 »

At first glance, it seems this guy is basically just describing the markets and calling traits problems. Obviously you need to invest in a company before its popular for it to be a good investment. A company with a fully stable profit won't even take your investment most of the time. "Mining" is just the process of investment! However, I do not think this is the point. The important point I think he's getting at is not that the markets are evil, but that founders shouldn't be investors. If you start a company, you should be interested in BUILDING A COMPANY, not selling a big company and making a boatload. Obviously, people want to make money, but for some reason the misconception that the cash in hand for a crappy company is worth more than the cash in stock for a great and growing company. Great companies start with people who want the company to succeed and investors who wan to make a buck, not the other way around.

Re: Success, and Farming vs. Mining

#30

Post by donnyg107 »

DanI-S wrote: post #10

On a slight tangent, modern farming techniques are more akin to the mining he describes than they are to farming. It's not just the software industry that is affected by this short-term thinking; it's the majority of human endeavour. It's hard to tell whether the stock market is a cause or a symptom - our primary mode of 'investing in the future' is so prone to being short-circuited for short term gain.

At first glance, it seems this guy is basically just describing the markets and calling traits problems. Obviously you need to invest in a company before its popular for it to be a good investment. A company with a fully stable profit won't even take your investment most of the time. "Mining" is just the process of investment! However, I do not think this is the point. The important point is not that "mining" and the markets are evil, but that founders shouldn't be investors. If you start a company, you should be interested in BUILDING A COMPANY, not selling a big company and making a boatload. Obviously, people want to make money, but for some reason the misconception that the cash in hand for a crappy company is worth more than the cash in stock for a great and growing company. Great companies start with people who want the company to succeed and investors who want to make a buck, not the other way around.
Post reply on HN