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You Have to Be A Fool to Start a Company

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Re: You Have to Be A Fool to Start a Company

#31

Post by gizmo »

tptacek wrote: post #24
gizmo wrote: post #23

Earlier quoted context omitted.

You're arguing against a straw-man version of my argument and you're making absurd claims in the process ("you don't learn anything from a startup" / "you spend 60% of your day in meetings"). When you write nonsense like this you can't possibly expect a constructive responsive.

See, you think I'm exaggerating or being hyperbolic, and I'm not. I might be wrong. But I'm not just making things up. I am telling you that you probably don't learn more from failing in a startup than you could have in 3-5 years doing something else, and that yes, in fact, if you have the misfortune of getting funded, you can wind up in a job that you're handcuffed to that involves you spending most of your time in…

When you do a startup you have to learn about building a product, finding customers, managing a team efficiently, hiring the right people, building a brand for your company, determine a revenue model, basic bookkeeping, and so on. I'm just listing a couple of the many things you have to learn when doing a startup. None of these things you have to do when you're a software engineer in an established company. You can only spend a few hours a day on software, if you're lucky. The rest of the time you're building different skills. So that's why I can't take the claim "you don't learn anything" seriously.

If you're in meetings all day you're either not delegating enough or you like being in meetings all day. Either way nobody is forcing you to have meetings all day every day.

Re: You Have to Be A Fool to Start a Company

#32

Post by gizmo »

borism wrote: post #17
tptacek wrote: post #12

Earlier quoted context omitted.

First, stop kidding yourself. The year everyone loses trying to get funded doesn't teach them anything other than "getting funded is harder than all the blog posts make it sound". The 3-5 years the "lucky" few lose on ultimately unsuccessful shoot-the-moon startups don't teach them anything other than "it is possible to waste a spectacular amount of money without much revenue in return for it, and that's a great way…

indeed. this "significant contribution to the economy (+ job creation)" part is especially delusional. most of the jobs are still created by small businesses.

Not the interesting ones. There's a reason people so many want to work for Microsoft / Google / Apple / Sun, etc. Small companies have the hardest time attracting really talented and ambitious people. And they usually can't afford them either.

A startup often works on interesting problems from day one, and if (!) it becomes profitable the jobs become permanent.

Since larger companies mostly grow by buying startups, a large part of all "interesting" jobs are created by startups/spinoffs.

Re: You Have to Be A Fool to Start a Company

#33

Post by staunch »

tptacek wrote: post #28
pg wrote: post #27

Earlier quoted context omitted.

Working on a startup is probably not the most interesting way you could spend your time, but it will be at least as interesting as getting a job as a developer at an existing company in the same field. So if that is the alternative and you're young enough to bear the financial risk, it makes sense to try.

You're right. But you can't look at each bite at the apple independently, either. A failed startup might very well be a better experience than three years at a great company. But two consecutive failed startups is probably not better than six years at a great company, if you take the company job as seriously as startup founders supposedly do. After a couple years at a great company, an A-player is going to get much m…

> But two consecutive failed startups is probably not better than six years at a great company...

Only if you're talking about the quality of the experience, and even that's entirely subjective.

If the goal is financial independence there's no comparison. Your shot at making FU money working for someone else is essentially zero. As a founder your shot at achieving financial independence is considerable, and making FU money is at least a possibility.

Re: You Have to Be A Fool to Start a Company

#34

Post by tptacek »

staunch wrote: post #33
tptacek wrote: post #28

Earlier quoted context omitted.

You're right. But you can't look at each bite at the apple independently, either. A failed startup might very well be a better experience than three years at a great company. But two consecutive failed startups is probably not better than six years at a great company, if you take the company job as seriously as startup founders supposedly do. After a couple years at a great company, an A-player is going to get much m…

> But two consecutive failed startups is probably not better than six years at a great company... Only if you're talking about the quality of the experience, and even that's entirely subjective. If the goal is financial independence there's no comparison. Your shot at making FU money working for someone else is essentially zero. As a founder your shot at achieving financial independence is considerable, and making FU…

This has been disproven time and time again. It's flat out wrong. You have a far better chance of becoming a millionare by careful career and money management than you do in entrepreneurship.

Your odds of making "FU money" are so remote that it is irrational to bank your career on it. Remember, during all the time that you're chasing the "FU money" (that you again are never going to see), you are also not contributing significantly to your retirement.

There are plenty of reasons to start companies, but money isn't a great one.

Re: You Have to Be A Fool to Start a Company

#35

Post by pg »

tptacek wrote: post #34
staunch wrote: post #33

Earlier quoted context omitted.

> But two consecutive failed startups is probably not better than six years at a great company... Only if you're talking about the quality of the experience, and even that's entirely subjective. If the goal is financial independence there's no comparison. Your shot at making FU money working for someone else is essentially zero. As a founder your shot at achieving financial independence is considerable, and making FU…

This has been disproven time and time again. It's flat out wrong. You have a far better chance of becoming a millionare by careful career and money management than you do in entrepreneurship. Your odds of making "FU money" are so remote that it is irrational to bank your career on it. Remember, during all the time that you're chasing the "FU money" (that you again are never going to see ), you are also not contributi…

If you phrased it "the average person has a far better chance of becoming a millionare by careful career and money management" I'd have agreed with you. The average person is not suited to starting a startup. But for the 1% of people who are suited to it-- the ones sufficiently smart and determined-- the odds are actually reasonably good.

I'm not sure what you mean about it having been disproven that starting a startup is a bad way to make money. Presumably the same sort of statistical evidence that would prove that randomly selected people can't do anything hard. But what matters to someone asking this question is not whether random people could do it, but whether they could, and if the right sort of person is asking the question, the answer becomes very different. If the young Bill Gates is asking the question, the odds of making FU money are close to 100%.

(Microsoft was already doing well before they got lucky with the DOS deal.)

Re: You Have to Be A Fool to Start a Company

#36

Post by wlievens »

gizmo wrote: post #32
borism wrote: post #17

Earlier quoted context omitted.

indeed. this "significant contribution to the economy (+ job creation)" part is especially delusional. most of the jobs are still created by small businesses.

Not the interesting ones. There's a reason people so many want to work for Microsoft / Google / Apple / Sun, etc. Small companies have the hardest time attracting really talented and ambitious people. And they usually can't afford them either. A startup often works on interesting problems from day one, and if (!) it becomes profitable the jobs become permanent. Since larger companies mostly grow by buying startups, a…

> Since larger companies mostly grow by buying startups

Is that even true?

Re: You Have to Be A Fool to Start a Company

#37

Post by borism »

wlievens wrote: post #36
gizmo wrote: post #32

Earlier quoted context omitted.

Not the interesting ones. There's a reason people so many want to work for Microsoft / Google / Apple / Sun, etc. Small companies have the hardest time attracting really talented and ambitious people. And they usually can't afford them either. A startup often works on interesting problems from day one, and if (!) it becomes profitable the jobs become permanent. Since larger companies mostly grow by buying startups, a…

> Since larger companies mostly grow by buying startups Is that even true?

it depends, but generally no

Re: You Have to Be A Fool to Start a Company

#38

Post by wlievens »

borism wrote: post #37
wlievens wrote: post #36

Earlier quoted context omitted.

> Since larger companies mostly grow by buying startups Is that even true?

it depends, but generally no

A vague answer :-)

To me, the remark sounded like a fanboi of the 'acquisition-target' business model which I personally think is naive and unsustainable.

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