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Startups are pummeled in the ‘great unwinding’

nytimes.com

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Re: Startups are pummeled in the ‘great unwinding’

#331

Post by d3ad1ysp0rk »

muse900 wrote: post #244
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

Small-medium hotel owner here, that used to write code for a living. What just happened in my industry, is forcing me to go look for a job. I don't think we are going to open for summer season or even if we do its not gonna make enough to live by. Hundreds or thousands of years ago, a few had all the wealth and then most people were poor. We even had slaves. I can't believe that in 2020 and with all the knowledge we'…

What hotel? I did mostly Ruby, Python, and engineering management before opening a Hostel :)

Re: Startups are pummeled in the ‘great unwinding’

#332

Post by imprettycool »

ummonk wrote: post #227
TheOtherHobbes wrote: post #161

Earlier quoted context omitted.

Anyone who thinks FAANG will survive without a contraction is deluding themselves. What happens to the ad market during a depression? How about luxury IT hardware? Entertainment subscriptions? Web services? If there isn't a bounceback in three months or so, the entire tech sector will deflate like a balloon. FAANG will probably survive in some form because of cash reserves, but there will absolutely be cancelled proj…

I've been reached out to by Google recruiters with COVID-19 specific messages. They know this is the time to hire software engineers.

This. Lots of cheap/desperate talent right now.

Re: Startups are pummeled in the ‘great unwinding’

#333

Post by haihaibye »

bsder wrote: post #252
tjr225 wrote: post #224

Earlier quoted context omitted.

Maybe I don't know the numbers. Maybe I only work for a startup because it allowed me some flexibility I wouldn't have had otherwise. Maybe I didn't know that a global pandemic was going to shut down the economy. Maybe I'm fresh out of college and don't know better. Maybe I lost my last job and had to take this job because the other option was to go bankrupt. Who knows? My point is the same as it was in my gp; your a…

> Maybe I didn't know that a global pandemic was going to shut down the economy. Then you are a fool. The tech economy crashes on 5-7 year cycles. See: Dot bomb. 2008 Financial Crash. Covid-19 in 2020. I can go backwards in time, too. 3D graphics card startup crash. Microprocessor startup crash. AI winter. etc. Too much money flows into the sector and then eventually the VC funds want it back. Roughly on 5-7 year tim…

> crashes on 5-7 year cycles. See: ... 2008 Financial Crash. Covid-19 in 2020.

2020-2008 is 12 years. Your second piece of evidence contradicts your main claim. Try again

Re: Startups are pummeled in the ‘great unwinding’

#334

Post by [deleted] »

rexreed wrote: post #86
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

Let's circle back in six months and see how you're doing. Things still feel nice and full when you've had a nice big dinner. But give me several lean days of no breakfast and meager lunch and dinner and you'll see just how full you feel. Startups are not in any way, shape or form, "better" than any other traditional business. In fact, maybe worse.

[deleted]

Re: Startups are pummeled in the ‘great unwinding’

#335

Post by grey-area »

scarface74 wrote: post #114
0x0001 wrote: post #107

Earlier quoted context omitted.

Not all startups require VC capital, some of us are just running without venture funding just clients money, some startups are in better shape because are on right market on the right time. You just need to be in the right time.

And you’re probably not looking for a large exit. You are trying that unheard of concept of spending less than you make. What you are doing is running a “lifestyle business”. That’s not a negative despite what the tech bro’s think. I hate the idea of success for a company seems to be “we got another round of funding while losing money”.

Sounds more like a 'business' to me.

Re: Startups are pummeled in the ‘great unwinding’

#336

Post by mikeg8 »

xapata wrote: post #294
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

> thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased operations overnight. It would be foolish of them to fold instead of getting loans. And it would be foolish of a bank to deny a good business a loan to get through the next couple years. I think much of the moaning about closing up is to encourage low-cost loans. Which is fair, because the government should be subsi…

One issue is the time it may take to get a loan approved and have funds available, especially during a crisis as dramatic as the one we’re in. The other larger issue is that the loan is incredibly high risk because the owner may not ever be able to pay it back and in some cases be asked to put their personal property up as collateral. If getting a loan was such a slam dunk, many more owners would be pursuing it, but the realities are, they may be worse off taking a loan they cannot pay back versus closing up and moving on.

Re: Startups are pummeled in the ‘great unwinding’

#337

Post by pixelmonkey »

seibelj wrote: post #131
pixelmonkey wrote: post #109

One of my good friends is a restaurant owner in NYC and my spouse is a doctor/surgeon in NYC. Startups aren't pummeled -- they're insulated. Restaurant owners and doctors are pummeled. And all of you who thought incompetent federal government leadership was OK in this modern world -- you were bamboozled. You can start apologizing now.

But I genuinely believe all federal government leadership is incompetent - it’s not a matter of it being “OK”, that’s just the default for every administration. Which country on earth is responding to this well without resorting to authoritarian practices?

If you don’t believe competence can exist in federal government administration, then you don’t believe in our representative democracy. If you don’t believe in that, then spare us your participation, and don’t vote. But please don’t express your lack of belief in competence by intentionally voting an incompetent leader into our most important office.

This pandemic is a world-wide A/B test on the difference between competence and incompetence, and we here in NYC now have to suffer because of votes we did not cast. Indeed, in spite of millions of votes we cast, that simply did not count.

The callous, purposeless, senseless disease came to us first, the lack of coordinated federal response harms us the most, but the contagion marches exponentially along — indifferently laying waste to grand life projects, solid small businesses, and urban vibrancy — and soon, it will come for us all.

Re: Startups are pummeled in the ‘great unwinding’

#338

Post by foobiekr »

scarface74 wrote: post #84
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

You weren’t around in 2000 or 2008 were you? Your startup is only in “better shape” as long as VCs are willing to keep funding you. VCs are only willing to keep funding you if they have confidence that you will have a profitable exit.

Too many people haven't lived through hard times. They think that rules exist and they know what the rules are. The other day I was describing to a friend who has a company that will need funding in about 6 months, in a conversation where I was imploring him to cut his burn rate, about how things can go.

In 2001, VCs actually pulled back investments from startups. People think that once cash is in the bank it's theirs.

Re: Startups are pummeled in the ‘great unwinding’

#339

Post by foobiekr »

bdcravens wrote: post #157
qppo wrote: post #54

Startups are in way better shape than traditional small businesses. By our very nature, we need months of runway just to keep running. We're designed to weather this kind of storm because "zero revenue" is the default state. Hearing about Bird cutting 30% of their workforce is awful. But it's nothing compared to the thin-margin Mom & Pop, or medium sized private enterprise that had 1 week of cash on hand and ceased o…

Founders aren't dumb. They need to survive through the war of attrition, and they will find ways to extend that runway. It's naive to believe it will be business as usual just because you're used to "zero revenue". If future rounds aren't coming (guess what, in this economy, they aren't), you extend runway by cutting expenses. Anyone with a career older than ten years knows how this will go.

I agree with your last sentence, but...

You don't have to be dumb to be inexperienced. An awful lot of startup founders are young and were propagandized endlessly about being entrepreneurs, etc. Downside risk is an alien concept to many of them. Many of them do not actually know how to cut expenses because they've never known a time when the now-no-longer current fluffy, cushy environment wasn't standard.

Re: Startups are pummeled in the ‘great unwinding’

#340

Post by rswail »

SpicyLemonZest wrote: post #271
xiaolingxiao wrote: post #112

Earlier quoted context omitted.

Did your investors give some justification for the 2 year time span? For example, did they account for the possibility that many business won't open until September, or a second wave of infection that will hit late fall, followed by say, recession in full swing all of 2021.

It's known that some businesses won't open until September - that's the current target for sports stadiums, for example. Even after September, there will be a lot of unknowns with massive economic implications. Will cruising recover in 1 year, or in 10 years? How much more friction will there be on international travel, and for how long? What's the risk of a coronavirus resurgence, both globally and locally? How diff…

I hope cruising only recovers with big reforms including:

* Cruise firms pay their taxes and aren't allowed to use flags of convenience

* They're required to look after and pay their staff properly

* They're required to dramatically improve their fuel usage and efficiency

* They're required to protect the environment, in particular their mooring and waste disposal practices

* They're required to improve their onboard sanitation so that the spread of noroviruses, bacterial infections and other transmission is much better filtered and controlled.

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