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Not raising funds to stay small and happy

antoine.finkelstein.fr

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Re: Not raising funds to stay small and happy

#41

Post by vonmoltke »

neltnerb wrote: post #38
tablet wrote: post #30

Earlier quoted context omitted.

Exactly. Startup = Growth http://www.paulgraham.com/growth.html

I mean, Steve Blank's definition is equally valid. https://steveblank.com/2010/01/25/whats-a-startup-first-prin... "A startup is an organization formed to search for a repeatable and scalable business model." Maybe you see "scalable" and think "to a billion users". I see "scalable" and think "sustainable over the long term". I think a small business is when you know the business model can work and have moved on to lo…

> I think a small business is when you know the business model can work and have moved on to long-term execution. Until then you are a startup.

I disagree slightly. A small business is one where the founders have a particular business model in mind, regardless if it's feasibility. If the business model is wrong, the business folds; it doesn't pivot. Until I was introduced to the startup community this was my sole understanding of "starting a business".

Re: Not raising funds to stay small and happy

#42

Post by jasode »

onassar wrote: post #4

Rarely comment, but definitely identify with this. Given HN's general focus on growth and funding, I think it's great/important for an article/concept like this to be given some reach. I find that there isn't enough critical thought given to why one ought to pursue an aggressive growth strategy. And that generally, staying small is seen as a failure to grow, rather than a conscious effort to grow in line with ones ow…

>Given HN's general focus on growth and funding, I think it's great/important for an article/concept like this to be given some reach. [...] , it's refreshing to see an article like this

It's interesting how people get this inaccurate perspective. It's an interesting phenomenon where the majority (incorrectly) believes they are the suppressed minority. (I feel there must be a name to describe that phenomenon but I don't know what it is.)

The HN community actually is heavily tilted towards no-growth or low-growth bootstrapped companies. (I use "HN" to mean the HN discussion forum and not the YC fund.) Spending any time on HN and noticing what type of business articles are popular would make that obvious. Also, a relevant quote from dang: "Far more HN commenters (and voters) identify against VC than with it.": https://news.ycombinator.com/item?id=13931617

Examples of this are the very popular David Heinemeier Hansson (DHH) articles that make a case for staying small and avoiding VC money that pressures you to grow fast:

https://news.ycombinator.com/item?id=14694434

https://news.ycombinator.com/item?id=13668746

https://news.ycombinator.com/item?id=13929398

Those get upvoted to the front page and commenters pile on in violent agreement. There's no need to be "refreshed" by the advice to stay small -- it's basically the default sentiment on HN.

Re: Not raising funds to stay small and happy

#43

Post by paulie_a »

amelius wrote: post #29
combatentropy wrote: post #27

Earlier quoted context omitted.

> what prevents a bigger player to copy it, improve upon it Its size can be as much a hindrance as a help. Big companies turn more slowly and are less likely to put out elegant ideas for the same reason a committee is. Paul Graham writes about how his small online store was able to turn out features faster because he was leaner. I can't find it among his essays ( http://paulgraham.com/articles.html ) but Getting Real…

> Its size can be as much a hindrance as a help. Big companies like Google know this, and often seem to structure themselves into small competitive groups.

Side note: Google has 4-6 competing messaging applications that are all sub par

Re: Not raising funds to stay small and happy

#44

Post by npgatech »

jasode wrote: post #42
onassar wrote: post #4

Rarely comment, but definitely identify with this. Given HN's general focus on growth and funding, I think it's great/important for an article/concept like this to be given some reach. I find that there isn't enough critical thought given to why one ought to pursue an aggressive growth strategy. And that generally, staying small is seen as a failure to grow, rather than a conscious effort to grow in line with ones ow…

>Given HN's general focus on growth and funding, I think it's great/important for an article/concept like this to be given some reach. [...] , it's refreshing to see an article like this It's interesting how people get this inaccurate perspective. It's an interesting phenomenon where the majority (incorrectly) believes they are the suppressed minority. (I feel there must be a name to describe that phenomenon but I do…

I found your comment a bit abrasive, yet you’re lacking the grit to support it besides just anecdotal evidence (just as the parent comment).

I have yet another opinion - I’ve seen a wide variety of articles on HN from how to grow fast to how to stay small. We’re not going to stay productive by arguing without data.

Re: Not raising funds to stay small and happy

#45

Post by jasode »

npgatech wrote: post #44
jasode wrote: post #42

Earlier quoted context omitted.

>Given HN's general focus on growth and funding, I think it's great/important for an article/concept like this to be given some reach. [...] , it's refreshing to see an article like this It's interesting how people get this inaccurate perspective. It's an interesting phenomenon where the majority (incorrectly) believes they are the suppressed minority. (I feel there must be a name to describe that phenomenon but I do…

I found your comment a bit abrasive, yet you’re lacking the grit to support it besides just anecdotal evidence (just as the parent comment). I have yet another opinion - I’ve seen a wide variety of articles on HN from how to grow fast to how to stay small. We’re not going to stay productive by arguing without data.

>support it besides just anecdotal evidence

If it isn't clear, "dang" is one of the longtime moderators and I'm confident he's seen enough quantity of posts over the years to have an accurate pulse of the HN readership.

There are virtually zero articles giving the advice to "take VC money and grow grow grow" that made it to the front page. (If you have examples, please post them.) The YC fund emphasizes exponential growth startups but in contrast, the HN discussions downgrade it.

This thread's article from Antoine Finkelstein and the DHH posts that I cited are much more popular with the HN crowd. I'm not complaining about it; it's just an interesting observation.

Re: Not raising funds to stay small and happy

#47

Post by njyx »

ig1 wrote: post #11

Building a small boot-strapped company vs a funded company is in a large part dictated by market and product rather than by individual intention. If you try to build a funded company in a space that can't sustain one you will struggle, likewise if you try to build a small bootstrapped company in a space that can you will similarly struggle. If your direct competitors have a much better product then you (because they…

This is the crux of it - the world doesn't stand still. So if you're in a small team in a space that's fast moving and very competitive then the comfortable life wont last long...

If you're in a space where the addressable market is very hard to reach or fragmented, a venture based run will probably run aground. Whereas a small player hitting a niche might be great for a long time.

Re: Not raising funds to stay small and happy

#48

Post by cperciva »

Mountain_Skies wrote: post #9

I believe it is Bhutan that measures gross national happiness in addition to GDP, realizing growth just for growth's sake doesn't necessarily increase overall happiness. Don't know how well that works for them but good for both the nation and this startup to have it as a goal. My concern in the context of the startup would be that another player would enter the same market segment and use funding to expand aggressive…

Yes, you're thinking of Bhutan. But "gross national happiness" is just a propaganda exercise.

Re: Not raising funds to stay small and happy

#49

Post by john_moscow »

_0ffh wrote: post #21
amelius wrote: post #19

> Not raising funds to stay small and happy But in this winner-takes-all reality, is that possible? If your business concept becomes successful, what prevents a bigger player to copy it, improve upon it, and steal away your customers?

They might out-advertise you, but it's not at all easy to beat a well oiled team of three talented persons on the technical front. Just throwing money at a problem does not guaranty a superior product.

They can just offer an decent clone of your product for free. Given the popularity of the "grow now, monetize later" approach, investors will likely not see a problem with that.

Re: Not raising funds to stay small and happy

#50

Post by cjalmeida »

framestr wrote: post #15

I can definitely agree with this. I was developing http://framestr.com (SaaS), and at the time, we had to bring on a 2nd developer and server costs were increasing (we all wanted to avoid raising funds and aim to bootstrap). Rather than raise funds, my partners and I built a small SEO business. We ended up scaling the SEO business to around $200k MRR. Having been through the financing process before for at a previous…

Anecdotally, Boeing built furniture for a while to keep afloat when developing it's commercial aircraft business

http://www.u-s-history.com/pages/h1832.html

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