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Why Not To Do A Startup

mattmaroon.com

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Re: Why Not To Do A Startup

#61

Post by mattmaroon »

1gor wrote: post #40

Staying employed and slowly building your wealth is not a riskless proposition. Past 20 years have been very nice to the tech sector and to equities in general. What are you going to say when your employer suddenly collapses and takes your pension/stock wealth with it (Enron, Bear Stearns etc)? Even more extreme -- what if the whole economic cycle reverses, the currency devalues and inflation eats up your savings? Ha…

Of course nothing is riskless, but it's pretty close if done properly. Plowing all of your retirement savings into the stock of your employer is something that anyone who spends ten minutes Googling "how to manage my money" knows is retarded.

I'm sure it's possible to instead put your 401k and IRA money into a diversified collection of ETFs and bonds and such and still end up broke, but it hasn't happened yet, and if it does, our entire country is in a very bad place.

Re: Why Not To Do A Startup

#62

Post by mattmaroon »

andreyf wrote: post #52

Those happen, and your odds of that are probably far better than winning the lottery, but it’s still highly unlikely [...] and just like the lottery, everyone thinks their chances are better than they really are. I hate this comparison - building a successful startup may have some element of luck, but like with everything in life, the amount of luck your success is based on is inversely proportional to the amount of…

In poker world there's a famous aphorism that says tournaments are a lottery, but the good players get more tickets. (If you want to be technical, the average player gets 1 ticket, the best players get 5-10, the worst get some tiny fraction approaching 0).

Startups work much the same way. Those who win at anything (startups, lottery, poker) always underestimate the amount of luck involved, so if you ask them, they will of course denigrate its role.

Re: Why Not To Do A Startup

#63

Post by mattmaroon »

jraines wrote: post #31

Matt Maroon : Hacker News 2008 :: Aaron Swartz : Hacker News 2007 Don't get me wrong, though -- they're both good writers, so the above isn't a swipe at either guy or Hacker News. However: "trailer-dweller" seems a little mean-spirited (and inaccurate) when it's clear who you are referring to with that example.

Hopefully I manage to avoid any comparisons to Paris Hilton.

Re: Why Not To Do A Startup

#64

Post by [deleted] »

mattmaroon wrote: post #63
jraines wrote: post #31

Matt Maroon : Hacker News 2008 :: Aaron Swartz : Hacker News 2007 Don't get me wrong, though -- they're both good writers, so the above isn't a swipe at either guy or Hacker News. However: "trailer-dweller" seems a little mean-spirited (and inaccurate) when it's clear who you are referring to with that example.

Hopefully I manage to avoid any comparisons to Paris Hilton.

[deleted]

Re: Why Not To Do A Startup

#65

Post by ciscoriordan »

This article can also be used to support Y Combinator's policy of preferring startups that aren't one person operations.

The problem of being lonely at the top is pretty much eliminated if you found your startup with some buddies who are also smart, creative, and motivated. If your startup is successful, you'll have some good friends who are in the same position as you and who have just gone through the entire startup experience with you.

Re: Why Not To Do A Startup

#66

Post by pchristensen »

juanpablo wrote: post #37
dood wrote: post #16

Startups tend to be fairly binary, with you making either a very large amount off of them or nothing at all. Recently re-reading pg's How To Make Wealth [1] made me wonder if this will soon become an outdated view of startups. The factors leading to the current and predicted rise in the number of startups (free software, cheap hardware, less personnel) should also lead to a large broading of the spectrum of failure s…

"Startups tend to be fairly binary, with you making either a very large amount off of them or nothing at all." Like a lot of thing in life: The most popular movie/book sells 10 times more than the #2. MS Word vs WordPerfect. Harrison Ford vs Mark Hamill... People like stars.

People like choices they don't have to think about.

Re: Why Not To Do A Startup

#67

Post by jedberg »

tim2 wrote: post #11
timr wrote: post #8

While I was reading this, I kept making a mental translation of the word "startup" into "grad school" (especially the bit about being 30 and single, due to the seven previous years of 80-hour weeks). It held together just as well. I'm no defender of the blind optimism that goes along with the startup universe, but there are certainly less lucrative ways to waste the best years of your life.

My perception was that it's much harder to fail at grad school.

You don't so much fail at grad school as fail at finding lucrative work afterwards.

Re: Why Not To Do A Startup

#68

Post by jedberg »

Mistone wrote: post #57
pg wrote: post #45

While this is mostly true, it's really the case against doing anything especially ambitious, not just starting startups. You could make an almost identical case against trying to write a great novel. The novelists you hear about in the press are the successful ones. Most people who try fail. It sucks up huge amounts of time regardless. The community is littered with sad, failed novelists. And are the ones who succeed…

ever been to LA? a few big stars and producers up in the hills, every other person in the "biz" scattered across miles and miles of flatlands.

There are plenty of middle class folks in the "biz". These are the makeup artists, sound designers, animators, model makers and so on. They all make a good living pursuing their dream.

Re: Why Not To Do A Startup

#69

Post by pyro »

mattmaroon wrote: post #60
pyro wrote: post #33

A finely written article, and he almost had me going there for a while. The most frustrating thing for me, though, is how he implies that a default life of "ballgames," "ballet recitals," and working for someone else is superior by its very nature. Not everyone wants to not live up to their full potential and trade freedom for some veneer of security. Ultimately, this kind of thing is just more inspiring because it m…

None taken, you just didn't understand it. I'm not saying it is superior, just that a lot of people would find it to be, and those people may not belong in startups.

Ah, I do see your point. Basically, you were saying people should make sure they really know what they want out of life before blowing their best years, yeah?

Re: Why Not To Do A Startup

#70

Post by ca »

While it's good to mentally prepare one's self with the knowledge that startups are (usually) a long hard road, and success is far from guaranteed, this article seemed a bit too negative for negativity's own sake. For my tastes anyway.

It's important to try to do great things, and it's noble to encourage others to do the same. ("Yay YC," you know?)

Seth Godin has an old post on this that I think serves as a good reminder, and still rings very true to me. A key quote:

"The thing is, we still live in a world that's filled with opportunity. In fact, we have more than an opportunity -- we have an obligation. An obligation to spend our time doing great things. To find ideas that matter and to share them."

--http://sethgodin.typepad.com/seths_blog/2007/12/only-two-yea...

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