This story has a ridiculous amount of integrity. You did what was right, even when convention went the other way.
Future investor reaction to it will tell us what they think of actually bucking convention to do the right thing.
Why I turned down $500K and shut down my startup
81–90 of 180 posts
Re: Why I turned down $500K and shut down my startup
#82Earlier quoted context omitted.
It's only a matter of time before this kind of thinking results in founder suicide. I've read multiple cases where investors, including Y Combinator, forced founders to pivot, which caused serious mental distress to the founders. If the idea won't work, drop it, and drop the founders too, until their next project can be properly assessed. Dropping a project doesn't mean the founders are bad founders or that they are…
> I've read multiple cases where investors, including Y Combinator, forced founders to pivot I don't think you should sling this kind of thing around so lightly. It's trivial to post charges like this on the internet and have many people just believe them. But this is a serious thing to say right after you've invoked the idea of suicide, and doesn't remotely resemble anything I've observed at YC. In my observation, Y…
Here's one Y Combinator founder who spoke out about the continual push to pivot. https://backchannel.com/how-i-f-ed-up-in-ycombinator-35a19e7...
>The last few weeks of the program are a bit of a blur. My morale plummeted, and my stress skyrocketed. I dreaded going to the weekly dinners, where I would have to talk to my cohort and confirm that no, we hadn’t found an idea yet and yes, we were still super excited about our “company.” I did little else but eat, code and sleep. I felt like everyone else was ready to raise millions, while we were desperately trying to find a product.
>Postponing Demo Day was a no-brainer. We didn’t have an idea we believed in, and although we could have cobbled one together and raised some seed funding, we didn’t want to do that. I didn’t want to do that, in part because it seemed disingenuous. But primarily it was because taking half a million dollars of other people’s money would have moved my stress level from unhealthy to crippling.
>But skipping Demo Day didn’t fix our lack of conviction. The rapid-fire pivoting continued. Around this time, I started coming to terms with the fact that I was seriously unhappy. For as long as I’ve been interested in startups, I have never wanted to start a company simply for the sake of starting a company. Yet doing things “for the sake of starting a company” was where I found myself, as I scrambled for a plausible idea.I don’t know if this is true for other people, but as a flailing founder I desperately wanted to believe in the startup myth—that success was just over the next ridge, that if we waited a bit longer, or had a slightly better idea, we would suddenly be riding a rocket ship. I hated doubting myself, but I’ve never been good at blind faith. So I decided to leave.
Re: Why I turned down $500K and shut down my startup
#83Why is Paul Graham defining a word that's already well defined and understood? Go to Google and type in "define startup" and you will see that: startup = a newly established business I think the reason he wants to redefine the term is so that people associate starting a business with rapid growth, which will benefit him personally. How do you achieve growth in almost all cases? By taking VC money. What happens when y…
I think Graham's definition aligns much better with general usage of the word than a definition that would make the new ice cream stand at the corner a startup.
Re: Why I turned down $500K and shut down my startup
#84I think the entrepreneur failed to assess why it had to be him to solve the market problem and give birth to the company.
Sometimes it's not necessary to assess this because you are compelled to act and you can't stop.
In this case I think had he asked this hard question sooner he would have found his heart wasn't in it. Either way dropping it was the right thing to do.
In comparison my 'why' for the thing I'm working on makes my soul burn and is a limitless well of determination.
Call it 'Conviction/Opportunity' pull.
Re: Why I turned down $500K and shut down my startup
#85"I was deciding whether this venture was worth committing to another year of 70+ hour weeks. I need a higher level of certainty than investors do because my time is more valuable to me than their money is to them. Investors place bets in a portfolio of companies, but I only have one life." That's the key quote in the article. It's a fair decision from his standpoint but I wonder if saying that will lead investors to…
>I wonder if saying that will lead investors to question his determination in the future
You could also argue that it proves his determination, if he does in fact decide to engage in a new venture.
Re: Why I turned down $500K and shut down my startup
#86Earlier quoted context omitted.
If the situation were really "take the money and do 70+ hours a week for a year" versus "shut down the business" then I'd agree, but that's a false dichotomy. You can run a startup putting in far less time than that; putting in long hours is a choice. You can bring in a team or outsource the parts you don't like. It makes it harder to succee but it's an option. You could (depending on lots of caveats) simply hand the…
Although the author phrases it as "70+ hours a week", my assumption is it's not the hours per week that he doesn't want to commit to it, but the total hours involved that it's going to require to solve the situation. Whether that's 70 per week or 5 hours per month, the total amount of hours needed is going to be x,00 or x,000 - and that's time he simply thinks is not a priority or valuable to him.
There's a total number of hours of work needed to build something, but they don't all have to be put in by one person. It might be one person doing 70 hours a week, but equally it can be two people doing 35 hours each (probably more like 40 hours actually to account for comms, but still, not even close to 70). The hard part is finding someone who can do the role.
Re: Why I turned down $500K and shut down my startup
#87After this, I'd never give this guy time or money and I doubt anyone else will either. No matter how shitty you feel about your start-up, if you have a willing team and cash, you should see it through. Being an entrepreneur isn't always about having all of the answers. It's very often about not knowing the answers and figuring things out. Especially if you have a team and cash flow and investors. I think this guy nee…
> The rest of the team kept their day jobs. > The team was excited. Our potential investors were excited. He didn't really have a team and he didn't really have investors. He took a personal risk and found it wasn't working. He shut it down before it got expensive for people other than himself. I applaud this. People, especially around here, need to understand failure is the norm. This person failed fast, well. Nice…
This goes to my core belief that "failing fast" is bad for entrepreneurship. It is far more rare for an initial idea to succeed than one that morphs out of original ideas. Even Facebook started out as something other than what it is now.
I have nothing against accepting failure in an idea. My first start-up failed and I had to let it go. It was really fucking hard to do that. But I tried to pivot twice before finally letting it go and I worked at it for a number of years.
The people that want us to fail fast don't have entrepreneurs best interests at heart. They're looking for quick wins and the more starts and fails they get, the better _their_ odds of something "popping".
But there's something to be said for perseverance.
I won't argue that there shouldn't be a balance, and maybe I was too hard on the OP, but it sounded to me like he needed to step away and think about it, not just let it go.
But I guess we have to defer to his judgment since it was his idea.
I just really don't like fail fast mentality.
Re: Why I turned down $500K and shut down my startup
#88Hi. Tim here. I'm delighted that this article struck such a chord. I'll try to answer the most common questions here. I wish I could answer everyone directly. 1) I called it off before anyone sent money or quit their jobs. The only one who lost money or a job because of ContractBeast was me. If the money was in the bank and the team on board we would have gone ahead. That's why I had to make that decision when I did.…
Hi tim, nice reading. It put balm in my heart. Well, I thought I was crazy some times in my life (when I pulled the plug of my own company) for putting my life and my sanity on par with money. I was getting broken, I had a constant flow of ... 70+ /hrs job paid 35 hrs a week and even though I had customers but I was chaining more and more burn-in on burn-out. I was seeing my benefits diminish and my life sucked out.…
Thank you. I'm glad it meant something to you. TO tell the truth I was a mess the first week after deciding to shut down. No matter how many ways I could "prove" to my self I was doing the right thing, it still felt horrible.
I'm better now, and this discussion on HN -- even those who disagree with me -- really helps.
Re: Why I turned down $500K and shut down my startup
#89"I was deciding whether this venture was worth committing to another year of 70+ hour weeks. I need a higher level of certainty than investors do because my time is more valuable to me than their money is to them. Investors place bets in a portfolio of companies, but I only have one life." That's the key quote in the article. It's a fair decision from his standpoint but I wonder if saying that will lead investors to…
If the situation were really "take the money and do 70+ hours a week for a year" versus "shut down the business" then I'd agree, but that's a false dichotomy. You can run a startup putting in far less time than that; putting in long hours is a choice. You can bring in a team or outsource the parts you don't like. It makes it harder to succee but it's an option. You could (depending on lots of caveats) simply hand the…
It's not about time or money. It's about wasting time on something while you're not motivated anymore because you know it will fail 99% sure. If you can't commit to it, you make that 100%.
Re: Why I turned down $500K and shut down my startup
#90Why is Paul Graham defining a word that's already well defined and understood? Go to Google and type in "define startup" and you will see that: startup = a newly established business I think the reason he wants to redefine the term is so that people associate starting a business with rapid growth, which will benefit him personally. How do you achieve growth in almost all cases? By taking VC money. What happens when y…
I think Graham's definition aligns much better with general usage of the word than a definition that would make the new ice cream stand at the corner a startup.
Really, only on HN and other "startup forums". Anywhere else... well, do you think even an ice cream stand is immediately a viable, profitable business? Usually not. The space between "having a registered company" and "actually in the black and stable" is a startup.