I know that this is 37 Signal's thing. They like to be hip, contrary and different. They take a popular post, and they take an opposing view, stir the pot and raise a ruckus. After all, they are "rock stars". But really, David?<p>Why do you care what Stack Overflow does? Why do you presume to know more about Stack Overflow's business needs than Joel? Why do you presume to know more about the VC funding process and it's outcomes than Joel? You've run a successful business and you manage a great open source framework. That's to be commended. You chose to not take VC, and you have been successful. Congratulations. (We'll ignore that bit about Bezos investing in you for now.)<p>But, there are hundreds if not thousands of successful software companies that have indeed taken investor money. Presumably, it was the right decision for them. Why do you insist on criticizing those decisions and put people down for those decisions?<p>When I worked as an ER nurse in the inner city, we had an expression for this behavior: "Up in someone else's kool aid, not knowing what the flava is".
If I were told "Here's several million dollars, an Answers platform, and a mandate to make a super-scalar return", I would immediately start trying to pull off Demand Media, starting each property with a core of content produced by cheap freelancers and then thickening them out with real UGC as they gained traction in the search engines. The million get spent on the freelancers and on having my crack team of engineers build a search prediction algorithm so that I know, e.g., what the top three questions about birdfeeders and the highest payout topics are.<p>The resulting company looks very, very different than what StackOverflow looks like... but it would make sense, I guess. (Major risk of getting annihilated by Google in the next 12 months but, hey, not my money.)<p>I generally yield to no one in my agreement against "land grab" economics. However, this space actually <i>is</i> a land grab. Maybe it isn't obvious to DHH because DHH doesn't really need to worry about the nuts and bolts of SEO all that much, but Demand Media can create a page for $15 and sell $40 of ads on it <i>this year</i> (it will still be there next year). That model scales to the effing moon, at least until Google gives them the smackdown.
Reading the original post, I thought pretty much the same thing. The whole idea of getting VC money is to jumpstart the next phase of a company/product's life. Facebook was a college kid's side project that looked promising but VC money made it top 3 site on the web. YouTube would have been impossible for 3 typical 20-somethings to afford out of their personal/family savings. They needed VC funding because they were burning through $1m/month in cash. What exactly is it about Stack Overflow that Joel can't pay for himself with his own funds? What kind of hiring does he want to do to make it any bigger?<p>Joel listed all these vague reasons that sort of sound good without actually saying concrete steps / changes that would come out of VC funding. I would definitely like to hear what it is that he, despite being one of the most popular tech bloggers with a boatload of notoriety and savings, can't do with Stack Overflow that somehow VC money can.
Does anyone NOT think Joel is going to get one of the best VC deals of all time? He's insanely well connected and has a proven product. He'll get meetings with all the top angels and VCs no problem then start a bidding war. I bet he gets a great valuation with good terms on control and equity.
I got the impression that Joel just wants to give the big risk venture with a big payoff for success a go. As he says Fog Creek is build the safe slow constant growth way and he always has that to fall back on.
Quoting from the article:<p>"There are a few indicators for the type of company that I believe can benefit from, and should take, VC."<p>Which means, the list in his article of companies that can benefit is more academical, and each of these may not apply to StackOverflow.<p>The response from 37signals is a bit presumptuous in the sense that it assumes Joel means //all// of these apply to StackOverflow.
It may be that DHH's last point (taking money off the table) is the crucial element here. I.e., this could be an easy way for Joel and Jeff to get their second or third homes without destroying their baby and their darling developers at Fog Creek.
I don't know why Joel used Starbucks as his example of why land grab makes sense for StackOverflow. Starbucks, like McDonalds, is all about location/location/location. So it is literally needing capital for a land grab.<p>Websites are never about a land grab. Especially when talking about creating just a network of sites for individual niches.
I think DHH's post raises a valid question about the land-grab analogy. What land exactly is being grabbed here?<p>I guess that is the real mystery, as other commentators have pointed out. I assume there is some kind of grand business plan which yahoo answers and expert exchange missed and which Joel et al have not missed. It would not be the first time they took a 'solved' problem - bug tracking software - and built a successful business off of it.
I'd take DHH's opinion more seriously if he had any actual experience with VC or startups. 37 Signals is not a startup -- they crow about that fact themselves. 37 Signals is a small business.<p>David's points all presume that he fully understands what Joel is planning; he clearly cannot, since Joel hasn't laid out a detailed business plan.