I love this comment, but probably for the wrong reason:<p><i>For every successful startup that has ran their bank account down to $100, maxed out their credit cards, had trouble fundraising, etc., dozens (hundreds?) more have done the same but ended up in the deadpool.</i><p>For me it highlights the insanity of our pursuit. Not only do founders struggle, experience the trough of sorrow, and often not emerge... there are often not even any indicators that things are going to turn around. The feedback you get from being $100 away from failure and $100 away from almost turning around and being huge might often be the same.<p>It's like fate's deliberate and cruel punishment to those who have elected the startup path, telling you that you can't quit, no matter how bleak it feels, because, well ... you don't even have a way to know if it <i>IS</i> bleak.<p>It's not over til it's over.
Startups: never have so many understood so little about the statistics of variance present in the outcomes of small samples.<p>People like to speak of 10x productivity, non-stop work and geniuses - but the reality is much less interesting. A large number of small teams working on many different problems will by definition have a great variance in outcomes just by random extraneous factors (also known as the law of small numbers and insensitivity to sample size).<p>> <i>A certain town is served by two hospitals. In the larger hospital about 45 babies are born each day, and in the smaller hospital about 15 babies are born each day. As you know, about 50% of all babies are boys. However, the exact percentage varies from day to day. Sometimes it may be higher than 50%, sometimes lower.<p>For a period of 1 year, each hospital recorded the days on which more than 60% of the babies born were boys. Which hospital do you think recorded more such days?<p>1) The larger hospital<p>2) The smaller hospital<p>3) About the same (that is, within 5% of each other)<p>56% of subjects chose option 3, and 22% of subjects respectively chose options 1 or 2. However, according to sampling theory the larger hospital is much more likely to report a sex ratio close to 50% on a given day than the smaller hospital.<p>Relative neglect of sample size were obtained in a different study of statistically sophisticated psychologists</i><p>-- <a href="http://en.wikipedia.org/wiki/Insensitivity_to_sample_size" rel="nofollow">http://en.wikipedia.org/wiki/Insensitivity_to_sample_size</a><p>> <i>A deviation of 10% or more from the population
proportion is much more likely when the sample size is small.
Kahneman and Tversky concluded that "the notion that sampling variance
decreases in proportion to sample size is apparently not part of man's
repertoire of intuitions. For anyone who would wish to view man as a reasonable
intuitive statistician such results are discouraging."</i><p>-- <a href="http://www.decisionresearch.org/pdf/dr36.pdf" rel="nofollow">http://www.decisionresearch.org/pdf/dr36.pdf</a><p>Taking lessons as gospel from these "10x" events is by definition foolhardy and merely an extension of the bullshit pushed by the entire "Good To Great" Jim Collins business book industry.<p>It's like taking lessons from survivors of the Titanic on how to survive the sinking of a ship. It's quite simple - be a young female child with a life vest and rich parents (or in startup land - a young upper-middle class male living in California during a venture bubble, a cyclical investment in the Valley with a convergence of secondary technologies, above average intelligence and a college degree from a reputable university).<p>I have a personal rule with any kind of advice or explanation coming out of anyone working in a "soft" industry - if it's vague - it's bullshit. All of the advice given at these events are bullshit by this definition. So are many other things - and yeah it doesn't preclude me from spouting it. Or using the advice at my discretion.<p>But honestly - startup founders literally have no idea why things take off and they have no idea why they win. That's why they have to keep pivoting - it increases their luck surface area and their ability to gain traction - after which they simply must hold on tight while surfing the wave.<p>YouTube was a dating site - didn't work - pivot - video traction - venture up - ride.<p>PayPal was a Palm Pilot app - didn't work - pivot - traction - venture up - ride.<p>Google sold corporate search - didn't work - pivot - copy PPC from Overture - lever up - traction hits - ride.<p>Instagram - started with a location checking HTML5 app 2 years too early - pivot - copy PicPlz and Hipstamatic - hit traction - lever up - ride.<p>Angry Birds - fail at hitting nearly every game in the past decade - pivot - take a shot at the iPhone - hits traction - lever up - ride.<p>Of the startups that didn't pivot - they either skipped the pivot thanks to previous side projects/companies or already had traction - and all they had to do was lever up and ride.<p>I'm going to make this clear - there is absolutely, positively nothing wrong with this - not at all - it is merely reality and not particularly unfair.<p>People stating pointless platitudes that success is due to things like "Be 10x more productive", "Commitment" and "People, product, and philosophy" are simply wasting their breath, other people's time and confusing what actually happens. These things may or not be either actionable, predictive or sufficient for success.<p>Here's my list of startup advice:<p>Be alive. Be male. Be young. Don't have health issues. Be born in America or move there. Enter the cycle after a recession. Speak English. Enter a growing/new field where the level of competition is low and so is the sophistication of your competition. Surf cost trends down from expensive to mass consumer markets. Work bottom up - on small things. Be of above average intelligence. Have family support. Have a college degree.<p>Oh and most importantly of all: Get fucking lucky.<p>The hindsight/survivorship biases in combination with faulty causality and the narrative fallacy will completely hose your thinking - so be careful.<p>More interesting stuff:<p><a href="http://en.wikipedia.org/wiki/List_of_biases_in_judgment_and_decision_making" rel="nofollow">http://en.wikipedia.org/wiki/List_of_biases_in_judgment_and_...</a><p><a href="http://en.wikipedia.org/wiki/Black_swan_theory" rel="nofollow">http://en.wikipedia.org/wiki/Black_swan_theory</a><p><a href="http://en.wikipedia.org/wiki/List_of_fallacies" rel="nofollow">http://en.wikipedia.org/wiki/List_of_fallacies</a><p><a href="http://en.wikipedia.org/wiki/List_of_memory_biases" rel="nofollow">http://en.wikipedia.org/wiki/List_of_memory_biases</a><p><a href="http://www.econ.yale.edu/~shiller/behfin/2000-05/rabin.pdf" rel="nofollow">http://www.econ.yale.edu/~shiller/behfin/2000-05/rabin.pdf</a><p>Disclaimer: Biases rule your thoughts and mine - this post is also subject to both bullshit and biases (mostly bullshit - I do love that word). Think for yourself.
Somewhat off-topic, and then again, maybe not.<p>Interesting Concept/Term. I'd been looking for an official term to describe my problem with The American Dream(sm) and the Bootstrapping myth.<p>I feel the reason why large parts in our society simply don't care for the plight of the failed (poor/bankrupt/downtrodden) is a combination of Survivor(ship) Bias combined with the "I did it all by myself, which means you can do it too, now get off my lawn" myth/mechanism.<p>This is also a major issue in the startup world. So often we are led to believe that successful startups are the result of mere perseverance, blood, sweat and tears (and a little bit of luck), instead of'I got money from my uncle/grammy/mommy/daddy/mentor'.<p>It irks me that there are many self-reflecting stories on startup failure and what went wrong, but so very few on the financial contribution received from family, so often described as 'investors' or summarized as 'self-funded'.<p>Don't get me wrong, it's great to start off with positive thoughts, but for anyone to make an informed decision, it makes sense to have all the facts, not just the myths.
>"Startup School is mostly an exercise in survivorship bias"<p>Life itself is mostly an exercise in survivorship bias. Startup goes into deadpool, you don't hear about it. Similarly, John Doe dies, and nobody ( other than his family & relatives ) hear about it. I mean, what are you going to say to the world at large ? John Doe was born, John Doe went to accountancy school, John Doe became bean counter at big-corp, John Doe died, ergo John Doe's 401K = $xyz => goes towards Junior John Doe's accountancy school. Repeat cycle. GOTO 1.That's what the obituaries are for.
The issue with Survivor Bias is that we don't really have other great guides for doing startups. It's natural to ask a great writer what they did to get published or a programmer what they did to build their first app. While we should take the retrospective stories of winners with a grain of salt, there's probably more good than bad to be gained from following what has worked.
I agree. it would be great to hear from smart people who made critical mistakes, the cautionary tales often warned against, but not often told by the players who played and lost.<p>Jessica Livingston's book (<a href="http://www.amazon.com/Founders-Work-Stories-Startups-ebook/dp/B001C30BH6/ref=tmm_kin_title_0" rel="nofollow">http://www.amazon.com/Founders-Work-Stories-Startups-ebook/d...</a>) goes into some detail on this topic. Very insightful and enlightening.<p>I did meet one audience member at startup school during lunch this weekend who briefly related his story of a recent startup failure and commented that he was recovering from the painful experience. Is it too painful to share??? Could be. But it is the one out of fifty 10 minute conversations I remember most.<p>Only the very brave are willing to share.<p>Let's celebrate failure, though, because it is only through many small failures that the path to big success makes itself known.
Are there any smart entrepreneurs who have tried non-stop for 25 years and have not achieved any success. Success being 10+ million dollars. It seems to me that because the world is changing so fast, we have become very sensitive to the span of time. 2+ years sounds like eternity to people if you have started a startup and hasn't hit a hockey stick yet.<p>What if we look at starting a startup from a different perspective in which success nor failures exists. Its a work you do everyday to solve some problem. At the end you might not solve the problem but you reconfigured the universe in which the problem you were trying to solve has been little bit more "digested" for you or others. Doing hard work for many years does matter, at least if you enjoyed doing it.<p>If you start a company just to make money in a very short time, working hard for many years and still failing sounds terribly scary.
I've been saying for a long time that things like Startup School and YC (I went through YC S09) aren't about teaching you the path to success, but rather to teach you about known paths to failure.<p>It's always a little disappointing to me to hear stories about how someone succeeded, that's likely to contain relatively little replicable information. A story of failure however tends to contain plenty of examples of concrete things to avoid doing! Not a universal precept of course, many of those who succeed do so by violating known rules, but after hearing many failure stories you start to better understand common threads.
> Combinator has funded over 460 startups, the vast majority are unheard of and presumably not breakthrough successes like Airbnb or Dropbox (yet?). This number alone was one of the more interesting data points of the day. Will Dropbox and Airbnb pay for it all 10x over?<p>I'm no accountant, but say they give every startup $18k * 460 = $8,280,000. AirnBnB gets valued at 1.3 Billion * .07 = $91,000,000.<p>There are generalizations aplenty in my reasoning, but I'm sure that ycombinator being profitable isn't an issue.
This is a valid criticism, but is mitigated a little by the fact that some of these success stories include within them wisdom from preceding (or competitive-contemporaneous) failures.<p>This is even the case, indirectly, where the Startup School presentation can't fit the speaker's whole story.<p>For example, I think the Travis Kalanick presentation about Uber at Startup School was great. (I'd love to see the time-unconstrained 'two-hour' version of the same talk.) But, it was just about Uber: a current big success.<p>Kalanick also did a shorter -- and perhaps even better -- talk about his previous ventures at the 2011 FailCon:<p><a href="http://www.youtube.com/watch?v=2QrX5jsiico" rel="nofollow">http://www.youtube.com/watch?v=2QrX5jsiico</a><p>Combined with the SS12 Uber presentation -- indeed, perhaps best viewed just before -- it provides real context, and a much better idea of the range of outcomes and challenges startups face. And, of the entrepreneurial qualities that gave Kalanick repeated chances at Uber-like success.
I thought this while watching them too: everyone here is doing great. As someone who publicly screwed up my first startup, and doing well on my second, it would be good to see more stories like that.
I completely zoned when I saw "Killing it Bro". That and 7 "Zucs" in 1 paragraph and I'm out in 2 parrys brah. Learn to write and maybe more people will read it.
"Zuck also mentioned that he can't relate to wanting to start a company for the sake of starting a company. I thought it was notable that Paul Graham interjected that he wished more people wanted to start companies"<p>That is not what pg interjected with. He said he wished more people had companies that started themselves, like facebook did. As in, I have to build this company because this little project is growing like a weed and it's my responsibility to see it through - as opposed to more founders who just want to be founders.