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Sure - and there's nothing wrong with that. Look at patio11 before he started starfighter. You could call it "bootstrapped business". Those companies still take

Sure - and there's nothing wrong with that. Look at patio11 before he started starfighter. You could call it "bootstrapped business". Those companies still take a long time to build. To be fair - most of these businesses still rely on hiring lots of personnel. A software company by definition scales better than a consulting company. If the goal indeed is to scale with SAAS like margins then you are going to need a different model than consulting. That being said, we work with a lot of consulting companies (I even used to run one) called systems integrators. They make good money for their families and are pretty well off. Many of them are also subsidaries of very large conglomerates (Samsung SDS, LG CNS, SK C&C in korea for example) Those kinds of businesses don't need VC and shouldn't take it. I didn't mean it to be patronizing per se it's just different goals.

vonmoltke 10y ago
> Sure - and there's nothing wrong with that. Yes there is: you are forcing a false dichotomy on the business world. "Businesses that 'scale'[1]" vs. "businesses that don't" is not a very useful classification, no matter what you call them. [1] Whatever that means; this has become one of those terms that means whatever the reader/author wants it ti mean.
- marcosdumay 10y ago
  What? Some business scale, some don't. Consulting services are around the extreme of "non-scaling" business (the most extreme being specialized consulting), while licensing software is at the "scaling" extreme. There are lots and lots of thing in between.
  - vonmoltke 10y ago
    > There are lots and lots of thing in between. That's my point. "Scaling" is, well, a scale. It isn't a binary (scale || !scale).
- agibsonccc 10y ago
  http://www.paulgraham.com/growth.html http://www.paulgraham.com/growth.html Anyways - FWIW I'm definitely biased. I'm a cofounder of a venture backed YC startup. Scale here typically means: software you can infinitely copy vs people who get tired. Personnel cost more than software. Does that make sense?
  - vonmoltke 10y ago
    I agree startup == growth. I don't agree that making generalizations about !startup is useful. > Personnel cost more than software. Does that make sense? Yeah, but that's orthogonal. Needing more people makes scaling harder and more expensive, but doesn't fundamentally change the nature of the business or its goals.
    - agibsonccc 10y ago
      The "goals" include "how" to make money though. It's defined right in the business model. Every businesses' goal is "technically" to "make money" to "survive". To what degree and how are the business model and the focus of my points here. Eg: open core vs consulting.

vonmoltke 10y ago

> Sure - and there's nothing wrong with that. Yes there is: you are forcing a false dichotomy on the business world. "Businesses that 'scale'[1]" vs. "businesses that don't" is not a very useful classification, no matter what you call them. [1] Whatever that means; this has become one of those terms that means whatever the reader/author wants it ti mean.

marcosdumay 10y ago
What? Some business scale, some don't. Consulting services are around the extreme of "non-scaling" business (the most extreme being specialized consulting), while licensing software is at the "scaling" extreme. There are lots and lots of thing in between.
- vonmoltke 10y ago
  > There are lots and lots of thing in between. That's my point. "Scaling" is, well, a scale. It isn't a binary (scale || !scale).
agibsonccc 10y ago
http://www.paulgraham.com/growth.html http://www.paulgraham.com/growth.html Anyways - FWIW I'm definitely biased. I'm a cofounder of a venture backed YC startup. Scale here typically means: software you can infinitely copy vs people who get tired. Personnel cost more than software. Does that make sense?
- vonmoltke 10y ago
  I agree startup == growth. I don't agree that making generalizations about !startup is useful. > Personnel cost more than software. Does that make sense? Yeah, but that's orthogonal. Needing more people makes scaling harder and more expensive, but doesn't fundamentally change the nature of the business or its goals.
  - agibsonccc 10y ago
    The "goals" include "how" to make money though. It's defined right in the business model. Every businesses' goal is "technically" to "make money" to "survive". To what degree and how are the business model and the focus of my points here. Eg: open core vs consulting.