4 ms·

I think you're being excessively patronizing, which is insulting because I usually like your comments. I'm well-aware of "business fundamentals." I'm not sayin

I think you're being excessively patronizing, which is insulting because I usually like your comments. I'm well-aware of "business fundamentals." I'm not saying high-growth startups are better than other kinds of businesses. Heck, I'd very willingly advocate the view that other kinds of small businesses have better business fundamentals than tech startups. Just because one pizzeria managed to scale doesn't change the fact that the vast majority of small businesses are not built to scale. Most small business owners think about how to grow 10-20% in the next year, not 100-200%. Heck, in my experience a lot of them are terrified of the concept of rapid growth. Like I said in my comment, I don't really care if we use the term "startup" to refer to high-growth businesses or not. We should just all agree on a consistent set of terms and stick to that. Otherwise you get unhelpful comments. Like I could talk about how my "startup" has reached profitability and 6 figures of revenue with only a single employee. Except this startup is my consulting business and has no business being lumped in with high-growth VC-funded companies.

tptacek 10y ago
The vast majority of tech companies aren't built to scale either, and the entire VC model is built around the assumption that in a portfolio of 10 companies, 5-6 of them will fail as well. I think "VC-backed startup" captures the thing Paul Graham is talking about, and I think the modifier "VC-backed" is particularly important because you want to follow the Graham playbook if you're VC-backed, but not otherwise. You probably don't want to get me started on the growth and return potential of a consulting shop doing a regular 6 figures of revenue.
- morgante 10y ago
  > The vast majority of tech companies aren't built to scale either, and the entire VC model is built around the assumption that in a portfolio of 10 companies, 5-6 of them will fail as well. The latter isn't good evidence for the former. VC-backed startups are explicitly designed to either fail fast or grow quickly. So they simultaneously have a higher failure rate than standard small businesses and a higher rate of becoming $100M+ companies. > I think "VC-backed startup" captures the thing Paul Graham is talking about That's fine (and I agree that it's a more thorough definition), but I don't think it's useful to require a redefinition of a word that most people in the community already understand to mean high-growth VC-backed companies. > You probably don't want to get me started on the growth and return potential of a consulting shop doing a regular 6 figures of revenue. Honestly, I really really do. :) To be clear, I've had lots of success selling my time (either as a developer or, occasionally, managing a small team of contractors) but not at scaling myself.

tptacek 10y ago

The vast majority of tech companies aren't built to scale either, and the entire VC model is built around the assumption that in a portfolio of 10 companies, 5-6 of them will fail as well. I think "VC-backed startup" captures the thing Paul Graham is talking about, and I think the modifier "VC-backed" is particularly important because you want to follow the Graham playbook if you're VC-backed, but not otherwise. You probably don't want to get me started on the growth and return potential of a consulting shop doing a regular 6 figures of revenue.

morgante 10y ago
> The vast majority of tech companies aren't built to scale either, and the entire VC model is built around the assumption that in a portfolio of 10 companies, 5-6 of them will fail as well. The latter isn't good evidence for the former. VC-backed startups are explicitly designed to either fail fast or grow quickly. So they simultaneously have a higher failure rate than standard small businesses and a higher rate of becoming $100M+ companies. > I think "VC-backed startup" captures the thing Paul Graham is talking about That's fine (and I agree that it's a more thorough definition), but I don't think it's useful to require a redefinition of a word that most people in the community already understand to mean high-growth VC-backed companies. > You probably don't want to get me started on the growth and return potential of a consulting shop doing a regular 6 figures of revenue. Honestly, I really really do. :) To be clear, I've had lots of success selling my time (either as a developer or, occasionally, managing a small team of contractors) but not at scaling myself.