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Most successful companies have to execute perfectly AND have an some of those extrinsic factors, such as family money, personal connections, good timing, or dum

Most successful companies have to execute perfectly AND have an some of those extrinsic factors, such as family money, personal connections, good timing, or dumb luck. There's nothing wrong with acknowledging that. It doesn't make the successful founders bad or less worthy to give advice, it helps explain the conditions necessary for success. Anyone receiving advice should be aware of the prerequisites to that advice.

cpkpad 8y ago
Nope. I've seen plenty of successful companies bumble around and have dumb luck. The reverse is also true -- perfect execution is rare and almost guarantees success. I'll reemphasize that even competent execution is rare; few people can execute perfectly on business AND technology AND marketing AND design AND .... Especially first-time entrepreneurs. Fortunately, the other guy's deeply imperfect too. In capitalism, you just have to be better than the other guy. It's pretty hard -- the other guy has been at it for a while and you're just starting out, but it's far from impossible. Most businesses execute very poorly. Fortunately, each time you try to execute, you get a little bit better at all of those, so after a few tries, you can out-execute. You also learn the advantages smaller, more agile players have over bigger ones. I agree with the persistence bias argument 100%.
- speedplane 8y ago
  Ive seen plenty of successful companies that got lucky, but none with dumb luck. Which are you referring to?
- smokestack412 8y ago
  Execution is an HN startup meme. Correctly: most businesses execute very unluckily. You're hopelessly down the rabbit hole if you think skill has the most to do with it, it's total nonsense. VCs don't invest in skill, they invest in crapshoots. Skill is a prerequisite, luck is what makes people rich. Don't pretend otherwise or you'll make it more painful when you fail (99% of the time).
  - cpkpad 8y ago
    I've seen order-of-magnitude difference in abilities of companies to: * Build products * Sell products * Recruit * Build rapport with customers * Evaluate business models Most of that is ability. Few people have ability in /all/ of those directions. I've seen people who are even competent (not great) at all of those launch successful business after successful business. By "successful" I don't mean billion dollar unicorn. I mean businesses which employ tens (or hundreds) of people, have millions in revenue, and last indefinitely. This stuff isn't rocket science. If a Fortune 500 make widgets, and you make higher quality widgets at lower cost and make people aware of that, you'll run a sustainable business. As a small business, on one hand, you'll have slightly less access to distribution and marketing channels. On the other hand, you'll have a much leaner cost model (no multi-layer executive hierarchies to sustain). Your team will also be much more focused, productive, and agile. You'll also be more risk-tolerant. All of those provide competitive advantages.
    - smokestack412 8y ago
      I wish we'd (as a whole) stop using quantitative terms for things that aren't quantifiable. We can all do that, it's easy and it makes us sound smart. I've seen $100mm+ companies fail because Google decided not to like them anymore. I'm talking about external forces that are far more powerful than execution. And there are lots of 'em (an infinity, even!).
      - cpkpad 8y ago
        External forces happen. I've certainly seen businesses shut down for reasons outside of their control. It's just that this happens a minority of the time. Most of the time, businesses shut down either because: 1. High-risk venture. Someone wants to be the next Facebook and takes a 1-in-a-100 gamble at a billion dollars. 2. Stupid idea/business model. Founder is a true believer in some idea which doesn't match reality. 3. Poor execution. It's a good idea and business model, but any of the hundred things which can shut down a business do: technology takes 10x as long to develop and is buggy; founder fails to recruit good people; zero external sales/visibility/marketing ("if you build it they will come" or wildly implausible assumptions about viral or similar); costs get out-of-control; etc. Most founders I know can do all of those reasonably, and one or two brilliantly. It's hard for me to emphasize how important (and hard) it is to be at least competent at all of those since messing up any one will shut down a company.
- svantana 8y ago
  > perfect execution is rare and almost guarantees success Isn't that a tautology? Is there any reliable measure of execution other than the success that follows?
sah2ed 8y ago
> Most successful companies have to execute perfectly AND have an some of those extrinsic factors, such as family money, personal connections, good timing, or dumb luck. Humans are imperfect so I'm generally wary of characterizations that talk about perfection, especially when used to explain historical phenomena like success. One metaphor that I think is far more useful is to think of businesses as having a mistake budget. Only after you have exhausted your allowance of poor decision-making do you enter a life-threatening situation where your next business decision could spell the end, or a second-chance at seeing any kind of success. Successful businesses are merely more judicious at spending out of their mistake budget, by course-correcting after critical mistakes, compared to their not-so-successful counterparts; rather than saying that successful companies executed perfectly, which is something that is impossible to do in practice.
- speedplane 8y ago
  Sure, absolute perfection is impossible, my point is that the river to success is extremely narrow with plenty of hidden boulders along the way. Navigating it requires extreme precision and a bit of luck.
douglaswlance 8y ago
Depends how you define, "success." Most companies that provide a valuable enough product for enough customers to build a decent career for the companies employees are started by average Joe's with no special connections and are executed very poorly. You'd be surprised how easy it is to start and operate a decent business. The difficult part is growing and scaling that business.
- speedplane 8y ago
  > You'd be surprised how easy it is to start and operate a decent business. The difficult part is growing and scaling that business. I could not disagree more. Businesses fall apart all the time, whether they're top tier banks, manufacturing giants, Silicon Valley venture darlings, medium size businesses, mom-and-pops, restaurants, you name it. Operating a business is a constant balancing act between customers, employees, shareholders, the public, and your own internal vision and desires. Your premise that "companies that provide a valuable enough product ..." is also incredibly dismissive. Creating any product that provides true value is not easy.
- pdimitar 8y ago
  K. I just made the best software product on the planet. I did not tell anyone. I did not hire a marketing firm. It sits on awesomedomain.com with zero leads. Am I rich? You have a flaw in your thinking here.
  - douglaswlance 8y ago
    Delivering value is part of the equation, obviously. Something is not valuable unless there are customers actually receiving value.
    - pdimitar 8y ago
      That is part of the point I am making with my sarcastic remarks in this thread: too many things go "by default" or by "obviously". Too much implicitness. Hence the validity of most "successful people advice" is close to nil.

cpkpad 8y ago

Nope. I've seen plenty of successful companies bumble around and have dumb luck. The reverse is also true -- perfect execution is rare and almost guarantees success. I'll reemphasize that even competent execution is rare; few people can execute perfectly on business AND technology AND marketing AND design AND .... Especially first-time entrepreneurs. Fortunately, the other guy's deeply imperfect too. In capitalism, you just have to be better than the other guy. It's pretty hard -- the other guy has been at it for a while and you're just starting out, but it's far from impossible. Most businesses execute very poorly. Fortunately, each time you try to execute, you get a little bit better at all of those, so after a few tries, you can out-execute. You also learn the advantages smaller, more agile players have over bigger ones. I agree with the persistence bias argument 100%.

speedplane 8y ago
Ive seen plenty of successful companies that got lucky, but none with dumb luck. Which are you referring to?
smokestack412 8y ago
Execution is an HN startup meme. Correctly: most businesses execute very unluckily. You're hopelessly down the rabbit hole if you think skill has the most to do with it, it's total nonsense. VCs don't invest in skill, they invest in crapshoots. Skill is a prerequisite, luck is what makes people rich. Don't pretend otherwise or you'll make it more painful when you fail (99% of the time).
- cpkpad 8y ago
  I've seen order-of-magnitude difference in abilities of companies to: * Build products * Sell products * Recruit * Build rapport with customers * Evaluate business models Most of that is ability. Few people have ability in /all/ of those directions. I've seen people who are even competent (not great) at all of those launch successful business after successful business. By "successful" I don't mean billion dollar unicorn. I mean businesses which employ tens (or hundreds) of people, have millions in revenue, and last indefinitely. This stuff isn't rocket science. If a Fortune 500 make widgets, and you make higher quality widgets at lower cost and make people aware of that, you'll run a sustainable business. As a small business, on one hand, you'll have slightly less access to distribution and marketing channels. On the other hand, you'll have a much leaner cost model (no multi-layer executive hierarchies to sustain). Your team will also be much more focused, productive, and agile. You'll also be more risk-tolerant. All of those provide competitive advantages.
  - smokestack412 8y ago
    I wish we'd (as a whole) stop using quantitative terms for things that aren't quantifiable. We can all do that, it's easy and it makes us sound smart. I've seen $100mm+ companies fail because Google decided not to like them anymore. I'm talking about external forces that are far more powerful than execution. And there are lots of 'em (an infinity, even!).
    - cpkpad 8y ago
      External forces happen. I've certainly seen businesses shut down for reasons outside of their control. It's just that this happens a minority of the time. Most of the time, businesses shut down either because: 1. High-risk venture. Someone wants to be the next Facebook and takes a 1-in-a-100 gamble at a billion dollars. 2. Stupid idea/business model. Founder is a true believer in some idea which doesn't match reality. 3. Poor execution. It's a good idea and business model, but any of the hundred things which can shut down a business do: technology takes 10x as long to develop and is buggy; founder fails to recruit good people; zero external sales/visibility/marketing ("if you build it they will come" or wildly implausible assumptions about viral or similar); costs get out-of-control; etc. Most founders I know can do all of those reasonably, and one or two brilliantly. It's hard for me to emphasize how important (and hard) it is to be at least competent at all of those since messing up any one will shut down a company.
svantana 8y ago
> perfect execution is rare and almost guarantees success Isn't that a tautology? Is there any reliable measure of execution other than the success that follows?

sah2ed 8y ago

> Most successful companies have to execute perfectly AND have an some of those extrinsic factors, such as family money, personal connections, good timing, or dumb luck. Humans are imperfect so I'm generally wary of characterizations that talk about perfection, especially when used to explain historical phenomena like success. One metaphor that I think is far more useful is to think of businesses as having a mistake budget. Only after you have exhausted your allowance of poor decision-making do you enter a life-threatening situation where your next business decision could spell the end, or a second-chance at seeing any kind of success. Successful businesses are merely more judicious at spending out of their mistake budget, by course-correcting after critical mistakes, compared to their not-so-successful counterparts; rather than saying that successful companies executed perfectly, which is something that is impossible to do in practice.

speedplane 8y ago
Sure, absolute perfection is impossible, my point is that the river to success is extremely narrow with plenty of hidden boulders along the way. Navigating it requires extreme precision and a bit of luck.

douglaswlance 8y ago

Depends how you define, "success." Most companies that provide a valuable enough product for enough customers to build a decent career for the companies employees are started by average Joe's with no special connections and are executed very poorly. You'd be surprised how easy it is to start and operate a decent business. The difficult part is growing and scaling that business.

speedplane 8y ago
> You'd be surprised how easy it is to start and operate a decent business. The difficult part is growing and scaling that business. I could not disagree more. Businesses fall apart all the time, whether they're top tier banks, manufacturing giants, Silicon Valley venture darlings, medium size businesses, mom-and-pops, restaurants, you name it. Operating a business is a constant balancing act between customers, employees, shareholders, the public, and your own internal vision and desires. Your premise that "companies that provide a valuable enough product ..." is also incredibly dismissive. Creating any product that provides true value is not easy.
pdimitar 8y ago
K. I just made the best software product on the planet. I did not tell anyone. I did not hire a marketing firm. It sits on awesomedomain.com with zero leads. Am I rich? You have a flaw in your thinking here.
- douglaswlance 8y ago
  Delivering value is part of the equation, obviously. Something is not valuable unless there are customers actually receiving value.
  - pdimitar 8y ago
    That is part of the point I am making with my sarcastic remarks in this thread: too many things go "by default" or by "obviously". Too much implicitness. Hence the validity of most "successful people advice" is close to nil.