5 ms·

One of the arguments that the reviewer makes is that breakout success looks unattractive from an vc point of view and are thus hard to predict(category killers

One of the arguments that the reviewer makes is that breakout success looks unattractive from an vc point of view and are thus hard to predict(category killers like Microsoft/not the first os, Facebook/not the first social media and google/~20th search engine). If I’m understanding him correctly, he seems to suggest that much of success can be attributed to luck. That is, being at the right place at the right time. But if being lucky means all the stars align and the market takes off, such as storage cost drops to enable Dropbox, or processing power per dollar drops to enable more expensive compute, really all players in the industry are able to take advantage of it. Therefore it doesn’t explain why Facebook was the one and not MySpace. In my opinion, being a category killers comes down to having an revolutionary product that truly separates you from the pack as well as be at the right place at the right time. Google pagerank probably was the 10x improvement AND they had good timing. On the same line, Dropbox just worked at a time storage and bandwidth cost was rapidly decreasing and was 10x better than the competition. Of course, there is another category of category killers that didn’t have any competitors to come before it. And that is likely because from an investment perspective, it looked so unfavorable no one even bothered. As such, one offs such as Musk who are willing to act irrationally by funding the likes of SpaceX (original goal is to increase public interest in space) and Tesla created those category killers. It’s more than simply luck. Just my two cents.

deleted 8y ago
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darawk 8y ago
> But if being lucky means all the stars align and the market takes off, such as storage cost drops to enable Dropbox, or processing power per dollar drops to enable more expensive compute, really all players in the industry are able to take advantage of it. Therefore it doesn’t explain why Facebook was the one and not MySpace. That's true, but you also have to be well positioned to capitalize on it quickly when it happens. Dropbox was, and so was Microsoft. It's not necessarily the insights that are luck...it's all the missed equivalents that we've all never heard of. There may have been 10 companies trying to do more or less exactly what Microsoft was doing. They may all have been at the right place at the right time, but Microsoft had a little extra something that's hard to pin down. While i'm speculating with Microsoft, this is certainly true in the case of social networks. There were dozens of them at the time. Livejournal, Xanga, Friendster, MySpace, etc...They were all doing more or less what Facebook was doing. What did Facebook do so right that they didn't? There's certainly lots of ex-post just-so narratives about their exclusionary, college based early access model. But it's very hard to know if that was truly causal or not. I will say that the one example of Gwern's that I really take issue with is Google. Google was very much not just another search engine. Google had a true, deeply differentiated technical insight that nobody else had. They solved search. The 'search engines' that existed before Google weren't even worthy of the name. They really innovated, and they deserve every ounce of credit for doing that. While luck is always a factor in these things, I think Google's success was as genuinely merit-based as any company's i'm aware of.
- avinium 8y ago
  I always saw Facebook's enormous success as very much "right place, right time". I feel that 2007 was a massive shift in internet consumption habits/demographic. Prior to this, it was still relatively young/geeky - Mum and Dad would use it for e-mail and work research, but not much else. Then the iPhone came along, and suddenly, your average Joe and Jane were flocking to the internet on their mobile devices. It was no longer geeky, it was mainstream. Facebook opened the gates to the (non-university) public right around the same time, which meant they were perfectly positioned to capitalize on this colossal new demographic of internet media consumers. I'm not saying that they wouldn't have built a successful social network without the iPhone. But I do think it would have just been another Myspace. Same goes for Twitter, mind you.
  - JumpCrisscross 8y ago
    > Then the iPhone came along, and suddenly, your average Joe and Jane were flocking to the internet on their mobile devices. It was no longer geeky, it was mainstream Facebook went public before figuring out mobile. Something in your timeline is off.
    - avinium 8y ago
      I'm not saying Facebook mobile, I'm saying I think the iPhone made a huge impact in driving internet consumption into the public consciousness.
- billfruit 8y ago
  From the scene in India, Orkut was so firmly entrenched here, but slowly Facebook won over, it may have taken years.
- microtherion 8y ago
  I don't know about that. In my recollection, AltaVista was not that bad, and I switched to Google mostly because the AltaVista search field was getting harder and harder to find among all the ads. A few years earlier, I switched to AltaVista from Lycos for pretty much the same reason. A good thing that Google is too smart to crowd out organic search results with more and more paid results.</s>

deleted 8y ago

[deleted]

darawk 8y ago

> But if being lucky means all the stars align and the market takes off, such as storage cost drops to enable Dropbox, or processing power per dollar drops to enable more expensive compute, really all players in the industry are able to take advantage of it. Therefore it doesn’t explain why Facebook was the one and not MySpace. That's true, but you also have to be well positioned to capitalize on it quickly when it happens. Dropbox was, and so was Microsoft. It's not necessarily the insights that are luck...it's all the missed equivalents that we've all never heard of. There may have been 10 companies trying to do more or less exactly what Microsoft was doing. They may all have been at the right place at the right time, but Microsoft had a little extra something that's hard to pin down. While i'm speculating with Microsoft, this is certainly true in the case of social networks. There were dozens of them at the time. Livejournal, Xanga, Friendster, MySpace, etc...They were all doing more or less what Facebook was doing. What did Facebook do so right that they didn't? There's certainly lots of ex-post just-so narratives about their exclusionary, college based early access model. But it's very hard to know if that was truly causal or not. I will say that the one example of Gwern's that I really take issue with is Google. Google was very much not just another search engine. Google had a true, deeply differentiated technical insight that nobody else had. They solved search. The 'search engines' that existed before Google weren't even worthy of the name. They really innovated, and they deserve every ounce of credit for doing that. While luck is always a factor in these things, I think Google's success was as genuinely merit-based as any company's i'm aware of.

avinium 8y ago
I always saw Facebook's enormous success as very much "right place, right time". I feel that 2007 was a massive shift in internet consumption habits/demographic. Prior to this, it was still relatively young/geeky - Mum and Dad would use it for e-mail and work research, but not much else. Then the iPhone came along, and suddenly, your average Joe and Jane were flocking to the internet on their mobile devices. It was no longer geeky, it was mainstream. Facebook opened the gates to the (non-university) public right around the same time, which meant they were perfectly positioned to capitalize on this colossal new demographic of internet media consumers. I'm not saying that they wouldn't have built a successful social network without the iPhone. But I do think it would have just been another Myspace. Same goes for Twitter, mind you.
- JumpCrisscross 8y ago
  > Then the iPhone came along, and suddenly, your average Joe and Jane were flocking to the internet on their mobile devices. It was no longer geeky, it was mainstream Facebook went public before figuring out mobile. Something in your timeline is off.
  - avinium 8y ago
    I'm not saying Facebook mobile, I'm saying I think the iPhone made a huge impact in driving internet consumption into the public consciousness.
billfruit 8y ago
From the scene in India, Orkut was so firmly entrenched here, but slowly Facebook won over, it may have taken years.
microtherion 8y ago
I don't know about that. In my recollection, AltaVista was not that bad, and I switched to Google mostly because the AltaVista search field was getting harder and harder to find among all the ads. A few years earlier, I switched to AltaVista from Lycos for pretty much the same reason. A good thing that Google is too smart to crowd out organic search results with more and more paid results.</s>