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> As long as one is clear about what one is optimising for, both strategies are fine. I know this is HN orthodoxy, considering the audience and our beneficent

> As long as one is clear about what one is optimising for, both strategies are fine. I know this is HN orthodoxy, considering the audience and our beneficent hosts. But I think this assumption bears questioning. Is the startup model really morally equivalent? Clearly we wouldn't say that all cost functions a business could optimize are all equivalent. So why should the traditional small business and startup model be assumed to be equivalent? And moreover, even if it is morally equivalent... is it really that good of a strategy? By which I mean two things: 1) is it a fit strategy in of itself, and 2) is it good for the entire business ecosystem? As food for thought... why hasn't Silicon Valley adequately considered a "slow-up" model that combines the traditional survival and sustainable growth focuses with the advantages of massive cash influxes and rapid iteration towards a viable product (even if that means pivoting)? I think the answer is clear: venture capitalists want a return, and a large one, before they die. Is a business model optimized for generating returns before investors die really a healthy strategy to have so much capital allocated towards? Especially when these businesses in particular (tech startups) can often have such a large impact on culture and society.

keenmaster 6y ago
I have a startup to sell you on. It's called Brydge. We have a radically non-linear revenue model which resembles a perpendicular hockey stick. We currently have no revenue, but revenues will quintuple each year until you die, at which point we expect to make ten billion dollars per year. We are looking for a 10 million dollar investment for a 30% stake. You are also entitled to 100% of our revenues until you die. In expected value terms, that's a great deal.
cosmie 6y ago
> As food for thought... why hasn't Silicon Valley adequately considered a "slow-up" model that combines the traditional survival and sustainable growth focuses with the advantages of massive cash influxes and rapid iteration towards a viable product (even if that means pivoting)? > I think the answer is clear: venture capitalists want a return, and a large one, before they die. Is a business model optimized for generating returns before investors die really a healthy strategy to have so much capital allocated towards? Especially when these businesses in particular (tech startups) can often have such a large impact on culture and society. I think the answer is simpler than that: the VC investment model is predicated on jackpot payouts. Anything less than that is a failed bet from their perspective. That mentality permeates the businesses they invest in and pressures them to take risks they otherwise wouldn't, thereby increasing the odds of becoming such a jackpot. Even if the "slow-up" model was a net win for everyone involved, it's not the jackpot the VC was after. And the sheer existence of it being an acceptable outcome would act as a relief valve for that pressure and lower the odds of a jackpot payout for the VC.

keenmaster 6y ago

I have a startup to sell you on. It's called Brydge. We have a radically non-linear revenue model which resembles a perpendicular hockey stick. We currently have no revenue, but revenues will quintuple each year until you die, at which point we expect to make ten billion dollars per year. We are looking for a 10 million dollar investment for a 30% stake. You are also entitled to 100% of our revenues until you die. In expected value terms, that's a great deal.

cosmie 6y ago

> As food for thought... why hasn't Silicon Valley adequately considered a "slow-up" model that combines the traditional survival and sustainable growth focuses with the advantages of massive cash influxes and rapid iteration towards a viable product (even if that means pivoting)? > I think the answer is clear: venture capitalists want a return, and a large one, before they die. Is a business model optimized for generating returns before investors die really a healthy strategy to have so much capital allocated towards? Especially when these businesses in particular (tech startups) can often have such a large impact on culture and society. I think the answer is simpler than that: the VC investment model is predicated on jackpot payouts. Anything less than that is a failed bet from their perspective. That mentality permeates the businesses they invest in and pressures them to take risks they otherwise wouldn't, thereby increasing the odds of becoming such a jackpot. Even if the "slow-up" model was a net win for everyone involved, it's not the jackpot the VC was after. And the sheer existence of it being an acceptable outcome would act as a relief valve for that pressure and lower the odds of a jackpot payout for the VC.