5 ms·

These SV made-men, taken as a group, are Exhibit A for survivorship bias. Their primary talent is having been in the right place at the right time and they've s

by courtf 6y ago

These SV made-men, taken as a group, are Exhibit A for survivorship bias. Their primary talent is having been in the right place at the right time and they've spun an entire self-help industry out of it. If they hadn't gotten lucky early on, they'd just be dopey middle management parasites at some investment firm. These aren't they people that can build anything, they're just the middlemen between rich idiots and people with actual talents.

tyu2 6y ago
Right, but the point is those materials are not for starting a sustainable business, but a startup, a whole different thing as you understand. For sustainable business you probably don't want to listen to anyone involved in VC-funded startups, it's in their interest even to sabotage you.
- pontus 6y ago
  The fact that some think there's a distinction between a startup and a sustainable business says a lot about SV. A startup should be sustainable too. There's a distinction between a quickly growing business or a slowly growing business for sure, and sometimes it makes sense to forgo the sustainable part in the short term in order to promote growth, but to think that a startup somehow should not aim to be sustainable leads to really perverse incentives.
  - nowherebeen 6y ago
    I think this concept was popularized by VCs like SoftBank. It also makes me wonder how much of a tech bubble we are in and what happens when it finally bursts.
    - Rastonbury 6y ago
      The appearance of being a bubble is inherent in the VC business model.. VCs know full well that 9/10 startups they fund are likely to fail, they make returns out of the 1/10. The median funded startup is a failure. People look at this an think "all this money and all this failure, its going to end badly, these investors are gonna get burnt!" yes some do, but even the most stellar firms have more misses than hits.
      - nowherebeen 6y ago
        > all this money and all this failure, its going to end badly, these investors are gonna get burnt No, I think all these startups employees with families to feed are going to be out of a job. VCs fund startups that shouldn’t have been funded in the first place. They create a market that artificially props up unsustainable businesses. This video is a good explanation of how the VC world actually works. https://m.youtube.com/watch?v=NVVsdlHslfI https://m.youtube.com/watch?v=NVVsdlHslfI
- courtf 6y ago
  Fair point, I just want to point out that this "lecture" series could be greatly reduced to one simple rule: do what the money-men tell if you want to get funded. These guys don't know how to build your business, they know how to get funds to change hands. So kiss their ass, jump through whatever inane hoops they use to trick the wealthy to part with their jewels, and you might just be among the chosen few.
  - aerosmile 6y ago
    YC (and by extension, Sam Altman in his past capacity as its President) is not in the business of maximizing the longevity of each and every investment. Instead, they are in the business of maximizing their ROI within a reasonable timeframe (and they are pretty good at it). If that doesn't sound like a good deal to you as an entrepreneur, you should raise your money from elsewhere or avoid raising altogether. But to claim that Sam Altman doesn't know how to build a business is a bit of stretch. OpenAI seems to be doing quite well.
    - courtf 6y ago
      It's easy to make money when you have money and thousands of desperate poors begging for the opportunity to bhe your investment vehicle. Sam got lucky and got rich. From there it's all downhill.
      - aerosmile 6y ago
        Nobody would dispute the element of luck in each rich person's journey. Or that the first million is the hardest one. And yet, it does seem that the particularly ambitious, smart and hard working ones tend to get more lucky. Also, note this quote from Paul Graham [1]: > Within about three minutes of meeting him, I remember thinking "Ah, so this is what Bill Gates must have been like when he was 19." Not to mention that PG still declined him, and Sam refused to leave. Sounds to me like a bit more than just your average lucky kid. [1] http://www.paulgraham.com/mit.html http://www.paulgraham.com/mit.html
      - courtf 6y ago
smurf_t 6y ago
That doesn't change the fact that there were many people in SV at the time. Arguably, Sam and the team did very well.
- courtf 6y ago
  You're just making my point for me because what you wrote is the definition of survivorship bias.
aerosmile 6y ago
The "right place at the right time" argument sounds like you could create a cohort of all the SV-based entrepreneurs who arrived there within a certain time period (supposedly the earlier the better?), and somehow all current SV-based unicorns would magically link back to those folks. If anything, I am observing a surprisingly small correlation there - the average founder of a top 100 YC company went through YC 5 years ago [1]. 5 years ago is shockingly recent and well past the SV gold rush curve. [1] https://www.ycombinator.com/companies/?top100=true https://www.ycombinator.com/companies/?top100=true
- courtf 6y ago
  I mean, it's just a phrase you can put away the analysis. It means any other warm body inhabiting that space at that time would have similar results. There are infinite right places and right times.

by courtf 6y ago

tyu2 6y ago

Right, but the point is those materials are not for starting a sustainable business, but a startup, a whole different thing as you understand. For sustainable business you probably don't want to listen to anyone involved in VC-funded startups, it's in their interest even to sabotage you.

pontus 6y ago
The fact that some think there's a distinction between a startup and a sustainable business says a lot about SV. A startup should be sustainable too. There's a distinction between a quickly growing business or a slowly growing business for sure, and sometimes it makes sense to forgo the sustainable part in the short term in order to promote growth, but to think that a startup somehow should not aim to be sustainable leads to really perverse incentives.
- nowherebeen 6y ago
  I think this concept was popularized by VCs like SoftBank. It also makes me wonder how much of a tech bubble we are in and what happens when it finally bursts.
  - Rastonbury 6y ago
    The appearance of being a bubble is inherent in the VC business model.. VCs know full well that 9/10 startups they fund are likely to fail, they make returns out of the 1/10. The median funded startup is a failure. People look at this an think "all this money and all this failure, its going to end badly, these investors are gonna get burnt!" yes some do, but even the most stellar firms have more misses than hits.
    - nowherebeen 6y ago
      > all this money and all this failure, its going to end badly, these investors are gonna get burnt No, I think all these startups employees with families to feed are going to be out of a job. VCs fund startups that shouldn’t have been funded in the first place. They create a market that artificially props up unsustainable businesses. This video is a good explanation of how the VC world actually works. https://m.youtube.com/watch?v=NVVsdlHslfI https://m.youtube.com/watch?v=NVVsdlHslfI
courtf 6y ago
Fair point, I just want to point out that this "lecture" series could be greatly reduced to one simple rule: do what the money-men tell if you want to get funded. These guys don't know how to build your business, they know how to get funds to change hands. So kiss their ass, jump through whatever inane hoops they use to trick the wealthy to part with their jewels, and you might just be among the chosen few.
- aerosmile 6y ago
  YC (and by extension, Sam Altman in his past capacity as its President) is not in the business of maximizing the longevity of each and every investment. Instead, they are in the business of maximizing their ROI within a reasonable timeframe (and they are pretty good at it). If that doesn't sound like a good deal to you as an entrepreneur, you should raise your money from elsewhere or avoid raising altogether. But to claim that Sam Altman doesn't know how to build a business is a bit of stretch. OpenAI seems to be doing quite well.
  - courtf 6y ago
    It's easy to make money when you have money and thousands of desperate poors begging for the opportunity to bhe your investment vehicle. Sam got lucky and got rich. From there it's all downhill.
    - aerosmile 6y ago
      Nobody would dispute the element of luck in each rich person's journey. Or that the first million is the hardest one. And yet, it does seem that the particularly ambitious, smart and hard working ones tend to get more lucky. Also, note this quote from Paul Graham [1]: > Within about three minutes of meeting him, I remember thinking "Ah, so this is what Bill Gates must have been like when he was 19." Not to mention that PG still declined him, and Sam refused to leave. Sounds to me like a bit more than just your average lucky kid. [1] http://www.paulgraham.com/mit.html http://www.paulgraham.com/mit.html
    - courtf 6y ago

smurf_t 6y ago

That doesn't change the fact that there were many people in SV at the time. Arguably, Sam and the team did very well.

courtf 6y ago
You're just making my point for me because what you wrote is the definition of survivorship bias.

aerosmile 6y ago

The "right place at the right time" argument sounds like you could create a cohort of all the SV-based entrepreneurs who arrived there within a certain time period (supposedly the earlier the better?), and somehow all current SV-based unicorns would magically link back to those folks. If anything, I am observing a surprisingly small correlation there - the average founder of a top 100 YC company went through YC 5 years ago [1]. 5 years ago is shockingly recent and well past the SV gold rush curve. [1] https://www.ycombinator.com/companies/?top100=true https://www.ycombinator.com/companies/?top100=true

courtf 6y ago
I mean, it's just a phrase you can put away the analysis. It means any other warm body inhabiting that space at that time would have similar results. There are infinite right places and right times.