6 ms·

Five Myths About Building Billion-Dollar Startups

74 points by jkuria 5y ago

throway27182818 5y ago
I met with the 645 team, not impressed. Venture investing 101: Raise money from pension funds, invest it in founders who have had good exits before. Rinse, repeat. VC in 2021 is a media and promotion play to get in front of the right founders, and then claim you have a good hiring pipeline or intros to customers. (They mostly don't. 645 especially doesn't.)
- hk1337 5y ago
  645 sounds like Entertainment 720
colordrops 5y ago
Are these really myths? Maybe they were 15 years ago. No one believes them now.
- 1cvmask 5y ago
  Those myths were not around 15 years ago as well. Take SAP for example.
- javajosh 5y ago
  I feel pedanticdirty pointing this out, but something can be a myth AND also not be believed. I bet most myths are like that. That said, your criticism is right on, because you're responding to the implicit synonym to the title: 5 things you believe that aren't true about startups. But the assertion that we believe them is false, and false is bad. The correct title here would be "5 things that some people at some point in time may have believed that aren't true that we are dusting off for an original content listicle." Which I think has a nice ring to it!
  - ineedasername 5y ago
    Sure, but we're not talking about Greek Mythology here. In this context, the semantic weight of "myth" tends to be in the sense of misconceptions that many people do believe.
    - javajosh 5y ago
      I feel like I already agreed with you in my comment?
      - ineedasername 5y ago
        I think it was just my pedantic side coming out as well. Probably unnecessary on my part. To be pedantic though, technically all comments here aren't strictly necessary. Though I should probably stop now: non productive hairsplitting is something I have to watch out for as I comment :)
- jjoonathan 5y ago
  No one would admit to believing them, but actions speak louder than words and actions tell a different story.
siddharth-shah 5y ago
Too many click bait articles on hackernews now.
- freetinker 5y ago
  Probably bot armies upvoting this junk on HN.
yannoninator 5y ago
Do we really need more VC parasitic puff pieces? Less of this drivel please, it doesn't contribute anything to HN.
ineedasername 5y ago
None of these seem like popular myths that a lot of people believe.
rkk3 5y ago
Garbage in garbage out. Basing it off of self-reported crowdsourced data (Crunchbase) and is deeply flawed. Paypal doesn't even appear on the list of employers with more than 5 unicorns from ex employees I can name more off the top of my head: Tesla, Spacex, Palantir, Youtube, Linkedin, Yelp, Yammer, Affirm
- lostinquebec 5y ago
  AFAIK Musk didn't found Tesla (nitpicking I know): https://en.wikipedia.org/wiki/Tesla,_Inc.#Founding_(2003%E2%80%932004) https://en.wikipedia.org/wiki/Tesla,_Inc.#Founding_(2003%E2%...
  - rkk3 5y ago
    My point still stands even if Paypal has one less unicorn. Founder also doesn't have a universal definition and by your own link the courts decided that he could be called a co-founder, along with the 4 others.
- mohanmcgeek 5y ago
  > I can name more off the top of my head Only spacex here is a unicorn.Everything else has been acquired or listed And the author seems to talk about billion dollar start-ups, not necessarily just unicorns but only in the past decade. Most the PayPal Mafia companies were $1B+ Already in 2000s.
  - rkk3 5y ago
    > Only spacex here is a unicorn.Everything else has been acquired or listed I don't know what your point it, almost every company mentioned in this article has been acquired or listed... > the author seems to talk about billion dollar start-ups, not necessarily just unicorns but only in the past decade. They list several companies made in 00's; Mulesoft, Dropbox, Uber, Whatsapp... Qualtrics was made in 2002 almost 2 decades ago.
    - mohanmcgeek 5y ago
notaniitian 5y ago
Amazing how ex-googlers create the most unicorns. Is there a reason?
- redis_mlc 5y ago
  Creating the most startups is not the same as succeeding at them. The reason ex-googlers could create the most startups are: 1) There's a lot of google employees, so a large population of former employees 2) They're paid some of the highest salaries in the world, so can afford the runway to start their own company (this is hugely important.) Although the occasional MVP is written in a weekend, more likely it takes about 90 days, and without a salary most people can't afford to do that. The life cycle of most startups is about 7 years, so a long-term commitment. Back in the day, business owners used to say, "I pay my staff well, but not enough to leave me." That's why. 3) Their pedigree makes it easier to get VC funding. VCs actually think, "Since the founders are ex-google, this must be a good opportunity." in the sense of social proof. (VCs hate when they hear a pitch like, "after we get funding, these other people will join" since the other people don't sound committed, and may actually decline to join after getting funding anyway, and most people including VCs are naysayers and nitpickers.) 4) Google is a Bay Area company, so no non-competes, like Boston has. Parallel to that is the SV startup culture, where startup risk is normalized - good luck trying that in Europe or Japan. However, note that a lot of ex-googlers admit to struggling when founding startups because the infrastructure (and monopoly sales) they're used to doesn't exist outside google (borg, bigtable, pregel, etc.) It's much easier for somebody who used AWS or ran a lemonade stand before to build their first business than "institutionalized" ex-googlers. What's interesting is the contrast between software and hardware startups. Since hardware is so expensive, Cisco funded several "spin-outs" to create new product lines. Ironically, Zoom is their biggest and unintentional "spin-out", but it was software and the value was captured by an ex-manager, not Cisco itself. (Zoom was formed from 40 ex-Cisco Webex staff.) :)
- seanhunter 5y ago
  I don't know about "the most" unicors, but they have lots of money and lots of contacts so it seems unsurprising.

74 points by jkuria 5y ago

I met with the 645 team, not impressed. Venture investing 101: Raise money from pension funds, invest it in founders who have had good exits before. Rinse, repeat. VC in 2021 is a media and promotion play to get in front of the right founders, and then claim you have a good hiring pipeline or intros to customers. (They mostly don't. 645 especially doesn't.)

hk1337 5y ago
645 sounds like Entertainment 720

colordrops 5y ago

Are these really myths? Maybe they were 15 years ago. No one believes them now.

1cvmask 5y ago
Those myths were not around 15 years ago as well. Take SAP for example.
javajosh 5y ago
I feel pedanticdirty pointing this out, but something can be a myth AND also not be believed. I bet most myths are like that. That said, your criticism is right on, because you're responding to the implicit synonym to the title: 5 things you believe that aren't true about startups. But the assertion that we believe them is false, and false is bad. The correct title here would be "5 things that some people at some point in time may have believed that aren't true that we are dusting off for an original content listicle." Which I think has a nice ring to it!
- ineedasername 5y ago
  Sure, but we're not talking about Greek Mythology here. In this context, the semantic weight of "myth" tends to be in the sense of misconceptions that many people do believe.
  - javajosh 5y ago
    I feel like I already agreed with you in my comment?
    - ineedasername 5y ago
      I think it was just my pedantic side coming out as well. Probably unnecessary on my part. To be pedantic though, technically all comments here aren't strictly necessary. Though I should probably stop now: non productive hairsplitting is something I have to watch out for as I comment :)
jjoonathan 5y ago
No one would admit to believing them, but actions speak louder than words and actions tell a different story.

siddharth-shah 5y ago

Too many click bait articles on hackernews now.

freetinker 5y ago
Probably bot armies upvoting this junk on HN.

yannoninator 5y ago

Do we really need more VC parasitic puff pieces? Less of this drivel please, it doesn't contribute anything to HN.

ineedasername 5y ago

None of these seem like popular myths that a lot of people believe.

rkk3 5y ago

Garbage in garbage out. Basing it off of self-reported crowdsourced data (Crunchbase) and is deeply flawed. Paypal doesn't even appear on the list of employers with more than 5 unicorns from ex employees I can name more off the top of my head: Tesla, Spacex, Palantir, Youtube, Linkedin, Yelp, Yammer, Affirm

lostinquebec 5y ago
AFAIK Musk didn't found Tesla (nitpicking I know): https://en.wikipedia.org/wiki/Tesla,_Inc.#Founding_(2003%E2%80%932004) https://en.wikipedia.org/wiki/Tesla,_Inc.#Founding_(2003%E2%...
- rkk3 5y ago
  My point still stands even if Paypal has one less unicorn. Founder also doesn't have a universal definition and by your own link the courts decided that he could be called a co-founder, along with the 4 others.
mohanmcgeek 5y ago
> I can name more off the top of my head Only spacex here is a unicorn.Everything else has been acquired or listed And the author seems to talk about billion dollar start-ups, not necessarily just unicorns but only in the past decade. Most the PayPal Mafia companies were $1B+ Already in 2000s.
- rkk3 5y ago
  > Only spacex here is a unicorn.Everything else has been acquired or listed I don't know what your point it, almost every company mentioned in this article has been acquired or listed... > the author seems to talk about billion dollar start-ups, not necessarily just unicorns but only in the past decade. They list several companies made in 00's; Mulesoft, Dropbox, Uber, Whatsapp... Qualtrics was made in 2002 almost 2 decades ago.
  - mohanmcgeek 5y ago

notaniitian 5y ago

Amazing how ex-googlers create the most unicorns. Is there a reason?

redis_mlc 5y ago
Creating the most startups is not the same as succeeding at them. The reason ex-googlers could create the most startups are: 1) There's a lot of google employees, so a large population of former employees 2) They're paid some of the highest salaries in the world, so can afford the runway to start their own company (this is hugely important.) Although the occasional MVP is written in a weekend, more likely it takes about 90 days, and without a salary most people can't afford to do that. The life cycle of most startups is about 7 years, so a long-term commitment. Back in the day, business owners used to say, "I pay my staff well, but not enough to leave me." That's why. 3) Their pedigree makes it easier to get VC funding. VCs actually think, "Since the founders are ex-google, this must be a good opportunity." in the sense of social proof. (VCs hate when they hear a pitch like, "after we get funding, these other people will join" since the other people don't sound committed, and may actually decline to join after getting funding anyway, and most people including VCs are naysayers and nitpickers.) 4) Google is a Bay Area company, so no non-competes, like Boston has. Parallel to that is the SV startup culture, where startup risk is normalized - good luck trying that in Europe or Japan. However, note that a lot of ex-googlers admit to struggling when founding startups because the infrastructure (and monopoly sales) they're used to doesn't exist outside google (borg, bigtable, pregel, etc.) It's much easier for somebody who used AWS or ran a lemonade stand before to build their first business than "institutionalized" ex-googlers. What's interesting is the contrast between software and hardware startups. Since hardware is so expensive, Cisco funded several "spin-outs" to create new product lines. Ironically, Zoom is their biggest and unintentional "spin-out", but it was software and the value was captured by an ex-manager, not Cisco itself. (Zoom was formed from 40 ex-Cisco Webex staff.) :)
seanhunter 5y ago
I don't know about "the most" unicors, but they have lots of money and lots of contacts so it seems unsurprising.