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Just curious, being a Valley outsider (Washingtonian): How common is the startup that finds the middle ground between working to the bone (trying desperately to

Just curious, being a Valley outsider (Washingtonian): How common is the startup that finds the middle ground between working to the bone (trying desperately to be the next Google/Yahoo/Microsoft and secure massive VC) and the expect-nothing-back, RMS-enamored open source group? Because that's where I'd like to be: A tech shop that cares about turning a profit, but that's equally concerned with innovation and just having a good time. It seems to me that many people affiliated with the startup scene are way too dollar-driven or take themselves too seriously.

mattmaroon 18y ago
If you have investors, you have a responsibility to them to be dollar-driven. If you don't, then you're pretty much free to do whatever you wish. People in every sphere take themselves too seriously I think. Everything is life or death the the people involved.
- il 18y ago
  Exactly. Unless you're working on an open source project, you're building a business. The core purpose of any business is to maximize value for your shareholders- that's business school 101. If innovating or having fun are means to maximize value, then that's what you should do, but I don't know how any startup that doesn't keep its eye on the prize($$$) can be succesful.
  - thomasmallen 18y ago
    That is, if you're a traded company. And to parent's parent, that is, if you have investors. It's the assumption that the most noteworthy prize is "$$$" that I think needs to be reconsidered, but that of course depends on who's in the company and what their priorities are. If what you're doing is significant, I think that at some point profits will be a given if you stay small and nimble.
    - mattmaroon 18y ago
      I don't think it's impossible to have fun while still attempting to build a profitable enterprise. Most startuppers I know seem to enjoy the process enough that they would just do another one if their current one tanked. It beats working a job by a long shot.
      - fallentimes 18y ago
        YES I've had roughly 30 jobs in my life and this is easily the best one. I would do another startup in a heart beat - hopefully I won't have to.
    - 13ren 18y ago
      Meaningful innovation: We are the technology company that invents the useful and the significant. http://www.hp.com/hpinfo/abouthp/corpobj.html http://www.hp.com/hpinfo/abouthp/corpobj.html Less true of HP today, but they arguably started this silicon valley thing, Woz wanted to work for them, etc. The "Built to Last" companies tended to be about something meaningful, not just naked profit (but profit as well).
SwellJoe 18y ago
So, I know you're asking more from an "approach to business" perspective than a "how much Open Source goes on in the valley" perspective...but, I figured I'd chime in, anyway: I've been surprised by how little Open Source happens in the valley, at least among the "young, rich and good looking" startup set that shows up all the time on TC and Valleywag. I'm somewhat disappointed by it, as well. Folks are building everything they do on Free and Open Source Software. It's polite to give something back, even if the license was written before web apps were a presence, and so you aren't legally obligated to do so. I don't want that to sound too harsh or too inclusive. There are tons of startups, in the valley and elsewhere, that do take part in Open Source development, but I'd say for every one that I meet at events, I meet five startup founders that have never contributed a line of code to Open Source, even though their apps are built with PHP, Ruby, Perl, or Python, using vast swaths of Open Source library code, are checked into git or Subversion, and run on top of Linux. This could just be selection bias, since it seems like a lot of OSS folks are more likely to be bootstrapping outside of the valley. Anyway, we're an Open Source project (Webmin/Virtualmin/Usermin) turned startup. It has positives and negatives, but I don't think one can say, "You can't be the next Google/Yahoo/Microsoft, if you're running a fun Open Source oriented company"...we don't know that yet. It's still early in the history of OSS startups. Red Hat does OK. MySQL AB sold to Sun for ~$500 million, XenSource to Citrix for ~$300...Not Google/Yahoo/MS money, but nothing to sneeze at. Making money on Open Source is harder than on proprietary software, in general. But, you get some awesome benefits. Like, how many of our competitors can claim millions of users? Not a single one. While our software has been downloaded over 12 million times from a single source (and OSS ends up in all sorts of funny places without showing up on the download counter, because it gets packaged, included with distros and hardware products, comes from local mirrors, etc.). And, let's face it, when you have a million people looking at your software on a daily basis, you pretty much can't help but make money if you're trying. Free is a powerful game changer in most markets, and changing the game might be mandatory if you're working in an established market against strong competitors. From the perspective of raising money, investors don't have a problem with it, and most understand OSS. It may even be a positive angle for them, assuming you still have a business model after factoring in, "But it's free!"
- davidw 18y ago

mattmaroon 18y ago

If you have investors, you have a responsibility to them to be dollar-driven. If you don't, then you're pretty much free to do whatever you wish. People in every sphere take themselves too seriously I think. Everything is life or death the the people involved.

il 18y ago
Exactly. Unless you're working on an open source project, you're building a business. The core purpose of any business is to maximize value for your shareholders- that's business school 101. If innovating or having fun are means to maximize value, then that's what you should do, but I don't know how any startup that doesn't keep its eye on the prize($$$) can be succesful.
- thomasmallen 18y ago
  That is, if you're a traded company. And to parent's parent, that is, if you have investors. It's the assumption that the most noteworthy prize is "$$$" that I think needs to be reconsidered, but that of course depends on who's in the company and what their priorities are. If what you're doing is significant, I think that at some point profits will be a given if you stay small and nimble.
  - mattmaroon 18y ago
    I don't think it's impossible to have fun while still attempting to build a profitable enterprise. Most startuppers I know seem to enjoy the process enough that they would just do another one if their current one tanked. It beats working a job by a long shot.
    - fallentimes 18y ago
      YES I've had roughly 30 jobs in my life and this is easily the best one. I would do another startup in a heart beat - hopefully I won't have to.
  - 13ren 18y ago
    Meaningful innovation: We are the technology company that invents the useful and the significant. http://www.hp.com/hpinfo/abouthp/corpobj.html http://www.hp.com/hpinfo/abouthp/corpobj.html Less true of HP today, but they arguably started this silicon valley thing, Woz wanted to work for them, etc. The "Built to Last" companies tended to be about something meaningful, not just naked profit (but profit as well).

SwellJoe 18y ago

So, I know you're asking more from an "approach to business" perspective than a "how much Open Source goes on in the valley" perspective...but, I figured I'd chime in, anyway: I've been surprised by how little Open Source happens in the valley, at least among the "young, rich and good looking" startup set that shows up all the time on TC and Valleywag. I'm somewhat disappointed by it, as well. Folks are building everything they do on Free and Open Source Software. It's polite to give something back, even if the license was written before web apps were a presence, and so you aren't legally obligated to do so. I don't want that to sound too harsh or too inclusive. There are tons of startups, in the valley and elsewhere, that do take part in Open Source development, but I'd say for every one that I meet at events, I meet five startup founders that have never contributed a line of code to Open Source, even though their apps are built with PHP, Ruby, Perl, or Python, using vast swaths of Open Source library code, are checked into git or Subversion, and run on top of Linux. This could just be selection bias, since it seems like a lot of OSS folks are more likely to be bootstrapping outside of the valley. Anyway, we're an Open Source project (Webmin/Virtualmin/Usermin) turned startup. It has positives and negatives, but I don't think one can say, "You can't be the next Google/Yahoo/Microsoft, if you're running a fun Open Source oriented company"...we don't know that yet. It's still early in the history of OSS startups. Red Hat does OK. MySQL AB sold to Sun for ~$500 million, XenSource to Citrix for ~$300...Not Google/Yahoo/MS money, but nothing to sneeze at. Making money on Open Source is harder than on proprietary software, in general. But, you get some awesome benefits. Like, how many of our competitors can claim millions of users? Not a single one. While our software has been downloaded over 12 million times from a single source (and OSS ends up in all sorts of funny places without showing up on the download counter, because it gets packaged, included with distros and hardware products, comes from local mirrors, etc.). And, let's face it, when you have a million people looking at your software on a daily basis, you pretty much can't help but make money if you're trying. Free is a powerful game changer in most markets, and changing the game might be mandatory if you're working in an established market against strong competitors. From the perspective of raising money, investors don't have a problem with it, and most understand OSS. It may even be a positive angle for them, assuming you still have a business model after factoring in, "But it's free!"

davidw 18y ago