4 ms·

Better still to find an opportunity that has a chance of making it to $100mm if everything goes perfectly, but might end up at $2mm on a bad run. Bootstrap so

Better still to find an opportunity that has a chance of making it to $100mm if everything goes perfectly, but might end up at $2mm on a bad run. Bootstrap so you don't have the pressure to 100x for an investor, and so you can pull out some of that $2mm once it starts flowing.

psykotic 15y ago
> Better still to find an opportunity that has a chance of making it to $100mm if everything goes perfectly, but might end up at $2mm on a bad run. If you know of a business where even a bad run nets you $2mm, I'm sure everyone here would love to know. This kind of vague general math is silly. It assumes that the chance of success stays more or less the same while the potential pay-off obviously grows for larger ventures. If it were that simple. You simply can't make an intelligent generalization along those lines. Any comparison should be made on a case by case basis.
InclinedPlane 15y ago
This is silly dot com 1.0 math. It's easy to point out how $2mil a year might be only 1% or even 0.001% of the total size of some particular market, but that's irrelevant. No amount of business is guaranteed. $2mil is still $2mil, it's still x number of people each ponying up y number of dollars, for pretty significant values of both. Without a compelling product and a solid brand you have no guarantee of that. There's no such thing as a business venture that makes $2mil in a worst case scenario. The worst case is always losing money.
- erichocean 15y ago
  > There's no such thing as a business venture that makes $2mil in a worst case scenario. The opposite is true though: there are a lot of companies that will have trouble doing more than $2 million. I think the author is suggesting you don't pick one of those. In the end, the real cost is time. Do you want to spend your time building something small, or something big? That depends on why you're working, I suppose, but if you really don't care what the business is, might as well build something big.
- rabbitonrails 15y ago
  The numbers are arbitrary, so it would have been better for me to say "business models that produce nonzero revenues even when things go wrong are superior to business models that return nothing unless everything goes right, especially for bootstrapped companies". The counter argument is that the latter kind of business models (e.g. social) have much higher potential payouts due to scale. But I believe one doesn't have to look too hard in the first category (e.g. SAAS) to find billion dollar opportunities that collapse into million dollar ones if the winds change.

psykotic 15y ago

> Better still to find an opportunity that has a chance of making it to $100mm if everything goes perfectly, but might end up at $2mm on a bad run. If you know of a business where even a bad run nets you $2mm, I'm sure everyone here would love to know. This kind of vague general math is silly. It assumes that the chance of success stays more or less the same while the potential pay-off obviously grows for larger ventures. If it were that simple. You simply can't make an intelligent generalization along those lines. Any comparison should be made on a case by case basis.

InclinedPlane 15y ago

This is silly dot com 1.0 math. It's easy to point out how $2mil a year might be only 1% or even 0.001% of the total size of some particular market, but that's irrelevant. No amount of business is guaranteed. $2mil is still $2mil, it's still x number of people each ponying up y number of dollars, for pretty significant values of both. Without a compelling product and a solid brand you have no guarantee of that. There's no such thing as a business venture that makes $2mil in a worst case scenario. The worst case is always losing money.

erichocean 15y ago
> There's no such thing as a business venture that makes $2mil in a worst case scenario. The opposite is true though: there are a lot of companies that will have trouble doing more than $2 million. I think the author is suggesting you don't pick one of those. In the end, the real cost is time. Do you want to spend your time building something small, or something big? That depends on why you're working, I suppose, but if you really don't care what the business is, might as well build something big.
rabbitonrails 15y ago
The numbers are arbitrary, so it would have been better for me to say "business models that produce nonzero revenues even when things go wrong are superior to business models that return nothing unless everything goes right, especially for bootstrapped companies". The counter argument is that the latter kind of business models (e.g. social) have much higher potential payouts due to scale. But I believe one doesn't have to look too hard in the first category (e.g. SAAS) to find billion dollar opportunities that collapse into million dollar ones if the winds change.