5 ms·

I would say whether PG is right or not depends on how much initial funding the founders have and what they're trying to build. If you have not a lot of savings

by jll29 4y ago

I would say whether PG is right or not depends on how much initial funding the founders have and what they're trying to build. If you have not a lot of savings to live from, and your runway is therefore short, you'd be stupid to quid your day job and launch your startup: your small savings will quickly be used up and that'll be the end, because you won't be able to raise a round. If, however, you have substantial savings to deploy so that you can get far enough to afford to pivot 1-2 times until you find product-market fit, then PG is right and taking the plunge is the right thing, regardless of business environment. If your plan relies on customers, then it also depends on whether your product or service is aimed at reducing customer cost or has value in a different way. To exemplify the above: I claim "You can/should start something like AirBnb in a bad economy, but not Google."

randomdata 4y ago
> I claim "You can/should start something like AirBnb in a bad economy, but not Google." Yet AirBnB was born into a good economy (that, in fairness, was on the cusp of going quite bad), while Google was born into an economy that was just starting to recover from being bad. Not when you start but when your product is ready to ship may be more significant. By the time Google was ready for prime time we were in a good economy. When AirBnB was ready for prime time, we were in a bad economy. Skate where the puck is going, as they say.
- boulos 4y ago
  > while Google was born into an economy that was just starting to recover from being bad. Huh? Google was started in the mid to late 90s (incorporated 1998 but started earlier at Stanford). It was quite literally during the peak years of the dot com bubble and the US economy was doing fantastically well. The Clinton administration was even trying to draw up plans for what to do if the national debt was paid off... Are you thinking about when Google went public in 2004?
  - randomdata 4y ago
    Work on Google started in 1996. While things weren't bad per se, we were still working through recovery from the early 90s recession. It wasn't bad but it wasn't good either. By 1998, when Google was ready to ship, things were quite good. If, in an alternate universe, work on Google had started in 1998 when the economy was strong and didn't ship until 2000, things could have been quite different. It was no doubt important that they were ready to ship when the economy was at its peak. That means starting when things aren't so good.
    - boulos 4y ago
      Using unemployment as a reasonable signal, I don't think 1996 is that connected to the 1991 recession. https://fred.stlouisfed.org/graph/?g=YUZM https://fred.stlouisfed.org/graph/?g=YUZM Sure, it was still above 5% in 96 nationally. But strongly down from the summer of 92 peak. Additionally, Netscape's IPO was in August 1995. I wouldn't call that a bad environment for starting an internet company.
      - cmrdporcupine 4y ago
        96 is when I got into the industry. There was definitely money and buzz in the air, but it wasn't anything like 99/'00, or other booms that have followed. It was really just the prelude leading up to that, where some infrastructure was being put in place. Online commerce, credit card processing, etc. online was still quite rare. Even in '95, '96 running banner advertising on web sites was still kind of a faux-pas. Media beyond fairly crappy images was non-existent, because bandwidth wasn't there. Actual profitable business models hadn't been proved. People building Internet infrastructure (Cisco, Sun, etc.) were making some decent money, but actual Internet businesses? Not really. In fact even by 98, 99, '00, Google itself had no real viable business model. Despite becoming a household name already.
        boulos 4y ago
        All that's true enough, but do you agree with the original statement: > Google was born into an economy that was just starting to recover from being bad. I don't think being grad students at Stanford and then incorporating in 1998 counts as "just starting to recover". The economy in 1996 wasn't bad. 1998 definitely wasn't.
logifail 4y ago
> If, however, you have substantial savings to deploy so that you can get far enough to afford to pivot 1-2 times until you find product-market fit, then PG is right and taking the plunge is the right thing, regardless of business environment. [snip] I claim "You can/should start something like AirBnb in a bad economy, but not Google." Q: How many times did AirBnb and/or Google have to pivot to find product-market fit?
- mach1ne 4y ago
  Some startups do, some don't.
  - logifail 4y ago
    > Some startups do, some don't I'm not sold on pivoting, and I'm not the only one. See: Too Many Pivots, Too Little Passion https://hbr.org/2012/09/too-many-pivots-too-little-passion https://hbr.org/2012/09/too-many-pivots-too-little-passion
- Swizec 4y ago
  Google pivoted from “ads ruin search engines” to one of the world’s biggest advertising companies. That’s a pretty big pivot
- fidgewidge 4y ago
  PMF is tricky. Google's first product was a hit, but it wasn't a market fit because nobody was paying for it so there was no market. They were attempting to sell an enterprise version (the search appliance). They pivoted pretty fast to AdWords. Like, is there PMF if no money is changing hands. I saw Docker be described as having extreme PMF but they went down because they had a product, but giving away cool stuff does not create a market.
  - kaashif 4y ago
    I can get product market fit right now giving out cash on a street corner. It doesn't mean anything, and that obviously can't be what PMF means. If it's not profitable, it's not PMF.
davedx 4y ago
> I would say whether PG is right or not depends on how much initial funding the founders have and what they're trying to build. I think PG is fairly criticized for some things, but on this topic I trust that he knows what he's talking about.
newaccount2021 4y ago
[dead]
sircastor 4y ago
> so that you can get far enough to afford to pivot 1-2 times until you find product-market fit, This line of reasoning has always felt so bizarre to me: try to start a business doing something you think is important and when you find it doesn’t work, try some other business until it does. I understand it as a response to things not working out as expected, but people go into business with this as a strategy. I guess I’m just not that type of person.
- MattGaiser 4y ago
  I assume the idea is that the initial impulse was in the right area, but the first attempt itself isn’t quite correct. So you learned a bunch and therefore aren’t starting from scratch with the 2nd try. I.e. you make some environmental tool and try to sell it to the government. You learn that the government is a byzantine mess. You then sell the tool as part of a service to the corporations causing the mess to prevent future lawsuits. You pivoted, but the tool itself still had value.
  - chii 4y ago
    is that not just describing the process of finding customers? What happens if you don't find a customer, even after some several iterations/searchings? How do you know the tool has value in that case, other than personal conviction?
- hideo 4y ago
  I think its a distinction between the type of person that says "I want to build a business, I think building product X sounds like a good way to do so" and the type that thinks "I want to build product X, I think building a business sounds like a good way to do so"
  - chubot 4y ago
    What’s interesting to me is that Amazon appears to be the former. Bezos wanted to start an Internet business, and he thought that books were a good way to do it. He was much more interested in the business model than anything to do with books specifically. Apple and google seem to be more of the latter

by jll29 4y ago

randomdata 4y ago

> I claim "You can/should start something like AirBnb in a bad economy, but not Google." Yet AirBnB was born into a good economy (that, in fairness, was on the cusp of going quite bad), while Google was born into an economy that was just starting to recover from being bad. Not when you start but when your product is ready to ship may be more significant. By the time Google was ready for prime time we were in a good economy. When AirBnB was ready for prime time, we were in a bad economy. Skate where the puck is going, as they say.

boulos 4y ago
> while Google was born into an economy that was just starting to recover from being bad. Huh? Google was started in the mid to late 90s (incorporated 1998 but started earlier at Stanford). It was quite literally during the peak years of the dot com bubble and the US economy was doing fantastically well. The Clinton administration was even trying to draw up plans for what to do if the national debt was paid off... Are you thinking about when Google went public in 2004?
- randomdata 4y ago
  Work on Google started in 1996. While things weren't bad per se, we were still working through recovery from the early 90s recession. It wasn't bad but it wasn't good either. By 1998, when Google was ready to ship, things were quite good. If, in an alternate universe, work on Google had started in 1998 when the economy was strong and didn't ship until 2000, things could have been quite different. It was no doubt important that they were ready to ship when the economy was at its peak. That means starting when things aren't so good.
  - boulos 4y ago
    Using unemployment as a reasonable signal, I don't think 1996 is that connected to the 1991 recession. https://fred.stlouisfed.org/graph/?g=YUZM https://fred.stlouisfed.org/graph/?g=YUZM Sure, it was still above 5% in 96 nationally. But strongly down from the summer of 92 peak. Additionally, Netscape's IPO was in August 1995. I wouldn't call that a bad environment for starting an internet company.
    - cmrdporcupine 4y ago
      96 is when I got into the industry. There was definitely money and buzz in the air, but it wasn't anything like 99/'00, or other booms that have followed. It was really just the prelude leading up to that, where some infrastructure was being put in place. Online commerce, credit card processing, etc. online was still quite rare. Even in '95, '96 running banner advertising on web sites was still kind of a faux-pas. Media beyond fairly crappy images was non-existent, because bandwidth wasn't there. Actual profitable business models hadn't been proved. People building Internet infrastructure (Cisco, Sun, etc.) were making some decent money, but actual Internet businesses? Not really. In fact even by 98, 99, '00, Google itself had no real viable business model. Despite becoming a household name already.
      - boulos 4y ago
        All that's true enough, but do you agree with the original statement: > Google was born into an economy that was just starting to recover from being bad. I don't think being grad students at Stanford and then incorporating in 1998 counts as "just starting to recover". The economy in 1996 wasn't bad. 1998 definitely wasn't.

logifail 4y ago

> If, however, you have substantial savings to deploy so that you can get far enough to afford to pivot 1-2 times until you find product-market fit, then PG is right and taking the plunge is the right thing, regardless of business environment. [snip] I claim "You can/should start something like AirBnb in a bad economy, but not Google." Q: How many times did AirBnb and/or Google have to pivot to find product-market fit?

mach1ne 4y ago
Some startups do, some don't.
- logifail 4y ago
  > Some startups do, some don't I'm not sold on pivoting, and I'm not the only one. See: Too Many Pivots, Too Little Passion https://hbr.org/2012/09/too-many-pivots-too-little-passion https://hbr.org/2012/09/too-many-pivots-too-little-passion
Swizec 4y ago
Google pivoted from “ads ruin search engines” to one of the world’s biggest advertising companies. That’s a pretty big pivot
fidgewidge 4y ago
PMF is tricky. Google's first product was a hit, but it wasn't a market fit because nobody was paying for it so there was no market. They were attempting to sell an enterprise version (the search appliance). They pivoted pretty fast to AdWords. Like, is there PMF if no money is changing hands. I saw Docker be described as having extreme PMF but they went down because they had a product, but giving away cool stuff does not create a market.
- kaashif 4y ago
  I can get product market fit right now giving out cash on a street corner. It doesn't mean anything, and that obviously can't be what PMF means. If it's not profitable, it's not PMF.

davedx 4y ago

> I would say whether PG is right or not depends on how much initial funding the founders have and what they're trying to build. I think PG is fairly criticized for some things, but on this topic I trust that he knows what he's talking about.

newaccount2021 4y ago

[dead]

sircastor 4y ago

> so that you can get far enough to afford to pivot 1-2 times until you find product-market fit, This line of reasoning has always felt so bizarre to me: try to start a business doing something you think is important and when you find it doesn’t work, try some other business until it does. I understand it as a response to things not working out as expected, but people go into business with this as a strategy. I guess I’m just not that type of person.

MattGaiser 4y ago
I assume the idea is that the initial impulse was in the right area, but the first attempt itself isn’t quite correct. So you learned a bunch and therefore aren’t starting from scratch with the 2nd try. I.e. you make some environmental tool and try to sell it to the government. You learn that the government is a byzantine mess. You then sell the tool as part of a service to the corporations causing the mess to prevent future lawsuits. You pivoted, but the tool itself still had value.
- chii 4y ago
  is that not just describing the process of finding customers? What happens if you don't find a customer, even after some several iterations/searchings? How do you know the tool has value in that case, other than personal conviction?
hideo 4y ago
I think its a distinction between the type of person that says "I want to build a business, I think building product X sounds like a good way to do so" and the type that thinks "I want to build product X, I think building a business sounds like a good way to do so"
- chubot 4y ago
  What’s interesting to me is that Amazon appears to be the former. Bezos wanted to start an Internet business, and he thought that books were a good way to do it. He was much more interested in the business model than anything to do with books specifically. Apple and google seem to be more of the latter