5 ms·

Marc Andreessen posted the following comment on Gabriel's blog. "Great post -- this is what my partner Ben and I have always believed. Starting a company is ju

Marc Andreessen posted the following comment on Gabriel's blog. "Great post -- this is what my partner Ben and I have always believed. Starting a company is just plain hard. It's not clear that starting an ambitious company is any harder than starting a less ambitious company. Your points on market size and being attractive to the ecosystem (particularly talented employees) are dead on. The other thing we find is that less ambitious startups in Silicon Valley are often built to appeal to an acquirer as an exit strategy -- the cliche of "we will work for two years and then Google will buy us for $50 million". The big problem with that is what we call the "then what" problem -- if Google doesn't buy you, then what? Whereas ambitious companies built to stand on their own two feet and succeed in big markets are both highly attractive as acquisition targets and are viable independent companies. "

swombat 15y ago
That's only true if you're following the "build to flip" model. Many supposedly companies all around the world become successful businesses by focusing on a problem that is perhaps less ambitious, but makes money.
- architgupta 15y ago
  I am not sure I follow your comment. For most startups, if I understand correctly, the founders get rich on a liquidity event - either the company getting sold or IPO'ing. So eventually you are going to flip, if things go well, right? Or go public in the rare but usually better outcome. Anyway this is Andreessen's view. I work on a "smaller problem" right now. :)
  - swombat 15y ago
    Absolutely not. There are many ways for a founder to get rich. Liquidity is just one of them. A pretty standard way is for the company to start issuing dividends. The founder is presumably a major shareholder, and so if a big dividend is issued, they'll get a big chunk of that. Obviously if you've raised VC, then that won't work - though angels will probably be more understanding. So, the conclusion is, liquidity events are only necessary if you've raised VC money. So don't raise VC money if you don't have to.

swombat 15y ago

That's only true if you're following the "build to flip" model. Many supposedly companies all around the world become successful businesses by focusing on a problem that is perhaps less ambitious, but makes money.

architgupta 15y ago
I am not sure I follow your comment. For most startups, if I understand correctly, the founders get rich on a liquidity event - either the company getting sold or IPO'ing. So eventually you are going to flip, if things go well, right? Or go public in the rare but usually better outcome. Anyway this is Andreessen's view. I work on a "smaller problem" right now. :)
- swombat 15y ago
  Absolutely not. There are many ways for a founder to get rich. Liquidity is just one of them. A pretty standard way is for the company to start issuing dividends. The founder is presumably a major shareholder, and so if a big dividend is issued, they'll get a big chunk of that. Obviously if you've raised VC, then that won't work - though angels will probably be more understanding. So, the conclusion is, liquidity events are only necessary if you've raised VC money. So don't raise VC money if you don't have to.