8 ms·

> while treating you like an idiot savant they can easily take advantage of. I considered it a bit, and you know what, I'd wager that four-fifths of tech busin

by lainga 3y ago

> while treating you like an idiot savant they can easily take advantage of. I considered it a bit, and you know what, I'd wager that four-fifths of tech business dynamics flow from this statement. Technical expertise is the money printer onto which all manners of value extraction anchor themselves, like barnacles. If not at the creation, then, for a time, it is good. And then it happens anyway 5-10 years down the line. That said, there are different failure modes for purely technical people not understanding business. But the market doesn't seem to reward them the same way. Root cause is outside the scope of this comment...

_jal 3y ago
Yep. I used to be more charitable, but I've taken to being very short with founder wannabes who act like this. Bluntly, if they refuse to look past their preconceptions to see who they're actually talking to, why should I? This is made easier knowing founders with those sorts of blinders are likely going to fail anyway, so you don't want to be in the blast radius when it happens.
gary_0 3y ago
> That said, there are different failure modes for purely technical people not understanding business. A common one, I think, is technical people thinking management or business expertise is easy (or even beneath them) because they're so smart in other areas--and any problems they might have can surely be solved with the same tools they use to solve engineering problems, right? Which is kind of the flip side of the attitude of the kind of nontechnical founders we're talking about. Another thing I'm facing myself (as a technical person) is when I've successfully dipped a toe into a management role, I was lucky enough that the people I was leading were all also technical people whose personalities were mostly in line with mine. But I've had to remind myself that if I put myself in a leadership position again, it won't always be that simple...
- ethbr1 3y ago
  The biggest business gap seems to be assuming other people won't screw you over, given enough money on the table and the opportunity. I assume most MBAs already know this. Lots of technical people learn the hard way.
  - jjav 3y ago
    Yes, this. I've been in many startups but only once as a founder. I was the technical one, the only one with deep expertise in the core business area of the startup. Well, my title was founder. All the other founders were on the board, I was not. All the other founders controlled budget, I did not. So really, despite the words on the offer letter I was just an employee. The founder title granted me the right to work 90 hour weeks with no help and no support and no budget to hire help. At least didn't waste too many years on that one. Learn from me. Spend some of your money up front and hire a lawyer with tons of experience in startups to guide you through contract negotiations and if the company balks at your (lawyer-assisted) terms that's your giant red flag to run very far away.
    - TuringNYC 3y ago
      >> Well, my title was founder. All the other founders were on the board, I was not. All the other founders controlled budget, I did not. So really, despite the words on the offer letter I was just an employee. The founder title granted me the right to work 90 hour weeks with no help and no support and no budget to hire help. >> At least didn't waste too many years on that one. Firstly, i'm sorry to hear about your situation. I'm curious why you didnt negotiate harder some time into this. It seems to be you held all the cards. I'm fascinated by the number of "business co-founders" who think they can cut a 25k check to some random person on eLance/Upwork and replace technical co-founders. My recommendation would be to say -- sure, try that. Lets talk in 6mo if you still need me, but i'll set the terms at that point. 6mo is about when most non-technical people realize they have no code in source control and some random person overseas now owns their company effectively.
      - jjav 3y ago
        > I'm curious why you didnt negotiate harder some time into this. I guess it comes down to being a techy engineer that doesn't know how to even begin to negotiate confrontationally. Thus my thought that if I ever consider such a role again I'll find a startup employment lawyer to tell me what to do.
      - 3y ago
mainpassathome 3y ago
> Technical expertise is the money printer onto which all manners of value extraction anchor themselves, like barnacles. An even easier way to look at this is in general: Business people somehow don’t understand that the value comes from the labour
- Matticus_Rex 3y ago
  The other parts of the business are labor as well. Products don't magically go to market. Business models don't magically create and evolve themselves.
  - TuringNYC 3y ago
    >> The other parts of the business are labor as well. Products don't magically go to market. Business models don't magically create and evolve themselves. You are right, but it is about which labor comes first. The first labor is taking 100% of the risk without others taking any risk. Others have all upside and no downside. They have a free-option for the upside as the technologist does all the upfront work.
    - Matticus_Rex 3y ago
      The idea that everything that comes after initial unpaid technical work to get to where you can bring on investment is "all upside and no downside" is so divorced from the reality of anything I've ever seen in any company that I'm having trouble processing it.
      - TuringNYC 3y ago
        It is a surprisingly common reality for numerous technologists. That doesnt mean that there arent good situations. I would LOVE to work with business co-founders with these backgrounds - They already have 10 customers in mind, have done mockups, have done validation with customers, and you can verifiably know that the customers are interested in the technology at a particular price point before you build - They have a friend/colleague at a key major customer who is willing to be the first customer before the technology is even built, and this can be verified - They can bring in purchase orders before the technology is built out - They can bring in conditional purchase orders contingent on some technical milestone - They can bring in VC to pay technical co-founder for upfront work - They can get front-row seat with some key industry group or policy-maker with influence - They have prior verifiable successes (e.g., Steve Jobs, Elon as extreme examples) All the above are worth gold. What isnt worth gold is someone who wants to sit back and chill while a technologist codes away for six months.
waprin 3y ago
Technical expertise is very rarely where the core value of a product comes from. If you're really pushing some boundary and just have a better technology product, like original Google or ChatGPT, then sure, tech is your special sauce. For 99% of software businesses, the tech can cause the business to fail but its almost never what makes the business succeed. Things like customer development and sales are actually far more important. Its hard to build a well-architected web app that scales, but theres many people who can do a reasonable job at it. But translating that to business value is much harder. Theres many people can build a React project in a week, fewer who know how to turn that React project into money. That should be self-evident on a site full of people who know how to make a React app, but begrudglingly work for others because they dont know how to turn a React app into money. The thing about "the business guys" is most of them are actually pretty bad at the business side. And a lot of developers are actually better at the business side, because they have more relevant experience. The "business guys" get their MBA and learn about merges and acquisitions for billion dollar business and do case studies about how GM optimizes their supply chain, information that's useful in some contexts but mostly entirely useless when it comes to getting your first 100 paying customers for your SaaS. The developer is actually more likely to have the relevant business skills since they're more likely to have put some sort of SaaS on the internet and tried to get users for it, even if they failed. I was on YC cofounder matchmaking for a while and was inundated with "business guys" who were just bad at the business side. It didn't bug me that they were non-technical, but their non-technical nature led to some bad business planning. For example, one guy who worked in VC wanted to make a GMail / Superhuman competitor oriented towards VCs. I suggested we start with a Chrome extension for Gmail, he insisted we build an entirely new email stack from scratch for the MVP. Making a realistic plan is part of making a business plan and his lack of technical acumen made him bad at business. If someone came to me and said, hey I have a super pared down MVP, it's just 4 screens in Figma with a minimal data model, and I have 100 people who I showed the Figma screens to and they signed up to pay $50 a month, can you build it ? I'd be thrilled to pair up with a "business guy" like that but they are far more rare than a good tech co-founder and the business types that get that far tend to offer things like "founding engineer" instead of actual co-founder because they, somewhat fairly, assume that the skills you're bringing to the table aren't actually that difficult to find. But to recap, my high level point is that the technical expertise is not really the money printer. The money printer is mapping market demand to technical products, which is a business skill. And that business skill is worth a lot more than technical skills. Its just a type of business skill that you find more often in developers than you do in MBA, and so we don't associate it with "business guys". But it's the most fundamental of all skills to make money from software, other than a handful of "exceptions that prove the rule".

by lainga 3y ago

_jal 3y ago

Yep. I used to be more charitable, but I've taken to being very short with founder wannabes who act like this. Bluntly, if they refuse to look past their preconceptions to see who they're actually talking to, why should I? This is made easier knowing founders with those sorts of blinders are likely going to fail anyway, so you don't want to be in the blast radius when it happens.

gary_0 3y ago

> That said, there are different failure modes for purely technical people not understanding business. A common one, I think, is technical people thinking management or business expertise is easy (or even beneath them) because they're so smart in other areas--and any problems they might have can surely be solved with the same tools they use to solve engineering problems, right? Which is kind of the flip side of the attitude of the kind of nontechnical founders we're talking about. Another thing I'm facing myself (as a technical person) is when I've successfully dipped a toe into a management role, I was lucky enough that the people I was leading were all also technical people whose personalities were mostly in line with mine. But I've had to remind myself that if I put myself in a leadership position again, it won't always be that simple...

ethbr1 3y ago
The biggest business gap seems to be assuming other people won't screw you over, given enough money on the table and the opportunity. I assume most MBAs already know this. Lots of technical people learn the hard way.
- jjav 3y ago
  Yes, this. I've been in many startups but only once as a founder. I was the technical one, the only one with deep expertise in the core business area of the startup. Well, my title was founder. All the other founders were on the board, I was not. All the other founders controlled budget, I did not. So really, despite the words on the offer letter I was just an employee. The founder title granted me the right to work 90 hour weeks with no help and no support and no budget to hire help. At least didn't waste too many years on that one. Learn from me. Spend some of your money up front and hire a lawyer with tons of experience in startups to guide you through contract negotiations and if the company balks at your (lawyer-assisted) terms that's your giant red flag to run very far away.
  - TuringNYC 3y ago
    >> Well, my title was founder. All the other founders were on the board, I was not. All the other founders controlled budget, I did not. So really, despite the words on the offer letter I was just an employee. The founder title granted me the right to work 90 hour weeks with no help and no support and no budget to hire help. >> At least didn't waste too many years on that one. Firstly, i'm sorry to hear about your situation. I'm curious why you didnt negotiate harder some time into this. It seems to be you held all the cards. I'm fascinated by the number of "business co-founders" who think they can cut a 25k check to some random person on eLance/Upwork and replace technical co-founders. My recommendation would be to say -- sure, try that. Lets talk in 6mo if you still need me, but i'll set the terms at that point. 6mo is about when most non-technical people realize they have no code in source control and some random person overseas now owns their company effectively.
    - jjav 3y ago
      > I'm curious why you didnt negotiate harder some time into this. I guess it comes down to being a techy engineer that doesn't know how to even begin to negotiate confrontationally. Thus my thought that if I ever consider such a role again I'll find a startup employment lawyer to tell me what to do.
    - 3y ago

mainpassathome 3y ago

> Technical expertise is the money printer onto which all manners of value extraction anchor themselves, like barnacles. An even easier way to look at this is in general: Business people somehow don’t understand that the value comes from the labour

Matticus_Rex 3y ago
The other parts of the business are labor as well. Products don't magically go to market. Business models don't magically create and evolve themselves.
- TuringNYC 3y ago
  >> The other parts of the business are labor as well. Products don't magically go to market. Business models don't magically create and evolve themselves. You are right, but it is about which labor comes first. The first labor is taking 100% of the risk without others taking any risk. Others have all upside and no downside. They have a free-option for the upside as the technologist does all the upfront work.
  - Matticus_Rex 3y ago
    The idea that everything that comes after initial unpaid technical work to get to where you can bring on investment is "all upside and no downside" is so divorced from the reality of anything I've ever seen in any company that I'm having trouble processing it.
    - TuringNYC 3y ago
      It is a surprisingly common reality for numerous technologists. That doesnt mean that there arent good situations. I would LOVE to work with business co-founders with these backgrounds - They already have 10 customers in mind, have done mockups, have done validation with customers, and you can verifiably know that the customers are interested in the technology at a particular price point before you build - They have a friend/colleague at a key major customer who is willing to be the first customer before the technology is even built, and this can be verified - They can bring in purchase orders before the technology is built out - They can bring in conditional purchase orders contingent on some technical milestone - They can bring in VC to pay technical co-founder for upfront work - They can get front-row seat with some key industry group or policy-maker with influence - They have prior verifiable successes (e.g., Steve Jobs, Elon as extreme examples) All the above are worth gold. What isnt worth gold is someone who wants to sit back and chill while a technologist codes away for six months.

waprin 3y ago

Technical expertise is very rarely where the core value of a product comes from. If you're really pushing some boundary and just have a better technology product, like original Google or ChatGPT, then sure, tech is your special sauce. For 99% of software businesses, the tech can cause the business to fail but its almost never what makes the business succeed. Things like customer development and sales are actually far more important. Its hard to build a well-architected web app that scales, but theres many people who can do a reasonable job at it. But translating that to business value is much harder. Theres many people can build a React project in a week, fewer who know how to turn that React project into money. That should be self-evident on a site full of people who know how to make a React app, but begrudglingly work for others because they dont know how to turn a React app into money. The thing about "the business guys" is most of them are actually pretty bad at the business side. And a lot of developers are actually better at the business side, because they have more relevant experience. The "business guys" get their MBA and learn about merges and acquisitions for billion dollar business and do case studies about how GM optimizes their supply chain, information that's useful in some contexts but mostly entirely useless when it comes to getting your first 100 paying customers for your SaaS. The developer is actually more likely to have the relevant business skills since they're more likely to have put some sort of SaaS on the internet and tried to get users for it, even if they failed. I was on YC cofounder matchmaking for a while and was inundated with "business guys" who were just bad at the business side. It didn't bug me that they were non-technical, but their non-technical nature led to some bad business planning. For example, one guy who worked in VC wanted to make a GMail / Superhuman competitor oriented towards VCs. I suggested we start with a Chrome extension for Gmail, he insisted we build an entirely new email stack from scratch for the MVP. Making a realistic plan is part of making a business plan and his lack of technical acumen made him bad at business. If someone came to me and said, hey I have a super pared down MVP, it's just 4 screens in Figma with a minimal data model, and I have 100 people who I showed the Figma screens to and they signed up to pay $50 a month, can you build it ? I'd be thrilled to pair up with a "business guy" like that but they are far more rare than a good tech co-founder and the business types that get that far tend to offer things like "founding engineer" instead of actual co-founder because they, somewhat fairly, assume that the skills you're bringing to the table aren't actually that difficult to find. But to recap, my high level point is that the technical expertise is not really the money printer. The money printer is mapping market demand to technical products, which is a business skill. And that business skill is worth a lot more than technical skills. Its just a type of business skill that you find more often in developers than you do in MBA, and so we don't associate it with "business guys". But it's the most fundamental of all skills to make money from software, other than a handful of "exceptions that prove the rule".