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America is in the midst of an extraordinary startup boom
- crunkykd 2y agohack: do a startup only after you already have living money assured (savings from earlier corporate jobs, now invested & producing). you have time & energy, and no obligations.
- georgehill 2y agoUnpaywalled: https://archive.ph/jMTsc https://archive.ph/jMTsc
- ajkjk 2y agoI wonder what the numbers look like when restricted to 'companies that sound like good ideas'. Not that that's a requirement. Some ideas famously sounded bad (Google had plenty of doubters?). But a lot of these AI and wearable things seem.. silly. I guess I'm getting old.
- throwup238 2y agoThey all sound like good ideas, otherwise why would anyone waste their time?
- deleted 2y ago[deleted]
- ajkjk 2y agoWell they sound like good ideas to somebody but often bad ideas to me oO
- chrsig 2y agoHave you seen....people? Quality of an idea has marginal influence on people's decision to execute on it.
- vundercind 2y agoAcquaint yourself with the “coaching” industry (think: life coaching) Almost all the money in it comes from milking people who’ve been sold on the idea of launching their own life coaching business, not from people with other careers seeking life coaching. Whatever tiny legitimate side of that market exists is very-obviously saturated to the tune of a large multiple over what’s sustainable, and it’s pretty clear the real money remaining is in selling people the idea that they too can launch their own coaching business (“be your own boss! You don’t want a boring corporate job forever, do you? That may be fine for some people, I guess, but not for you!”) and have an easy, lucrative career, then charging them money to (supposedly) teach them how (“well of course coaches need coaches, too!”). And yet, despite all this being pretty damn obvious, lots of people get sucked into the scam-vortex anyway. Similar things happen all over the place. Starting restaurants without a solid path to success even on paper, et c. Folks deceive themselves really well when dreams get involved. So, lots of people waste both time and money on clearly-bad business ideas.
- KapKap66 2y agoThere's thousands of video games for instance that are just blatantly obviously bad ideas but nevertheless get years of work put into them. This goes for any tier too, indies, AA, AAA, etc. Why? Still haven't figured that out, but I've seen way too much effort put into games that are destined to fail. I don't know where that drive comes from particularly in the indie space but I really wish I had it. Point is, the quality of an idea does not seem to be a major factor that constrains people from committing a ton of resources bringing it into reality.
- metacritic12 2y agoAccording to Paul Graham, successful startups (weighted by eventual market cap) are ideas that: 1) Sound bad 2) But are actually good. So by selecting on ideas that sound good on first glance, you're already selecting for startups that won't comprise the majority of the success mass.
- marcinzm 2y agoObviously good ideas are ones that a large company department will also easily get funding for. That increases the competition a lot.
- api 2y agoYeah but large companies often execute badly or develop solutions that are many many orders of magnitude more complex and expensive than needed. Large companies also generally push for all their products to work together, limiting their ability to build clean standalone things.
- bcrosby95 2y agoNot true when it comes to new tech. That's why anytime there's a new piece of tech there's a gold rush of new companies born. Internet, smart phones, social platforms, etc.
- jszymborski 2y agoIn fairness, I think pg mostly concerns himself with start-ups whose goals are to become a unicorn or be acquired by one. I think there are plenty of boring, sustainable businesses built on good, logical sounding ideas that have found their niche in the industries they find themselves in.
- nprateem 2y agoAh so post-hoc categorisation. That's really useful. I suppose it's blindingly obvious to VCs the bad ideas that are bad vs the bad ideas that are good, which is why they never lose money.
- IshKebab 2y ago
- karaterobot 2y ago> "People realised that they do like being around their families, and it gave many a sense of freedom" I want to spend more time with my family and not have as many responsibilities, better start a startup.
- throwup238 2y agoI misread that quote as “they do not like” three times before it clicked. It made a lot more sense then…
- cs702 2y agoHahahaha. They will learn a lesson that can be learned in no other way.[a] Regardless, all this entrepreneurial activity is great news for the country! --- [a] With apologies to Mark Twain: https://www.goodreads.com/quotes/8006482-a-man-who-carries-a-cat-by-the-tail-learns https://www.goodreads.com/quotes/8006482-a-man-who-carries-a...
- siva7 2y agoStart a startup and see your marriage break apart
- withinboredom 2y agoThis is not true, unless you are putting more into your startup than your marriage. It's priorities. My marriage and child is always more important than money and chasing an idea.
- grugagag 2y ago> My marriage and child is always more important than money and chasing an idea Startups are very demanding on time and attention resources. Families with children would feel the strain of absent parents. It could work out in some cases but for the general case it’s not the best idea.
- withinboredom 2y ago
- TheArcane 2y agoIs the startup boom in the room with us?
- hn_version_0023 2y agoNever address the elephant directly.
- xyst 2y agoWhy can’t this be the default for submitted articles? HN should wrap all of these articles in an archive link.
- woleium 2y agoor have an option to submit and display unpaywalled links at the top. I guess though its probably not best for longevity of the site to be seen as a place that encourages this sort of thing.
- MuffinFlavored 2y agoHow is it not against the terms of service for the websites that are trying to keep their journalistic content paywalled?
- toastercat 2y agoBecause it is stealing, un-capitalism, and evil. HackerNews should BAN archive links like this that go around the paywall, and any mention of tools that allow users to bypass paywalls or ad-like content. I'm so sick of entitled HackerNews users whining about having to pay for services. It's as if they think there are no operating costs.
- xen2xen1 2y agoWow, that wins and award for needing an /s. Bravo. If there wasn't the "word" un-capitalism
- purplerabbit 2y agoStealing and piracy are different Stealing removes something — nothing is removed here But maybe this semantic battle is lost because most people make this equivocation (Not saying piracy is necessarily OK)
- toastercat 2y agoPiracy is stealing. So is adblock and circumventing paywalls. You are not stealing the content literally persay, but you are violating a contract and stealing bandwidth that can be for an honest user. The same goes for all the whiners on HN when YouTube fights back against uBlock Origin. They just want to have their cake and eat it too and won't admit that they are stealing from Google and Content Creators. Privacy is a non-issue.
- nolongerthere 2y agoSomething they don’t really touch on is the massive layoffs from big tech, I’m sure many of those people were happy to take a paycheck but once that dried up they went back to building their own company based on whatever idea they had that was too small for Google/facebook/etc.
- mrbluecoat 2y agoI had a similar thought. Necessity is the mother of invention.
- deleted 2y ago[deleted]
- Havoc 2y agoThere is a fanatastic smallish YouTube channel called S3 that showcases some of this (mostly manufacturing)
- mdorazio 2y ago"A paper published in March by the Census Bureau found a particularly sharp increase last year in business applications based around artificial intelligence (ai)." If we exclude the gold rush of startups doing something "AI", the picture would look a lot different. Personally, I'm looking forward to a similar article two years from now about a sharp spike in US business failures.
- ohthatsnotright 2y agoI thought the crypto-bros were annoying but the generative LLM bubble is far, far worse for everyone.
- chiefalchemist 2y agoNot to get off on the wrong foot (and I'm sure it's obvious on HN) but starting your own business !== startup. In the broader culture, startup has become a trendy word (along with entrepreneur). Most people using these words don't actually understand what they mean. It's as if they're holding their pet in their arms. They say, "Would you like to pet my dog" and they're actually holding a cat. I'm certainly not knocking SMB biz owners. I'm one. But that doesn't make me a startup. It doesn't make me an entrepreneur. Entrepreneurial? Or entrepreneur-minded? Sure. But I - along with many others - don't meet the definition of entrepreneur.
- endisneigh 2y agoWhat?
- dgacmu 2y agoI think you do - you organized a business venture and assumed the risk for it. I've founded or co-founded two venture funded startups and two self-funded businesses, and I consider them equally entrepreneurial. The ISP, while we didn't take external funding, was definitely a startup. I don't put the cryptocurrency crap in the startup bin because I deliberately chose not to grow it to have employees beyond the three founders, even though it was the most profitable of all of the ventures. Weird that.
- CrazyStat 2y agoOut of curiosity, how do you define “entrepreneur” so as to exclude people who create small businesses?
- chiefalchemist 2y agoBack of the envelope (and of couse there are exceptions and subtleties to all these)... - scale, as in they think about it. Franchising your brand === entrepreneur. Buying a franchise - despite Entrepreneur mag's narrative - does not. - exit, as in they don't lose sight of it - hit by a bus (similar to exit). An entrepreneur's brand continues without them. - innovation and/ uniqueness in product. Opening another cookie cutter lemonade stand don't cut it - risk, their lens is not about risk, it's about opportunity. That is, where other see risk, the true entrepreneur sees opportunity. I might have one or two others but that's the basic filter. <edit> One to add. - upsetting - I don't like the word disruption. It's over used and it's the wrong goal. The goal is to identify a market and find fit. Disruption in and of itself is silly. That said, if you're not pissing some one(s) off then you're likely not an entrepreneur. Again, another lemonade stand isn't grounds enough to be considered an entrepreneur.
- mud_dauber 2y agoYou’ve got to have a local core of people to bounce ideas off each other. I moved from Austin to Appalachia to care for parents. The lack of any entrepreneurial spark here is just jarring. People just keep their heads down. They want better - but there’s zero intellectual infrastructure.
- vundercind 2y agoAppalachia’s a big place I guess, but the thing I found most remarkable in the North Carolina portion of it was that damn near every rural-road mountain driveway seemed to have a sign marking that the house was also home to a small business.
- coffeebeqn 2y agoProbably also out of necessity. There aren’t many employers in the mountains
- rm_-rf_slash 2y agoPeople in rural places have supplemented their incomes selling things from flowers to honey to moonshine for ages.
- jwells89 2y agoMy experience having grown up in the WV portion of Appalachia is that there used to be a number of highly localized small businesses, but ability to scale was highly restricted. Back in the 90s my father ran a little greenhouse that he sold plants out of for example which brought in a little bit of extra income for the family, but wasn’t able to scale it up due to lack of access to the capital required to do so, and money didn’t exactly grow on trees out there even 30 years ago (when financially things were much better there than they are now). Even if he had been able to scale, I’m not sure how long it could’ve lasted. Bigger greenhouses in the area ended up being run out of business when Walmart came in and started selling plants for prices that no small business could compete with. These days that part of the state is a ghost of what it was back then. So many businesses have closed down or moved out, small/startup or otherwise.
- brevitea 2y agoCould it be because everyone was laid off and needs a job? Could it be unprecedented amounts of layoffs are an orchestrated measure by large corporations to "ensure" they are not "monopolies", as anti-trust season kicks off? Could it be that those same large corporations will end up buying or strategically killing these same start ups because they inevitably engage in anti-competitive practices? Could it be that lobbying dollars will shelter these large corporations from enduring legal ramifications? I think we've done this before...
- pixelmonkey 2y agoI was looking over some data from a similar article and I found it striking how many of these new business application increases were in the South, Mid-Atlantic, and Mid-West states, rather than the West or Northeast. (At least for 2020 vs 2019.) One interpretation could be that these were places where stay at home orders were for “un-Zoomable” jobs (retail, manufacturing, machinists, construction, services), and thus workers were taking the plunge on entrepreneurship to create their own work. Map visualization here: https://www.datawrapper.de/_/xv4ys/ https://www.datawrapper.de/_/xv4ys/
- feverzsj 2y agoHow much can you get from incubator or VC ... for free?
- Scandiravian 2y agoI think the article is painting an overly positive view of the situation, without looking into anymore than a surface level causality How many of these new businesses are started because it's the only way to make ends meet? How many of these businesses actually have a sustainable plan? AI can do some cool things, but I think the market is oversaturated by apps that are nothing more than a skin over ChatGPT I'm predicting that most of these businesses will have closed again in five years and there'll be a sudden "unexpected" rise in unemployment by then
- w10-1 2y ago> the market is oversaturated by apps that are nothing more than a skin over ChatGPT OpenAI et al expressly don't care about small applications, but will do deals e.g., with Apple. So aside from humanity-wide applications, AI commercialization depends entirely on all these skins. It's often a harder problem to get people used to new technology than to build it, particularly since it's hard to keep a customer you trained without some lock-in that is off-putting to new customers. Most may fail; but a few fortunes will be made from skinning AI, and customers will be better for it.
- Scandiravian 2y agoI go into more depth in the sibling comment, but I am not that optimistic about the prospect of these start-ups, given that ChatGPT is currently heavily subsidised by Microsoft When that cost eventually has to be recouped I think the pricing will make it unsustainable for use in consumer products There's definitely some people who'll become rich from it, but I think it's more likely going to be from acquisitions by a large corporation than from direct consumer sales
- weitendorf 2y agoI want to push back on the idea that a “a skin over chatgpt” has no value a little, because it’s a common sentiment, but the tide is shifting amongst a lot of people I’m in contact with and what I’m building indeed makes API calls to OpenAI/Anthropic. In my opinion foundational models are essentially becoming commodity products with only temporary functional differences (eg voice) and ever-changing relative quality and aptitude for certain problems. Yes, OpenAI/Google/Anthropic/Microsoft can launch their own apps built on top of foundational models, but so can almost anybody else, and presumably there will be (or already is) a plateau in quality improvements so that open models may catch up and drastically reduce costs for those calling LLMs in their products. In my opinion reducing applications that call LLMs to skins over <insert model name> is like calling web applications skins over JavaScript, or a database, or a Java backend. Yes the technology has value in itself and they’ve commercialized it with conversational interfaces, but there are many more business applications or technical products that could use LLMs (on top of other things) and don’t exist yet. And surely many attempts will fail, but I think it’s going to become the primary way that LLMs become commercialized as time goes on.
- _the_inflator 2y agoMaybe this is the future in a somewhat saturated world: LLMs as operating systems, aka platforms, and apps as expressions of them on top of existing layers like OSes, yet another layer. Many apps on the app stores around the smartphone OSes aren't that elaborated either. What one considers a feature might serve a purpose for someone else who is willing to pay for it. We will find out the next decade.
- croes 2y agoCould it be that more people tend to start a company if they can't find a job to get hired? How many of these companies are sustainable and will still exist in 5 years?
- ipnon 2y agoHalf of all businesses fail after 5 years anyway according to Bureau of Labor Statistics. Might as well make a stake in something you can call your own, right? I often think of the pg essay where he claims none of the founders in the first batch regretted the experience. Worst case scenario I think is that you get the kind of experience that every company is looking for in employees. Counterintuitively I think being a founder is one of the best things you can do for your resume, even if you fail.
- deleted 2y ago[deleted]
- tim333 2y agoIt's one of those moments in tech like when the internet was coming and it was obvious it was going to change most business. Now it's AI. You can take almost any human problem and pitch for AI to make it better, even if you are only using an API to ChatGPT. Or even if the AI doesn't work just now, there's a good chance it will in a year or two.
- nytesky 2y agoDoes it specify how many are actually externally funded and are hiring/bringing in revenue? There may be a huge boom in underemployment or unemployed workers hanging a shingle as a “startup”, but it’s basically in name only. I thought VC funding had tightened?
- binary132 2y agoAmerica is in the midst of an extraordinary debt bubble driven by desperate and greedy venture-capitalists.