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Very interesting... >> "I took some public lists of technology acquisitions in 2007 and 2008" Not all startups are after the 'Acquisition' event either. I'd s

by axod 18y ago

Very interesting... >> "I took some public lists of technology acquisitions in 2007 and 2008" Not all startups are after the 'Acquisition' event either. I'd say if anything that would bias results in favor of the Valley. I don't know how you can really get a handle on the millions of 'startups' that just make money reasonably quietly. Communities like HN, IRC channels, etc make me wonder more what the Valley has to offer. There's a whole array of cool online communities, and if you build something cool, people will start to contact you. I think face to face contact is needed less and less these days, unless you're trying to raise money.

webwright 18y ago
Yaw, given the source of the lists (TechCrunch, VentureBeat-- two American Valley Blogs), I imagine there is a bit of a Valley slant. And, as you say-- tons of startups are actually aiming for a profitable business and don't care so much for exits.
abstractbill 18y ago
I agree in some respects, but there definitely are still some real advantages to being in the Valley. I've been doing a lot of work towards monetizing justin.tv lately, especially with video ads. These products tend to be very ad-hoc, and are usually quite poorly documented. Sometimes we've tried to get an integration working by having me try to follow the docs, and call/email when things don't work properly. It usually works out in the end, but it's frustrating and takes too long (sometimes several days of back-and-forth). To contrast, with the ad companies that are in the Bay Area, we just ask them to send a developer to our office. Both of us sit on my couch, while I do the integration and make bad jokes about the quality of their documentation. We usually get it done in an hour or so this way.
- 10ren 18y ago
  I think it depends on how integrated vs. modular the business is. Disruptive business ideas usually require many deals between different parties - there's the business integration, and the technical integration that you mention (as video ads become more common, technical and business standards will probably emerge, making it modular). But some business ideas are more modular, in that customers can just slot the produce/service into an existing business role, and into an existing socket in their system. They are plug-compatible, in both senses. This plug-compatibility also applies to partners. If you need to interact with content providers and hardware manufacturers (e.g. as Apple needed for the iPod and iTunes), some kind of Pond is essential, not just for access to those parties, but also access to helpers of the connection (e.g. lawyers who understand the issues in these kinds of deals). I think this is probably true whether you have a novel disruptive business, or just an ordinary one: if you need to make deals, a Pond makes things much easier. But if you can modularize (systematize) your interactions with your "partners" to such an extent that they become "customers", you don't need to be in the same pond. An example is the "partners" of Google Adwords - there's a standard interface that people use all over the world, and it works well even though there's no customer service. New ideas tend to not be modular - standardization comes later - so a Pond there.
  - timr 18y ago
    It's true that some businesses are more nimble than others, but Bill is still right: the ability to sit on the couch here is a more efficient integration mechanism than any other. You're far more likely to complete a deal when the technical work can be done extremely quickly. I've worked at startups in Seattle and San Francisco now, and in my experience, the startups here are faster. At the risk of sounding like a cliche, it's just something in the air here. Things are always on fire. Is it worth the cost of living? I don't know. But there's definitely a difference.
- axod 18y ago
  With email, you can ignore it, and just drag things out. I had a pretty good experience with Google the other day though, they changed something on adsense which just happened to break Mibbit (Their js tried to access something, security permissions, threw an exception Mibbit wasn't expecting etc). I sent an email, and about 10 emails later and about an hour later, we'd sorted out exactly what was going on, and they'd fixed it. I think it can work either way...
- dejb 18y ago
  Even if I was in the same city as the other developer I would just talk to them on the phone. I think the 'in person' meeting would usually involve enough time wasting to defray the benefits of the small increase in direct communication. If you are going to be doing a lot of work together it can be nice to meet the person but it isn't necessary just to clarify something.
frossie 18y ago
>"I don't know how you can really get a handle on the millions of 'startups' that just make money reasonably quietly." There are millions of startups? There are millions of startups making money quietly? Does anybody know, because from where I am sitting I'd be surprised if there were 10,000. And yes, it does make a difference to the argument.
- axod 18y ago
  Well most 'affiliate' websites I know of don't call themselves 'startups', and make a lot of money. Quietly. I don't know if you want to call them startups, depends on your definitions, but they're online businesses that make a lot of money. Then what about all the ebay businesses out there making a lot of money.
  - frossie 18y ago
    A start-up isn't somebody making money on the Internet, or somebody using e-commerce. It is a technology company founded by a small group of people that, were its technological product prove popular, presents an opportunity for spectacular growth. It is the potential huge return that makes start-ups of interests to VCs (and if you believe PG's thesis, of potential large economic impact). If I had an Internet business idea that would make me $250,000 for life guaranteed but fixed, that's a great business idea for me - but not for an investor.
    - kragen 18y ago
      Yeah, if you use an unduly narrow definition of "start-up", you can get some small number in the few thousands. But if you use a more normal definition (like the one at the top of http://en.wikipedia.org/wiki/Startup_company http://en.wikipedia.org/wiki/Startup_company — “A startup company or start-up is a company with a limited operating history. These companies, generally newly created, are in a phase of development and research for markets,” or my usual rule of thumb, “A startup is a company that has not yet become profitable,”) you get a much larger number, perhaps in the millions.

by axod 18y ago

webwright 18y ago

Yaw, given the source of the lists (TechCrunch, VentureBeat-- two American Valley Blogs), I imagine there is a bit of a Valley slant. And, as you say-- tons of startups are actually aiming for a profitable business and don't care so much for exits.

abstractbill 18y ago

I agree in some respects, but there definitely are still some real advantages to being in the Valley. I've been doing a lot of work towards monetizing justin.tv lately, especially with video ads. These products tend to be very ad-hoc, and are usually quite poorly documented. Sometimes we've tried to get an integration working by having me try to follow the docs, and call/email when things don't work properly. It usually works out in the end, but it's frustrating and takes too long (sometimes several days of back-and-forth). To contrast, with the ad companies that are in the Bay Area, we just ask them to send a developer to our office. Both of us sit on my couch, while I do the integration and make bad jokes about the quality of their documentation. We usually get it done in an hour or so this way.

10ren 18y ago
I think it depends on how integrated vs. modular the business is. Disruptive business ideas usually require many deals between different parties - there's the business integration, and the technical integration that you mention (as video ads become more common, technical and business standards will probably emerge, making it modular). But some business ideas are more modular, in that customers can just slot the produce/service into an existing business role, and into an existing socket in their system. They are plug-compatible, in both senses. This plug-compatibility also applies to partners. If you need to interact with content providers and hardware manufacturers (e.g. as Apple needed for the iPod and iTunes), some kind of Pond is essential, not just for access to those parties, but also access to helpers of the connection (e.g. lawyers who understand the issues in these kinds of deals). I think this is probably true whether you have a novel disruptive business, or just an ordinary one: if you need to make deals, a Pond makes things much easier. But if you can modularize (systematize) your interactions with your "partners" to such an extent that they become "customers", you don't need to be in the same pond. An example is the "partners" of Google Adwords - there's a standard interface that people use all over the world, and it works well even though there's no customer service. New ideas tend to not be modular - standardization comes later - so a Pond there.
- timr 18y ago
  It's true that some businesses are more nimble than others, but Bill is still right: the ability to sit on the couch here is a more efficient integration mechanism than any other. You're far more likely to complete a deal when the technical work can be done extremely quickly. I've worked at startups in Seattle and San Francisco now, and in my experience, the startups here are faster. At the risk of sounding like a cliche, it's just something in the air here. Things are always on fire. Is it worth the cost of living? I don't know. But there's definitely a difference.
axod 18y ago
With email, you can ignore it, and just drag things out. I had a pretty good experience with Google the other day though, they changed something on adsense which just happened to break Mibbit (Their js tried to access something, security permissions, threw an exception Mibbit wasn't expecting etc). I sent an email, and about 10 emails later and about an hour later, we'd sorted out exactly what was going on, and they'd fixed it. I think it can work either way...
dejb 18y ago
Even if I was in the same city as the other developer I would just talk to them on the phone. I think the 'in person' meeting would usually involve enough time wasting to defray the benefits of the small increase in direct communication. If you are going to be doing a lot of work together it can be nice to meet the person but it isn't necessary just to clarify something.

frossie 18y ago

>"I don't know how you can really get a handle on the millions of 'startups' that just make money reasonably quietly." There are millions of startups? There are millions of startups making money quietly? Does anybody know, because from where I am sitting I'd be surprised if there were 10,000. And yes, it does make a difference to the argument.

axod 18y ago
Well most 'affiliate' websites I know of don't call themselves 'startups', and make a lot of money. Quietly. I don't know if you want to call them startups, depends on your definitions, but they're online businesses that make a lot of money. Then what about all the ebay businesses out there making a lot of money.
- frossie 18y ago
  A start-up isn't somebody making money on the Internet, or somebody using e-commerce. It is a technology company founded by a small group of people that, were its technological product prove popular, presents an opportunity for spectacular growth. It is the potential huge return that makes start-ups of interests to VCs (and if you believe PG's thesis, of potential large economic impact). If I had an Internet business idea that would make me $250,000 for life guaranteed but fixed, that's a great business idea for me - but not for an investor.
  - kragen 18y ago
    Yeah, if you use an unduly narrow definition of "start-up", you can get some small number in the few thousands. But if you use a more normal definition (like the one at the top of http://en.wikipedia.org/wiki/Startup_company http://en.wikipedia.org/wiki/Startup_company — “A startup company or start-up is a company with a limited operating history. These companies, generally newly created, are in a phase of development and research for markets,” or my usual rule of thumb, “A startup is a company that has not yet become profitable,”) you get a much larger number, perhaps in the millions.