4 ms·

In the US, just pick a town, any town, tiny to huge, and walk down its Main Street. There you will see just what you are asking for except mostly the businesse

by graycat 14y ago

In the US, just pick a town, any town, tiny to huge, and walk down its Main Street. There you will see just what you are asking for except mostly the businesses are not in information technology, Web 2.0, mobile apps, etc. Instead the businesses are dentists, pizza shops, Chinese carryout, franchised fast food, auto repair, auto body repair, lawn services, plant nurseries, boutique retailing, kitchen and bath remodeling, roofing, driveway installation, other construction trades, CPAs, general practice lawyers, auto dealers, bakeries -- get the pattern? Can look at an information technology startup essentially the same way. A great example is the Canadian matchmaking site Plenty of Fish -- long just one person, two old Dell servers, ads just from Google, and $10 million a year in revenue. There are some advantages to an information technology startup: First, if connect a server to the Internet and keep it busy sending Web pages with ads, then at common ad rates will get the five figures a month in revenue. E.g., send two Web pages a second, send an average of four ads per page, get the charge per 1000 ads displayed (CPM) average of $2.125 in the KPCB Meeker report, and then get monthly revenue of 2.125 * 4 * 2 * 3600 * 24 * 30 / 1000 = 44,064 dollars. So, the advantage? Sure: The server stands to be something can plug together in an afternoon from parts that cost less than $2000 in total. So, $2000 in capital equipment and $44 K a month in revenue. Darned near a license to print money and totally blows away everything else, legal or not, on Main Street. If the usage keeps growing, fine: Get more servers. Else, the $44 K a month will do fine for providing for a family. Moreover, most of the work is just learning the coding skills, e.g., in the Microsoft world, .NET, ASP.NET, ADO.NET, IIS, system management and administration. Then if the first Web 2.0 site flops, use the skills to bring up another one. But, it might grow, especially if it was carefully planned to from the beginning to grow. So, then, let it grow. Any questions?

throwaway4544 14y ago
>send an average of four ads per page Holy shit you sure love raping your viewers' eyes. I can't wait for the day when all the popular browsers(except chrome obviously) gets bundled with ABP by default.
wensing 14y ago
Yes! I have one! Where do you plan to get your 5 million PV's per month?
- graycat 14y ago
  Well, apparently Plenty of Fish did it! So, for a first answer to your question, have to 'plan', that is, think of a Web site that can attract that much traffic, at least from publicity, viral effects, other network effects, happy users, etc. How to do that? Well one way is just to think of a 'business idea' (John Doerr said that business ideas are easy and plentiful; bad business ideas are; maybe good ones are more difficult and rare!), develop a prototype, use 'lean' methodology and/or the Steve Blank approach of continually 'iterating' with the customers and revising the prototype to achieve 'product/market fit', 'pivot' if this doesn't work well, and keep trying. I have another approach in mind borrowed from project planning examples going back over 100 years. A joke version is, a good recipe for rabbit stew starts out, first catch a rabbit! More seriously think of what one venture partner calls a "big ass" problem. I would add detail: Want a problem that is 'big' in the sense that we are sure that the first good or a much better solution will be a very valuable 'must have' and not merely a 'nice to have'. To keep risk down, want no doubt about this. If there is any doubt, pick another problem. Another local, mobile, social, sharing app has too much doubt. Similarly for another 'social graph' recommendation site. From all I can see, mobile payments also have too much risk from regulations and need for 'critical mass'; if try this, then be ready to jump quickly on the first good acquisition offer. The obvious example of such a "big ass" problem, although not from information technology, is a safe, effective, inexpensive, patentable one pill cure for any cancer. Then don't have to worry about 'product/market fit'. Instead, a sad reality and not at all a joke, have to hire security guards to keep desperate customers from breaking down the doors to the lab and trying to steal the pills. Why don't we have such a pill? No one knows how to make one. But the first person or group that figures out how to make one and patents it will have a low risk, first good or much better very valuable solution and a very successful business. So, right, we are getting a hint: For the success we want, it might help to do some original research! So, for step (1), think of a suitable "big ass" problem. Step(2). For this "big ass" problem, want to find the first good or much better solution that will clearly be a very valuable 'must have'. For the very valuable part, in part want a barrier to entry. For a cancer pill, could use patents. For information technology might use Fred Wilson's "large network of engaged users" (but apparently now he is moving into mobile payments instead!), a network effect (everyone uses it because everyone else uses it, e.g., LinkedIn; nice to have; usually tough to get started), a brand name, etc. Or have a technological barrier to entry, that is, have a solution too difficult to duplicate or equal. The common claim that there is nothing new to permit such is just not true. Uh, the technology might be original and not on the shelves of the research libraries -- right, that's commonly called 'research' and venture capital won't fund it, evaluate it, review it, or even think about it and instead will throw it into the bit bucket because their backgrounds in bizdev, marketing, and selling made them afraid and jealous of it; also they want always to be "the smartest guys in the room" which raises a risk of the other guys not being smart enough to make money! So, to get this solution, do something different for recent information technology entrepreneurship but nearly standard for much of engineering going back over 100 years: For our step (2), faithfully convert the real problem into a mathematical problem, e.g., as in the applied mathematics in each of most of the fields of engineering. E.g., notice that the wings don't fall off Boeing 747 airplanes. Why? A major part of the reason is the applied mathematics of mechanical engineering. So, from our step (2), we now have a clearly stated mathematical problem. Although we are in information technology, notice I didn't say we have a computer science problem. We're talking applied math, complete with theorems and proofs and possibly with some advanced pure math prerequisites, common in engineering going back over 100 years, e.g., to Maxwell's equations, but recently rare in information technology startups. Step (3). Get a solid mathematical solution to the mathematical problem. Have two advantages here: (A) Generally it is relatively easy to check such math for math correctness. So, get lower project risk. (B) The math approach can yield solution techniques more powerful and too difficult to think of otherwise. So, get a better shot at the first good or much better valuable solution with a technological barrier to entry. Step (4). Write software to do the data manipulations specified by the mathematical solution. There are two advantages here: (A) The math really should provide a precise, usually succinct, specification of what the software needs to do. E.g., we are not trying to write an 'artificial intelligence' application based on, say, 'rules' and Forgy's RETE algorithm where have to keep 'tweaking' the rules until they appear to work, i.e., keep throwing the software against the wall to see if it appears to stick. We don't have to keep trying maximum likelihood estimation of 'machine learning' to see if it appears to stick. Similarly for neural networks. Instead, if the software just does the data manipulations specified by the prior math, then likely the software is essentially correct, has done its job. So we lower project risk. And such software tends to be easier to write than the common, elaborate user interface software. (B) Such software is relatively easy to check for correctness because of the fundamental advantage that we have a precise, and usually succinct, specification of what the software is supposed to do (the lack of such a specification is the main problem in establishing software correctness). Step (5). Deploy the solution. Get publicity. Likely have built into the problem specification that want a lot of virality. The steps (2) through (4) typically are challenging and high risk. But there are two advantages: (A) Typically these steps can be done essentially just on paper, e.g., as an applied math Ph.D. dissertation or engineering project planning document. And, as for most applied math research, the work usually needs just one person. So, the cost, 'burn rate', is low. (B) The work, the applied math and software, are relatively easy to check for correctness thus lowering project risk. If can't get through the fourth step, then return to step (1) and another problem. Back to step (1), picking the big ass problem: Here definitely want no doubt. But 'social' is not well understood so that for highly 'social' applications we will usually have too much doubt. More generally this 'way' of doing projects won't work for all projects and would not have worked for all successful projects in the past. Right. But the intention that, once step (4) had been completed successfully, the 'way' gives high financial return at low risk for an appropriate project and enough, broadly, to get the business progress we have in mind. So, that's the plan to get the page views!
MicahWedemeyer 14y ago
Plenty of Fish is one of the worst offenders of what the OP is calling business porn. They've been pushing the "overnight success with zero effort" story for a long time. http://www.nytimes.com/2008/01/13/business/13digi.html?pagewanted=all&_r=0 http://www.nytimes.com/2008/01/13/business/13digi.html?pagew...
- graycat 14y ago
  I just read the article on 'Scalability' or some such. There the founder went into a lot of detail on system administration for his relational database. At no time did I conclude that his project was either "overnight success" or "zero effort". But I can understand the point of just one guy: A founder really should understand his business. So, that takes him into all the relevant topics in computing and outside. That's a lot of topics. My main points about Plenty of Fish were just as I explained, and I never claimed either "overnight success" or "zero effort".
  - MicahWedemeyer 14y ago
    My point is that the OP is looking for examples of real businesses telling real stories. In the story I linked, PoF is selling the same old "I fell out of bed into a pile of money" tale. A few choice quotes from the first few paragraphs: He developed software for his online dating site, Plenty of Fish, that operates almost completely on autopilot, leaving Mr. Frind plenty of free time. On average, he puts in about a 10-hour workweek. Mr. Frind built the Plenty of Fish Web site in 2003 as nothing more than an exercise to help teach himself a new programming language, ASP.NET. No mention of long hours promoting, begging users to sign up, tracking down weird bugs, or all the actual work that goes into building a business. Just a quick rundown of how easy it is to whip up a shitty website and become a millionaire overnight.
    - graycat 14y ago
      Fine. I just don't think that additional background on PoF has much to do with my use of PoF as an example. Now that you mention the claim of a 10 hour work week, I believe I did read that, but I didn't remember it or pay much attention to it because it sounded to me like just media fluff to 'tell a good story'. Media fluff aside, there's no doubt that PoF is a good example of what was for a long time just one guy, two old Dell servers, and some nice revenue. So, such a thing, not the 10 hour claim, is possible. That's all I wanted from the PoF example.

by graycat 14y ago

throwaway4544 14y ago

>send an average of four ads per page Holy shit you sure love raping your viewers' eyes. I can't wait for the day when all the popular browsers(except chrome obviously) gets bundled with ABP by default.

wensing 14y ago

Yes! I have one! Where do you plan to get your 5 million PV's per month?

graycat 14y ago
Well, apparently Plenty of Fish did it! So, for a first answer to your question, have to 'plan', that is, think of a Web site that can attract that much traffic, at least from publicity, viral effects, other network effects, happy users, etc. How to do that? Well one way is just to think of a 'business idea' (John Doerr said that business ideas are easy and plentiful; bad business ideas are; maybe good ones are more difficult and rare!), develop a prototype, use 'lean' methodology and/or the Steve Blank approach of continually 'iterating' with the customers and revising the prototype to achieve 'product/market fit', 'pivot' if this doesn't work well, and keep trying. I have another approach in mind borrowed from project planning examples going back over 100 years. A joke version is, a good recipe for rabbit stew starts out, first catch a rabbit! More seriously think of what one venture partner calls a "big ass" problem. I would add detail: Want a problem that is 'big' in the sense that we are sure that the first good or a much better solution will be a very valuable 'must have' and not merely a 'nice to have'. To keep risk down, want no doubt about this. If there is any doubt, pick another problem. Another local, mobile, social, sharing app has too much doubt. Similarly for another 'social graph' recommendation site. From all I can see, mobile payments also have too much risk from regulations and need for 'critical mass'; if try this, then be ready to jump quickly on the first good acquisition offer. The obvious example of such a "big ass" problem, although not from information technology, is a safe, effective, inexpensive, patentable one pill cure for any cancer. Then don't have to worry about 'product/market fit'. Instead, a sad reality and not at all a joke, have to hire security guards to keep desperate customers from breaking down the doors to the lab and trying to steal the pills. Why don't we have such a pill? No one knows how to make one. But the first person or group that figures out how to make one and patents it will have a low risk, first good or much better very valuable solution and a very successful business. So, right, we are getting a hint: For the success we want, it might help to do some original research! So, for step (1), think of a suitable "big ass" problem. Step(2). For this "big ass" problem, want to find the first good or much better solution that will clearly be a very valuable 'must have'. For the very valuable part, in part want a barrier to entry. For a cancer pill, could use patents. For information technology might use Fred Wilson's "large network of engaged users" (but apparently now he is moving into mobile payments instead!), a network effect (everyone uses it because everyone else uses it, e.g., LinkedIn; nice to have; usually tough to get started), a brand name, etc. Or have a technological barrier to entry, that is, have a solution too difficult to duplicate or equal. The common claim that there is nothing new to permit such is just not true. Uh, the technology might be original and not on the shelves of the research libraries -- right, that's commonly called 'research' and venture capital won't fund it, evaluate it, review it, or even think about it and instead will throw it into the bit bucket because their backgrounds in bizdev, marketing, and selling made them afraid and jealous of it; also they want always to be "the smartest guys in the room" which raises a risk of the other guys not being smart enough to make money! So, to get this solution, do something different for recent information technology entrepreneurship but nearly standard for much of engineering going back over 100 years: For our step (2), faithfully convert the real problem into a mathematical problem, e.g., as in the applied mathematics in each of most of the fields of engineering. E.g., notice that the wings don't fall off Boeing 747 airplanes. Why? A major part of the reason is the applied mathematics of mechanical engineering. So, from our step (2), we now have a clearly stated mathematical problem. Although we are in information technology, notice I didn't say we have a computer science problem. We're talking applied math, complete with theorems and proofs and possibly with some advanced pure math prerequisites, common in engineering going back over 100 years, e.g., to Maxwell's equations, but recently rare in information technology startups. Step (3). Get a solid mathematical solution to the mathematical problem. Have two advantages here: (A) Generally it is relatively easy to check such math for math correctness. So, get lower project risk. (B) The math approach can yield solution techniques more powerful and too difficult to think of otherwise. So, get a better shot at the first good or much better valuable solution with a technological barrier to entry. Step (4). Write software to do the data manipulations specified by the mathematical solution. There are two advantages here: (A) The math really should provide a precise, usually succinct, specification of what the software needs to do. E.g., we are not trying to write an 'artificial intelligence' application based on, say, 'rules' and Forgy's RETE algorithm where have to keep 'tweaking' the rules until they appear to work, i.e., keep throwing the software against the wall to see if it appears to stick. We don't have to keep trying maximum likelihood estimation of 'machine learning' to see if it appears to stick. Similarly for neural networks. Instead, if the software just does the data manipulations specified by the prior math, then likely the software is essentially correct, has done its job. So we lower project risk. And such software tends to be easier to write than the common, elaborate user interface software. (B) Such software is relatively easy to check for correctness because of the fundamental advantage that we have a precise, and usually succinct, specification of what the software is supposed to do (the lack of such a specification is the main problem in establishing software correctness). Step (5). Deploy the solution. Get publicity. Likely have built into the problem specification that want a lot of virality. The steps (2) through (4) typically are challenging and high risk. But there are two advantages: (A) Typically these steps can be done essentially just on paper, e.g., as an applied math Ph.D. dissertation or engineering project planning document. And, as for most applied math research, the work usually needs just one person. So, the cost, 'burn rate', is low. (B) The work, the applied math and software, are relatively easy to check for correctness thus lowering project risk. If can't get through the fourth step, then return to step (1) and another problem. Back to step (1), picking the big ass problem: Here definitely want no doubt. But 'social' is not well understood so that for highly 'social' applications we will usually have too much doubt. More generally this 'way' of doing projects won't work for all projects and would not have worked for all successful projects in the past. Right. But the intention that, once step (4) had been completed successfully, the 'way' gives high financial return at low risk for an appropriate project and enough, broadly, to get the business progress we have in mind. So, that's the plan to get the page views!

MicahWedemeyer 14y ago

Plenty of Fish is one of the worst offenders of what the OP is calling business porn. They've been pushing the "overnight success with zero effort" story for a long time. http://www.nytimes.com/2008/01/13/business/13digi.html?pagewanted=all&_r=0 http://www.nytimes.com/2008/01/13/business/13digi.html?pagew...

graycat 14y ago
I just read the article on 'Scalability' or some such. There the founder went into a lot of detail on system administration for his relational database. At no time did I conclude that his project was either "overnight success" or "zero effort". But I can understand the point of just one guy: A founder really should understand his business. So, that takes him into all the relevant topics in computing and outside. That's a lot of topics. My main points about Plenty of Fish were just as I explained, and I never claimed either "overnight success" or "zero effort".
- MicahWedemeyer 14y ago
  My point is that the OP is looking for examples of real businesses telling real stories. In the story I linked, PoF is selling the same old "I fell out of bed into a pile of money" tale. A few choice quotes from the first few paragraphs: He developed software for his online dating site, Plenty of Fish, that operates almost completely on autopilot, leaving Mr. Frind plenty of free time. On average, he puts in about a 10-hour workweek. Mr. Frind built the Plenty of Fish Web site in 2003 as nothing more than an exercise to help teach himself a new programming language, ASP.NET. No mention of long hours promoting, begging users to sign up, tracking down weird bugs, or all the actual work that goes into building a business. Just a quick rundown of how easy it is to whip up a shitty website and become a millionaire overnight.
  - graycat 14y ago
    Fine. I just don't think that additional background on PoF has much to do with my use of PoF as an example. Now that you mention the claim of a 10 hour work week, I believe I did read that, but I didn't remember it or pay much attention to it because it sounded to me like just media fluff to 'tell a good story'. Media fluff aside, there's no doubt that PoF is a good example of what was for a long time just one guy, two old Dell servers, and some nice revenue. So, such a thing, not the 10 hour claim, is possible. That's all I wanted from the PoF example.