4 ms·

The bar should be much higher, but it isn't. You'd expect there to be thousands of startups in every space imaginable, because writing software has never been e

by gizmo 13y ago

The bar should be much higher, but it isn't. You'd expect there to be thousands of startups in every space imaginable, because writing software has never been easier and there are more software programmers today than at any point in history. You'd expect the competition to be fierce, but it isn't. This is why mediocre products with mediocre marketing make bank. The games industry is very competitive, and so is the iOS app market. But that's only a tiny percentage of the software market (measured in dollars). Where are the thousands of Gmail competitors? Word processing and spreadsheet competitors? Where is a better DabbleDB? Nothing has changed in the past 5 years, and in any of these markets you can simply win with a better product and half-decent marketing. And if you make a product for a specific vertical it's even easier. It's not like Patio11 is the first guy to ever make Appointment Reminder software. Or the 20th. But with half-decent execution and half-decent marketing he's still making a ton of money. And is he afraid that by posting on HN people here are going to start competing AR software? Of course not. Because there are so many better opportunities out there that there is no need to fight for the same customers. How many startups do we see coming from Spain, or India, or Brazil? Very few. How many from Milwaukee? I don't know of any. But the software engineers exist. The opportunities are right here for the taking. But people just don't take them.

wslh 13y ago
I agree in that there is an opportunity window until the market is semi-arbitrage-free. People around virtual communities like HN are in an advantage now. But you are underestimating by a lot the costs and risks of software development, for example, a spreadsheet competitor. Not only from the software development side but also from the marketing/sales perspective. If you analyze an established software company the work force in software development and marketing/sales are evenly distributed and this is not because companies love to make advertisements, events, etc but because is how (currently) the business world works: you compete in an attention economy and this costs millions. Another thing that you are underestimating is that Internet makes much easier things that were impossible or time consuming just a decade ago but "everyone" is competing in a new league and that advantage will be capitalized by "everyone".
- gizmo 13y ago
  1. In a competitive world you'd expect startups to pop up everywhere, and especially in areas with low cost of living. Reality: opposite. 2. Building a spreadsheet program is a ton of work, but it's also a multi-billion dollar market. And a proof of concept can be built by a couple of smart hackers -- but it needs a good hook of course. Reality: very few people even try. 3. When a ton of money is spent on marketing then that is strong evidence for lack of competition. After all, all money spent on marketing would otherwise go directly to the bottom line. This is why restaurants (fierce competition) spend almost nothing on marketing. They can't afford to. Fierce competition => low margins => no marketing budget. Reality: mediocre products and tons of marketing. 4. The advantages of the internet are not capitalized on by everybody, as I've been saying. The opportunity is there, but people still have to take it.
  - wslh 13y ago
    2) Again, you are underestimating the effort to build a competitive spreadsheet and overestimating what intelligence or smart people are capable of achieving. First, you can take a look at the spreadsheet history and see that there was a lot of competition in computer history stages with more opportunity windows: how many developers were in the Apple/DOS era? Another important thing that you are not taking into account is the ecosystem for spreadsheets like Excel. It's not only Excel, but the whole Microsoft Office and Legacy Applications. Do you think that a Fortune 1000 company will take the risk of moving outside Excel? 3) No, just the contrary. Try yourself to gain traction with a free open source software and see how difficult it is. 4) That's what I said but it's being capitalized by a lot of people 1) Startups and small business are popping up everywhere and the majority die.
  - chc 13y ago
    > Building a spreadsheet program is a ton of work, but it's also a multi-billion dollar market. And a proof of concept can be built by a couple of smart hackers -- but it needs a good hook of course. Reality: very few people even try. This is because it's a sucker's game. You can build the best spreadsheet in the world and Microsoft will still eat your lunch. The expected returns on a goldfish-selling business are higher. LibreOffice can't even manage to give away a tenth as many as Microsoft sells. Like, yes, building a spreadsheet program is something people could do, but it is not an idea with even the remotest possibility of making good money. I think I have figured out the fundamental disconnect here. You are talking about how easy it is to build stuff these days, while other people are talking about how easy it is to make a living off stuff. It is easy to build things. But building something alone is pure cost, no profit. Then the hard part comes. The difficulty has just shifted around, not disappeared.
nawitus 13y ago
>How many startups do we see coming from Spain, or India, or Brazil? Very few. How many from Milwaukee? Or maybe they're targeting local customers, just like most(?) American startups.
chc 13y ago
> It's not like Patio11 is the first guy to ever make Appointment Reminder software. Or the 20th. But with half-decent execution and half-decent marketing he's still making a ton of money. And is he afraid that by posting on HN people here are going to start competing AR software? Of course not. Because there are so many better opportunities out there that there is no need to fight for the same customers. "Half-decent marketing"? I think you are selling Patrick short. Based on his vague hints about what people pay him to consult on their marketing, I don't think "half-decent" quite covers it. I'm halfway to decent, and empirically people don't pay me a quarter of that. > How many startups do we see coming from Spain, or India, or Brazil? Very few. How many from Milwaukee? I don't know of any. But the software engineers exist. The opportunities are right here for the taking. But people just don't take them. Doesn't it seem implausible that these people take all the other opportunities that are offered to them, but just not these ones? Isn't the more likely explanation that you have an exaggerated idea of how accessible this stuff is to most people?
coffeemug 13y ago
You make the case that a low bar exists in myriads of markets, but your examples don't support the argument. Where are the thousands of Gmail competitors? The reason they don't exist (or they do exist but you never hear about them) is that you'll have to pry Gmail from people's cold dead hands. Firstly, Gmail is an amazing product, and it would be really, really, really hard to do better. Very few teams can attempt such a thing, certainly not thousands. Secondly, even if you build a better product, it's extremely unclear how it would be enough better to get enough people to leave Gmail. Word processing and spreadsheet competitors? Exactly the same reason. Microsoft Office is an amazing piece of software, and it would be immensely difficult to do better. Furthermore the barrier to entry is huge -- word processing and spreadsheet software that can effectively compete with MS Office would take decades to build. There is something to be said for competing with Google's online office offerings (and I know some really smart people who are doing just that), but again, it's not as easy as it seems. Where is a better DabbleDB? DabbleDB didn't work as a business. That's why there is no better DabbleDB -- there is no market for it.
- avibryant 13y ago
  (I worked on Dabble DB) I don't think it's so much that there's no market for it as that the market is very hard to reach and we had no good channel. Intuit's Quickbase is a very healthy business, because they have a channel to millions of SMBs. We didn't, and didn't know how to build one, so we grew much more slowly (though I should say that by most sane, non-valley standards we were doing just fine, thanks ;) I learned a lot of things at Dabble, but I think the biggest lesson was that the three most important things in B2B software are distribution, distribution, and distribution.
  - gvnonor 13y ago
    DabbleDB was a very forward thinking product, pity it was shutdown. Could you share an estimate of the number of man-hours it took to build it?

by gizmo 13y ago

wslh 13y ago

I agree in that there is an opportunity window until the market is semi-arbitrage-free. People around virtual communities like HN are in an advantage now. But you are underestimating by a lot the costs and risks of software development, for example, a spreadsheet competitor. Not only from the software development side but also from the marketing/sales perspective. If you analyze an established software company the work force in software development and marketing/sales are evenly distributed and this is not because companies love to make advertisements, events, etc but because is how (currently) the business world works: you compete in an attention economy and this costs millions. Another thing that you are underestimating is that Internet makes much easier things that were impossible or time consuming just a decade ago but "everyone" is competing in a new league and that advantage will be capitalized by "everyone".

gizmo 13y ago
1. In a competitive world you'd expect startups to pop up everywhere, and especially in areas with low cost of living. Reality: opposite. 2. Building a spreadsheet program is a ton of work, but it's also a multi-billion dollar market. And a proof of concept can be built by a couple of smart hackers -- but it needs a good hook of course. Reality: very few people even try. 3. When a ton of money is spent on marketing then that is strong evidence for lack of competition. After all, all money spent on marketing would otherwise go directly to the bottom line. This is why restaurants (fierce competition) spend almost nothing on marketing. They can't afford to. Fierce competition => low margins => no marketing budget. Reality: mediocre products and tons of marketing. 4. The advantages of the internet are not capitalized on by everybody, as I've been saying. The opportunity is there, but people still have to take it.
- wslh 13y ago
  2) Again, you are underestimating the effort to build a competitive spreadsheet and overestimating what intelligence or smart people are capable of achieving. First, you can take a look at the spreadsheet history and see that there was a lot of competition in computer history stages with more opportunity windows: how many developers were in the Apple/DOS era? Another important thing that you are not taking into account is the ecosystem for spreadsheets like Excel. It's not only Excel, but the whole Microsoft Office and Legacy Applications. Do you think that a Fortune 1000 company will take the risk of moving outside Excel? 3) No, just the contrary. Try yourself to gain traction with a free open source software and see how difficult it is. 4) That's what I said but it's being capitalized by a lot of people 1) Startups and small business are popping up everywhere and the majority die.
- chc 13y ago
  > Building a spreadsheet program is a ton of work, but it's also a multi-billion dollar market. And a proof of concept can be built by a couple of smart hackers -- but it needs a good hook of course. Reality: very few people even try. This is because it's a sucker's game. You can build the best spreadsheet in the world and Microsoft will still eat your lunch. The expected returns on a goldfish-selling business are higher. LibreOffice can't even manage to give away a tenth as many as Microsoft sells. Like, yes, building a spreadsheet program is something people could do, but it is not an idea with even the remotest possibility of making good money. I think I have figured out the fundamental disconnect here. You are talking about how easy it is to build stuff these days, while other people are talking about how easy it is to make a living off stuff. It is easy to build things. But building something alone is pure cost, no profit. Then the hard part comes. The difficulty has just shifted around, not disappeared.

nawitus 13y ago

>How many startups do we see coming from Spain, or India, or Brazil? Very few. How many from Milwaukee? Or maybe they're targeting local customers, just like most(?) American startups.

chc 13y ago

> It's not like Patio11 is the first guy to ever make Appointment Reminder software. Or the 20th. But with half-decent execution and half-decent marketing he's still making a ton of money. And is he afraid that by posting on HN people here are going to start competing AR software? Of course not. Because there are so many better opportunities out there that there is no need to fight for the same customers. "Half-decent marketing"? I think you are selling Patrick short. Based on his vague hints about what people pay him to consult on their marketing, I don't think "half-decent" quite covers it. I'm halfway to decent, and empirically people don't pay me a quarter of that. > How many startups do we see coming from Spain, or India, or Brazil? Very few. How many from Milwaukee? I don't know of any. But the software engineers exist. The opportunities are right here for the taking. But people just don't take them. Doesn't it seem implausible that these people take all the other opportunities that are offered to them, but just not these ones? Isn't the more likely explanation that you have an exaggerated idea of how accessible this stuff is to most people?

coffeemug 13y ago

You make the case that a low bar exists in myriads of markets, but your examples don't support the argument. Where are the thousands of Gmail competitors? The reason they don't exist (or they do exist but you never hear about them) is that you'll have to pry Gmail from people's cold dead hands. Firstly, Gmail is an amazing product, and it would be really, really, really hard to do better. Very few teams can attempt such a thing, certainly not thousands. Secondly, even if you build a better product, it's extremely unclear how it would be enough better to get enough people to leave Gmail. Word processing and spreadsheet competitors? Exactly the same reason. Microsoft Office is an amazing piece of software, and it would be immensely difficult to do better. Furthermore the barrier to entry is huge -- word processing and spreadsheet software that can effectively compete with MS Office would take decades to build. There is something to be said for competing with Google's online office offerings (and I know some really smart people who are doing just that), but again, it's not as easy as it seems. Where is a better DabbleDB? DabbleDB didn't work as a business. That's why there is no better DabbleDB -- there is no market for it.

avibryant 13y ago
(I worked on Dabble DB) I don't think it's so much that there's no market for it as that the market is very hard to reach and we had no good channel. Intuit's Quickbase is a very healthy business, because they have a channel to millions of SMBs. We didn't, and didn't know how to build one, so we grew much more slowly (though I should say that by most sane, non-valley standards we were doing just fine, thanks ;) I learned a lot of things at Dabble, but I think the biggest lesson was that the three most important things in B2B software are distribution, distribution, and distribution.
- gvnonor 13y ago
  DabbleDB was a very forward thinking product, pity it was shutdown. Could you share an estimate of the number of man-hours it took to build it?