5 ms·

Startups for the 99%

66 points by superasn 13y ago

16s 13y ago
Some words should be universal... like shark. But I don't think start-up falls into that category.
RyanZAG 13y ago
This is very, very true. The waters are a bit muddy though, because a lot of those smaller 'would never take VC' startups actually transition into the VC kind of startup. This is even true for many of the big players in the tech landscape today. When they started out and before they gained their incredible traction, a lot of VCs would have laughed them out of the building. There should still be some way to differentiate the name though. Maybe something as simple as 'VC-Startup' and 'LS-Startup' (lifestyle)?
jiggy2011 13y ago
Not to mention that the term "startup" in general usage doesn't even have to mean a technology company. In general terms it could mean a small , new business with low revenue. On HN you will often see companies with multi million $ valuations referred to as startups.
chromaton 13y ago
They're two different things, but often have significant overlap. Both need to get new customers, hire employees, create infrastructure, and so on. I'll suggest "bootup" for "bootstrapped startup".
- wj 13y ago
  I like "bootup".
eldavido 13y ago
Startup vs. small business.
onion2k 13y ago
I believe that a business being referred to as a "startup" should be something akin to an insult unless you're very, very early stage. It usually means you're running a business that's basically failing - no customers, no revenue, no profit. The sooner you stop being a startup and start being a business the better. Obviously there are a few caveats to that as certain things that take more time and money than others (hardware, biotech, etc), but for most SaaS businesses (eg most startups) it's true enough.
- mildtrepidation 13y ago
  Call a brand new business a startup. Hell, just drop the term and call it a new business. Call a failure a failure. I don't see why we have to load these terms so much or why people insist on pushing their own preconceptions. People like to bicker about whether it's a startup if it accepts funding, where the funding comes from and how ownership is established, what kind of background the founders have and how long their "runway" is, whether it's set up for an exit or for long term operation... it's ridiculous. I think the implication is that we've overloaded this term and a few others when we're talking about many different things in many different contexts but can't be bothered to clarify what we're talking about, so hey, what I see as a startup is pretty specific, but I'm not actually going to tell you what I mean (despite knowing I'm bringing serious bias to the term), so I'm just gonna throw that term around and disparage anyone with a different interpretation. If you define "startup" as very early stage, fine. Why would you use it as an insult for something that's not? Why wouldn't you just say "no, you're just NOT a startup" and ask what the business model is and why they aren't profitable?
jacques_chester 13y ago
The second category he defined has a pretty good name: small and medium business. He even mentions it in passing (as "SMBs").
- vdaniuk 13y ago
  No, they are not. SMBs have stable business model. Startups are searching for a business model. This is startups 101. Startup can become a smb in the future. SMB may decide to pivot and create a startup that is developing a complementary product.
  - teleclimber 13y ago
    Agreed. A business is a startup if it is pivoting on a regular business, or developing the product.
    - jmduke 13y ago
      My favorite definition of a startup is that of a company that prioritizes growth over all other metrics.
  - jacques_chester 13y ago
    Is it the model or the income which matters? If it's the model, then "startup" means "any business which isn't profitable with its current model". If it's the income, then "startup" means "any business which isn't profitable with its current model". At least, that's how it appears to me.
    - anigbrowl 13y ago
      A valid point. But we don't think of restaurants as startups, even though they typically take 1-2 years to become profitable.
michaelochurch 13y ago
This link is relevant to the "What defines a startup?" conversation: http://michaelochurch.wordpress.com/2013/03/26/gervais-macleod-17-building-the-future-and-financing-lifestyle-businesses/ http://michaelochurch.wordpress.com/2013/03/26/gervais-macle...
tchock23 13y ago
I was thinking the same thing as the OP the other day - most of the sites I visit every day are tailored toward the 1% that gets VC and goes for the gold. I recently registered startupsinhardmode.com and plan to blog there about the day-to-day challenges that "the 99%" go through (the DNS should propagate shortly if anyone is interested in checking it out).
ArekDymalski 13y ago
It would be great if the author has specified what kind of advice isn't applicable to non-VC-backed companies. IMHO a part of it is still relevant even if you don't shoot for the stars. After all every business (even the "lifestyle" one) needs some good practices to (at least) stay on the market and avoid the fate of an expensive hobby. Yesterday I had a similar discussion on the workshop with a group of SMB owners/managers (mostly experienced people running the business for many yrs - up to 30, but there were also a few startups). All of them were in real need for an actual change to either grow or keep up with the evolving market. We were working on their business models and I was using well known examples of companies as illustrations. One of the guys suddenly asked "Why are we talking about such big companies? We are not them." The answer was pretty simple - if you want to learn and get inspired there's only one direction to look - up.
akbar501 13y ago
The author's key assertion is that there should be separate terms for the different types of startups: those that fit with the venture capital model, and those that don't. While separate terms may make the differences clearer, the same differentiation can be obtained with 2 widely used qualifiers: fundable, scalable A fundable startup / scalable startup is a business that, if successful, has a high probability of being huge (>= $1B in market cap). However, its questionable if the media, bloggers, etc. would start to use each term accurately.
blizkreeg 13y ago
I wonder if part of the reason why most everyone uses the word 'startup' is because the alternatives 'small business', 'lifestyle business', or 'SaaS business' are just not sexy or cool to say. It would be good for the overall entrepreneurial community if both were given their due attention (and the credit they deserve) but the tech media loves to drum up the hype for the former and it's hard not to be influenced by it. I'm fairly unaffected by the hype and would like to start my own company but even I cringe at the thought of calling it a small business even if it has no chance of raising VC (and doesn't need to).
- Zoomla 13y ago
  how about: business? you can add an adjective when it is large enough
mooreds 13y ago
Here's a chestnut from over a decade ago that spells it out in black and white: Are you Amazon or are you Ben and Jerry's? http://www.joelonsoftware.com/articles/fog0000000056.html http://www.joelonsoftware.com/articles/fog0000000056.html
bradleyland 13y ago
> "...how many investors can you name who don’t have an active blog?" Six months ago? Zero. Today? Four, off hand. This blog post has some sound advice about evaluating whether your startup should seek outside funding, but it is based on the false premise that the only VC money worth taking comes from the top-tier VC firms like USV, Sequoia, etc. There is a whole world of capital investors outside of the ones you read about in the news. Think of it as venture capital for the 99%. That doesn't mean all startups should take outside money; it only means that you shouldn't believe that just because USV wouldn't invest in your company that no one would.

66 points by superasn 13y ago

16s 13y ago

Some words should be universal... like shark. But I don't think start-up falls into that category.

This is very, very true. The waters are a bit muddy though, because a lot of those smaller 'would never take VC' startups actually transition into the VC kind of startup. This is even true for many of the big players in the tech landscape today. When they started out and before they gained their incredible traction, a lot of VCs would have laughed them out of the building. There should still be some way to differentiate the name though. Maybe something as simple as 'VC-Startup' and 'LS-Startup' (lifestyle)?

jiggy2011 13y ago

Not to mention that the term "startup" in general usage doesn't even have to mean a technology company. In general terms it could mean a small , new business with low revenue. On HN you will often see companies with multi million $ valuations referred to as startups.

chromaton 13y ago

They're two different things, but often have significant overlap. Both need to get new customers, hire employees, create infrastructure, and so on. I'll suggest "bootup" for "bootstrapped startup".

wj 13y ago
I like "bootup".

eldavido 13y ago

Startup vs. small business.

onion2k 13y ago

I believe that a business being referred to as a "startup" should be something akin to an insult unless you're very, very early stage. It usually means you're running a business that's basically failing - no customers, no revenue, no profit. The sooner you stop being a startup and start being a business the better. Obviously there are a few caveats to that as certain things that take more time and money than others (hardware, biotech, etc), but for most SaaS businesses (eg most startups) it's true enough.

mildtrepidation 13y ago
Call a brand new business a startup. Hell, just drop the term and call it a new business. Call a failure a failure. I don't see why we have to load these terms so much or why people insist on pushing their own preconceptions. People like to bicker about whether it's a startup if it accepts funding, where the funding comes from and how ownership is established, what kind of background the founders have and how long their "runway" is, whether it's set up for an exit or for long term operation... it's ridiculous. I think the implication is that we've overloaded this term and a few others when we're talking about many different things in many different contexts but can't be bothered to clarify what we're talking about, so hey, what I see as a startup is pretty specific, but I'm not actually going to tell you what I mean (despite knowing I'm bringing serious bias to the term), so I'm just gonna throw that term around and disparage anyone with a different interpretation. If you define "startup" as very early stage, fine. Why would you use it as an insult for something that's not? Why wouldn't you just say "no, you're just NOT a startup" and ask what the business model is and why they aren't profitable?

jacques_chester 13y ago

The second category he defined has a pretty good name: small and medium business. He even mentions it in passing (as "SMBs").

vdaniuk 13y ago
No, they are not. SMBs have stable business model. Startups are searching for a business model. This is startups 101. Startup can become a smb in the future. SMB may decide to pivot and create a startup that is developing a complementary product.
- teleclimber 13y ago
  Agreed. A business is a startup if it is pivoting on a regular business, or developing the product.
  - jmduke 13y ago
    My favorite definition of a startup is that of a company that prioritizes growth over all other metrics.
- jacques_chester 13y ago
  Is it the model or the income which matters? If it's the model, then "startup" means "any business which isn't profitable with its current model". If it's the income, then "startup" means "any business which isn't profitable with its current model". At least, that's how it appears to me.
  - anigbrowl 13y ago
    A valid point. But we don't think of restaurants as startups, even though they typically take 1-2 years to become profitable.

michaelochurch 13y ago

This link is relevant to the "What defines a startup?" conversation: http://michaelochurch.wordpress.com/2013/03/26/gervais-macleod-17-building-the-future-and-financing-lifestyle-businesses/ http://michaelochurch.wordpress.com/2013/03/26/gervais-macle...

tchock23 13y ago

I was thinking the same thing as the OP the other day - most of the sites I visit every day are tailored toward the 1% that gets VC and goes for the gold. I recently registered startupsinhardmode.com and plan to blog there about the day-to-day challenges that "the 99%" go through (the DNS should propagate shortly if anyone is interested in checking it out).

ArekDymalski 13y ago

It would be great if the author has specified what kind of advice isn't applicable to non-VC-backed companies. IMHO a part of it is still relevant even if you don't shoot for the stars. After all every business (even the "lifestyle" one) needs some good practices to (at least) stay on the market and avoid the fate of an expensive hobby. Yesterday I had a similar discussion on the workshop with a group of SMB owners/managers (mostly experienced people running the business for many yrs - up to 30, but there were also a few startups). All of them were in real need for an actual change to either grow or keep up with the evolving market. We were working on their business models and I was using well known examples of companies as illustrations. One of the guys suddenly asked "Why are we talking about such big companies? We are not them." The answer was pretty simple - if you want to learn and get inspired there's only one direction to look - up.

akbar501 13y ago

The author's key assertion is that there should be separate terms for the different types of startups: those that fit with the venture capital model, and those that don't. While separate terms may make the differences clearer, the same differentiation can be obtained with 2 widely used qualifiers: fundable, scalable A fundable startup / scalable startup is a business that, if successful, has a high probability of being huge (>= $1B in market cap). However, its questionable if the media, bloggers, etc. would start to use each term accurately.

blizkreeg 13y ago

I wonder if part of the reason why most everyone uses the word 'startup' is because the alternatives 'small business', 'lifestyle business', or 'SaaS business' are just not sexy or cool to say. It would be good for the overall entrepreneurial community if both were given their due attention (and the credit they deserve) but the tech media loves to drum up the hype for the former and it's hard not to be influenced by it. I'm fairly unaffected by the hype and would like to start my own company but even I cringe at the thought of calling it a small business even if it has no chance of raising VC (and doesn't need to).

Zoomla 13y ago
how about: business? you can add an adjective when it is large enough

mooreds 13y ago

Here's a chestnut from over a decade ago that spells it out in black and white: Are you Amazon or are you Ben and Jerry's? http://www.joelonsoftware.com/articles/fog0000000056.html http://www.joelonsoftware.com/articles/fog0000000056.html

bradleyland 13y ago

> "...how many investors can you name who don’t have an active blog?" Six months ago? Zero. Today? Four, off hand. This blog post has some sound advice about evaluating whether your startup should seek outside funding, but it is based on the false premise that the only VC money worth taking comes from the top-tier VC firms like USV, Sequoia, etc. There is a whole world of capital investors outside of the ones you read about in the news. Think of it as venture capital for the 99%. That doesn't mean all startups should take outside money; it only means that you shouldn't believe that just because USV wouldn't invest in your company that no one would.