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I don't really remember those two talking about startups being gameable in the way that PG is talking about megacorps. Most of the reasons they prefer bootstrap

I don't really remember those two talking about startups being gameable in the way that PG is talking about megacorps. Most of the reasons they prefer bootstrapping vs startups are around the idea that bootstrapping has a predicable model for success. Where as your chances of a successful exit in a startup are like winning the powerball. Even PG notes that one good exit covers the losses of hundreds of other investments and that they still don't really know how to pick winners (they just happen). Startups that take VC are also kind of designed to fail early so as to not waste too much investor money. The other pro for bootstrapping seems to be around the idea of "freedom" from bosses. In a megacorp you work for like 14 bosses. In a startup your bosses are the VC's. As bootstrapper you work for yourself and the people that pay your for what you produce.

j45 12y ago
Bootstrapping is not excluded from being a startup. 98% of all startups in Canada, for example (tech included) are self-funded. There ultimately is little freedom from bosses. Either your VC's are, or paying customers are.
- 7Figures2Commas 12y ago
  You can fire customers you don't want; you can't get rid of investors so easily.
- graeme 12y ago
  >There ultimately is little freedom from bosses. Either your VC's are, or paying customers are. I hear this line often, and I think it switches terms. I'm a bootstrapper. When I say I don't have a boss, I don't mean I don't have responsibilities. I have a ton of responsibilities – maybe more so than those with jobs. I can't easily take a 100% off vacation, for example. But I don't have a boss. I can arrange things how I want. I could even blow off customer support entirely, if I felt like it. I'd make a bit less money, probably, but I'd still be fine. And I've occasionaly "fired" whole categories of customers when I felt like stopping a certain activity. Couldn't do that to a boss.
  - eloisant 12y ago
    Actually you can fire your boss, that's called quitting. And if you're a tech worker, you really have the freedom to do it because it's easy to find something else if you're decently competent.
    - dragonwriter 12y ago
      > Actually you can fire your boss, that's called quitting. Quitting is (to the extent the metaphor works at all) firing your employer, not your boss; these can sometimes be the same, but often your boss is, like you, an employee of your employer, not someone with whom you engage in a direct exchange that you can terminate. If a line supervisor isn't given permission to terminate his subordinates' employment (because, e.g., that's reserved for a higher-level manager), but can quit, it would be wrong to say he can fire his employees. Likewise, it is wrong to say you can fire your boss unless you can terminate the boss's employment.
  - poteleu 12y ago
    The boss, the VC or the customer is ultimately people you have commitments to. You can always decide not to comply to their request and see what happens. If your product is great, the customer might frown but will stay, and you'll be fine. The same thing with your boss, if you're a stellar employee, your boss won't be pleased but your job will probably be safe. In any case, you measure and take risks. The main difference in my opinion is you see your boss almost everyday, she gives you guidance and tells you if things go bad. With customers, you have to proactively get the feedback, or anticipate their needs.
- ryanbrunner 12y ago
  This depends on your definition of "startup". Paul Graham's definition - "a company built to grow fast", while not 100% incompatible with a bootstrapped company, certainly is in tension with the idea of not taking on outside investment. If the goal of your company is to grow as fast as possible, then the VC rocket ship approach seems like a no-brainer.
  - j45 12y ago
    I like Steve Blanks description that a startup is (paraphrasing) .. a temporary organization to find a repeatable and scalable business model. Many startup factories forget that the goal of a startup is to quit existing and become a business. Depending on the type of product and market you're in funding can help. For the first, or second time entrepreneur, there is a far more valuable lesson to learn than getting external validation in the form of investment: Learning to add value, and learning to build something of value at a small scale, as well as the associated business skills, before doing it at presumably a larger scale. The VC rocketship can create as many distractions from finding something people want. I'm not against it, but glad I hesitated taking investment in my 20's, I'm a much more well rounded entrepreneur for it, and now as the opportunities are coming up, investment is around that much more, and secondary to finding the right fit with team, market, and product. As you can tell, I think growth capital interests me more than getting funding to get a market. I think both are fine, I just find I respond better to grinding, hustling and being resourceful.

j45 12y ago

Bootstrapping is not excluded from being a startup. 98% of all startups in Canada, for example (tech included) are self-funded. There ultimately is little freedom from bosses. Either your VC's are, or paying customers are.

7Figures2Commas 12y ago
You can fire customers you don't want; you can't get rid of investors so easily.
graeme 12y ago
>There ultimately is little freedom from bosses. Either your VC's are, or paying customers are. I hear this line often, and I think it switches terms. I'm a bootstrapper. When I say I don't have a boss, I don't mean I don't have responsibilities. I have a ton of responsibilities – maybe more so than those with jobs. I can't easily take a 100% off vacation, for example. But I don't have a boss. I can arrange things how I want. I could even blow off customer support entirely, if I felt like it. I'd make a bit less money, probably, but I'd still be fine. And I've occasionaly "fired" whole categories of customers when I felt like stopping a certain activity. Couldn't do that to a boss.
- eloisant 12y ago
  Actually you can fire your boss, that's called quitting. And if you're a tech worker, you really have the freedom to do it because it's easy to find something else if you're decently competent.
  - dragonwriter 12y ago
    > Actually you can fire your boss, that's called quitting. Quitting is (to the extent the metaphor works at all) firing your employer, not your boss; these can sometimes be the same, but often your boss is, like you, an employee of your employer, not someone with whom you engage in a direct exchange that you can terminate. If a line supervisor isn't given permission to terminate his subordinates' employment (because, e.g., that's reserved for a higher-level manager), but can quit, it would be wrong to say he can fire his employees. Likewise, it is wrong to say you can fire your boss unless you can terminate the boss's employment.
- poteleu 12y ago
  The boss, the VC or the customer is ultimately people you have commitments to. You can always decide not to comply to their request and see what happens. If your product is great, the customer might frown but will stay, and you'll be fine. The same thing with your boss, if you're a stellar employee, your boss won't be pleased but your job will probably be safe. In any case, you measure and take risks. The main difference in my opinion is you see your boss almost everyday, she gives you guidance and tells you if things go bad. With customers, you have to proactively get the feedback, or anticipate their needs.
ryanbrunner 12y ago
This depends on your definition of "startup". Paul Graham's definition - "a company built to grow fast", while not 100% incompatible with a bootstrapped company, certainly is in tension with the idea of not taking on outside investment. If the goal of your company is to grow as fast as possible, then the VC rocket ship approach seems like a no-brainer.
- j45 12y ago
  I like Steve Blanks description that a startup is (paraphrasing) .. a temporary organization to find a repeatable and scalable business model. Many startup factories forget that the goal of a startup is to quit existing and become a business. Depending on the type of product and market you're in funding can help. For the first, or second time entrepreneur, there is a far more valuable lesson to learn than getting external validation in the form of investment: Learning to add value, and learning to build something of value at a small scale, as well as the associated business skills, before doing it at presumably a larger scale. The VC rocketship can create as many distractions from finding something people want. I'm not against it, but glad I hesitated taking investment in my 20's, I'm a much more well rounded entrepreneur for it, and now as the opportunities are coming up, investment is around that much more, and secondary to finding the right fit with team, market, and product. As you can tell, I think growth capital interests me more than getting funding to get a market. I think both are fine, I just find I respond better to grinding, hustling and being resourceful.