Congratulations on the investment. The return is nothing short of spectacular. It's a truly excellent example of execution and timing.
But the point that keeps resurfacing in my mind is SpaceX. SpaceX, from nothing, created a low-earth orbit delivery system that is revolutionizing satellite launches and (soon) the cost of getting men into space... for less than the price that a bunch of people can send photos to each other with cheesy filters [1].
It would be difficult to overstate the impact Elon Musk has had, is having and will have on humanity (and no this isn't hyperbole) through SpaceX (and maybe even Tesla). And it didn't even require, relate to or is connected with some bullshit social network.
I'm also reminded of Steve Yegge's OSCON talk [2] from some months back. The computer power we have available now is stunning. used for the right purposes it could fundamentally change humanity for the good, whether that be in bioinformatics or whatever, is hard to overstate.
Yet we're using all this power and the brightest minds on the planet... to send cat pictures. It's actually reached the point that when I get unsolicited recruitment email or read about some new startup on HN that I tune out as soon as I see the word "social".
There's something astoundingly depressing about all this.
EDIt: I should add that my issue isn't that the founders and investors sought wealth. I don't begrudge them that at all. Not by any means am I anti-capitalist. Bill Gates, as one example, is doing huge amounts of good with his accrued wealth.
If it makes you feel any better, there's nothing new about this situation. One could just as well complain in the 1930s about the money and effort that were going into popular films instead of whatever other more virtuous project.
This case actually sounds like a fairly mild one. Instagram didn't have many employees, so only a few people were diverted from curing cancer to sending cat pictures.
only a few people were diverted from curing cancer to sending cat pictures
Pre-acquisition, sure. But how many people will see the instagram acquisition and decide to give up on curing cancer to help people send cat pictures instead?
Cancer research is a gamble: You spend years of your life pipetting liquids in the hope that you'll discover something new that improves upon the current standard methods of treating cancer. The equivalent in CS is, well, CS research: You spend years of your life poring over journals in the hope that you'll discover something that dramatically improves the standards of computing.
Like a lot of research, these are highly worthwhile activities but they aren't big business. That's why, if you want to see more of them, the bottleneck isn't finding the talent: It's the funding, which generally comes from taxpayers. (I assure you from very personal experience that there is a large and consistent oversupply of people who would be willing to conduct cancer research, or any other kind of research, so long as the funding is there.)
Whereas sending cat pictures is not a gamble. It is an established business. It reliably, demonstrably, and very inexpensively improves the lives of tens of millions of average people, to the extent that it and similar businesses are consistently profitable ($355 million earned at Facebook on revenues of $1.2 billion, for example).
And cancer treatment - doing more of what we already know how to do to treat cancer - is likewise not a gamble but a business, which is presumably why it's a huge and growing sector of the economy that dwarfs Facebook and everything else that's fun – $128 billion per year in the USA alone:
So given that the USA is only 309 million people out of seven billion, we can guess with some confidence that the world spends more on cancer treatment than on advertising of any sort, let alone on the tiny percentage of ads that suffice to pay for all the cat pictures that any cat lover could want.
They are comparable in the sense that a new Stanford CS grad might conceivably be deciding between working in cancer research or cat picture startups.
Your overall point about funding is correct, but typically the very best students and researchers don't have trouble finding funding. Thus the problem is how to attract the very best students away from Wall Street and cat picture startups, and stories like Instagram don't help with that.
I don't really feel that the sight of one company in fifty thousand cashing out for one billion dollars has a profound influence on the career decisions of a cancer researcher. One thing that even beginners in that field understand is elementary statistics.
The simpler explanation is that any programmer -- COBOL for bankers, CRUD apps, even "maintainer of Office installations for the IT department" -- commands a salary larger than that of a decently-paid Ivy League postdoctoral researcher. With minimal effort at steering one's career, the multiplier is two; according to rumors coming from the general direction of (e.g.) Google, if you've got talent and experience the number is a multiple of three.
You don't have to win the lottery. You start winning on the day of your first paycheck and you never lose, relative to research, because programming is a safer career than research.
Be careful about cherry-picking Wall Street and Instagram when choosing examples: Those are just the sensational ones. If Wall Street disappeared tomorrow, and venture funding with it, plumbers would still make more money than the average researcher. (Remember: A lot of research work is done by grad students, whose salaries make postdocs look pampered.)
"The very best students and researchers don't have trouble finding funding" - this is like saying "talented farmers have no trouble growing food". First, you're selecting a group of winners and then looking for evidence of winning. Lo, you found some! The second problem is that this statement doesn't account for effort: Farmers work hard and take risks for the money, and researchers do as well. As a researcher who wants to succeed you must have grants in the front of your mind one third of the time, and in the back your your mind most of the rest of the time, because success is measured in grants: Your pay, promotion, rate of progress, and reputation are directly contingent on the amount of grant money you can raise. Unless you're Einstein, maybe, but see above under "winning the lottery".
Face it, society doesn't value research as highly as going concerns. When you think about it, why should that surprise anyone? Businesses are a sure thing by comparison. You turn the crank, profits fall out. Often, happiness and human health fall out, too. Nursing, for example, saves lives. It saves them one at a time, but they get saved, and it's a sure thing: You don't need to make a bet against long odds. Change a bedpan, make someone considerably happier; notice that the patient has stopped breathing, save a life. Turn the crank. Turn the wheel the world has given you.
Your assuming everyone is equally good at building cat picture start-ups and doing Cancer research which I don't think is particularly accurate. Also, I suspect Cancer is over funded and we would be much better off diverting 1/10th of that talent and resources to building cheap self driving cars.
Burned out (and homeless) in San Diego says: I am completely ready to make that (type of) switch, and it has nothing whatsoever to do with any company being acquired. Most people don't really want to get well. They want a better drug. I am currently seriously planning to burn my health site to the ground and start something shallow and hopefully profitable, like an astrology site.
Mz, you don't know me but I've often read your comments here with interest and respect. I also know several people in the San Diego ecosystem (I was in LA for many years). I admire what you're doing with healthgazelle and if I can help let me know (email is in my profile).
While the sentiment is appreciated, I cannot imagine what to ask for. I need either a huge cash gift to wipe out my debts or to declare bankruptcy, which I am currently trying to work on through legal aid. I also need an online income. I suck at self promotion and most people have either given me well meaning advice which failed to make any real difference or pooh-poohed the idea that any of my current sites could be commercialized and monetized. While it bothers me to take the site down, my webhosting expires in May and not only can I not afford the $120-ish dollars to renew for another year but if someone gave me the money, as has happened the previous three years, I would spend it on food, not hosting service. I see little reason to continue taking verbal abuse for a project which makes no money and is of interest to very few people.
I also do not know how to get off the street in part because I have been healthier sleeping in a tent these past few months. I do not wish to remain homeless but I also do not want to rent a typical American apartment ever again. I do not know how to go from homeless to homeowner, which is probably the only hope I have for arranging a housing situation which does not contribute to my health issues.
You are more than welcome to email me. I just have no idea how it would help.
Thanks
Edit: Though I do have a non-internet business idea I am toying with. And concerned that it will go nowhere because a) I can't get a business loan in my current circumstance b) I won't qualify for a business loan if I successfully declare bankruptcy and c) I don't know if I can successfully run an IRL business given my health issues.
> While it bothers me to take the site down, my webhosting expires in May and not only can I not afford the $120-ish dollars to renew for another year but if someone gave me the money, as has happened the previous three years, I would spend it on food, not hosting service.
How about if someone offered to take over the project(s) from you? In effect equivalent to the above, but non-fungible.
Since all three of my current sites are deeply rooted in first hand personal experience, I do not see how that can be realistically accomplished. I either need a (financial) miracle within the next month which makes it worth my while to continue developing my sites or they need to die. I don't see any other reasonable alternative.
How about if someone offers to host the site free for some time. And once you have recovered, you can move it your own server.
Even if you are not going to update it any time in future, the information already there could be of some help to someone.
Just don't take the sites down since could be providing some value to some one in the mean time.
Let me know.
I will think about it however free hosting will not solve anything. Other people have paid the hosting for the last three years. Keeping the site up does not change the lack of traffic. It does not change the lack of credibility I have with the CF community. It does not change the general perception that I am some attention mongering egomaniac who got myself well as some publicity stunt. It does not change the fact that no one wants to compensate me for the information there. Given that I am currently homeless, it rubs me the wrong way that people still want to preserve the site but not give me one thin dime. Meanwhile, people in the CF community raise thousands of dollars for the CF Foundation because they are desperate for better drugs. If everyone here is so fucking idealistic, why are there zero donations?
I do not know what the answer is but at the moment I see no reason to be idealistically trying to preserve the information for the benefit of other people and I find it incredibly offensive that people are suggesting I should given that I am homeless. Either give me money, help me effectively monetize it, or say goodbye to it. If it has value, it should be worth something to people. If it is not worth something to people, then bleeding a homeless person for sympathy seems pretty freaking sick.
I don't know anything about your situation or your site, but I think it comes down to a very simple business evaluation: does your site make money?
It sounds like you are not making money, so either A) fix something so it makes money or B) toss it.
Just because something is useful does not mean it is profitable. As with all things in business, you have to find someone that values your service enough to pay for it (in some capacity).
I wanted to write software for academic biologists because I'm an ex-biologist...but they don't want to pay for it. Doesn't matter how useful it is if no one is willing to pay.
No, it does not make money. It gets me sympathy and condescending pats on the head. Everyone who thinks I should keep my sites out of idealism will not give me money and will not promote them. They tell me I am doing something wonderful. But they will not tell other people I am doing something wonderful and it is deserving of support.
At the moment, $1700 in donations (edit: and a few links/promos generating traffic) would convince me to keep it up for another year. That would not get me off the street but it would pay my taxes, pay the webhosting and domain name and help me and my kids eat properly for the next two weeks. In other words, it would alleviate some serious immediate stressors. But no one will blog about it and announce it to the world and tell people to support it or open their own wallet up. So I think I will try the e-book idea and then move on to other projects with an eye towards making money first and foremost.
Take all the info you have on your site, dump it into a PDF, give it a title, and sell it as an e-book on Amazon -- let the site die.
If someone out there thinks your information is valuable, they can pay $15-25 bucks for it; at least then you don't have to keep paying/updating your site and you might put a few bucks in your pocket.
If you search for "convert wordpress to book" you get a bunch of sites, including this one http://www.blogbooker.com/wordpress.php, which is free. There are a lot more.
Thank you. Any suggestions on how I can do that within a month? Or where I can get info on how to do so? I am currently on a tablet and having trouble using my webhosting interface, though for something like this (i.e. a short term project) I could use a computer at the library for anything I can't do on my tablet.
Instagram founders can probably afford to fund some medical research or establish a chair or even a medical center like many wealthy business people end up doing. There are many ways to help the world if you find a good way to make money.
I have cystic fibrosis, as does my 24 year old son. We have figured out how to get ourselves well. It has left me deeply in debt and homeless. And damn few people have any interest in what I have done. I get called a liar and snake oil salesman. At the moment, I don't feel like getting rich so I can make the world a better place. I feel like getting rich and then telling the world to go fuck itself should the world suddenly reverse position and find my story of recovery fascinating just because I have found fame and fortune.
You are making the assumption inventors are primarily motivated by money. I doubt this to be the case. Furthermore, the sharing of photos and memories is known to have therapeutic qualities for humanity:
I have a feeling that people who think they could cure cancer will stick with it no matter how much money there is in cat pictures. Getting cancer probably means you're going to die and there may be little or nothing you can do to buy yourself more time. If you really believe you have the ability to stop this, it would seem crazy to go chase money instead. Imagine being that person, making the next Instagram and then dying of cancer. Oops.
"so only a few people were diverted from curing cancer to sending cat pictures."
I have to be reminded of this every time I get judgmental about how people spend their time simply because it isn't the way I choose to spend my time. I don't watch or follow sports, and try to avoid religious activities to the best of my ability. But after many years I finally was able to respect in the end that those things are important to others.
Back in the day you know, people were always critical about the time I spent "playing with computers" and of all things, photography. Funny how things change.
Yeah, and it's not like they would have be cancer researchers otherwise. Curing cancer is great, but I have no interest in doing it - my passion is in creating media and technology for people to enjoy. I think that's just as valuable to society than having me become a cog in the quest for space exploration or cancer research. We can't assume that the noblest goal should be everyone's passion or expertise.
Things not getting better in a world whose population is increasing drastically (from ≈ 2 billion in 1930 to almost 7 billion currently) is a problem.
The real test though, in this system, is what Instagram or any successful startup does next (or are they so used to pivoting towards profitability that nobody tackles hard, virtuous problems).
It would be difficult to overstate the impact Elon Musk has had, is having and will have on humanity
I can't count how many times I've seen this debate. I think last week there was a thread debating the triviality of web apps and similarly mentioned Musk.
Elon Musk may very well have developed a cat picture social network to gain the wealth required to fund his companies, but he instead worked on X.com/PayPal. Do you really believe Musk would be where he is today if he didn't gain considerable wealth from that venture? He'd likely be drawing rockets in a sketchbook while working as VP of Advertising at Google.
The Instagram founders are only wealthy enough at this point to have great credit, who knows what great investments they could make post-close?
I'm a fan of taking the simplest, reasonable route to wealth, then investing in something of greater importance, something that critics would agree improves humanity.
I'm a fan of taking the simplest, reasonable route to wealth, then investing in something of greater importance, something that critics would agree improves humanity.
I agree with this, and have been talking to people about it under the moniker of "deferred altruism". My hypothesis is that someone who continually gives his time and/or money to worthy causes over his entire life may end up being cumulatively less world changing than someone who spends half her life making money, then switches to philanthropy or world changing ideas later.
The canonical examples are Elon Musk and Bill Gates, but of course there must be thousands of examples where the risk doesn't pay off, and the deferred altruist ends up unable to contribute much at all.
Perhaps I'm just finding a way of justifying being miserly now, but I certainly intend to pay it back in cash if I'm successful, or in time if I'm not.
One danger is that if you're not giving at least some in the meantime, it might be hard to part with it when "it's time". "Deferred altruism" is basically my plan, or at least I tell myself that, but this is something I worry about, so I try to give now, too.
My hypothesis is that someone who continually gives his time and/or money to worthy causes over his entire life may end up being cumulatively less world changing than someone who spends half her life making money, then switches to philanthropy or world changing ideas later.
How do you know how long you're going to live, such that you can switch from miserly to altruistic halfway through?
Doesn't really matter how long a specific rich individual lives for this to work. As long as there is a culture of rich people doing it, then things would average out. Especially given that the life spans of very rich people tend to be longer.
To an extent this was my point too - if a decent number of people do this, then the few who get mega-rich and become philanthropic will make up for the many who fail to get mega-rich, and also the few who get mega-rich but don't become philanthropic. Well... hopefully!
I get your point, but it's hard to shake the feeling that "deferred altruism" is just an "excuse" to keep everything to our self. Also, I strongly believe it's hard to turn generous after being very selfish for a long time. Guess that's what andrewflnr said..
Yep, I get your point too. But I feel that we can't pressure people into altruism so if they aren't going to give anyway, then it doesn't matter whether they fail to do so in one lump sum or fail to do so continuously.
"...someone who continually gives his time and/or money to worthy causes over his entire life may end up being cumulatively less world changing than someone who spends half her life making money, then switches to philanthropy or world changing ideas later."
Couldn't have said this better myself. Thank you :)
Yeah, it was intentional. I noticed a while ago that I almost always used masculine pronouns when the gender was really irrelevant so I've been forcing myself to switch it up a bit. I think I first noticed after reading a comment on an article on Fred Wilson's blog where a guest author did this too.
I don't believe deferred altruism is as good as it's cracked up to be, because of the importance of motivation. If you tell someone who wants to work in a homeless shelter, "Go to Walk Street instead and give away your wealth" you may be correct in theory, but in practice that person might be a terrible banker and burn out quickly. To desire money instinctively, the way most people crave hugs and candy, is actually rather rare, and most of the rich people I know desire money that way, while most of the poor people don't. I'm not sure an altruist can make himself obsessed with money in order to be a better altruist. I've seen people try and fail.
So yeah, there's a gold rush. They're great for economic expansion but kind of suck when it comes to depth of achievement.
Right now, there's a lot of low-hanging fruit in the ability of technological innovators to positively affect the everyday lives of normal people in lots of small but personally significant ways.
If you consider that goal bullshit, then yes, I imagine the current economic environment is astoundingly depressing.
Yes, there are many amazing opportunities higher up the tree, and yeah, it seems like there aren't enough multibillionaires to take the risks to chase them, and counterbalance all the "easy stuff" people are chasing.
My point is this gold-rush-like era will pass. California got started that way, after all. I bet people were pretty frickin' sick of all the n00bs and posers moving to the West Coast with crazy/stupid dreams of getting rich. It probably seemed depressing to have every single week bring more idiots panning creeks.
But three generations later, California was manufacturing a command module to put men on the moon. The expansion that started in the gold rush led to agriculture, movies and technology.
And now things are cycling around in some ways. But if you're serious about progress, you have to be patient at times.
Elon Musk's first start up was called Zip2. Only after selling Zip2 was he able to co-found Paypal, Tesla, SpaceX, etc. if it werent for Zip2, a online publishing company (which could've been used posting cat pictures), there wouldn't be a Paypal, Tesla or SpaceX.
I agree. It's quite sad that some of the best and brightest minds of our time are spending their days working to increase revenue per click of advertisements. We could achieve so much more if our focus shifted towards more meaningful endeavors.
I am, however, encouraged by the recent rise of impact entrepreneurship, where for-profit ventures tackle large societal problems. It's something we certainly need to see more of.
Actually on advertising I will have to respectfully disagree. This may be controversial but:
My opinion is that Internet advertising has done an inordinate amount of good for the world.
Advertising has allowed the creation of amazing services that are free to use. Let's imagine a world where search or GMail might otherwise cost you $20/month (completely made up number) to use. You could afford that right? Even if you could you may not pay for it (people are remarkably fickle when it comes to paid services). That's not a lot of money.
But what about to the poor or those in developing countries to whom $20/month is a significant amount of money? They get the same service you do because of advertising.
Consider that the next time a text ad at the top of Google otherwise offends your (and I'm talking the general "you" rather than you specifically) aesthetic sensibilities.
> But what about to the poor or those in developing countries to whom $20/month is a significant amount of money? They get the same service you do because of advertising.
Well they're not paying for the service directly, but surely the advertisers want something for their money. And inflated material desires with excessive spending can certainly keep the poor poor, in a way that a fixed $n/month expense can't.
That said, advertising which directs your expenditures to more appropriate places is morally fine by me. If I search for "buy a basketball" and some start-up is able to expose me to a better, cheaper basketball than that seems useful. However, if that same query returns ads for Nike shoes, Kobe Bryant jerseys, and the All-NBA-All-The-Time cable channel, then that's bad for society, I think.
The canonical example I use for myself is grocery store coupons. I purposely ignore them. While intuitively it seems I could save money by redirecting my purchases to things that are on sale, I use my meta-intuition to know that more than likely it will convince me to buy some category or brand of good (now or on a future trip) that I wouldn't have otherwise purchased. Consequently, I see coupons as net money-losers.
I see ads in the same way. While it may get me this service for free, I imagine it planting seeds of desire in my mind for various other goods/services, such that I end up paying more over the course of my life than I would have if I just paid for the service in the first place and didn't see the ads.
What makes you think that "all the best and brightest minds" in this world are capable and motivated to work on the most noble tasks? If they had the passion for it they'd be doing it. If they don't have the passion for it, they wouldn't be any good at it.
Frankly, I personally have no interest in learning how to cure cancer. I have no interest for biology or formalized scientific research. I do have a passion for creating technology for people to enjoy. Does that mean my values are wrong? Should all people be pursuing what society deems the "noblest goal"?
I agree wholeheartedly with your comments on SpaceX and Elon Musk. What I don't understand is how you're relating SpaceX to the Instagram acquisition.
"Yet we're using all this power and the brightest minds on the planet... to send cat pictures."
So you're suggesting we have a problem because intelligent people don't always find the "right" ways to contribute to society? I think you should be directing your anger at those who spend their time sending cat pictures, rather than those who enable millions of people to do so simultaneously.
"Social" gave us evolutionary fitness. Does that mean that it could have a compounded effect bigger (inclusive) impact than "revolutionizing satelite launches"?...
Elon Musk first made his money in Paypal and then funded SpaceX. I think Krieger and Systrom will have exciting world-changing projects in the pipeline too.
Oddly, I think the most influential path to curing cancer is making a lot of money, gaining lots of power, and having more control to allocate societal resources.
SpaceX did not come from nothing. The science, technology and infrastructure that enabled SpaceX to exist was created by tax payer funded programs. I'm not saying he's not a great guy. I'm just saying he's standing on the shoulders of giants.
The taxes paid by people sending cat pictures funds the infrastructure that enables SpaceX to exist.
When the OP stated something from nothing I think he/she meant tangible 'things' from investment and research(ie. rockets). As opposed to Instagram which is a form of communication and entertainment that will forever exist within a software context.
Also keep in mind that there is a big difference between a billion dollars in the hands of someone as capable as Elon Musk (who also happens to invest all of his time and creativity), and a billion dollars in the hands of a random investor. The latter won't come close to the former in terms of returns.
then again:
-the wealth Bill Gates is using was generated (in part) by software intended to create office memos and clip art.
-much of the computing power mentioned above to change humanity for good comes from infrastructure designed to sell twilight novels and, yes, send cat pictures...
But the point that keeps resurfacing in my mind is SpaceX. SpaceX, from nothing, created a low-earth orbit delivery system that is revolutionizing satellite launches and (soon) the cost of getting men into space... for less than the price that a bunch of people can send photos to each other with cheesy filters [1].
It would be difficult to overstate the impact Elon Musk has had, is having and will have on humanity (and no this isn't hyperbole) through SpaceX (and maybe even Tesla). And it didn't even require, relate to or is connected with some bullshit social network.
I'm also reminded of Steve Yegge's OSCON talk [2] from some months back. The computer power we have available now is stunning. used for the right purposes it could fundamentally change humanity for the good, whether that be in bioinformatics or whatever, is hard to overstate.
Yet we're using all this power and the brightest minds on the planet... to send cat pictures. It's actually reached the point that when I get unsolicited recruitment email or read about some new startup on HN that I tune out as soon as I see the word "social".
There's something astoundingly depressing about all this.
EDIt: I should add that my issue isn't that the founders and investors sought wealth. I don't begrudge them that at all. Not by any means am I anti-capitalist. Bill Gates, as one example, is doing huge amounts of good with his accrued wealth.
The issue is more on what society values.
[1]: http://news.ycombinator.com/item?id=3857904
[2]: http://www.youtube.com/watch?v=vKmQW_Nkfk8