

Predict Whether a Startup Will Succeed or Fail - sanj
http://www.xconomy.com/seattle/2010/04/28/how-to-predict-whether-a-startup-will-succeed-or-fail-testing-the-disruptive-innovation-model/comment-page-1/

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sanj
I'm troubled by this line:

* ARM processors are cheaper and worse [than Intel chips] *

Beyond the fact that they have a very different profile and are optimized for
mobile, I don't think of ARM chips as "worse" in any sense. Their instruction
set is beautiful where Intel's is... not.

~~~
10ren
That sentence continues _but they’re getting faster with Moore’s Law_. They're
worse in terms of speed.

They are described as a threat to Intel in terms of Intel's market, the
desktop, ie. they may invade the desktop from beneath, which would be a
classic disruption.

~~~
jacquesm
Typical apples & oranges comparison. Arm chips have been optimized for an
entirely different use case, the parameters are probably more closely related
to stand-by power when idle and mips/watt.

To simply use the 'speed' metric when comparing a < 1W CPU with a > 30W cpu is
dumb.

Arm chips will not enter the desktop market any time soon, the ARM
architecture is for the moment solidly stuck in 32 bit address space and then
there will be the problem of convincing a company the size of microsoft to bet
on a different architecture.

This will happen in due course, but not in the next 3 to 5 years.

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shalmanese
85% on a yes/no decision sounds more impressive than it actually is. The
majority of startups fail so the baseline is somewhere above 50%. What would
be more interesting is if it could calculate expected value at better than
chance.

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acgourley
Right, simply predicting 'no' in every case could be right 80% of the time if
you believe someone people's number on startup success.

On that note, I wish we had a better data set of attempted startups and
general agreement on when a startup 'starts.'

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10ren
> better is actually a con because it will invoke a competitive response.

Be stealthy, young startup, and non-threatening.

SINGLE-PAGE VIEW [http://www.xconomy.com/seattle/2010/04/28/how-to-predict-
whe...](http://www.xconomy.com/seattle/2010/04/28/how-to-predict-whether-a-
startup-will-succeed-or-fail-testing-the-disruptive-innovation-
model/?single_page=true)

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briancooley
I would be interested to see exactly what is meant by "worse." One of the
common lean startup themes seems to be that a simpler product can be an
advantage over incumbents who have succumbed to feature bloat. I surmise that
simpler might equate to worse according to the metrics used in the analysis.

~~~
patrickk
I think by "worse" it means sheer performance.

Think electric cars being generally underpowered and containing heavy
batteries compared to their internal combustion engine counterparts which are
powered by millions of years of natural geological processes distilled into a
convenient liquid. Naturally, electrics are getting better over time. Ford and
GM must have laughed for years at those silly beatniks and their wacko
electric vehicles, but now GM is betting it's future on electrics.

37Signals' products deliberately do less than their competitors (less
performance? the analogy doesn't really fit here) but are highly successful.

~~~
10ren
It can be sheer performance; going by _the innovator's dilemma_ , in general
it is whatever attributes are higher-ranked by the market (ie. customers).
This makes sense, because that is what incumbents naturally worry about, and
what they compete on. So if your startup is _worse_ on those attributes, you
don't threaten them, and they leave you alone.

So what's the point of your startup, if you're worse for customers? You're
better for other people, who _aren't_ customers of the incumbents, and who
rank the attributes differently. There's lots of examples.

The _coup de grâce_ is when both you and the incumbent improve over time, but
the incumbent becomes _better than it needs to be_ for its existing customers
on those attributes, and your startup becomes _good enough_ , but you also
have those other attributes - then the incumbent's existing customers switch
to you, and incumbent dies. It doesn't always go that way, but it does happen,
and that's the pattern studied in _the innovator's dilemma_.

Incidentally, electric vehicles were popular at the dawn of the car; even
edison was developing batteries for them. They've been overtaking the petrol
car for a _long_ time. But they have made inroads in other markets, such as
those disability wheelchair carts (I'm not sure exactly why they're a better
fit for electric, but they are certainly not a focus of incumbent car
manufacturers - and maybe that's the important thing).

sorry, I can't help explaining this whenever it comes up, whether it's needed
or not. It's such a cool observation.

~~~
patrickk
No need for apologies, I find this kind of stuff fascinating.

" _In 1906, Fred Marriott drove a steam powered vehicle built by the Stanley
Brothers to an amazing speed of 127.659 MPH._ "

<http://www.steamcar.co.uk/lsr_history.html>

I think this is amazing considering the time it happened.

Henry Ford himself experimented with corn oil and ethanol as a fuel source for
his vehicles in 1942:

[http://en.wikipedia.org/wiki/Henry_Ford#Interest_in_material...](http://en.wikipedia.org/wiki/Henry_Ford#Interest_in_materials_science_and_engineering)

It's amazing that cars evolved to run on refined oil at all! I know I've gone
completely off topic here ;-D

~~~
10ren
127.659 MPH that's terrifying. Talk about a steam punk.

I like Ford's plastic car... sounds like the soviet niva (sp?) made of
plywood. Easy to ridicule, but cheap, economical, though not that safe.
Unfortunately, once cars went mainstream, cool became the key attribute.

It's nice to observe that even the most famous inventors had many failures;
you only need one success (probably, s/even/especially/, because more attempts
--> more successes).

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alanthonyc
The main nugget:

 _But if [this model is] so successful, why haven’t more people—entrepreneurs
and investors in particular—adopted disruption theory? Probably because models
for predicting how companies will do are a dime a dozen_

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jiaaro
sounds like an argument for release early, release often

be crappier and cheaper and as you gain marketshare, improve

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baguasquirrel
Explain Google and Apple then?

Google's main selling points were that (1) it was bloody fast, (2) the search
results were better than everyone else's back then and (3) there were no
banner ads, which helps (1) a lot.

Apple's main selling point, in its revival form, was that people are willing
to pay more for a product that is a work of art.

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ekanes
Single-page view: [http://www.xconomy.com/seattle/2010/04/28/how-to-predict-
whe...](http://www.xconomy.com/seattle/2010/04/28/how-to-predict-whether-a-
startup-will-succeed-or-fail-testing-the-disruptive-innovation-
model/?single_page=true)

