
Reconsider - josemrb
https://medium.com/@dhh/reconsider-41adf356857f
======
mangoman
I'm so freaking happy that someone finally affirmed my feelings that maybe,
just maybe, I don't need to start my own startup with the notion of "Unicorn
or Bust". I've just felt wrong since graduating college 3 years ago, unable to
motivate myself to hack outside of work, and this finally captures why I've
felt so tired. I am tired of feeling like I need a Unicorn idea to justify
working on something outside of my job. I want to work for myself, but it just
hasn't felt possible without a plan to "Take over the world". I don't want to
take over the world. I want to build something that people use and can sustain
me. That's it. But for every idea, there are millions of reasons in the back
of my head that stop me from doing it, all boiling down to "Well I just won't
be able able to grow this as a startup".

I don't really care about growing something as a startup. I don't need to
revolutionize anything. I just want to make someone's day better through
software. I want to launch a cool product that people find fun, silly, useful,
critical to their process, whatever you want, and NOT be beholden to interests
of anyone who isn't involved in the daily operations of whatever product that
is.

I just want to build something, and make it better every day. Something that I
own, that I can change however I want, whenever I want. I shouldn't have felt
like I needed a16z to invest in my company to believe that my product is worth
something.

~~~
junto
Personally this was my favourite bit:

    
    
      Because while that area north of Silicon Valley is busy 
      disrupting everything, it still hasn’t caught up with the 
      basic disruption of geography.

~~~
ryanSrich
As a remote worker and remote work proponent that was by far my favorite
quote.

~~~
TranquilMarmot
Any advice for finding remote work?

~~~
ryanSrich
Get an offer first. After that then say you'll only work remotely.

~~~
mahyarm
That is pretty funny solution, but it might just work sometimes. How much has
that worked for you?

------
jarek
Another submission for the flagged files.

As of 17:51 GMT, this submission is 3 hours old and has 374 points, 68
comments, sitting in position 11 on the HN front page

In position 10 is a submission from 8 hours ago with 100 points and 76
comments
([https://news.ycombinator.com/item?id=10505476](https://news.ycombinator.com/item?id=10505476))

In position 1 is a submission from 4 hours ago with 177 points and 91 comments
([https://news.ycombinator.com/item?id=10506338](https://news.ycombinator.com/item?id=10506338))

 _edit:_ This isn't to pass judgment on the merits of the article, which seems
a bit conveniently timed to a product launch linked at the bottom. But as a
community we should realize what gets flagged/pushed down and by how much.

 _update:_ at 18:51 GMT, this is 4 hours old, has 490 points, 97 comments, and
is in position 26. In position 25 is a 5 hour old submission with 57 points
and 15 comments
([https://news.ycombinator.com/item?id=10506372](https://news.ycombinator.com/item?id=10506372))

 _final update:_ at 19:24 GMT, this is off the front page at position 33. Age
5 hours, 536 points, 112 comments. In position 18 is a story from 10 hours
ago, 362 points, 192 comments
([https://news.ycombinator.com/item?id=10505362);](https://news.ycombinator.com/item?id=10505362\);)
the 10506372 story referenced previously is now in position 31, 62 points, 16
comments, 5 hours ago.

~~~
natural219
Is there seriously a list of HN flagged items somewhere? I fantasize about
this often when I try to explain to friends how much quality content gets
booted off of HN immediately these days. It's super heartbreaking and
infuriating when they don't know what I'm talking about.

~~~
jarek
Not that I'm aware of. I made that joke since it's the second submission in a
week I saw sunk far below its expected score (the Homejoy debacle was the
other,
[https://news.ycombinator.com/item?id=10469134](https://news.ycombinator.com/item?id=10469134))

~~~
natural219
This happens very often. It's not until you start noticing it that you start
noticing it.

------
rm_-rf_slash
People find themselves drawn to the unlikely startup success stories because
they have a beautiful allure to them: if I spend every night tucked away
writing code and focusing my entire life around my work, then maybe I, too,
can be the next Zuckerburg!

Even though this narrative is hugely removed from the realities of startup
life (most college startups go nowhere, the most successful founders tend to
be in their middle age with significant financial stability, etc), it is still
romanticized by founders and startup employees and other people who really
should know better. So then why do they buy it?

To get people to work harder for you. Spending every waking moment in front of
a customer or a computer screen eating bulk ramen sounds like a great montage
scene in the movie you'll have an EP credit in, and this distorted reality is
even easier to sell to impressionable young college grads who have maybe .1%
of the equity (in options!) that founders and VCs get to keep.

Why are jeans and hoodies the fashion choice of founders? Because if everyone
is used to dressing like a poor college student, they tend not to notice how
little they're truly being compensated.

This isn't some big founder/VC conspiracy, it's complicit common sense.

~~~
djrogers
> Why are jeans and hoodies the fashion choice of founders?

Because they're comfortable, familiar, and they can get away with it? I think
it takes a particularly cynical and angry mind to stretch the choice of
clothing to be a tool of oppression on the part of the founders.

~~~
rm_-rf_slash
If you research any culture at any time period, you will find clothing as a
method of control. Medieval European countries often banned commoners from
wearing violet, because the color was expensive and the ruling class wanted to
reinforce the idea that the nobility were fundamentally different and better.
Same goes for Jews in nazi Germany's being forced to wear yellow stars. The
way you get someone to dress influences the way they think.

It's the same as buying a few pizzas for your employees to get them to code
till sunrise instead of paying them proper overtime. Impressionable college
grads with little work experience elsewhere will take that kind of behavior
for granted, and assume it is the cost of their (measly) equity. Essentially,
you want them to be suckers. Comfortable suckers.

~~~
argonaut
_Any_ culture at _any_ time period? Are you sure about that? That's a
ridiculously strong claim.

------
mbrock
I'm eagerly awaiting the forthcoming geek poet who'll write our Howl. Who saw
the best minds of our generation destroyed by startups... their skulls bashed
open by a sphinx of capital... that moloch "whose mind is pure machinery...
whose soul is electricity and banks!"

[http://genius.com/Allen-ginsberg-howl-annotated/](http://genius.com/Allen-
ginsberg-howl-annotated/)

Moloch in whom I sit lonely! Moloch in whom I dream Angels! Crazy in Moloch!
Cocksucker in Moloch! Lacklove and manless in Moloch! Moloch who entered my
soul early! Moloch in whom I am a consciousness without a body! Moloch who
frightened me out of my natural ecstasy! Moloch whom I abandon! Wake up in
Moloch! Light streaming out of the sky! Moloch! Moloch! Robot apartments!
invisible suburbs! skeleton treasuries! blind capitals! demonic industries!
spectral nations! invincible mad houses granite cocks! monstrous bombs! They
broke their backs lifting Moloch to Heaven! Pavements, trees, radios, tons!
lifting the city to Heaven which exists and is everywhere about us! Visions!
omens! hallucinations! miracles! ecstasies! gone down the American river!
Dreams! adorations! illuminations! religions! the whole boatload of sensitive
bullshit!

~~~
saulrh
[http://slatestarcodex.com/2014/07/30/meditations-on-
moloch/](http://slatestarcodex.com/2014/07/30/meditations-on-moloch/)

~~~
mbrock
Thanks. I'm a few paragraphs in. Yeah, the poem is powerful because Moloch is
not only a stereotyped evil other. ("The capitalists.") We are Moloch. "Moloch
whose name is the Mind!" Speaking personally and unprofessionally, I feel a
grand loss of innocence from the time when as a dorky kid when I wrote Emacs
Lisp macros for fun. I don't blame others, I don't blame "capitalism," I don't
blame teh evil bankers. I simply want money so that I won't need money so that
I'll be "free," just like everyone wants this. I do appreciate what David has
been saying for years.

~~~
rm_-rf_slash
Capitalism is certainly worth blaming, at least for offering a lens to justify
the deterioration of the global middle class.

Essentially, the wealthy have come around to the idea as seeing the poor and
middle classes and resources to be exploited, like a coal mine, by offloading
their tax burdens onto them. The more people chafe under low pay and high
taxes, the more easily they can be tricked into thinking the social support
system is unsustainable and should be dismantled before people are taxed to
death.

People who created this mindset and let it fester know who they are. The rich
who benefit stay silent. That's why this generation of CEOs who may be highly
vocal about social issues tend to be conspicuously quiet about tax policy. For
every Warren Buffett, there are a dozen post-exit founders who are happy to
leave their capital gains tax rate where it is.

~~~
dragonwriter
> Essentially, the wealthy have come around to the idea as seeing the poor and
> middle classes and resources to be exploited, like a coal mine, by
> offloading their tax burdens onto them.

"Come around to"? That's the _central essence of capitalism_ , for which it
was criticized by the socialists who put the name "capitalism" on it in the
19th century.

~~~
vezzy-fnord
Correct me if I'm wrong, but wasn't the term "capitalism" originally coined as
a synonym for "wealth" (and particularly conspicuous wealth)? The novelist who
coined it was writing a satire, but its origin doesn't strike me as implying
an intrinsic value judgment.

~~~
dragonwriter
> Correct me if I'm wrong, but wasn't the term "capitalism" originally coined
> as a synonym for "wealth" (and particularly conspicuous wealth)?

I was referring to the socialist critics of the dominant system in the
developed world of the 19th Century who introduced and popularized the use of
"capitalism" it _as a label for an economic system_ (who, seem to be first
users of the term, though that's somewhat tangential to the main point I was
making.)

> The novelist who coined it was writing a satire, but its origin doesn't
> strike me as implying an intrinsic value judgment.

Presumably, you are referring to W.M. Thackeray's use in _The Newcomes_ in
1854, which is counted on Wikipedia, with reference to the OED, as the first
known use of the word in English; this postdates the early use of "
_capitalisme_ " in French to refer to an economic system, and even known
earlier uses _in English_ of "capitalism" to refer to an economic system [1].
Thackeray's use is somewhat oblique, and there seems to be some discussion
among people who care about these things whether it was about wealth _per se_
or some kind of attitude or orientation toward wealth. But, in any case, his
use isn't the first (even if it may have been original, not directly following
the others) and is a tangent from the use of the term to refer to an economic
system.

[1] e.g., W. B. Greene, _Equality_ , 1849.
[https://books.google.com/books?id=yCQ3AQAAMAAJ&q=capitalism#...](https://books.google.com/books?id=yCQ3AQAAMAAJ&q=capitalism#v=snippet&q=capitalism&f=false)

------
joeevans1000
This is brilliant. The one thing it doesn't go into is the harm that will be
done to healthy ventures when the bubble pops. Suddenly, everyone will have a
bad taste and healthy ventures won't be able to get sane necessary resources
and bridge loans, all thanks to the excesses of what's described in the piece.
Not engaging in the insane startup culture described isn't just a healthy
lifestyle choice, it's also taking a stand against a situation that will soon
very much harm the tech industry as a whole. When the tide rushes away from
the unicorn machine, it will carry away the innocent as well.

------
iamsohungry
Most of the time, "disrupt" is a euphemism for "put a Web 2.0 interface on".
You're not disrupting shit, you're putting whitewash on a shoddily-cobbled-
together product that other people have been doing better for decades. It's
all style and no substance.

If you're doing something new, you'll probably own the industry just by virtue
of being there first. But you'll also probably not grow to be super-huge,
because if you were solving a huge problem, it probably would have been solved
already.

The exception to this is when the problem _is_ huge, but the technology wasn't
there to solve it before: see search (Google), social media (Facebook), mobile
apps (Uber). And even then the conditions need to be just right (an app for
calling cabs would probably not have been nearly as successful if it didn't
coincide with a legal loophole that allows them to undercut the taxi
industry).

But most ideas aren't those ideas. And that's okay. A business that solves a
real problem, even if it isn't a huge problem, will likely be able to stay
alive, profit, and grow just fine. Those "disrupting" companies that are all
style and no substance will crash and burn when the tech bubble pops.

------
nrao123
I am big fans of 37s. I learnt a lot from reading thier blog posts especially
thier unconventional (at that time) thinking to avoid crazy detailed
requirement docs, focus on blank error states etc...

However, DHH's constant railing against the VC backed world seems a little
tiresome. There seems to be a religious fervor to his essays that thier way is
morally better (e.g. thier business model seems like a honest transaction vs
VC backed startups who inflate numbers etc).

I think a lot of people get that raising VC is not the only way to build a
business (there is even a nice tradeoff statement (do you want to be Rich Vs
King).

It's a choice one makes. It's not morally inferior or superior to raise VCs or
to bootstrap.

~~~
CPLX
> focus on blank error states

What does this phrase mean?

~~~
ralmeida
I believe s/he meant blank and error states - the screen the user sees when
there is no data to display.

In short, 37 signals believe this screen should not display an empty list, but
instead serve as a guide to the user. This is commonplace now ("You have
nothing to read yet, [button]add someting[/button]"), but first mentions of
this are from over 10 years ago:
[https://signalvnoise.com/archives/000375.php](https://signalvnoise.com/archives/000375.php)

------
cellover
I am in the process of creating a startup business with 2 partners.

Our ultimate goal is NOT to get rich, is NOT to be famous, is NOT to be valued
billions of rubles.

We want to be free, we want to work on the projects that motivate us, we want
to make our own decisions and decide when it's good to work and when it's not.

For me this is the most motivating part of this adventure. I can totally
relate to this article and it even gives me hope in our way of doing things.

~~~
NoCulturalFit
Make a living basically? Can work on both ends, like cutting your costs. I
wonder how much you would have to be living on annually in order to have a
decent idea work? Is $20k too high?

I've been working on that more than my startup recently.

We could live on $20k annually for at least 4 years. Now I am trying to figure
out a SaaS that could generate that within a couple of months. I don't mind
fighting with price even though that's what you're not supposed to do.

~~~
cellover
Maybe I should have added the 3 of us are still employed in companies. So we
are in a somewhat comfortable position. we are already making a little bit of
money that compensate for the administrative and infrastructure costs (which
are ridiculously low at the moment).

We estimate that the company should earn around 25k € every month so we could
quit our jobs but again our costs are very low so far.

I'm not sure to properly understand your question here ; you want to have a
side business so you can concentrate on your main startup?

Anyway, good luck with your business(es)!

~~~
NoCulturalFit
Nah I actually have no employment (no cultural fit anywhere) - so I am
focusing on (or figuring out) building something that could generate income
pretty quickly, though I understand the size of the income wouldn't be big, so
I've cut all my costs down for me and my family to $20k annually.

Living on savings for now, which runs out in a couple of weeks.

------
bjacks
I love this part of the article, it's incredibly important to remember this:

"The web is the greatest entrepreneurial platform ever invented. Lowest
barriers of entry, greatest human reach ever. I love the web. Permission-less,
grand reach, diversity of implementation. Don’t believe this imaginary wall of
access of money. It isn’t there."

~~~
yesimahuman
I believe that the next evolution in startups is full recognition of this
fact. Costs are practically zero for building viable SaaS products. Great
developers are everywhere. This isn't just over optimism, it's largely true.
What will that mean for startups and capital? My prediction is we will see new
models, more "startup factories," etc. Interesting times.

~~~
ryanSrich
> Great developers are everywhere

This is predominantly false. I would edit Great to mediocre.

~~~
ryandrake
Which does not diminish the original point. Everybody says they will only hire
genius top-1% programmers and that's usually ridiculous. For the vast majority
of products, you don't need 20 great developers to build it and make it great.
You can do it with 20 mediocre developers and one or two great leads who can
mentor and help them perform at their best.

~~~
strayptr
If that's true, then it should be easy to name some startups that fell into
technical mediocrity and recovered. Are there any?

I saw the opposite happen firsthand: a company that was about to get
steamrolled by a competitor, and they knew it. There was nothing they could
do, even though they had over two years to prepare. The reason they couldn't
do anything was because their team was mediocre. Last I checked, that company
no longer had any job listings.

How many people here have similar stories? It's tempting to believe that
mediocre programmers can be mentored, but it doesn't seem that simple.

------
lojack
I think DHH (and a lot of people) miss out on a lot of modestly growing
startups that are doing relatively boring things because they don't hear about
them. It's not that they don't exist. They just don't hear about them because
they're relatively boring.

The vast majority of (moderately successful) startups I see friends and
colleagues starting or working for are in this group. For every one friend I
see go work for a company like Uber, I see 10 more working for a startup that
builds software for expense reports or HR teams or insurance companies or old
school cab companies. They will never be billion dollar companies, and they
probably won't IPO, and they may be an acquisition target -- but that
certainly isn't their end goal. They are gaining customers and growing
relatively sustainably, making smart choices about when to (or not) take
outside funding.

~~~
javajosh
Actually, he mentions that such startups don't need to tell their story like
VC-funded startups do, to meet their recruitment goals, and so VC startups
dominate the zeitgeist.

~~~
morgante
Most of those "modest" startups are also VC-funded.

~~~
mattmanser
Last time I looked through the YC alumni list
([http://yclist.com/](http://yclist.com/)) I was surprised at how heavily it
was skewed B2C though. I haven't checked since W15 was added but a quick skim
and it still seems fairly B2C focused.

It's in their request for startups though. Seed funds don't seem to be an area
that attracts B2B.

I suspect it's because you have to be in the industry to understand the
problem exists in the first place, so a huge segment of the YC applicants
simply don't know about those opportunities as they've not worked in industry
and only know about B2C opportunities.

~~~
morgante
YC is not the VC industry as a whole. For one thing, it (like SV) skews much
younger and much more consumer than VCs in general. There are plenty of VCs
who invest mostly in B2B companies started by founders with domain expertise.

------
smackay
The documentary, Hoop Dreams by Steve James and Frederick Marx captures the
mania around startups just as well as it does for getting into the NBA. It's
well worth watching.

[https://en.wikipedia.org/wiki/Hoop_Dreams](https://en.wikipedia.org/wiki/Hoop_Dreams)

“Many are called but few are chosen”, Matthew 22:14

------
gmarx
I don't think early investors dubbed themselves "Angels". If I recall
correctly it came from the term used for similar people who used to finance
Broadway shows. I like to think some ingenue in the 1920s called some rich guy
"angel" and got him to fund a show and it went from there. I should Google it
but I miss speculating on things...

------
sithadmin
>Part of the problem seems to be that nobody these days is content to merely
put their dent in the universe. No, they have to fucking own the universe.
It’s not enough to be in the market, they have to dominate it. It’s not enough
to serve customers, they have to capture them.

I think this says more about the state of VC than startups themselves.
Founders feel that if they don't run around banging pots and pans while
tooting their own horn/vuvuzela, they won't ever get any attention from
investors. Crowdsourcing early funding is just going to make this worse.

------
jw989
I really enjoyed reading this.

However, I personally feel distain for the perspective of how every engineer
should maintain a noble sense of worth. No matter the environmental
differences of being in SF or elsewhere, people are bad at engineering wall to
wall. While there are still successes at both sides of the coin.

Frankly, 'Software eating the world' has nothing to do with us. It has to do
with, well, the world. And my own struggle with the tech industry is how
disconnected we are in the 'startup and grow' sector.

------
DigitalSea
"I wanted a life beyond work. Hobbies, family, and intellectual stimulation
and pursuits beyond Hacker News, what the next-next-next JavaScript framework
looks like, and how we can optimize our signup funnel."

 _drops the microphone_

What a great article. I am glad someone finally said something.

------
S4M
I find interesting that this article, that got 541 points (at the time I am
writing this) is out of the front page already. Makes me wonder if there is
the hand of people (VCs) _not_ wanting programmers to aim for lifestyle
business behind that.

------
chejazi
I think many founders echo his motivations. The one that he implicitly
suggests is misaligned is:

 _I wanted the best odds I could possible get at attaining the tipping point
of financial stability._

And that this is due to the corruption of investors. So I guess the takeaway
is that if you raise money, choose your investors wisely.

------
manigandham
I'm surprised this needed to be said.

There are millions of small businesses (in the US) and the vast majority of
them are just lifestyle businesses that bring freedom/pleasure/excitement to
the owner with perhaps a possibility of earning more, but there are many that
earn less than what they could make at a regular job with their same
experience.

This whole world domination startup thing seems to be localized to SV really.
Nowhere else is this considered normal.

By the way, there's a lot of confusion with just the term "startup" in general
when it should really be reserved for something new (biz model, innovation,
etc). If you're just doing something that's already been proven, which is
completely ok, then it's just a small business.

~~~
zeckalpha
Basecamp isn't a small business, nor does it stick to the already proven. They
are constantly trying new things, and spinning out other companies when
they're successful.

~~~
manigandham
Perhaps it isn't now but this whole thread is mostly referring to the start of
a company in which case everything is a small business.

Basecamp with 50 people is still small to me, I'd say companies need at least
100 people before they can be called mid-size.

Trying new things means the other spun-out companies are startups. Basecamp
itself is nothing new, just different software solving the same problem as
hundreds of other project management and collaboration tools.

~~~
zeckalpha
What about executing an already "proven" idea really well?

~~~
manigandham
What about it? It's already proven so still nothing new. Just new version.

I think new can be summarized as a new business model, new way to monetize
something, new innovation like a product or service that didnt exist before,
new industries in general, etc.

There can be multiple startups doing the same problem but most "startups" in
SV aren't really doing anything new, just a more modern approach or revamped
UX of existing solutions so I wouldn't call them startups. There's nothing
wrong just being a small business that grows into a medium and large business.

Not everything has to be brand new and it's not always worth it either.

------
mmphosis
_But in the end, they’re money lenders._

------
sholanozie
Greed, lust, and gluttony. Three personality traits our money-focused society
selects for.

~~~
lgieron
Given how fit the people in California/NYC are, I'd say gluttony is off the
table.

------
zeeshanm
The reality is you can't accomplish anything meaningful in life without being
uncertain. It is OK to be unsure. It is OK to do things that are not sexy. It
is OK to make small incremental improvements.

Unicorns happen over time. Smart founders have patience and resilience to
weather many storms ahead.

------
codingdave
"Lifestyle companies."

They are everywhere... but we are quieter than high-growth startups. Many of
us work for them. We enjoy it. If anyone was not aware of their presence, step
outside of the VC-driven culture. There is a whole other world out there.

~~~
triangleman
Even the term "lifestyle company" sounds like a mocking label straight out of
Silicon Valley.

------
juddlyon
This post really resonates with me. I think there is a "silent majority" type
of situation going on. Most people venturing out do it for the reasons DDH
states: independence, the ability to work with people of your choosing, etc.

Most of us don't care about winning some ridiculous lottery where smarmy Wall
Street types stakehorse tech wunderkinds.

Things have a way of balancing themselves out.

------
svckr
At the end I pictured David, standing on stage, stared at by the audience.
After a brief moment of silence, he drops the microphone. A loud crack echoes
through the PA, followed by screeching feedback, before the audio engineer
remembers to turn down the volume. Meanwhile David turns around, calmly
stepping down the stage to be detained by the (Ge)StartupPolice…

------
namocat
Relevant bit from the latest season of the Startup podcast:
[https://youtu.be/qfpdzPnElVU?t=738](https://youtu.be/qfpdzPnElVU?t=738)
*spoiler alert - this is toward the end of the season, in case you'd rather
listen to the podcast in order

------
nialllarkin
Eloquently expressed pov as we've come to expect from @dhh. Legend. Now what
I'd love to hear is from founders of @stripe and @intercom as they have both
lived the experience of developing 'lifestyle' scale businesses before
bringing unicorns to the market

------
morgante
> In the abstract, economic sense, a 30% chance of making $1M is as good as a
> 3% chance of making $30M is as good as a 0.3% chance at making $300M

I see this repeated as a truism all the time by the anti-VC crowd and it
sounds great. But is there actually any evidence whatsoever of it?

The success rate for startups which have raised a Series A is substantially
higher than the success rate for startups and small businesses in general. If
it were _true_ that avoiding VC funding somehow gave me a 30% chance of
building a $1M business, I'd be happy to give it a shot (at least for a year
or two). But I just don't see any evidence of that.

If anything, it seems like companies which accept VC money have dramatically
better odds of success than other startups. The only reason it seems like VC
has a high failure rate is that nobody bothers to write a news article when a
random small business fails.

EDIT: Downvoters, kindly provide _any_ evidence that avoiding VC funding
increases your odds of success by 10x.

~~~
mcphage
> Downvoters, kindly provide any evidence that avoiding VC funding increases
> your odds of success by 10x.

It's not so much, avoiding VC increases your chance of success by 10x. It's
not easier to reach a $1M business without VC than it is to do so with VC.
However, if you don't have VC, then a $1M business is probably a relatively
stable company. But if you do have VC investment, they're looking for a high
return on that investment, and so they won't be satisfied with a $1M business.
They'll want that $30M business, which _is_ harder, since the goal is so much
higher.

~~~
morgante
If you've only raised enough money to get to $1M, then you probably haven't
given up majority control and can choose to keep the business at a small size
if you want.

------
wnevets
Sounds like the plot of silicon valley.

------
Futurebot
I like this post, but we should contextualize it properly, and look at where
it doesn't work. Things have developed over the past forty years which don't
allow the "start small, stay small" to always be a possibility: the increase
in winner-take-all markets and the Superstar effect. We see it everywhere when
it comes to today's job markets, and we also see it (and _potentially worry
about it being the case, and this is critical_ ) in industries themselves.
This latter belief means that if you decide to start something, you may need
to consider whether you should bother at all if you aren't going to go big.

Is Uber in a winner take all market? If so, they have no choice but to operate
the way they do: [http://www.vox.com/2014/12/4/7336433/uber-
worth-](http://www.vox.com/2014/12/4/7336433/uber-worth-)

We see it in regular job markets more generally (where we call it job
polarization):
[http://economics.mit.edu/files/5554](http://economics.mit.edu/files/5554)

We see it in "art, sports and culture" markets (where we call it the Superstar
effect): [http://www.nytimes.com/2014/02/23/business/winners-take-
all-...](http://www.nytimes.com/2014/02/23/business/winners-take-all-but-cant-
we-still-dream.html)

[http://marginalrevolution.com/marginalrevolution/2010/09/win...](http://marginalrevolution.com/marginalrevolution/2010/09/winner-
take-all-economics.html)

[http://www.nytimes.com/2010/12/26/business/26excerpt.html](http://www.nytimes.com/2010/12/26/business/26excerpt.html)

We see it in newspapers:

[http://thinkprogress.org/yglesias/2010/09/10/198480/technolo...](http://thinkprogress.org/yglesias/2010/09/10/198480/technology-
and-the-top-one-percent/)

We see it in attention more generally (which has second order effects, like
everyone use just one or a handful of large platforms(!) and where we call it
variations of "winning in the Attention Economy"):
[https://en.wikipedia.org/wiki/Attention_economy](https://en.wikipedia.org/wiki/Attention_economy)

So the choice is sometimes (perhaps even often today) not between "get big" or
"stay small/medium", but get big (where big may represent firm size, level of
knowledge/skill, fame, or a number of other attributes depending on the area)
or "get (almost) nothing." When the distribution of customers/eyeballs/rewards
are as lopsided as they are in many areas, the only choice IS "get big or go
home."

More:

[http://www.slate.com/articles/business/moneybox/2011/12/how_...](http://www.slate.com/articles/business/moneybox/2011/12/how_technology_and_winner_take_all_markets_have_made_income_inequality_so_much_worse_.html)

[http://marginalrevolution.com/marginalrevolution/2010/09/win...](http://marginalrevolution.com/marginalrevolution/2010/09/winner-
take-all-economics.html)

[http://prospect.org/article/talent-and-winner-take-all-
socie...](http://prospect.org/article/talent-and-winner-take-all-society)

I don't knock dhh, and this is one of those posts I actually want to agree
with, but it doesn't neatly comport with extant realities. I think even this
advice, just like the advice to "get big" needs to be taken very carefully.
All of these roads entail risk (obviously), but the choice of big versus small
isn't as simple as implied.

~~~
dreamdu5t
Do you have any data for a dominant trend that small players can't compete
with big players?

From where I'm sitting, I see the exact opposite. There are very few
businesses that have few competitors.

~~~
Futurebot
The articles (and books/papers they reference) have copious examples. Here are
just a few:

Search Engines Top four market share: 98.5% Major companies: Google: 64.1%
Yahoo: 18.0% Microsoft: 13.6%

Arcade, Food & Entertainment Complexes Top four market share: 96.2% Major
companies: CEC: 52.2% Dave & Buster’s: 35.0%

Soda Production Top four market share: 93.7% Major companies: The Coca-Cola
Company: 41.2% PepsiCo: 33.6% Dr Pepper Snapple Group: 15.4%

Lighting & Bulb Manufacturing Top four market share: 91.9% Major companies:
General Electric Company: 32.9% Koninklijke Philips Electronics NV: 31.7%
Siemens AG: 27.3%

Major Household Appliance Manufacturing Top four market share: 90.0% Major
companies: Whirpool Corporation: 43.8% AB Electrolux: 20.7% General Electric
Company: 17.1% LG Electronics: 9.2% Market concentration

Mobile OSes (iOS and Android) are another, even if no one can make money on
the software itself anymore.

Banking software (FIS, Fiserv, Jack Henry, and D+H): 96% total

Internet service providers (a few large players, with a smattering of regional
ones. Some areas are served only by a single company.)

Wireless providers (AT&T, Sprint, Verizon and T-Mobile) have roughly 80% of
the market.

Here's a nice infographic:

[http://www.theatlantic.com/magazine/archive/2013/04/the-
char...](http://www.theatlantic.com/magazine/archive/2013/04/the-
chartist/309271/)

This is not to say that this applies to every market. There are competitive
markets without clear winners (in some of the above cases, the markets are
competitive oligopolies - but that doesn't help the "I just want to make a
nice living as a small player" idea - you still need to be huge in those
cases.) However, with the increase in mass communication, economies of scale,
picked low hanging fruit, clustering effects, and concentration of
talent/capital/connections, the trend has been towards winner-take-all (either
through pure domination, like search, or industry consolidation, like health
insurance.) Eking out a living at the margins is possible, but as I stated in
the other comment, has its own set of attendant risks.

------
MrBra
That Terry Davis comment :)

------
joesmo
What a well-written piece. I agree that there is a lot of room for
sustainable, technology based businesses. These are businesses that can
optionally be run remotely and don't need to limit themselves to the bay area
and its insane startup culture. They can work sane hours and be sustainable
for their employees. They can provide products of real value. In fact, this is
exactly the type of business that I'm interested in, the only kind with a
success profile that's not tantamount to the success of playing the lottery,
and the only kind where one can hope to stay in control and "be one's own
boss."

These types of businesses are very much startups, but have a more traditional
philosophy and generally plan to stick around for longer than a few years. I'd
say such businesses are often a lot riskier for the owners as they're
generally risking their own money and time to get it developed rather than
someone else's money. Spending someone else's money is not risky at all.
Failure in a silicon valley startup isn't a real loss: it's expected.

The people who venture out on their own and take their own risk with their own
capital and time should be applauded for trying to create sustainable
businesses that might be beneficial to the wider economy and society rather
than creating ones that try to dominate a market for a couple of years and
then almost inevitably fade out (as most startups do both before and even
after IPO), not really adding much to the economy or society at all, while, of
course, screaming the obligatory "I will change the world" mantra. In fact,
it's this idiotic mantra and the lies one must tell oneself to actually
believe it that turns off a lot of great talent form the silicon valley
startup version of a business. Most smart people can eventually see through
such simple, repeated, dogmatic ideas easily, and don't like to be associated
with the brainwashed masses for whom these ideas are reality.

------
draw_down
Not that I disagree with the main premise, but boy oh boy why waste time
skewering terms like "Angel" and "liquidity event". Sophomoric.

~~~
beat
Because it's fun? Personally, I take great pleasure in roasting sacred cows
and eating them in front of the shocked faithful. I'm sure DHH does too.

~~~
MichaelGG
Do you really think anyone was "shocked" or that this was "roasting sacred
cows"? It basically said " uh you can have a great life without seeking a huge
exit, and your chances might be better, too". Do people actually take this
stuff that seriously?

------
Chrossler
Not reading. Someone summarize?

~~~
tommoor
There's probably a startup for that

