
We Just Thought, 'This Is How You Start a Company in America' - staunch
http://www.forbes.com/sites/groupthink/2014/10/21/we-just-thought-this-is-how-you-start-a-company-in-america/print/
======
kevin
"We started in January 2012, and may still be the only Asian YC founders
ever."

So that is not true. 9gag is from Hong Kong. Semantics3 is from Singapore.
Strikingly is from China. Memebox is from Korea. Cleartax is from India. Those
are just off the top of my head, I'm sure there are more.

That being said, I actually would love to see more Asian startups applying to
Y Combinator. We should be funding one from each country EVERY batch, not just
averaging one per batch. I've made several trips to Asia now talking with
startups to try and better understand how YC can do a better job and what is
it about their ecosystem that makes the Asian startup scene so different. For
example, I did office hours with over 60 Japanese startups trying to
understand why it feels different over there. What surprised me the most was
how much we take for granted here in the US about our startup ecosystem and
values.

My plan is to write this all down in depth soon and figure out what actionable
things can be done by YC to help. Stories from companies like AnyPerk help,
but so much more needs to be done by us to reach out to founders out there.

~~~
blackkettle
In Japan at least, there is a very different mainstream cultural perception of
'startups'. It is basically not OK to try one and fail - you do not get credit
for trying, and it can have a significant negative impact on your career if
you do not succeed. There is a small, fairly tight-knit community within which
this is obviously not the case, but mainstream Japanese culture still takes a
conservative, and predominantly dim view of the 'startup'.

~~~
patio11
And by "significantly negative" read "You have forever passed on the
opportunity to work at any Japanese megacorp." Think of an alternate universe
America where AmaGooBookSoft did substantially all of the hiring at
universities and if, on the day you were invited to interview, you said "Oh I
am exploring a startup so I don't want a job this minute" that barred you from
them for life:

------
xnull2guest
How you start a (tech) company in America:

* Move to the valley.

* Come up with a really good idea. Or at least a gimmick that will be a fad for a time.

* Find a generous person from the upper echelons of the wealth distribution (or a club of them) who have enough money to fund your idea or gimmick.

* Make a deal with them so that your business becomes part of their diversified portfolio. The risk to them is hedged by being broadly invested. The risk to you is a real ultimatum of your time.

* Work tirelessly and thanklessly. If you do succeed you will give a large part of your company, and many times control, to your patrons.

* Furthermore, because you've waited as long as possible to IPO all of the initial growth to launch your business into 9 or even ten digit figures has been captured by the upper class - the common man never had a real chance to invest in your idea.

* That's okay though, the common man probably isn't paying you with dollars anyhow. You're probably collecting his data for sale and for advertisement (or rather partnering with a company that does for you).

~~~
wyager
>the common man never had a real chance to invest in your idea.

This part of your very pessimistic comment is certainly true, and I would like
to point out that this is the government's fault, not Silicon Valley's. People
who aren't rich are legally not allowed to invest in startups. [1]

But the unstated major premise of your comment, which is wrong, is that
investment in startups is some kind of magic bullet for making tons of money.
This is demonstrably not the case. One of the common justifications for the
law in [1] is the fact that high-risk investments like startups are not
necessarily any better than traditional low-risk investments (like stocks in
big companies), and (by some metrics) are worse.

1\.
[http://www.sec.gov/answers/accred.htm](http://www.sec.gov/answers/accred.htm)

~~~
xnull2guest
I completely agree that VC is not a magic money making bullet, but I don't
think it matters for the post.

Certainly there are patrons who will lose money. Having a portfolio full of
lemons isn't going to make any financial elite any money. Most will hire
accountants and financial and technological advisors. Some will provide extra
services (advice, contacts, demo day audiences, etc) to bolster the prospects
of their portfolios. Some will fail anyway. The ones who stick around are the
ones who are good at it.

The real unstated major premise of my comment is that it is essentially
impossible to be a self-starter unless you are already rich, which (along with
the other stated bits) implies that growth in the tech industry concentrates
wealth and that there is a mobility problem that runs counter to our nice
cultural myth about geniuses in garages.

------
downandout
You do not necessarily need to _start_ in the Valley to become successful,
especially if your situation there imposes additional hurdles to success.
Living out of a car or tenement is generally detrimental to one's ability to
focus on the business.

It's always amazing to me that as tech entrepreneurs we largely sell to others
the idea that technology enables us to do anything from anywhere, but
simultaneously believe that there is exactly one place on earth where _we_
must phyiscally be to get anything done. The ideal place to start a startup is
anywhere that your day-to-day life issues can take a backseat to working on
your startup.

~~~
rokhayakebe
From random readings, it appears that great musicians, scientists, artists
live not only during the same era, but usually very close to one another.

I guess today you could call the Internet the city/town.

There is also something to be said about what _seems_ to be serendipity. When
there is a high concentration of people doing the same thing, you are more
likely to bump into people who can help you turn your vision into a reality.
This is why you hear the joke "Go to jail with a bachelor in theft, come out
with a PHD in insert_high_level_crime_here."

~~~
_reality_check_
> From random readings, it appears that great musicians, scientists, artists
> live not only during the same era, but usually very close to one another.

I'm highly skeptical of this claim. Can you back it up?

~~~
applecore
There are several well-documented examples throughout history: Vienna at the
turn of the twentieth century[1], and the Florence Renaissance during the
fifteenth century.

[1]: [http://www.amazon.com/The-Age-Insight-Understand-
Unconscious...](http://www.amazon.com/The-Age-Insight-Understand-Unconscious-
ebook/dp/B0050DIWV6)

------
driverdan
Living in a Mission dump trying to sleep three people to a bed is _not_ how
you should be starting a business. Why do people think this is how you
optimize for success?

~~~
tatterdemalion
Right. Nothing against this company and all the best to them, but what is the
larger narrative this story is building? Its really exploitative to tell young
people that they should come to one of the most expensive places in the world
and sleep in their cars so they can have the privilege of giving equity to Y
Combinator.

It's something really dark in California's culture (I have lived my entire
life here). From '49 to Hollywood to now Silicon Valley, its a reverberating
call for people to come here and get rich quick. And in any gold rush, its
always better to be the ones selling the pics and shovels than the ones buying
them.

~~~
coralreef
I think a lot of the time people miss the positive side of these stories.

It's not just a story of impoverishment, its also story of adventure. If you
were going to backpack around the world, you're certainly going to be sleeping
somewhere dumpy, eating poorly, dealing with crazy situations, etc. But thats
okay, because you've accepted that you're trading off comfort for some unique
experience.

When I was a teenager, my friend would crash at my house and we'd just hack on
our websites, play computer games, and occasionally step outside. For weeks at
a time, that's all we'd do. And honestly it was some of the most fun and
fulfillment I've ever had.

You don't really get to do that as an adult, except in extreme cases like when
you try to build a startup. Life isn't about necessarily optimizing for
comfort or salary. Sometimes its more fulfilling to do what you want to do,
where you want to do it, on your terms.

~~~
tatterdemalion
I absolutely agree, but people need an honest appraisal of the situation. You
should be making these sorts of decisions because this - in the moment - is
the lifestyle you want, not because you believe it will make you a founder of
the next WhatsApp.

~~~
coralreef
I'm a bit more laissez-faire about the messaging behind these stories. Your
assumption is that young, naive founders are being suckered and exploited by
the perpetuation of these stories, because they don't need to live such
extreme lifestyles to be successful. This is partially true.

But we already know that we all can't be winners, and most ideas will be
losers anyway. In our subgroup of grinders, I don't know that there is a
significant statistical difference in the outcome vs the normal population of
startups. But heuristically, we know that people willing to put themselves
through more pain are objectively tougher, and harder to kill. Traits that
probably are pretty good to have for a startup entrepreneur.

Thus, I don't think its such a bad thing for entrepreneurs to do, even if its
for the wrong reason. We don't need to protect anyone from themselves,
startups are such an extreme experience that they'll quickly know whether or
not they're happy with their decision.

~~~
tatterdemalion
Sure; I'm not saying no one should do this - and definitely not saying that
people shouldn't be allowed to do this.

What I think is a problem is the way that it is memetically emerging into a
life narrative. To take an example that is probably not controversial - many
people are going to college who really should not be. It isn't advancing their
interests and often isn't even intangibly edifying for them. Why are they
going to college? Because there's a cultural messaging telling them to go to
college. Their ability to self-determine is being undermined by a larger sense
of what they are supposed to do.

So if there's a narrative that you should eat ramen, work 100 hour weeks, so
on, to try to catch the Zuckerberg lottery - well, who wins in that game? A
few of the people playing, and also the VCs.

~~~
to3m
Time to roll out my favourite Venkatesh Rao link, I think:
[http://www.forbes.com/sites/venkateshrao/2012/09/03/entrepre...](http://www.forbes.com/sites/venkateshrao/2012/09/03/entrepreneurs-
are-the-new-labor-part-i/)

EDIT: I submitted it to the front page as well, for good measure:
[https://news.ycombinator.com/item?id=8510967](https://news.ycombinator.com/item?id=8510967)

------
reduce
Nice story. I'm so tired of hearing all the "get rich without stressing
yourself - by using this one simple trick" folks. Not that I encourage going
to extremes for no purpose, I just don't see these as extreme at all. Just
determined.

Sharing a room with a few people for a little while to save the last bit of
money? I just call that camping and adventure, which some people actually seem
to like. Have the commenters here never been camping? Travelled on a small
boat? Been in competitive sports? Hiked a mountain? And they cry about sharing
a room for a little while? What a bunch of wimps!

~~~
jarek
When most people go camping it's not because they can't afford a flat

~~~
reduce
Yup, pure ego. Competing to be the guy who can show off that he got away with
doing the least. It's the adult version of trying to be the too cool for
school guy.

------
willbonz
This valley conceit is just astounding. Do some of you people who are
obviously so smart at what you code and create really think that this is the
only way to go about being a success? You look like trapped otters.

~~~
walshemj
sorry 99.99% of hn commenters are not as cute as otters :-)

------
craneca0
"Three days into joining YC, we decided to pivot. We’d been working on the
dating site for six months at that point, and we knew it wasn’t working...
Also, I’d read a study that said happy employees are twice as productive as
unhappy employees. That was the beginning of AnyPerk."

After all the flak the word 'pivot' has gotten I'm surprised to see it used
this way here. This does not seem like a pivot, but rather you just deciding
to work on a completely new business. Were the two ideas related in any way?
Did anything in the original dating business inform this new idea?

~~~
wbillingsley
Presumably "the team" and "being in YC". Which is reasonable -- you're in a
program with a time-limit, together in a foreign land, and you realise the
idea you had isn't going anywhere. So they took their advantages (time in YC
remaining) and applied them to a different problem/application.

------
bsaul
Is it just me or do other people also find the idea of pivoting after three
months really troubling ?

I've seen two kinds of people creating start ups so far : business school guys
and "real job" guys. The first type are really focused to one thing : making
money. The second type have a passion for their skills and had an idea on how
to improve something in their field.

The first type can pivot to about anything, because ultimately the product is
just a mean of getting rich. The second type feels the need for their product
in their every day life. So profitable or not, they really want that thing
done.

Somehow i've always found the "real job" type the most interesting to work
with.

Edit : business school guys doesn't mean you went to a business school. It's
just a mind set. Same for "real job", i mostly mean passionate about one
specific personnal need.

~~~
jusssi
From what I gather from the last paragraph of the story, they found out they
were doing something they didn't really care about. If that was the case, then
pivoting is the only right choice IMO.

Sometimes you just have to try something in order to find out whether it's
working for you or not.

------
tmuir
Can someone explain AnyPerk to me? Is it just a middleman for employee perks?
What is the added value? Why couldn't a company look at their landing page and
say "thats a good idea, I should buy my employees movie passes", but not sign
up for AnyPerk?

~~~
patio11
I worked in a Japanese megacorp which used the local systems available for
doing this. From the corporation's perspective, it costs rat spit to buy a
_very_ wide selection of perks for their entire employee base and _they don 't
have to spend any time managing it_.

I never once took advantage of anything in the booklet, as I was a salaryman
and all of my waking hours were spoken for, which is one reason why prevailing
rates for this are so low in Japan. Still, had I wanted to take advantage of
the movie pass perk (50% off a ticket at a local chain), the process would
have been "Call a toll-free number or log onto the website, speak with a rep
for a minute, give her my membership number and the address of a local
convenience store, and then consummate the transaction there." Note that at no
point have I inconvenienced my HR department.

(Your offer as a perk broker to vendors is "Will you cut us a deal on N units
of your service if we bring you happy, well-behaved, middle class paying
customers with lots of disposable income?" The conversation goes like this:
"Hello hotel chain corporate sales department. Can we buy 100 nights in your
off season?" "OH YES YOU CAN." "Great! Make it worth our while." "WE CAN DO
THAT." "And we'd prefer 30 day net payment terms, counting after use." "Umm
could you maybe pre-pay for the whole block?" "100 nights." "30 day net it
is!")

~~~
S4M
From the description you gave it sounds the business model of AnyPerk is based
on the fact that HR departments are too lazy to do their job.

~~~
patio11
I'd phrase it as "HR departments prefer to spend their time negotiating with
an insurance provider over how many millions a group policy for 200 people
costs versus negotiating with a single employee over a mutually acceptable
showtime for Frozen."

------
akanet
The amount of cynicism in the comments for this story is astounding. The list
of complaints is long. By my accounting, people don't like that the founders
were:

    
    
      * naive
      * exploitative of the funding climate
      * deluded into irrational personal sacrifice by dreams of riches
      * whiners for thinking their hardship was hard
      * bad decision-makers overall by coming to SF
    

What happened to being charitable? Taro and co have built a real company out
of nothing, and they took a particular path to get there. No one was harmed
and it looks like they had a great time. Startups are HARD and you should
expect successful (for some value of success) companies to have odd
beginnings.

------
staunch
I had to resubmit this because the first post got missed. This is one of the
best startup stories I've heard. Good luck with AnyPerk, guys!

~~~
tarof
Thanks for submitting!

------
SSH007
The problem I had with this article was that there was no substance on what
they actually did to create the product and start a company. How did they
arrive at the idea of AnyPerk, what did they do? Did sleeping in the TacoBell
parking lot or sharing a bed in a $10/night hotel do something for their
startup other than low burnrate. How did this help them? Seems they had a
(wrong) idea in their mind on what you have to do to start a business in
America and in the end they contributed more to that idea by only telling a
story of sharing a bed/sleeping in a car. Someone naive may come along and
think if I sleep in a car in a parking lot, and sacrifice my privacy I'll have
a successful business. There was more to this story and this was their
opportunity to state that. I wanted to hear about how the idea came about, how
they created a site, then they spoke to and contracted with x number of
vendors to provide these perks that they are essentially reselling.

Pretty weak article. I would have said that its not worth being on front page
of HN, but comments are interesting.

------
jcavin
Sometimes it just takes talking to the right person to get your start. It may
take a few thousand no's, but one yes can change your life. This story is
inspirational and reminds me that you have to put yourself out and communicate
with others not just build a great product.

------
teach
I wish more university students had this kind of attitude. Instead of "Let's
take out the maximum amount of loans so I can get a new iPhone!"

Well done.

~~~
jimmaswell
Do people really use loans for iPhones?

~~~
amalcon
Yes, in two ways:

\- By buying on a subsidized contract, you've effectively used a loan for an
iPhone. It's not different just because the phone company issued the loan.

\- By using a loan for something else (e.g. tuition, automotive, housing), and
then buying an iPhone instead of paying down the loan

~~~
jn1234
I wouldn't consider buying an iPhone on a subsidized contract a loan because
you are just commiting to have service for a set period of time. You would be
paying the same amount for service regardless if you were under contract or
not.

~~~
ceejayoz
> You would be paying the same amount for service regardless if you were under
> contract or not.

No, it's lower if you bring your own device with most carriers.
[http://www.att.com/shop/wireless/byop.html](http://www.att.com/shop/wireless/byop.html)

------
andrewliebchen
No one should have to consider living in their car when starting a business. I
guess that's how it goes in America.

