

Entrepreneurship is risk free: Heads I win, tails I don’t lose much - guglanisam
http://sameer.madhouse.in/entrepreneurship-is-risk-free-heads-i-win-tails-i-don%e2%80%99t-lose-much/

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Alex3917
What this doesn't take into account is the fact that 90+% of kids out of
college who decide to become entrepreneurs don't get traction, don't network
with other CEOs, and aren't getting the respect of people even if they fail.
It's like only looking at the failures among companies that have been YC
funded, and not looking at all the companies that failed after not even
getting funded.

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Andys
Its quite possible a kid leaving college not only fails at the startup, but
fails at networking and building contacts, and also fails at learning anything
at all.

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rama_vadakattu
Kids who are interested in learning only become entrepreneurs.The kid is
interested in networking but he don't know the way to network.

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huangm
While I am sympathetic to the author's thesis, the discussion is pretty
meaningless unless you acknowledge that there is opportunity cost to doing a
startup. Sure, you learn a lot and set up good contacts even if your startup
fails - but the risk is in what _other_ opportunities you might be missing.
It's not sufficient to just be better off than when you started.

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nostrademons
This is a pretty rosy "worst case" scenario. madhouse was acquired; most
people would consider that a success. The vast majority of failed startup
founders _do not_ get a VP position at their next job.

I suspect that for the vast majority of failed startups, the cost is mostly
pride and the lost wages of having a steady job for that 2-3 years. The
benefit is whatever experience you gain from that time period - people will
judge you based on your skill level and what you've learned.

There's also a much-worse case where people take on $100ks of debt, lose their
friends, lose their home, get divorced, and waste 10 years of their life on a
venture that was doomed from the start. This outcome is fairly easily avoided
by keeping perspective and constantly re-evaluating whether the potential
upside merits the risks you're taking, but it does happen to some people.

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tptacek
The title of this article contradicts itself and doesn't match the content of
the article, which contains an awful lot of "if's" to sustain the words "risk
free".

I almost stopped reading after inferring that he believes being the CEO of a
startup that your interviewer has never heard of, and for which "traction"
probably can't be defined in less than 10 minutes of conversation, is a
credential that will improve your chances at another company.

Selling a company is an accomplishment. Usually. (Sometimes that "sale" is a
marketing fiction, but, whatever). Most entrepreneurs --- in fact, _most_ of
the entrepreneuers that _get traction_ \--- don't manage to sell their
companies.

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drusenko
I disagree completely, at least for young entrepreneurs.

I started a hosted email company in high-school, and while it never really
went anywhere, it was the single greatest thing on my resume.

It made me stand far above most other applicants, proved that I could start
and complete something interesting, and gave me a lot of real-world
experiences to talk about in an interview, as opposed to the standard "In this
database class I took..."

~~~
tptacek
By all means start a company instead of playing World of Warcraft, hanging out
at Denny's, and going to Fall Out Boy concerts. You're right. Starting a
company is basically risk-free when you're in high school (though note that
it's _not_ risk free when you're in college; getting a degree would be an
incredible pain in the ass for me now, and I traded that opportunity for a
startup win in the '90s).

~~~
drusenko
There's a lot of free time in college, if you can keep your time organized.
It's very possible to (a) get decent grades (GPA 3.3-3.7), (b) learn something
in the classes that are interesting, (c) hang out with friends, party like
it's 1999, get laid, and (d) work on a "startup" (more like a side-project at
this point) for 10-20 hours per week.

If you're effective for those "startup" hours, you can have something to show
for it in a year -- maybe a business worth pursuing, maybe just an amazing
addition to your resume.

In any case, going to college and working on a startup shouldn't necessarily
be exclusionary, unless the startup proves to be successful enough that it
makes sense to drop-out or finish your degree remotely.

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coffeemug
_When your son started this venture he auto promoted himself from SW engineer
to the CEO / CXO - A level he may have never achieved or achieved after a very
long time period in a regular career with big SW companies_

There is an astronomical difference between being a CEO of a 2-5 man company
that barely has any clients (if that much) and a CEO of a large company with a
massive number of clients, employees, and large revenues. It's like comparing
a "lead" accountant for a 5 person non-profit with a lead accountant that took
Google to IPO. To quote Jules from Pulp Fiction, "ain't in the same f#$%
ballpark, it ain't the same league, it ain't even the same f#$% sport."

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blrgeek
In the Indian context, this article makes much more sense!

Note for instance the opening, "Recently I met with parents of the founder of
one of our portfolio companies." :) How many times would PG have met with the
parents of a YC founder?

Money during bootstrap phase would be from parents -> A middle-class kid fresh
out of college, could be easily supported by his parents for 3-5 years,
staying at home, with no additional expenses. Given many parents support grad
school, supporting their kids while they're working on a startup would not be
a stretch (if they agree with this article or see the fire in their kids).

If the startup goes anywhere but dead, (in a year or so) the founders would
have got a reasonable amount of independent mgmt experience, ability to
startup and deliver, and exposure to industry far greater than their peers.

Now in India there is a severe lack of middle management capable of
independent decision making, project level leadership, and delivery. There is
also a shortage of folks who can think at a product and market level, as
opposed to a customer/service level. A guy coming out of a startup (even
failed) who can demonstrate these skills would be quite better than his peers
who may have far more experience in sw development.

If the startup fails within a few months or years, worst case, an MBA may be
in store, although it would certainly not be as exciting :)

Many of the guys who are doing this would probably be of upper-class, or
upper-middle class, whose families would certainly encourage such risk taking.

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rythie
If you get traction and press attention particularly, then doors and options
open up to you. Also if you have a chance to speak at a conference you get a
lot of respect, often from people who didn't know who you were previously.

However, getting traction and press attention are the hardest bits. Also, how
much of your own money do you lose before quitting?

That said, even if you fail, if you had a job before, the chances are you
could at least do the same thing again after.

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justliving
nicely written article.

Still it should be considered that the author is a VC. Hence it's in his
utmost interest to portray entrepreneurship as quasi risk-free. The more
people decide to start a company, the bigger his choice while selecting a
company for funding. Reminds me a bit of 37signals who is kind of doing the
same thing, in order to promote their applications.

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sdsdsd
something is missing here, who is paying you when you starting your venture?
your saving, angel fund?

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steveplace
That's very simple to say after the fact.

