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When starting a business, if the idea is even reasonably good in a decent sized market and you stick to it, getting to $1M per year in revenue is not the hard part. In fact, after two companies of my own, it was almost too easy to get that far in each one. The hard part is making a decent amount of money at that revenue level because realistically you are going to have at least a few employees in the company to get there. ie: $1M isn't what it used to be.

In my experience, getting to $10M dollars should be the real goal and that proves to be quite a bit more challenging because this takes some real scale and the skills from 0 to $1M are quite a bit different that say the skills from $5M to $10M range....the job of CEO is completely different between the two and most people don't prove to be good at both types of the "jobs".....so the company hits a ceiling and never quite gets there.

Another way of saying same. If employees are in your future, focus on revenue per employee (RPE).

Napkin math: sub-$100k RPE and your wee company is nominally profitable after salaries, fixed & variable costs. Greater than $100k per employee, profits scale nicely.

While nice to talk about the Goog's RPE ($1 mil '08), I prefer to "fish" for company ideas a little closer to Earth. For inspiration, Inc 5000 companies with 50 or fewer employees, sorted by revenue:



I agree on RPE, but the data on the Inc. website is highly suspect, however, with regard to number of employees.

I did a random sampling of several companies that had tons of revenue with just 1 or 2 employees and checked out their websites and the Inc. data is flat out wrong in many cases.



this company is listed as 3 employees on INC., there's 4 in their management section alone...seems INC maybe has PUBLICLY listed employees, and is not counting the chairman...


Interesting. Can you elaborate how exactly job changes from 0 to $1 M as compared to $5 M or $10 M range?


I can tell you from experience... the job changes from making to managing. (c.f. http://www.paulgraham.com/makersschedule.html)


I would guess that the job changes from managing people to managing managers.


Yes, that is definitely part of it.


As stated by another reply, part of it definitely is the shift from managing people to managing managers.

The other main shift is that the scope of what you are doing goes beyond what one person can keep in their head. You can't know everything going on any more and you can't be telling people exactly what to do.

The closest analogy I can come up with it that it's kind of the like difference between "procedural programming" which you can get away with for the $1M company as compared "object-oriented programming" for the $10M+ company.

You can't possibly know every detail of every object's design and at the same time you need to have techniques to discover how well all the objects in the company are being constructed and acting as the "system engineer" making sure all the "objects" (ie: teams) still interface together well.


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