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Insight From Dropbox: Failure Is Not The Worst Outcome, Mediocrity Is (onstartups.com)
187 points by yoseph on Apr 18, 2011 | hide | past | web | favorite | 73 comments

This post reminds me of Paul Buchheit's definition of startup advice:

Limited Life Experience + Overgeneralization = ADVICE

The argument posed by the author looks good so long as he selectively chooses his examples (dropbox in this case). There's far too much chaos in startups to ever know what the best possible outcome is, so a founder can never come to the proposed conclusion of mediocrity (in fact, there's so much gray area that any conclusion is really just a reflection of founder confidence).

Yes. Clearly it makes logical sense to completely ignore the experience of people who have been doing what you're doing longer than you have.

Seriously though, I'm not saying you need to worship everything that these kinds of posts say. I'm just saying that one shouldn't go to the opposite extreme.

around 9 years ago I started a startup with three other guys. One of them left pretty quickly because he'd rather keep his daytime job, the three of us presed on. After around two years two of us thought that this particular startup wasn't worth pursuing, because it would never take off big-time. We'd basically missed our window of opportunity.

So we gave our shares to the last guy, and he's still running the company today - 9 years later. We've gone on to do other things, which are arguably more exciting, while he still sits around with two employees and tries to squeeze every penny out of the business while going nowhere.

Leaving was one of the best decisions I ever made. Leave or shut the company down if it enters a quagmire.

thats shows that your co-founder probably had/has much more passion and dedication for the idea you guys had. As long as he loves what hes doing, is happy and can live off of it then it seems fine to me.

Possibly. It could also show a relative lack of initiative, or a failure to face an unpleasant truth or a lack of attractive options as spending 9 years on a startup that hasn't gone anywhere isn't a great resume item. The concept of a "dead end job" isn't limited to the corporate world. He may be able to live off of what he's doing, but I wouldn't want to be in his shoes.

I don't understand how you can consider being self-employed and supporting yourself, your family, and two employes for 9 years a failure. If anything I think working for 'the man' for 9 years and having no sense of ownership is more of a failure.

Possibly. But there might also be people that dont put work above all, still enjoy what they are doing and keep going on with it when it makes them happy.

I do not think he would still be doing it after 9 years if he would totally hate it. I know people that do relativly mediocre jobs with mediocre pay but they still enjoy life and dont really want or need to improve their job situation.

unfortunately no - he's trying desperately to make it work and grow without having much success.

He's able to be his own boss running his own company. I'd trade my dayjob for his position in a heartbeat.

Why don't you?

Haven't come up with any kind of thing that people are willing to pay for. :/

Ideas are cheap. Just Google for them. There are several guys here on HN who post regular "idea dumps" of their recent ideas they don't have time to implement.

If you want to do it that bad you'll think of something.

I recently handed in my resignation. I finish in 2 weeks. I don't have any new work to go to (yet), and my savings+overdraft will only get me through 1-2 months at most. The idea is that I'll do contract work to build up some reputation, then hopefully land some bigger projects and build a team. Perhaps give me the flexibility to work on personal projects that might go somewhere. I was like you, I kept saying I'd start a company when I had a good idea. In the end I realised it wasn't the lack of idea holding me back, it was the fear of failing. I decided that failing wasn't something to be afraid of and if I didn't try I'd eventually regret it.

[Obviously I can't say if it's gone well or not yet, but I've made it past the paralysis. Ask me again in 6 months if it was a good idea]

"Develop success from failures. Discouragement and failure are two of the surest stepping stones to success."

Dale Carnegie

It's a Lifestyle Business. Not everyone wants to hit big. They are happy where they are. Leave them alone.

harmonix went for 10 years before hitting it big.

I would say a better test is if you are still having fun

There's something about this that makes me slightly uncomfortable. It seems to me that there's a very fine line between perseverance and mediocrity (probably the same fine line between self-belief and self-delusion). I can, for instance, think of a number of startups that 'languished in mediocrity' ... until they got acquired. Blogger and Gravatar, for instance.[1]

Has anyone a better measurement for knowing when it is mediocrity and when it is perseverance?

[1] Funnily enough, both acquisitions freed up the respective founders to do bigger, better things: Evan Williams to Twitter, and Tom Preston-Werner to Github.

Sam Altman had a pretty good litmus test for this:

"If no new or current users/advertisers/customers/etc care about what you're doing, and no one in the company has a plan (or, more commonly I think, a desire) to fix it, you are probably in bad shape."


This sounds like a pretty high bar, but there are lots of startups in this position. Mine was when I folded it up - my cofounder had just left for business school, we'd been rejected by YC 3 times, we had basically no users, and I had run out of ideas for how to get users. I've met other founders in their mid-30s who've been working on their "startup" for the past 10 years, and are still in this position.

In contrast, Blogger and Gravatar both had thousands of happy users, and were growing, and had attracted the attention of some fairly important people (Dan Bricklin, anyone?) They weren't smash hits, but they were clearly on the right path in the dimension that matters - do people want what you make?

Ironic presence of Dan Bricklin, given the goals of The Software Garden.

There is really no way to know. Your product might be just one iteration away from making it big. There are products which take time to hit the up-curve on the hockey stick - case in point gmail.

This is the hardest part about entrepreneurship and as Ben Horowitz puts it in one of his posts - no amount of pattern matching can help. These decisions can only be made from the gut - and basically need to align the entrepreneurs longer term motivations with 'his' understanding of the individual merits of the business.

If there were a good measurement for that, I'm sure that entrepreneurship would be a much easier business.

I don't think Blogger was languishing in mediocrity.

They had a lot of users, and more importantly lots of people cared about the services. You can always tell if people care by the volume of complaints when the service fails.

I don't know enough about Gravatar to comment on that case sensibly.

Has anyone a better measurement for knowing when it is mediocrity and when it is perseverance?

It's not perfect, but this is somewhat a function of the person's knowledge of history and the current landscape of both competitors and technical tools.

I definitely don't regret shutting down Tipjoy. I think about opportunity cost a lot, and the cost of not shutting down was huge.

This comment is somewhat ironic because I'm with Dropbox now. It really is a great company.

The world was not ready to understand why Tipjoy was such a great idea. When I wish Tipjoy succeeded, I'm mostly wishing the world were different.

Tipjoy had to be shut down by its financial nature. Other sites can stay up on autopilot for a long time. Anyvite grew after its founders moved on, enough so that they recently came back and gave it more attention. Snipshot is one I think could enjoy a rebirth if they made it work on the iPad.

Snipshot is one of those apps which I honestly think could be very successful with enough patience and grind.

wow, thanks

snipshot guys are at facebook kicking ass -- also relevant here I guess

The insight in slightly more detail:

> The reason mediocrity sucks more than failure is very simple: Failure lets you move on, mediocrity stalls you and keeps you from reaching your potential.

I think the real insight here is that Dropbox solved an unsexy fundamental problem in a huge market. Dropbox is actually exactly what Drew's original YC application said it would be. (Aside: not all initial ideas suck. Some are good and just take a lot of work to execute).

If Drew had carried on working on the test prep idea, it would have probably grown into something bigger within the broader education market, which seems to be popular with a lot of startups now.

To achieve huge success with Accolade, the product would have to expand out into new areas, unlike Dropbox, where the basic product itself caters to a huge market.

What's wrong with running a business indefinitely with modest growth? There are tens and thousands of small businesses all over the world that survive for years and years and their owners genuinely enjoy running them.

Nothing wrong with it, but it isn't mediocrity. This is only the top small % of small businesses.

The rest have an incessant daily struggle to pay the rent and staff wages.

Well from the account Accolade might not even have made any money. It's not really clear.

Also it's like quitting your present job for a possibly better opportunity. If you had the opportunity to gamble a small business for the opportunity of an explosive startup, would you do it? Should u do it?

There's nothing wrong with it, but a lot of people get into startups for the large upside potential. If that's your goal then make sure you're not shortchanging yourself.

Stated like that, the motivation is lottery-like, and I wouldn't be surprised if the odds of success in startups are comparable.

That remembers me the history of Angry Birds creators: Should they have stop after 6 years without a huge success ?



I think that's fine if you spend other people's money. For boot strapped I'll always go for mediocre instead of failure.

SAT preparation may be a "Super-competitive category, and it was going to be hard to differentiate." But you could say the same thing about online storage. I guess differentiating, and building something special, comes down to the ability and creativity of the entrepreneur, and knowing yourself enough to know whether you've hit a dead end or not.

What you've done there is called taking a comment out of context. The next sentence is:

Most importantly though, I was not sure how big of an opportunity it was

The market for SAT preparation is limited to students sitting for SAT in a given year in the US. The market for Dropbox is everyone with a computer and internet. Yes, the online storage market is super-competitive, but when it's that big it increases the likelyhood that chasing it is worthwhile.

"What you've done there is called taking a comment out of context."

It's not out of context at all. I'm not misleading anyone with my comment, or putting words into the OP's mouth. My comment fairly represents what the OP said about the competitiveness of the SAT prep market.

My intent was to indicate that the online storage market is also highly competitive. It wasn't to present a point by point analysis of the full post.

The competitiveness of a company within a market, however, is highly dependent upon a value of the market segment they want to participate. This is what the second sentence means.

Differentiating and all of that don't matter a whit if there's no business to be had, but yes, you're right, it's hard to compete in a crowded marketplace. The thrust of the quote was more specific than that, though.

This seems to go along with the "fail fast" philosophy that has been so popular recently.

I agree with this. In retrospect, I'm so glad I failed because of the time it saved me. The only thing worse than a failed startup is a funded failed startup, because the latter takes up 4+ years of your life, which is why it's interesting reading about Drew's exp with the SAT prep idea. Failure is totally worth it so long as you learned from those golden mistakes and are improving yourself to give yourself an edge the next time around.

I think the worst startup founders are the ones who go from one idea to the next without really thinking about what went wrong or what they need to do differently in order to improve their chances of winning. They think mere repetition is going to make them lucky.

Conversely, I think the best startup founders are the ones who are persevering and determined enough to not stop taking chances, but they're also continually investing more time in training and improving themselves to get an edge. Failure for them is a great learning experience. Max Levchin had four failed ventures before PayPal.

I understand the glamor of writing posts like this -- Yeah! Look at us (or them). We/they don't even care about money. It's all about building something incredible...

You won't often find these types of posts from people or about people who aren't wildly successful already.

The article fails to mention that the online storage space itself was considered quite competitive at the time. Yet Drew Houston was able to pull it off. It's a bigger space than SAT prep, but given the right entrepreneur, either could have been successful.

Chris Dixon had thoughts on this in an earlier posting: http://cdixon.posterous.com/dropbox-and-why-you-should-inves...


Competitive yes, but Dropbox has great differentiation. Maybe the concept for differentiating in the original startup wasn't as good.

I quit my full-time corporate job to create a start-up exactly a year ago. Worked without a salary for 9 months but had a vision. Product tested, launched and closed a Series A round of funding.

The goal now is to continue to work towards the best idea. The original idea got us here, now we need to keep growing it and pursing it - not get comfortable where we are. It's important to put goals to see where we'll be a year from now to take the company from here to great.

Thanks for the article it's given me a bit to think about. I've been running a web design business for 5 years and I would say it's well and truly stuck in that word you used. But it's hard to know whether you are the smart + entrepreneurial type or just a small business operator and it's hard to know what else to do as well. Thanks for the post though it's food for thought

I'm not sure anyone has ever pointed this out to you (sorry if they haven't) but it's pretty difficult for a web design business to scale profit growth like a software business.

Web design is service based, so your profits and costs increase linearly.

OTOH, a single piece of software can be sold multiple times, so the profits don't have the same relationship to costs.

I don't think that makes your business mediocre - just a different kind of business.

Dharmesh, are you saying it would be a bad thing to have a world with many profitable startups much smaller than Dropbox?

No, I am not saying that (and actually felt compelled to update the article and make that point clearer).

I'm a fan of building profitable, sustainable startups. I don't consider that to be mediocre at all.

That's not a bad thing, just someone capable of a really big startup stuck with one going sideways could be a bad thing.

Anyone who can create a moderate success in a bad market could probably create a big success in a great market.

Stories like this underscore the caveats to the idea that determination is the most important (controllable) factor in startup success. I think it is, but the right strategy is often to abandon a bad or mediocre company to focus on one that can be great. Don't fall into the trap of determination for determination's sake.

Mediocrity is not only a worse-case in startups. A 'comfortable' standard of living, a 'comfortable' desk job which pays the bills and doesn't encourage much development... that's the worst.

>doesn't encourage much development... that's the worst.

(Preface: Coder at a major financial company, first job out of university)

That stings me because my current job is exactly what you describe but without much personal development OR software development. I often wonder how much harm it will do as a career move to just outright quit(I've been having trouble getting another job lined up) so I can get better at my craft and get a better position elsewhere.

I got an internship my senior year of college with an excellent little software consulting outfit. They hired me full-time after graduation. I, too, was content, even though I'd sometimes work straight through the night and fail to accomplish anything meaningful. I liked my coworkers and am still in touch with them.

Leaving there was the best decision I've ever made. I activated my professional network and had another job lined up in under 24 hours. Now, this job is about as meaningful, and I will leave it at the end of my year-long contract... but it's been a good change of pace, it doubled my pay, and I got to move to a new city and meet new people.

I'd encourage you to take the plunge. It's easier if you have a professional network in place, but even if you don't, unemployment is a powerful motivator. If you're single and you're not living paycheck to paycheck... do it.

I feel like I'm putting a black mark on myself by admitting so on this site, but my problem is that I haven't done well technically in recent interviews because my programming knowledge has atrophied. I feel like if I had a little while to really study and crank out a few more small projects that I could do well at get an offer.

I have a decent amount saved up with no dependents. Maybe I'll make the move sooner than later.

If you have a boring comfortable job then presumably you can squeeze some time out on the side to polish your craft. You don't necessarily need to make a brash move like quitting tomorrow, instead you need steady measured moves towards you goal. Spend some time each night programming on personal projects. Eventually, yes, you should quit, but it should not be seen as a prerequisite to improve your life.

Also, I suggest listing to Dan Benjamin and Merlin Mann's Back to Work (http://5by5.tv/b2w). Best podcast ever for this sort of thing.

Keep applying fir this interviews. Each interview failure will make you get out your books and hone your craft. After 6 interview failures you will be learning more than what you learnt the whole previous year.

Just saying, your on the right track as long as you keep interviewing.

Sounds strange, but thinking about it -- it did work for me. I got motivation when I failed an interview a few years back (I hadn't understood what was really needed).

Otherwise, I am in the same situation as the grandparent comment, I've certainly lost more than I've learned at the present job. (But my CV looks better for what I planned to apply for next, which is the point.)

Yes but this (ie your skills atrophying) will happen at any job where your not being challenged enough.

Its part of life. Realize that you've gotten too comfortable and get out of there.

The lowest risk way of doing that is to keep interviewing for jobs you want. This will force you back into learning what you need automagically.

I'm trying a new method - trying to start a company. You'll have to ask me in a year or two whether this is as good a solution :) ...

atrophied how? You can't write a for loop anymore? Nothing fundamental has changed in programming in the last 10 years.

There are so many languages and frameworks and design patterns and whatnot that it'd be surprising if you WEREN'T constantly running into stuff you haven't used before. Don't underestimate your abilities to pick up new stuff.

I just saw this post so I'm commenting very late... I feel that I'm better than ever at software development, and I've certainly come a long way. The problem is that I thought I'd be much further along than I am now(fwiw, I have about 6 years of working experience, and have been programming since high school). Maybe I feel like I'm behind as a result of so many new technologies that have crept up, but I still feel that a lot of the time at work is spent outside of software development on other things.

It's only "the worst" if the only important thing to you is creating an amazing startup or learning awesome development skills. Be aware the bias in this environment (Hacker News). I'm not slamming career-/startup-minded ambition, but don't let this guy bug you too much if you don't share his priorities.

That said, if you're dissatisfied, better to take a risk sooner rather than later.

>(Preface: Coder at a major financial company, first job out of university) I've done that, just not the first job.

I've quit every job I've ever had. Six were without written notice, though they were prefaced with talks with managers over several months indicating that I wasn't happy and why -- so I don't think in any situation it ever came as a surprise. In no instance did I ever have another job lined up. This is because I knew exactly what I wanted in a change, so I was ready to act on it.

Reading further down in the thread, it seems that you're not working on things you like. Tell a manager this, tell them what you'd like to work on, and see if there's opportunity within the company to do that, or if they're willing to make that happen.

Your feeling of "atrophy" seems to be that you're falling behind current trends. This happens in most organizations. Don't let anyone - even here - tell you otherwise. Places working with newer technologies that are better tailored to specific needs are in the minority due to politics, shortsightedness and a myriad of other reasons. The only way around this is to find these organizations that are absolutely exceptions -- The places that want to always use the best tool for the job, even if they have to spend the time to evaluate the new tools and learn it up front. Cardboard Box Co., BigOl Wholesaler Inc., or J. Random Fund-of-Funds are rarely those kinds of organizations. Why? No one wants to put their neck on the line politically in case they made a mistake. People are too busy looking out for themselves rather than the organization as a whole.

You will probably need to change jobs, but see if the current employer is willing to make things work for you. If no, it's a matter of when. I'd say at least come up with a big list of places you're going to apply to if you're going to quit. And if you've come up with the list, start applying.

Unless you want something else. Regardless, you're not going to act until you know what you want. So figure that out, and then you'll find you make progress rather quickly.

> A 'comfortable' standard of living, a 'comfortable' desk job which pays the bills and doesn't encourage much development... that's the worst.

For you, sure. What about someone with two kids?

The fact that he has two kids means that he and I have different value systems, and that my judgments of what is best do not apply to him.

That said? Yeah, you do right by your kids, and you stay in that shit job, and you give them as much stability as possible.

That's pretty much my point. Your original comment sounded very much like "you're an idiot if you don't do what I consider right."

Objection withdrawn.

I think Rovio might disagree. Google might also.

I don't know about Rovio, but when was Google languishing in mediocrity (honest question)?

When they started. While the tech was good they had no business model. Was having trouble making money and tried to sell to various existing search engines, but no one bought. They eventually backed up and fell over into targeted search advertising... and the rest is history.

A less persistent set of founders may have closed up shop and simply said, "Great technology, but the business around search just isn't there outside the context of a portal".

I wish I was as "mediocre" and "unsuccessful" as Google's early history.

Google incorporated in late 1998, and by 2000 were powering the search results for Yahoo (the biggest website on the internet at the time). They were being paid (and paid well) for that too.

It was the same year (2000) that they implemented search advertising.

Given it only took them 12-18 months (of explosive growth) before they were powering the biggest site on the internet and making money I thnk it's hard to argue they were ever mediovre.

First, you have to remember that Brin and Page had done a fair bit of work before incorporating. But I think your statement kind of proves my point. In hindsight it seems obvious, right? But for Brin and Page, who were there at the time, they were willing to sell the company for $750k -- and their offer was turned down. Clearly they didn't see the company would be worth billions in just a few years.

So there was a period of time they viewed the company as a mediocre investment. And at this point they were just Ramen profitable. But they powered through it, and legend has it, that it was one of the Yahoo co-founders that helped convince them to really make a run of it.

My point, what others may look at and call "mediocrity" and say they won't pay $750k for today, may end up in a few years being the fastest growing company in the history of the world.


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