I think it all depends on your definition of success. Many of the hackers on ycnews seem to want to make money so they can do something else. Becoming financially successful is just a step towards allowing them to concentrate on a passion without worrying about monetization.
In which case it would seem logical to make x million the quickest and easiest way possible. I think many will agree its easier to do that building "mundane, income-producing businesses" than trying to create the next Google. In which case, keep the mundane apps coming...
If your goal is to make enough so that you can concentrate on something else, creating a mundane income-producing company is the wrong plan, because it will rapidly stop producing income if you stop paying attention to it.
Re:Our idea of success is all messed up
by nostrademons on Monday April 28, 2008 @09:55PM
(#176209)
HotOrNot.com or PlentyOfFish.com have done pretty well for their owners...even if they stopped producing income now (which PlentyOfFish may do, given competition from FaceBook), their founders have banked enough off them to live well for the rest of their lives.
I'd imagine 37signals is in that category too...it sounds like they're making a few million in profit each year.
There are probably a lot more counterexamples.
It depends on your definition of "mundane". You could start a consulting company, take whatever software jobs pay best and make your business grow to the point that it could be attractive to a buyer. This may be boring, but it's easier than creating the next Facebook.
It's also possible to have a mixed model, which is working very well for us. We do some consulting work but only pick clients that are interesting in terms of improving our products or doing work we like. This allows us to be profitable and work on our own interesting stuff without the pressure of concerned investors.
Not necessarily....hire great team, give them some stock then go on holiday
update - just to be more explicit, the founders of a business need not be involved in its future to make it successful.
If you define success as founding the next Google then the overwhelming majority of readers on HN will be unsuccessful. The number of "Google class" firms in Silicon Valley is perhaps a dozen in the last two decades. It's akin to defining successful as winning the lottery, because, let's face it, they were as lucky as they were smart.
Re:Our idea of success is all messed up
by startingup on Monday April 28, 2008 @09:37PM
(#176188)
Except that "big success" is a lot rarer than it seems. Mundane success (and a few millions) is actually a lot easier to achieve - practically any very hard working, reasonably intelligent person can get there within 10-15 years, and that assumes 1-2 false starts/failures along the way.
The problem with this meme is that it ignores the fact that success = log(quality). To build a business that has 2,000 paying customers is probably 85% as hard as building the next Google. To the extent that becoming the next Google is more unlikely than that, I'd say it's because once you max out the quality the rest is basically flip-a-coin.
The challenge with a VC investment is that it comes with a 5-7 year shot clock, after which they need to liquidate their investment: they don't want to return a minority holding in private firm to their limited partners. Bootstrapping or Angel investment allows you to be more patient about success. Also, the competitive landscape for a $1M revenue firm is very different than one earning $100M, it's much much harder. Very few larger firms care about a $1M market, or even a $10M market, especially if they view it as an unprofitable segment from their current revenue. But they will find a $100M market much harder to ignore.
success = log(quality). To build a business that has 2,000 paying customers is probably 85% as hard as building the next Google.
Not to say that you are wrong, but what data do you have to justify that statement?
There was actually a blog post making this argument a while back. I think it may have been submitted here, but I can't find it because news.yc only lets me see my last 180 saved stories. It goes through the numbers though and makes a pretty good case that getting "only" 2,000 subscribers is actually extremely difficult. (There was something vaguely similar submitted only a month or so ago, but the one I'm thinking of is from much longer back.)
Fair enough.
I wouldn't even say building Google was that hard -- wasn't it mostly done by Larry Page to start with?
Technology vs. Business. Think Xerox copier: the breakthrough that made money wasn't the dry copy process, it was charging by the copy and not for the machine. Adsense was the business breakthrough, not PageRank.
There are plenty of people in Silicon Valley working on mundane, income-producing businesses. In addition it has Googles.