Re:Why I turned down my Y Combinator interview
by dalbasal on Thursday March 21, 2019 @11:56AM
(#19453831)
I think this is just an extreme boomtime mentality. Investors are cashed up, and so are the large tech companies buying these startups. Valuations are so high that building companies to flip is just too damned lucrative to do much else.
I think part of the difference between the late 90s and now (besides scale) is that small IPOs don't exist anymore. VCs need exits and once founders own n% of a $100m company, they need a way to realize those, unless they're willing to totally ignore their own financial interests.
The 1990s IPOs didn't work out well though. These companies were still longshots, and public markets lend better to lower risk-reward companies.
The second part of the problem is tech "monopolies," in the thiel sense. Google and FB's business models, for example, needs massive scale. A social network or search engine with 10% of the user's is not worth anywhere near 10% of what FB or google are worth.
So... the "highest value use" of a smaller startup is to help maintain a larger company's monopoly.
Finally, the tech space (especially consumer web stuff) just changes too fast to "build something lasting."
.. I'm not sure everything needs to be lasting. Do we even want dating apps or online loyalty programs that last a century? Maybe we just need classier ways of doing shorter horizon stuff.
I think part of the difference between the late 90s and now (besides scale) is that small IPOs don't exist anymore. VCs need exits and once founders own n% of a $100m company, they need a way to realize those, unless they're willing to totally ignore their own financial interests.
The 1990s IPOs didn't work out well though. These companies were still longshots, and public markets lend better to lower risk-reward companies.
The second part of the problem is tech "monopolies," in the thiel sense. Google and FB's business models, for example, needs massive scale. A social network or search engine with 10% of the user's is not worth anywhere near 10% of what FB or google are worth.
So... the "highest value use" of a smaller startup is to help maintain a larger company's monopoly.
Finally, the tech space (especially consumer web stuff) just changes too fast to "build something lasting."
.. I'm not sure everything needs to be lasting. Do we even want dating apps or online loyalty programs that last a century? Maybe we just need classier ways of doing shorter horizon stuff.