Notifo is not dead, but the future is not certain (just as for any startup). We are going through YC again in order to figure things out and really figure out our direction for the future.
I didn't downvote you, but if I had to guess, it'd be because people perceived "at least you have a glimmer of hope" as downplaying or minimizing their struggle.
Anyone thinking about moving to SF to launch a startup needs to read the Sacrifies and Startup Depression section 10x, assume it will be worse for you, and then decide.
And doubly so if you're married. If your spouse isn't on board and you've minimized the challenge, you're screwed.
We cannot afford to drop everthing and move to SF. And considering where we are (Richmond in Virginia) and our roots here, we feel like we owe this town. There are a lot of things we are surely missing out by not moving to the Valley, which is the startup ecosystem, the investors, the talent etc. But startups also have to deal with the noise, the saturation, and the "meh" when you launch. Where as in Richmond, we can possibly have a far bigger impact, with a lot more people who will love us, and we are right next to DC.
I am sure we will not know if we made the right choice, for a long time. But I dont buy in to the belief that unless you are in the Valley, no one will give a damn (as touted by Vivek Wadhwa a few weeks ago).
Any thoughts?
EDIT: Needed to add a couple more thoughts that came out of the responses my post received.
a) Its really hard to find talent in SF - Right now, we are one non-tech founder and two hackers. And finding android or iOS talent in Richmond is like looking for needles. But I believe that if you find a darn good hacker, then a new tool or language is just a speedbump. We are still trying to find a very good UX designer though.
b) I agree with the Valley vibe. But it sounds more of a Goldrush than anything else. And I also agree with the vibrant support system that the Valley can provide. Right now, I get that through HN, blogs and my peers over email and phone.
Completely agree. I am in the same boat as a Canadian not wanting to move to the states. While it may be true that many investors will rule you out based on location; my firm belief is that first time entrepreneurs should spend their time acquiring customers, not investors.
Customers generally don't mind if you're not in the valley (although it is true that if your product is built for tech oriented people the bay area may be a high customer saturation zone.)
It matters to customers who are themselves in the valley, like me. I know the teams behind most of the products and web services I use, and it matters that I know who to call when something doesn't work. If customers in the tech world are important to you, you should be where you can go meet them for coffee.
It's not just for investors. It's much harder to exit to a US acquirer if your tax/legal structure is that of another country. Due diligence is longer and more expensive and I have heard of cases where UK companies have been skipped due to potential issues of integrating founders re immigration and IP laws.
I'll be moving from Minneapolis to SF soon. Before spending significant time in the Bay Area, I thought that the noise/saturation/and "meh" were a problem, but my experience was different. It's a very supportive environment, with a lot of smart people willing to help out.
There are three problems to the Bay Area:
1. Massive competition for engineering talent. It's probably harder to hire 20 brilliant engineers in SF than in any other major city in North America.
2. Cost. Our burn is increasing by 20%-30% because we're moving.
3. Echo chamber. Ideas tend to get reinforced here. This is often good or neutral; SV will sometimes recognize the significance of something before the rest of the country will. (There are a lot of people who still think Facebook and Twitter are hype and will go bankrupt soon.) But I imagine that there are ideas that make sense in SV that are ultimately bad ideas. And there are ideas that wouldn't resonate in SV that are probably huge opportunities.
This is a little off-topic from the original article, which is fantastic. But circling back: startups are hard, and moving to SV isn't a panacea. It may help a little, but do it with eyes open - because you want to commit to the startup life, and SV is a good place to do that.
All the three problem areas you identified are reasons why I would not move to SF until we are ready. If I see that the idea has traction, and revenue, and I didnt care about finding investors and talent, then I would think of moving to SF. Today, what we have built and is currently building, is still a pet project. We are keenly watching where it goes from here, but simply cannot move mid-sentence to the other coast.
Good luck though. You are much better positioned due to the YC framework and which should open doors far more easily than to a couple of outliers like us.
You're too close to the forest to see the trees. Forget you are a hacker for a minute and think of yourself as say a screenplay writer. Where would you rather be, LA or some hicksville town ? If you are in LA and you bump into some two-bit actress moonlighting in a bar and talk about your script, soon, she'll connect you to someone who knows someone else who knows something who will soon reshape your unsellable script into something that can actually get made and within a span of a few weeks you'll be on a studio lot while they go over the makeup of a costar you only saw on TV until yesterday! Sounds like complete baloney, but that's how it really works!! You can read say William Goldman's book Adventures in Screen Trade where he spells it out in considerable detail - Why professors with PhD in literature are still working on the nth draft of their dream project in the English Dept at Andover while some street smart dropout hacks away at a script on a couch in some dinghy motel on Hollywood Blvd that actually gets made.
It ain't fair but that's how it is.
In you go to SF with your pet project which has no traction and revenue, it will suddenly have traction and revenue. Don't ask me how. It isn't exactly logical. Things happen. You'll meet people who'll tell you if only you change this feature and add that feature and do this and not that you'll have a saleable proposition. So you'll say what the hell and give it a shot and soon it becomes so! Its just not rational, and as a coder and mathematician I hate irrationality just as much as you. But that's how it is.
Whereas with no such brutal feedback, you can labor away at some precious project until it becomes larger than life and super-brittle and soon even you don't want to touch it cause who knows which module will break which other module, and then you go looking for customers and nobody really wants it cause its gotten way too complex for anybody to decipher.
I've heard ideas that are so lame ( an app that counts ONE TWO THREE while you do pushups. Really! Yeah, that's got funding to the tune of a couple mil! ) your 3 year old could have come up with it. So its not the traction, framework, revenue model etc. Its just finetuning an idea to the point where it becomes saleable. And for whatever reason, perhaps because its in their DNA, SV seems to have the sort of people who actually give you a listen and then tell you exactly how to go about it. They actually give a damn! If you have an idea, I think you should atleast spend 1-2 weeks in SV trying to pitch before writing it off as a futile exercise. Nothing to lose, everything to gain.
I agree that its better to be in LA than in some podunk town working on a script if you wanted a movie to be made. Because movie making has not exactly been democratized to the extent that software development and creating businesses has been.
However, if what I have is a piss poor idea that has not won over customers, has no traction or revenue, then I dont think thats a problem a million dollar can solve. It will just be someone else's money that I will end up losing over a terrible idea. I would rather fail with this idea where I am now, than work on it (with someone else's money) for the next year and then still fail.
The Valley entices everyone to go there. I both drank the koolaid in 99 and ran for cover in the wake of the dotcom crash. Entrepreneurs who persevered were the ones who coupled the right ideas with a sense of commitment bordering on the insane. Thats what I want to emulate. That, to me is more tangible than a million dollars.
You missed the parent's point. It's not the money of Silicon Valley that helps you, it's the constant brainstorming of ideas. You will be exposed to so much collective experience that your product will improve. On the surface, it will seem to be magic, since really it's the same idea you had when you lived in the middle of nowhere.
Except you benefit from talking to people with deep experience. When someone here tells you "have you tried putting this button on that page?", it's because they did it and it doubled your traffic. Experience of what works and what doesn't circulates so much faster in Silicon Valley.
Why would you want to be disconnected from the flow of ideas? If you think online forums are a substitute, they are, but with a time delay.
I just came back from SF yesterday, and would certainly recommend dropping everything and going there. Better yet, relocate to Palo Alto. Every other office on University Avenue is a startup and the ones that aren't are either VC firms or gathering haunts like coffeeshops & restaurants. There is a certain electricity in the air. You have to be there to feel it. It is definitely quite surreal, like out of a parallel universe. 20 year olds in jeans & tees & sandals lugging their laptops & iphones, talking animatedly about monads and dependency injection and mock functions, while 60 year old asset managers in black suits and polished shoes walk around in reverence.
I remember thinking that I would have to be an absolute rank idiot if I can't get some bloke to fund me a half mil on a quick-flip consumer web play. On top of that, the guy who was escorting me, a 25 year old hotshot ceo of a stealth startup, pointed out various coffeehouses and said things like "i pitched here", " i raised 200k there" and so on and so forth until it was clear i was a dumb fuck wasting my time in the midwest.
So why am I back to the midwest ? Well, I'm not running a startup myself, atleast not yet :) And when it comes time to do so, I'll rush over there myself.
I guess this is what it was like in the 1960s in Greenwich village in NYC, or Berkeley CA or Woodstock or whereever else. Its just quite surreal & I still haven't gotten over it.
If it makes you feel better, my sense from what I've read is that you're more likely to have success once you get funding. You've been through a lot of pain, and you still believe in yourself and what you're doing. And apparently some very experienced and talented people believe in you too. That says a lot.
As for the "Somebodies", it's not all about past success; there is a lot of luck and flair to it. There are, in any human culture, people who are utterly worthless but can make the magic happen. They don't know much technically, but they're great at using the herd mentality and certain exploitable vulnerabilities in weak minds in order to make other people like them, so getting funding and press comes easily to them. When they actually have to build a product and a team and a company, they're screwed, and they tend to flame out catastrophically. Whereas the people who actually work hard and have real capability will have slower paths to success but, when they get there, they'll be able to stay where they are because they've actually earned it.
While I respect your opinion, I will say that for someone from the midwest who's never been to SV until yesterday, it does feel like something out of a science fiction movie. Its just so vastly different out here in the midwest. Hell, I can't start a conversation about currying and mapreduce even if I stand in the middle of my university's comp science department and scream. And yet, in SF, the buzz is so palpable it feels outright weird. In the span of a few minutes in which I sipped some coffee, the chap next to me drew up some enterprise routing system for something called postgres. Another bloke gave a demo of some ipad thingy called doctor krono. And a third chap was going on and on about some series A series C thingy.
I dare you to find a place in Chicago where all of these things happen. Or even any of these things happen.
It's not unheard of that I'll be hanging out at a cafe in Palo Alto and run into other entrepreneurs I've met before.
I went to a talk at the CS dept at Berkeley and ran into a direct competitor (who actually had my app installed on his phone). Had a great convo with him.
I've also had people come up to me who are in similar spaces who propose a possible collaboration.
Most people I meet who visit SF to do a little recon end up deciding to move here permanently because the environment is so great and supportive for entrepreneurs.
If you're looking for a great place to live, Silicon Valley or San Francisco aren't it: even elsewhere in Bay Area (e.g., Sonoma County, bedroom communities in the East Bay) is far more hospitable. I was very pleasantly surprised when visiting Chicago, Seattle, Berlin, Brussels: these are world class cities where transportation is a breeze, average food quality is amazing (although, San Francisco still wins out on the "high"-end dining options). This was quite a shock from growing up in Former USSR and then moving to California (where San Francisco and Los Angeles were my example of "cities").
However, there's good reason I am here in Silicon Valley. Athens at the time of Pericles and Socrates wasn't a great place to live either, far worse than Silicon Valley. Same goes late Republican and early imperial Rome, Tang dynasty Xi'an, Florence and Venice during the Renaissance, Victorian London, etc... On the other hand, people willingly sacrificed their standard of living and prestige to live in these cities and and pursue activities they found meaningful. Being a big fish in a small, provincial ponds sucks: if you want to grow intellectually or professionally, you should be around smart and ambitious people.
To be fair, there are pockets of talent elsewhere (New York, Seattle) but they're generally rather insular: a lot of the places tend to be a combination of a revolving door for some (people joining and leaving in 18 months, very frequently moving to Silicon Valley) and a life long commitment for others (lifetime "softies" at Microsoft). While exceptional talent does exist in many place outside of Silicon Valley, the stories of people joining a company, staying long enough to make a significant impact and then applying their lessons elsewhere (e.g., the "Fairchildren", "Paypal Mafia", Xooglers) are not as common in less-fluid engineering job markets.
Back when I was a physics major in college, I remember musing that there were two time/place combinations in history that I really really wish I could've been a part of. Copenhagen in the 1920s, and MIT in the 1970s. Both of them were collections of incredibly intelligent people that were feeding off each other's energy and making some really awesome discoveries.
I think that Silicon Valley in the late 2000s and early 2010s is that place. Particularly centered around the offices of Google, FaceBook, Twitter, and YCombinator. There's an energy here, a thrill of discovery, that's just missing in most other places in the world. It's enough to make me overlook that the city is basically suburban sprawl, public transportation sucks a lot more than Boston/NYC/DC, the quality of life is honestly not that high, there's little sense of history (only of history being made), and everybody wants to get rich quickly.
I don't think I'd want to settle in Silicon Valley. But when my grandkids ask questions about the birth of the Internet age, I want to say I was there.
Kudos to you for saying and admitting the hard things for the startup entrepreneur. Failing sucks. Struggling to not fail sucks even more because it can just drain you. Best of luck :)
I think that the "making something people want" at the right time is the hardest part, and maybe distribution as well.
Execution is important.
But I think many people have the skills to create what ends up being successful.
Take Groupon for example. It made something a lot of people wanted. Could most people on Hacker News have made it? Sure.
But Groupon created it before anyone else (I might be wrong about this?).
Another example is HN. Pg has said that what he thinks users want most are quality articles and discussion.
While it's "just a forum", I think Pg is right for not adding a lot of features, or spending the limited time he has working on the UI, and instead focusing on how people can discover quality articles and make/read quality comments.
"Make something people want." It's simple, but it sure isn't easy.
I think Pg is right for not adding a lot of features, or spending the limited time he has working on the UI
I believe HN's plain design is actually an intended feature, not a bug. From one of PG's essays:
So the most important thing a community site can do is attract the kind of people it wants. A site trying to be as big as possible wants to attract everyone. But a site aiming at a particular subset of users has to attract just those—and just as importantly, repel everyone else. I've made a conscious effort to do this on HN. The graphic design is as plain as possible, and the site rules discourage dramatic link titles.
Take Groupon for example. It made something a lot of people wanted. Could most people on Hacker News have made it? Sure.
But Groupon created it before anyone else (I might be wrong about this?).
Group buying has been done many, many times before, going back to the bubble. Many millions of dollars were burned to little avail. What Groupon actually nailed was all the hard parts of the business model that don't look really freaking difficult on the napkin -- particularly "signing up local merchants" and "cost-effective customer acquisition."
That second one is relevant for virtually all businesses and gets disproportionately short shrift here.
Focusing on the hard parts is a commonality to just about every successful startup story. It's not always pretty or interesting, but the business flows to their doorstep because competitors can't get the hard stuff right or keep up. Startup security is doing both what is hard and not attractive repeatedly until it looks both easy and fun.
>What Groupon actually nailed was all the hard parts of the business model that don't look really freaking difficult on the napkin -- particularly "signing up local merchants" and "cost-effective customer acquisition."
I may be misunderstanding what you're saying, but signing up local merchants doesn't seem all that hard. There seem to be many Groupon clones that have produced deals with merchants.
The main problem for the clones is not having Groupon's scale/distribution.
I think what Groupon got right was the simplicity of its offering.
One page that clearly explains what you're getting, at at least 50% off.
When looking at an offering, I see a picture, a short and sometimes funny/interesting description of the offering, short crisp bullet points about restrictions, how many people have bought it, how much time is left, and contact info -- specifically where the place is located.
That's really easy to understand. The user can vote yes or no in a minute or two.
It's anecdotes like these that reinforce my belief that for a bootstrapping pre-success founder it's easier to focus on revenue rather than investment. The growth curve might be slower, but the friction you face as a first time entrepreneur trying to raise money is deadly.
Chad, Couldn't have said any better about startups being hard. I wish you and Paul success. You have so many things that are going right for you. Access to great mentors, being part of YC, being in the valley and having a supporting family. You just need that missing piece for which people would really pay.
As a nobody, you have not much to lose.
We will be here to cheer you on when you find that missing link.
You are still in a better situation than many here. SF's coffee shops are littered w/ debt-laden (pseudo)-hackers who have half-baked ideas/projects, no gf's (or wives), zero connection to anyone of value and sleeping on a sofa of some friend's musty apartment.
"The less you need money, the more people want to give it to you." - some advice I have heard about finances. Applies to businesses selling a product, startups looking for money, and, especially well, to scholarships.
The best indication that people should invest in you is that you don't need them to invest in you at all.
Someone offered me a job recently. One of the people who interviewed me knew I had a side project that could become a startup. His advice was exactly what jazzychad said: startups are hard. He had been in one, so his advice meant something.
I turned down the offer, but for reasons unrelated to my side project. Still I feel like my project/startup is floating in the Sargasso Sea. If you think getting funding in the Bay Area is hard, move to Atlanta. There's a reason Stammy is out there.
And you can't be too much of a Nobody if you can get into YC twice. I wish team Notifo (or whatever your next project is) all the best.
I think there are different degrees of Nobodiness and Somebodiness, but I also think there is a pretty big gap between the highest Nobody, and the lowest Somebody. Maybe I am moving up the Nobody scale :) I don't want to belabor the point or make it seem like I am self-deprecating, but you get the point.
I think the nobody/somebody line is oftentimes: "were you a part of a team/company that made money for investors". If you are, it seems like funding often falls like rain-- people think whatever alchemy that company had might have rubbed off on you.
> I think there are different degrees of Nobodiness and Somebodiness
Indeed. You now at least you know a Somebody or two. Many folks don't get that far.
A misquote from the article (my perspective):
> Am I jealous of other companies' success? I would be lying if I said no. I am slightly jealous when I wake up and read another story about some company getting into YC when I didn't even get an interview.
I'd also be lying if I wasn't genuinely happy for every company that gets any sort of success, because I'm now getting a taste for how hard it really is.
I've also had "Startup depression" where I didn't sleep for 1 week and was totally unproductive for a grand total of 2-3 weeks. Ever since then I stopped recommending doing startups to my friends.
We've also experienced the "You're Nobody until you're Somebody problem." The work-around we're trying right now is to bring a (non-technical) "Somebody" onboard as a partner/founder, who is also, unlike us, located in the US where our market is.
Location has also come up in this thread. Early on I thought that thanks to the Internet location matters "less". Not true. You have to be where your investors/customers are. Deals require massive face time.
So startups the YC way are hard. The sacrifice is self-inflicted, and avoidable - just give up more of your company up front, or choose a more visible partner, or have a spouse that has a real income to start with, or work at BigCo then quit and create something they need and lease/contract it back to them, etc.
Its winning the lottery that is hard, and only because you make it hard on yourself for that big prize.
While the entire post is both cathartic and poignant, one line stood out for me because of its brutal honesty.
Am I jealous of other companies' success? I would be lying if I said no.
Thank you for saying this. I've always wanted to, but feared I'd be called out for it. In public. In fact, I think it's part of what keeps the fire burning inside - that constant hunger to try and figure out why some folks are plain better / more successful at the game, and then trying and internalizing / applying those lessons.
And it can get frustrating when you can't replicate / emulate what others have achieved seemingly easily. As a corollary, this is probably why Jack Dorsey and Dennis Crowley are enigmas unto themselves.
An important aside: Chad, I'm someone who has tracked (and may I add envied) the Notifo story. And I admire the work you've done, from fanout.js, to snagging Paul for a co-founder, to HN for Android, to PicAFight, to GramFrame, to Vorepad........I've found myself in awe of how prolific you've been (and you don't even know me).
It's possible you've been doing one thing too many (because you love APIs and can't keep from tinkering with them). What I'm convinced of, is that you have the talent, the work ethic and an incredible co-founder. All the best, I'm hoping I have to transition back into pure envy real soon.
I was doing all that "one thing too many" stuff during the "crap, what are we gonna do now" phase where we weren't super productive and just played around with prototyping some ideas.
Not shipping anything made me feel terrible, so we spent some time making random side-projects to stay sharp. All of them were good learning exercises, too. I made sure that each project had some part of it that I didn't know how to do, so it would force me to learn new things.
The #1 reason I ignored notifo is I couldn't understand the business model. As such, for our internal systems, we notify via SMS, email and jabber. Things that I know will still be around in a year.
Why the past tense? It's still going. As far as I know, they plan to charge for over 10k notifications/mo when they get a bit more traction. I use it on my Android phone and it's fantastic.
There's no doubt you've sharpened your saw with the projects you've worked on. It could've been way worse - I've been through the blues / in the doldrums, and couldn't get myself to do anything for weeks on end.
I happened to navigate to Paul's article on fundraising, and further, to Alexis' one on keeping calm and carrying on (http://alexisohanian.com/keep-calm-carry-on-what-you-didnt-k...) and I was blown away. There's no way I could've survived something like that. You're in great company.
I'm looking forward to what you come up with. Here's to a great couple of years ahead.
Nicely done. I especially liked "We let them [the investors] dictate our path with their negative signaling instead of listening to our guts."
This trap is something that is so easy to fall into and so painful to pull out of. My first startup had a 'star' VC fronting it, he loved the concept but didn't really understand that his vision was often in conflict with the founder's vision. That really hurt as the company was ripped too and fro trying to achieve a couple of really orthogonal goals.
Tom Lyon once told me that really it takes three startups before you 'get it'. One which is a somplete disaster, it helps you see what you did wrong and what can go wrong. One which isn't a complete disaster but exits sideways, which is to say you work at it day and night but when it exits you find yourself exactly where you were when you started. Then the third one where you know what to expect, you have a solid idea of what not to do and you keep laser focused on getting in, getting done, and getting it shipped.
"if you are having trouble putting together a round in the first few weeks of actual investor meetings, just say, "screw it," and get back to working ASAP."
- this seems a little extreme, to say the least, not sure I agree. It might apply to some premium selected YC startups in frothy Silicon Valley conditions, but not in general. Putting together a round takes time and quite often much much more than a few weeks.
that's why I say "of actual investor meetings." doing all the intros, and phone calls, and scheduling leading up to the meetings can take quiet a while and are necessary. But after you get to the "meeting phase", you really don't want to be spinning your wheels too long.
Great post! The thing that really rang true was the part about the fundraising/depression/derailment, and how that can lead a start-up to consider some random/terrible offers that would otherwise be totally bogus. Paul talked us off a few bad-acquisition cliffs as well.
We certainly went through all of that at Jamglue. It's absolutely true that being a founder, especially the fundraising part, requires a really thick skin.
Each time I think about doing another startup, I start having flashbacks to broken termsheets, bullshit EBITDA projections, and VC's telling us that they could introduce us to Quincy Jones (I swear, at least 7 different people told us this). When we came out of our fundraising stint (penniless), we realized that our product had suffered and we were completely broken people.
The ability to be self-aware about the emotional roller-coaster is invaluable, and essential to forward progress. Thanks for this honest account so that others can make some sense about what they are feeling.
What a bloody good read......they say nothing in life that is worth having ever comes easy....stay there chad...grit it out....you'll reach where u want....success will come..good luck have fun
I left my job to work on my startup full-time, and agree with all of this. It's one of the hardest things I've done. I had to detach myself from material possessions and live frugally. I don't have much of a social life anymore because it's expensive. I've had to force myself to work when I didn't feel like it days at a time. Programming was no longer fun.
If you're not ready to sacrifice everything you have, possibly including your health, then work on your project on the side. You really do have to be crazy to be an entrepreneur.
The positives: It's thickened my skin, I manage my finances better, I appreciate things more, I treat people better.
Thanks for sharing that. We've had a lot of articles lately that treat startups like 9-5 jobs so I think it's important that people like you give some perspective on how it's really like for the waste majority of startups.
This reminds me why passion is so crucial when starting your own business. You will work crazy under conditions that most employees would see as unreasonable and there is a great risk that the business will fail. But as long as your doing it out of passion you can motivate yourself through the hard times and, if it doesn't work out, walk away with the satisfying feeling that you followed your dream and gave it all you got.
Would you say that your passion played an important part in managing your business?
Absolutely. I chose the entrepreneurship route because it's something I that I feel I was born to do. Of course, I try to maintain a healthy lifestyle and a positive demeanor on the outside despite sacrificing a lot. It will take a lot of adjustments if you decide to take the plunge full-time.
Absolutely. I chose the entrepreneurship route because it's something I that I feel I was born to do. Of course, I try to maintain a healthy lifestyle and a positive demeanor on the outside despite sacrificing a lot. It will take a lot of adjustments if you decide to bootstrap a startup full-time.
I can relate to programming not being fun anymore. After my startup was finally bankrupt I just couldn't get myself to sit in front of a computer anymore at all.
I did a two week bartender crashcourse and did that for 3 months.
There's a meme to be spawned about things that work like the parole narrative in The Shawshank Redemption, where good things only happen when you decide to stop giving a shit about them. Deal closing of all sorts definitely fits it.
In the meantime, perhaps console yourself this way: you haven't found the pitch that's opening investor wallets yet, and maybe that's a good thing. Maybe the pitch you're using isn't your best bet; maybe a "yes" at meeting 38 would have put you on a bad path.
My friends and I got a high-seven-figures "yes" in '99 that ultimately killed our company.
Meanwhile, Matasano went through exactly what you did in 2005; every company that found a "yes" got dead as a result. We're relieved to have dodged the funding trap.
Best of luck to you. You don't need gatekeeping investors to succeed.
Those fall into the "hard to quantify" category. They are positives, yes, but there are equal amounts of negatives to go along with them. Hard to measure exactly, so I went with the easiest way to measure "worth it" in terms of running a company... finances.
This is the reality. I well remember hearing Steve Blank speak when he said nine out of ten of us in the audience would fail. But he said each of you are thinking that you will be the one who succeeds and are feeling sorry for the other nine. I didn't realize it at the time but he defined what it is to be an entrepreneur for us.
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[ 3.8 ms ] story [ 171 ms ] threadEdit: I'm curious - why the downvote?
And doubly so if you're married. If your spouse isn't on board and you've minimized the challenge, you're screwed.
I am sure we will not know if we made the right choice, for a long time. But I dont buy in to the belief that unless you are in the Valley, no one will give a damn (as touted by Vivek Wadhwa a few weeks ago).
Any thoughts?
EDIT: Needed to add a couple more thoughts that came out of the responses my post received.
a) Its really hard to find talent in SF - Right now, we are one non-tech founder and two hackers. And finding android or iOS talent in Richmond is like looking for needles. But I believe that if you find a darn good hacker, then a new tool or language is just a speedbump. We are still trying to find a very good UX designer though.
b) I agree with the Valley vibe. But it sounds more of a Goldrush than anything else. And I also agree with the vibrant support system that the Valley can provide. Right now, I get that through HN, blogs and my peers over email and phone.
Customers generally don't mind if you're not in the valley (although it is true that if your product is built for tech oriented people the bay area may be a high customer saturation zone.)
There are three problems to the Bay Area:
1. Massive competition for engineering talent. It's probably harder to hire 20 brilliant engineers in SF than in any other major city in North America.
2. Cost. Our burn is increasing by 20%-30% because we're moving.
3. Echo chamber. Ideas tend to get reinforced here. This is often good or neutral; SV will sometimes recognize the significance of something before the rest of the country will. (There are a lot of people who still think Facebook and Twitter are hype and will go bankrupt soon.) But I imagine that there are ideas that make sense in SV that are ultimately bad ideas. And there are ideas that wouldn't resonate in SV that are probably huge opportunities.
This is a little off-topic from the original article, which is fantastic. But circling back: startups are hard, and moving to SV isn't a panacea. It may help a little, but do it with eyes open - because you want to commit to the startup life, and SV is a good place to do that.
Good luck though. You are much better positioned due to the YC framework and which should open doors far more easily than to a couple of outliers like us.
It ain't fair but that's how it is.
In you go to SF with your pet project which has no traction and revenue, it will suddenly have traction and revenue. Don't ask me how. It isn't exactly logical. Things happen. You'll meet people who'll tell you if only you change this feature and add that feature and do this and not that you'll have a saleable proposition. So you'll say what the hell and give it a shot and soon it becomes so! Its just not rational, and as a coder and mathematician I hate irrationality just as much as you. But that's how it is. Whereas with no such brutal feedback, you can labor away at some precious project until it becomes larger than life and super-brittle and soon even you don't want to touch it cause who knows which module will break which other module, and then you go looking for customers and nobody really wants it cause its gotten way too complex for anybody to decipher.
I've heard ideas that are so lame ( an app that counts ONE TWO THREE while you do pushups. Really! Yeah, that's got funding to the tune of a couple mil! ) your 3 year old could have come up with it. So its not the traction, framework, revenue model etc. Its just finetuning an idea to the point where it becomes saleable. And for whatever reason, perhaps because its in their DNA, SV seems to have the sort of people who actually give you a listen and then tell you exactly how to go about it. They actually give a damn! If you have an idea, I think you should atleast spend 1-2 weeks in SV trying to pitch before writing it off as a futile exercise. Nothing to lose, everything to gain.
However, if what I have is a piss poor idea that has not won over customers, has no traction or revenue, then I dont think thats a problem a million dollar can solve. It will just be someone else's money that I will end up losing over a terrible idea. I would rather fail with this idea where I am now, than work on it (with someone else's money) for the next year and then still fail.
The Valley entices everyone to go there. I both drank the koolaid in 99 and ran for cover in the wake of the dotcom crash. Entrepreneurs who persevered were the ones who coupled the right ideas with a sense of commitment bordering on the insane. Thats what I want to emulate. That, to me is more tangible than a million dollars.
Except you benefit from talking to people with deep experience. When someone here tells you "have you tried putting this button on that page?", it's because they did it and it doubled your traffic. Experience of what works and what doesn't circulates so much faster in Silicon Valley.
Why would you want to be disconnected from the flow of ideas? If you think online forums are a substitute, they are, but with a time delay.
So why am I back to the midwest ? Well, I'm not running a startup myself, atleast not yet :) And when it comes time to do so, I'll rush over there myself.
I guess this is what it was like in the 1960s in Greenwich village in NYC, or Berkeley CA or Woodstock or whereever else. Its just quite surreal & I still haven't gotten over it.
It is good to be optimistic, but I'd hate for people to get this impression that the streets are paved with gold and make some really poor decisions.
As for the "Somebodies", it's not all about past success; there is a lot of luck and flair to it. There are, in any human culture, people who are utterly worthless but can make the magic happen. They don't know much technically, but they're great at using the herd mentality and certain exploitable vulnerabilities in weak minds in order to make other people like them, so getting funding and press comes easily to them. When they actually have to build a product and a team and a company, they're screwed, and they tend to flame out catastrophically. Whereas the people who actually work hard and have real capability will have slower paths to success but, when they get there, they'll be able to stay where they are because they've actually earned it.
you're not trying hard enough... moving to another location is not going to help you
> And a third chap was going on and on about some series A series C thingy.
Ok, this has to be a subtle troll...
It's not unheard of that I'll be hanging out at a cafe in Palo Alto and run into other entrepreneurs I've met before.
I went to a talk at the CS dept at Berkeley and ran into a direct competitor (who actually had my app installed on his phone). Had a great convo with him.
I've also had people come up to me who are in similar spaces who propose a possible collaboration.
However, there's good reason I am here in Silicon Valley. Athens at the time of Pericles and Socrates wasn't a great place to live either, far worse than Silicon Valley. Same goes late Republican and early imperial Rome, Tang dynasty Xi'an, Florence and Venice during the Renaissance, Victorian London, etc... On the other hand, people willingly sacrificed their standard of living and prestige to live in these cities and and pursue activities they found meaningful. Being a big fish in a small, provincial ponds sucks: if you want to grow intellectually or professionally, you should be around smart and ambitious people.
To be fair, there are pockets of talent elsewhere (New York, Seattle) but they're generally rather insular: a lot of the places tend to be a combination of a revolving door for some (people joining and leaving in 18 months, very frequently moving to Silicon Valley) and a life long commitment for others (lifetime "softies" at Microsoft). While exceptional talent does exist in many place outside of Silicon Valley, the stories of people joining a company, staying long enough to make a significant impact and then applying their lessons elsewhere (e.g., the "Fairchildren", "Paypal Mafia", Xooglers) are not as common in less-fluid engineering job markets.
I think that Silicon Valley in the late 2000s and early 2010s is that place. Particularly centered around the offices of Google, FaceBook, Twitter, and YCombinator. There's an energy here, a thrill of discovery, that's just missing in most other places in the world. It's enough to make me overlook that the city is basically suburban sprawl, public transportation sucks a lot more than Boston/NYC/DC, the quality of life is honestly not that high, there's little sense of history (only of history being made), and everybody wants to get rich quickly.
I don't think I'd want to settle in Silicon Valley. But when my grandkids ask questions about the birth of the Internet age, I want to say I was there.
Execution is important.
But I think many people have the skills to create what ends up being successful.
Take Groupon for example. It made something a lot of people wanted. Could most people on Hacker News have made it? Sure.
But Groupon created it before anyone else (I might be wrong about this?).
Another example is HN. Pg has said that what he thinks users want most are quality articles and discussion.
While it's "just a forum", I think Pg is right for not adding a lot of features, or spending the limited time he has working on the UI, and instead focusing on how people can discover quality articles and make/read quality comments.
"Make something people want." It's simple, but it sure isn't easy.
I believe HN's plain design is actually an intended feature, not a bug. From one of PG's essays:
So the most important thing a community site can do is attract the kind of people it wants. A site trying to be as big as possible wants to attract everyone. But a site aiming at a particular subset of users has to attract just those—and just as importantly, repel everyone else. I've made a conscious effort to do this on HN. The graphic design is as plain as possible, and the site rules discourage dramatic link titles.
http://paulgraham.com/hackernews.html
I agree. Though I've read several comments that suggest adding to it, and in general, I think doing that would make it less useful.
Group buying has been done many, many times before, going back to the bubble. Many millions of dollars were burned to little avail. What Groupon actually nailed was all the hard parts of the business model that don't look really freaking difficult on the napkin -- particularly "signing up local merchants" and "cost-effective customer acquisition."
That second one is relevant for virtually all businesses and gets disproportionately short shrift here.
Great reminder patio11
I may be misunderstanding what you're saying, but signing up local merchants doesn't seem all that hard. There seem to be many Groupon clones that have produced deals with merchants.
The main problem for the clones is not having Groupon's scale/distribution.
I think what Groupon got right was the simplicity of its offering.
One page that clearly explains what you're getting, at at least 50% off.
When looking at an offering, I see a picture, a short and sometimes funny/interesting description of the offering, short crisp bullet points about restrictions, how many people have bought it, how much time is left, and contact info -- specifically where the place is located.
That's really easy to understand. The user can vote yes or no in a minute or two.
The best indication that people should invest in you is that you don't need them to invest in you at all.
I turned down the offer, but for reasons unrelated to my side project. Still I feel like my project/startup is floating in the Sargasso Sea. If you think getting funding in the Bay Area is hard, move to Atlanta. There's a reason Stammy is out there.
And you can't be too much of a Nobody if you can get into YC twice. I wish team Notifo (or whatever your next project is) all the best.
Brilliant post, Chad. Many thanks.
Indeed. You now at least you know a Somebody or two. Many folks don't get that far.
A misquote from the article (my perspective):
> Am I jealous of other companies' success? I would be lying if I said no. I am slightly jealous when I wake up and read another story about some company getting into YC when I didn't even get an interview.
I'd also be lying if I wasn't genuinely happy for every company that gets any sort of success, because I'm now getting a taste for how hard it really is.
I've also had "Startup depression" where I didn't sleep for 1 week and was totally unproductive for a grand total of 2-3 weeks. Ever since then I stopped recommending doing startups to my friends.
We've also experienced the "You're Nobody until you're Somebody problem." The work-around we're trying right now is to bring a (non-technical) "Somebody" onboard as a partner/founder, who is also, unlike us, located in the US where our market is.
Location has also come up in this thread. Early on I thought that thanks to the Internet location matters "less". Not true. You have to be where your investors/customers are. Deals require massive face time.
Its winning the lottery that is hard, and only because you make it hard on yourself for that big prize.
Am I jealous of other companies' success? I would be lying if I said no.
Thank you for saying this. I've always wanted to, but feared I'd be called out for it. In public. In fact, I think it's part of what keeps the fire burning inside - that constant hunger to try and figure out why some folks are plain better / more successful at the game, and then trying and internalizing / applying those lessons.
And it can get frustrating when you can't replicate / emulate what others have achieved seemingly easily. As a corollary, this is probably why Jack Dorsey and Dennis Crowley are enigmas unto themselves.
An important aside: Chad, I'm someone who has tracked (and may I add envied) the Notifo story. And I admire the work you've done, from fanout.js, to snagging Paul for a co-founder, to HN for Android, to PicAFight, to GramFrame, to Vorepad........I've found myself in awe of how prolific you've been (and you don't even know me).
It's possible you've been doing one thing too many (because you love APIs and can't keep from tinkering with them). What I'm convinced of, is that you have the talent, the work ethic and an incredible co-founder. All the best, I'm hoping I have to transition back into pure envy real soon.
I was doing all that "one thing too many" stuff during the "crap, what are we gonna do now" phase where we weren't super productive and just played around with prototyping some ideas.
Not shipping anything made me feel terrible, so we spent some time making random side-projects to stay sharp. All of them were good learning exercises, too. I made sure that each project had some part of it that I didn't know how to do, so it would force me to learn new things.
I happened to navigate to Paul's article on fundraising, and further, to Alexis' one on keeping calm and carrying on (http://alexisohanian.com/keep-calm-carry-on-what-you-didnt-k...) and I was blown away. There's no way I could've survived something like that. You're in great company.
I'm looking forward to what you come up with. Here's to a great couple of years ahead.
This trap is something that is so easy to fall into and so painful to pull out of. My first startup had a 'star' VC fronting it, he loved the concept but didn't really understand that his vision was often in conflict with the founder's vision. That really hurt as the company was ripped too and fro trying to achieve a couple of really orthogonal goals.
Tom Lyon once told me that really it takes three startups before you 'get it'. One which is a somplete disaster, it helps you see what you did wrong and what can go wrong. One which isn't a complete disaster but exits sideways, which is to say you work at it day and night but when it exits you find yourself exactly where you were when you started. Then the third one where you know what to expect, you have a solid idea of what not to do and you keep laser focused on getting in, getting done, and getting it shipped.
It is very hard though, always.
We certainly went through all of that at Jamglue. It's absolutely true that being a founder, especially the fundraising part, requires a really thick skin.
Each time I think about doing another startup, I start having flashbacks to broken termsheets, bullshit EBITDA projections, and VC's telling us that they could introduce us to Quincy Jones (I swear, at least 7 different people told us this). When we came out of our fundraising stint (penniless), we realized that our product had suffered and we were completely broken people.
The ability to be self-aware about the emotional roller-coaster is invaluable, and essential to forward progress. Thanks for this honest account so that others can make some sense about what they are feeling.
If you're not ready to sacrifice everything you have, possibly including your health, then work on your project on the side. You really do have to be crazy to be an entrepreneur.
The positives: It's thickened my skin, I manage my finances better, I appreciate things more, I treat people better.
This reminds me why passion is so crucial when starting your own business. You will work crazy under conditions that most employees would see as unreasonable and there is a great risk that the business will fail. But as long as your doing it out of passion you can motivate yourself through the hard times and, if it doesn't work out, walk away with the satisfying feeling that you followed your dream and gave it all you got.
Would you say that your passion played an important part in managing your business?
In the meantime, perhaps console yourself this way: you haven't found the pitch that's opening investor wallets yet, and maybe that's a good thing. Maybe the pitch you're using isn't your best bet; maybe a "yes" at meeting 38 would have put you on a bad path.
My friends and I got a high-seven-figures "yes" in '99 that ultimately killed our company.
Meanwhile, Matasano went through exactly what you did in 2005; every company that found a "yes" got dead as a result. We're relieved to have dodged the funding trap.
Best of luck to you. You don't need gatekeeping investors to succeed.
I wish you good luck with with your startup. Actually I wish all startups having difficulty raising the next round good luck.
What about being your own boss? What about learning & producing at 10 times the rate you would at a desk job?
Also, I think you'll find there are plenty of "Nobodys" with past successes. Don't do it for the fame.