>in that I was assuming that you already know what would be useful - whereas that is often the difficult part.
Me, I focused on "what can I do" and "what would I buy" - I think a reasonable, though very limiting, starting point.
My first problem was that amazon radically changed the market for storage (I started by selling storage) - my second problem was that sharing pagecache? bad idea. My third problem was that I thought using obsolete hardware was somehow a good idea.
So, uh, yeah. of my major problems, only one, really, was external. the rest were me being stupid. I guess that could fall into the "finding something useful" category. But then, I am mostly filling unserved price niches in existing markets. When I started there were already VPS providers out there; linode was one. I do believe I was the first to switch to xen.
>I say that finding something to create that is useful enough to give a modest one-man income, is a lot easier than finding one giving a multi-billion dollar payout.
I assume it's harder to make the 'big exit' companies... not that I would know. It's certainly a very different game, one that would be /much/ harder for my particular skillset. most 'big exit' companies seem to be more focused on selling to investors than on day to day cashflow. In my industry, if I sold out tomorrow, I'd get the value of my servers, plus about a years revenue. Now, there's no way I'd sell at that price, but that's market for a ISP or hosting company. Compare that to the valuation MySpace got. They got a valuation that assumed myspace would be the dominant social networking site for a long time. The valuations for friendster and facebook both reflected that same assumption. To me, that assumption seems ridiculously irrational.
Now, if you are going for a 'big exit' usually you have more than one founder, and some startup cash from someone else. Certainly, more work is put in, but is any one person's contribution more than what they'd have to contribute to get their own lifestyle business off the ground? I don't know. Once you involve investors, though, and people depending on investor money, you are much more likely to get yourself in a situation where you have no choice but to close the company.
Of course, my negative tone is entirely sour grapes, because my skilset means that I'd be a very minor player in any "swing for the fences" venture, while I can handle my lifestyle business just fine.
I think the hard thing about the multi-billion dollar exit isn't the extra work needed, but the probability of it working out. Maybe one estimate of the odds is how many projects are started, verses how many cash out (this should include projects that are abandoned even after only a few weeks, if they would have continued had they got a little traction.) Massive survivorship bias, when only the huge payouts are publicized.
I don't think the initial founder/s necessarily must have the right skillset, but someone, sometime must come on board with that skillset. Rather tragically, these people seem to quite often eject the founders. One book ("Crossing the Chasm") even claims that the initial founders don't deserve the big pay-out because they don't have the skillset (and they're more interested in making cool stuff and being their own boss than in making money). Ugh.
To be captain of your soul, master of your destiny is worth more than all the riches and fame in the world - they merely tighten the shackles of the worldly and the opinions of others, not freedom of any kind, only dominance (says me, sans riches and fame. actually, I think it would be great fun).
BTW your 98th percentile puts you squarely in the "smarter than average, but not a genius" camp, which is where I am, and where I think most entrepreneurs are. In business, extremely high intelligence seems to be liability. I think what really counts is something like boldness + quick recovery. I could certainly do with some more of that.
I agree with you about MySpace etc, it's too unpredictable; too easy to switch (mind you, I said that about Google too; I thought their massive PR efforts was one of their few competitive advantages, I wonder if they've become complacent recently.)
> MySpace employs 1,000 employees, after laying off 30 percent of its workforce in June 2009
> By late 2007 into 2008, Myspace was considered the leading social networking site, and consistently beat out main competitor Facebook in traffic. When Facebook launched new features in an effort to attract a variety of users, Myspace found itself in a continuing decline of membership. As of July 2010, the site was ranked 25th in Internet traffic,[3] opposed to the 2nd position held by Facebook. http://en.wikipedia.org/wiki/MySpace
Kids love cool stuff, which means they switch all the time. Maybe the sustainable business model is a business that generates (or promotes) social sites? (analogous to music publishers always touting the next cool band - most bands have limited lifespan, but the publishers live on)
Me, I focused on "what can I do" and "what would I buy" - I think a reasonable, though very limiting, starting point.
My first problem was that amazon radically changed the market for storage (I started by selling storage) - my second problem was that sharing pagecache? bad idea. My third problem was that I thought using obsolete hardware was somehow a good idea.
So, uh, yeah. of my major problems, only one, really, was external. the rest were me being stupid. I guess that could fall into the "finding something useful" category. But then, I am mostly filling unserved price niches in existing markets. When I started there were already VPS providers out there; linode was one. I do believe I was the first to switch to xen.
>I say that finding something to create that is useful enough to give a modest one-man income, is a lot easier than finding one giving a multi-billion dollar payout.
I assume it's harder to make the 'big exit' companies... not that I would know. It's certainly a very different game, one that would be /much/ harder for my particular skillset. most 'big exit' companies seem to be more focused on selling to investors than on day to day cashflow. In my industry, if I sold out tomorrow, I'd get the value of my servers, plus about a years revenue. Now, there's no way I'd sell at that price, but that's market for a ISP or hosting company. Compare that to the valuation MySpace got. They got a valuation that assumed myspace would be the dominant social networking site for a long time. The valuations for friendster and facebook both reflected that same assumption. To me, that assumption seems ridiculously irrational.
Now, if you are going for a 'big exit' usually you have more than one founder, and some startup cash from someone else. Certainly, more work is put in, but is any one person's contribution more than what they'd have to contribute to get their own lifestyle business off the ground? I don't know. Once you involve investors, though, and people depending on investor money, you are much more likely to get yourself in a situation where you have no choice but to close the company.
Of course, my negative tone is entirely sour grapes, because my skilset means that I'd be a very minor player in any "swing for the fences" venture, while I can handle my lifestyle business just fine.