People seem to become really attached to the validation from YC.
Getting into an incubator or getting money from investors is zero measure of business success. Business success is users and growth and revenue.
Whether YC blesses you is also zero reflection on you as a person. Rejection by YC means nothing at all.
I think business is about trying to make money, it’s not about YC and funding and the scene and investment rounds and hyper growth and beers after work and been seen as one of the cool kids.
Head down, work, balanced lifestyle, try to make something small succeed on your own.
I think they're referencing YC specifically. While money is money, there is a prestige put upon the acceptance into YC (obviously more so in this community). This, I believe, is what's being discussed. Not the validation of business ideas via VC investment.
Even YC is open about the fact that they are wrong with rejections. Also agree on the problem with VC money as a measure of success, because it is not. And still it used, it seems, as the prime success indicator in everything start-up. And as such is the primary thing people seem to seek out. It is also very persuasive, sometimes I catch myself with a small amount of jealousy when someone in my field is raising multi-million rounds. And wouldn't even take that money if someone offered it right now.
> Business success is users and growth and revenue.
To me, business success is only the profit, what my business makes after the expenses - free cash to invest or share to shareholders. Everything else can go to hell, I don't care (except when it relates to making profit).
However nothing wrong if someone else has some other metrics. However I don't really understand why to pursue something else in business.
I completely agree that revenue gets too much airtime, at the expense of profit. I do think revenue can be a useful stat for startups, for example if it is a harbinger of future profit. Imagine you're spending $500k/yr on engineering to build a platform, and you're bringing in $500k/yr in revenue. In the early years, this means you have no profit. But if your product (perhaps Saas?) is one that requires much less upkeep than initial development, then you can be fairly certain that your business will become profitable once the early dev work has been completed.
Of course, you can't be naive here and forget to account for customer service, maintenance, etc., which all ramp up over time.
>Getting into an incubator or getting money from investors is zero measure of business success.
That is sort of like saying money doesn't buy happiness...true, but financial stress or poverty typically can be outright bars to happiness. As you say YC admission or raising funds from investors isn't a measure of business success...but then again I haven't seen a tech unicorn that hasn't been funded by investors.
>Head down, work, balanced lifestyle, try to make something small succeed on your own.
That is a great message to tell to the 99% that get rejected from YC and will never touch VC funding...but even that sounds more like a pipe dream than the American dream now a days.
> As you say YC admission or raising funds from investors isn't a measure of business success...but then again I haven't seen a tech unicorn that hasn't been funded by investors.
There is a difference between a company getting investor funding and the investor funding being a significant measure of success.
There are plenty of unicorns that didn't raise money until well after they were already considered a success. A couple examples off the top of my head would be:
* Github - first round was a $100mil series A at a $650mil valuation about 5 years after founding.
* Atlassian - first round was a $60mil round 8 years after founding.
I'm sure there are plenty more that are easier to find once you know what you're looking for.
>...but then again I haven't seen a tech unicorn that hasn't been funded by investors.
Partly because if you're not in the target market for a bootstrapping business, you probably won't have heard of them. It's a waste of money, time and energy making a big noise about your business if you're not chasing investment.
Partly because the desired exit for bootstrapped businesses is (usually) a trade sale. You can't trade-sale a unicorn-sized business because finding a buyer that big is difficult/impossible. Bootstrapped businesses tend to sell before they get that big, while they're still showing huge growth, to make sure they have enough potential buyers.
Partly because valuations of bootstrapped private companies are weird. With no VC driving valuation growth, and no stock sales, how much is a private company actually worth? Valuing one is tricky, and a lot less important than for an investment-driven business.
More accurately it probably means "Honestly, we probably didn't even look at your idea very well because we have a shot glass to fill and 10 fire hoses of output trying to fill it. Likely, for some entirely arbitrary reason, you did not make the cut. You may or may not have a good idea but we lack the time to tell you"
The problem is, virtually no VC is taking cold calls anymore (did they ever, really?). YC is great if you are early stage and need the money, networking and yes, validation. Their knowledge and experience are also very useful, but they already make it available to the public for free (which is amazing in itself).
If you can bootstrap a business without needing any of the above, that's really great and you should do it. But that depends greatly on the type of your business.
> Business success is users and growth and revenue
Nope, it's net profit. I know there are fashionable exceptions like Uber/Amazon that grab market share in a winner take all market before focusing on profit but for 99% of companies out there, unit economics are still the measure of success.
I've been part of companies with insane growth, crazy fund raises etc that eventually died because revenue didn't keep up with costs.
There are very valid reasons to be drawn to validation from groups like YC. They may be disconnected from business success, but they are valid nonetheless.
So what would YC disconnected from business look like?
Lots of comments here. This is one area where either you have tried or you haven’t and you have either succeeded or failed (to get to the next step).
I tried, (left my job, put my time and money on the line), had some small wins, but ultimately failed. Looking back, not getting in to YC was probably not a significant driver in the business not working.
That said, when you have your money and reputation on the line, validation is very valuable, and those that say it isn’t, either haven’t done it or are truly unique.
I think your point on a balanced life is also crucially important. Being too obsessed with something also shows off badly and had a way of pushing people away from both you and your "business". Nobody like a desperate person, balanced and well rounded people are more attractive.
You have to work on something you are passionate about. If you work on Sundays because you cant keep yourself away from it, then great. If you work Sundays because you think if you work hard enough you will become rich and successful, then you are likely going to burn yourself out. Your life is NOW, be happy now. Don't push it off. If coding all day makes you happy do so. but if you rather hang out at the beach do so. There is nothing wrong with that.
I see a lot of startups made up of people who bought in to the startup myth and all they want to do is be successful. They dont care the least about the problem they are trying to solve, or like to do the work needed to solve it. If you would spend day and night on something even if you knew it would never come to anything, then that's the thing you should do.
A lot of people try to figure out what the pattern for the perfect startup is, and I think its just what ever you are passionate about. Maybe it will work out, maybe it wont, but at least you wont have wasted your time.
If you are passionate about caviar, be a sturgeon fisherman, or a chef. dont start a startup.
I was so frustrated to find grinding through skills and development courses after work left me burned out and, all things considered, a poorer thinker.
My guess: Sharpening is the process of removing material, if you sharpen a knife forever it will grind down to a useless stub. It is possible something got lost in translation, or possible that the metaphor isn't quite as satisfying as some of the others used.
This seemingly simple sentence carries so much wisdom.
I'm not the biggest fan of Eckhart tolle but this is basically what his philosophy is too. To quote him "It is not uncommon for people to spend their whole life waiting to start living."
Understanding it can transform your entire life (at least it did mine)
Thanks for posting this. I've been bouncing startup ideas around for a long time, but I feel that this comment will help to reframe my thought process in a positive and productive way.
You have more chances of succeeding at anything if it's something you care about. You will understand the domain better. You will inspire others (customers, investors, coworkers, etc). You will go the extra mile.
This was a good article, but I want to briefly call out that `6X more likely to suffer from ADHD` is not a useful stat when trying to argue that being a founder causes health issues. ADHD is present from birth and cannot develop as the result of trauma.
It's still an interesting statistic, but for a different reason. People with ADHD are more likely to become founders, as they're more driven by passion, challenge, and novelty. Meanwhile, they're less driven by the security and consistency offered by traditional workplaces.
I'm uncertain we can trust that '6X more likely' statistic. There is evidence/speculation that sleep deprivation can cause symptoms that mimic ADHD symptoms. For example: [0].
Edit: That statistic is attributed to a Tech Crunch article [1], which in turn references another article [2]. The "6X" figure appears to be from one study involving 242 "entrepreneurs" and 93 "comparison participants" self-reporting on ADHD (and some other mental health-related conditions). It appears that the "comparison participants" were all students and faculty associated with the university.
I believe the relevant chart is on p. 14. Sleep and/or sleep deprivation doesn't appear to have been something that this study considered (or attempted to control for). (I didn't read this material extremely closely, however; maybe I missed something.)
> ADHD is present from birth and cannot develop as the result of trauma.
This is a misleading claim, as secondary ADHD can result from traumatic head injury, and childhood trauma can result in a condition that may differ from but is behaviourally very similar to ADHD.
And sleep deprivation/poor sleep habits, psychotropic use, stimulants, etc can all cause comparable conditions. I imagine the original quote isn't talking about a specific, concrete, diagnosis and is leaning more towards the colloquial use.
I had some meetings at the YC SF office 2 years ago and everyone I saw, and talked to, had a phone or laptop screen they were staring at while trying to also talk to you and in some instances pausing at their laptop to do something on their phone while occasionally looking up to notice you were still there and talking.
Anecdotally I find that doing the above can start to cause you to not be able to focus on any one thing with any real level of attention and I'm not a founder or startup employee that has a ton of real, and imagined, pressure/worry added to that.
I suspect it's also that employers don't like to hire people with ADHD. If traditional avenues get closed off then self employment might be the best alternative.
I’m not a healthcare professional but from what I’ve been reading clinical ADHD produces rather characteristic patterns in brain MRI scans in response to stimulation. I guess one could check that with a newborn if they found any value in diagnosing it so early?
In the midst of the business flailing, I loved that I could at least say we were working constantly. It felt like the only "positive" metric that showed we were true "entrepreneurs."
This is the wrong metric to use. It's a metric that's practically guaranteed to lead to unhealthy patterns.
When I worked at Aflac, a lot of my coworkers were enthralled that they were there. It was the biggest thing that had ever happened to them and they had stars in their eyes.
To me, it was just a day job. I was punching a clock for a paycheck.
I had done other things that I felt mattered a whole lot more, were far harder and made more of a difference in the world. My psychological relationship to the job was different from that of many of my coworkers.
Don't use suffering or hours worked as metrics to measure your worth. It won't go good places.
Don't get too starry-eyed about getting accepted to YC. It's a first step, not a last.
I'm glad he wrote this. I hope he gets things sorted out. Best of luck to the man.
Totally agree that's the wrong metric - learned that the hard way. It was just the only number I could use at the time that would make me feel like all those hours meant something.
Thanks so much for reading it and I've definitely been getting things sorted out. Best of luck to you as well!!!
It's headquartered in Columbus, Georgia. At the time I worked there, it was the largest civilian employer in town and a Fortune 500 company. It actually made the Fortune 200 while I was employed there.
It was founded in June 1955 by three brothers. When I was growing up in Columbus, I can remember it being advertised locally as American Family Life Insurance/Assurance Company of Columbus.
I'm not sure when they changed the name. It began as American Family Life Insurance Company. Some other company in some other state had the same name. Internal stories when I worked there indicated it was settled with a gentleman's coin toss, which Aflac lost. So they legally changed the name in all 50 states to American Family Life Assurance Company.
Had that not happened, you wouldn't have the name Aflac, which is an acronym for their legal business name, and you would have never had the Aflac duck commercials.
Anyway, it's a homegrown business started locally and they own the tallest building in town, known locally as The Tower. It's the only real skyscraper in all of Columbus that I know of and school kids get taken on tours of it as school field trips. The Aflac Tower is a local landmark and they do Christmas lights every year in the windows. Like making a Christmas tree based on which windows are lit or something like that.
It's a very big deal locally and a lot of the more interesting stuff I know about the company is stuff I never see articles about. I've looked and can't find them. I wrote up a few things at one point on a blog, none of which is online anymore, because the company really is interesting and doesn't seem to talk about a lot stuff I think is interesting.
It seems to have shrunk since I left, but when I worked there everyone would ooh and aaah when I was getting a haircut or a meal and making small talk and people asked me where I worked and I said "Aflac." It's kind of how when programmers work at a FAANG company.
Although Columbus is one of the bigger cities in Georgia, it's really not that big. But it has this big company that started there and grew and grew.
The other big thing locally is the Army base, Ft. Benning. It's a much more sophisticated city than it really should be, given its relatively small size, because of those two things giving it international connections and international flavor. Aflac was getting about 75-80% of it's revenue from Japan when I worked there. The CEO spent about one week a month in Japan and this is another thing that most of the world seems largely unaware of.
So Aflac is a really big deal locally and one of my teammates spent several years trying to get good enough to qualify for a job there. They have trouble filling jobs and have to do a lot of internal development of talent, in part because it's not a very big city and insurance is complicated stuff that requires substantial training, even for entry level positions.
One of the advantages of running your own business is that you set the tempo and values of it yourself. You. No one else. If you end up with something that isn't working out for you, you're doing it wrong.
At my previous company, one of our (somewhat implicit) values was "suffering is not a KPI".
And even though there are times when things are rougher, these should be exceptions, not the rule.
At the same time, working 100 hours per week is the most bullshit business myth of all.
This is usually touted by the type of person who spends a lot of time in meetings or 'catching up on important news', and within industries where people are flat out lying to each other about how much they actually work (management consultants come to mind, and certainly some investor types.)
When you meet these people IRL you realize many of their 100 hours are spend sipping coffee in another part of town while having casual meetings, prior to running some personal errand. While some of this may qualify as 'work', it is not the type of 'work-work' that a naive coder/entrepreneur is pursuing en route to their burn out!
The 80/week people I have seen are "too busy" to stop and ask themselves if they are spending their time efficiently. They are focused on the short term tasks right in front of them. It is like someone saying they are too busy to get an oil change or new tires so they keep driving their car until they are stuck on the side of the road.
This seems like the "oh you're busy, you just haven't learned how to manage your time effectively" feedback that's not helpful. Someone relatively smart probably has a decent idea of the constraint set in front of them. Let's say the company is close to failing and by working your absolute hardest you can keep it alive for 9 months. Would you not do it?
Like maybe there's some insight on time management but after rudimentary time management...it's probably something else.
At some point, working more hours makes you less productive. As an obvious example, you can’t work literally every hour of every day, since without sleep or food you can’t function. Now perhaps the curve for you really does peak at 100 hours/week, or 80 hours/week, but frankly I doubt it.
Acknowledging that there are thresholds for productivity, it also dramatically depends on the type of work and the objectives. Diminishing returns are bad for some tasks, acceptable for others, but both are subject to the types of deadlines. Implementing a half-good feature just in time for a big marketing event might be worthwhile or it might not, but cold calling potential customers to keep from failing generally is, and is somewhat less subject to declines from productivity loss.
At some point, not only do returns diminish, but they actually become negative because your productivity during the first forty hours of the week goes down when you don’t get enough sleep, relaxation, etc. Perhaps that point is at 100 hours/week, or more, but I’d wager that it’s at the 80 hours/week mark where working more decreases your productivity.
And yes, it does depend on the activity, but even cold calling customers all day can become too much, or an extra ten hours of calling could make your sixty hours of programming less productive.
Suffering, indeed, is not a KPI but your takeaway is off.
I use Timing app to track my digital. I spin up at 11am, get reving by 1pm and don't stop until I pull up to the drive way at 1am or 2am. Monday to Sunday.
There are plenty like me as owner-operators that put in the time/work to get shit done until there are enough rev to hire out.
At the alphabet soup company we worked maybe 11am until 4pm, wrap up to go home on the busses, put in another 1-2 hrs at night time to checkin. But during that 3-5 hrs it's highly focused flow that takes dozens of other supporters and personnel to get to.
The pirates that go flitter about, whether in silicon valley or los angeles, to get production done, show going, or keep it moving, all work however they work.
I believe the focus of what's being said is that people who claim to work these insane hours, _and_ manage to keep all other plates in their personal lives spinning, usually do not spend that much time doing productive work.
That is not to say that there are others who can do many actual productive hours. But usually, at least in my personal experience, when one does that they are sacrificing other aspects of their personal life in the hopes that when they achieve their goals they can then deal with everything else.
In my experience, things don't really work out all that well. Ideally one should find balance in the now.
It kind of depends what the work is and if it's tiring. Take someone like Warren Buffett - he's reading and thinking pretty much all working hours but it's what he likes to do and not especially tiring. Seems to work quite well in that case. The only real downside seems to have been his family complaining they didn't see enough of him.
I did that once for 18 months and spent two years burned out afterwards. And bragging about it is basically a hubris of considering oneself a superhuman.
From Patrick Collison : "While long hours can't be a goal, I worry that it's easy to mislead. As a descriptive matter, creating Stripe required obsessive intensity. Maybe better founders could have worked "smarter", but I do know that long hours were needed for us to build something great."
Don't let work dominate your life. Work is important, but it should not be a grind, or you will end up with serious mental health issues.
I have some observations to contribute (context: I am a solo founder of a bootstrapped business):
* Much of the "news" you read will be stacked against you, because it is in the interest of VCs and employers to see you work your butt off for years, with the mythical carrot of a major payout hanging in front of you. Your mental health is not a consideration.
* You can make good progress working reasonably. In fact, I'd wager that you can often make better progress, because the quality of your work is better than when you are tired.
* Being a solo bootstrapped business founder is not necessarily a panacea, the anxiety and pressure are still there. You have to learn how to deal with them (I'm still learning, but making good progress).
* Consider your goals. Does it really need to be a multi-million payout, or is a healthy income for you and your family enough? Do you really need huge growth, or are you OK with modest growth once you reach a comfortable level? Your goals might not align with those of others, and there is no such thing as "obvious" goals. I believe that a lot of problems in today's world are created by the pressure for constant growth (at all levels, both startups and companies like Apple).
Why is there only one up-vote to give? Being a Solo-founder myself, you are so right.
My, and as soon as the business can sustain another person our, goal is helathy growth to a sustainable levelwhere we can oneday employ an handfull of people so we don't have to do everything our selves. So one of the most important metrics is cash flow. Success is positive cash flow, profits and happy customers. If you ask me, that might very well be easier to achieve without VC money as you can aim lower with a smaler chance of missing.
Agree on the anxiety and pressure part, it is still there. And since your entire runway depends on yourself maybe even more. But that you don't have a board nd investors pushing you on a course to hypergrowth.
One of the main reasons I started the company was to not have a boss anymore. So I won't replace a boss with an external investor if I can help it.
EDIT: Taking guys like Gary and people considering sleeping on factory floors to be a good idea as role models is a problem. In the first case bacause Gary is making a living of selling his message and merch online. In the second case because it indicates grave mistakes happened a long time ago.
Disclaimer: I know a bit about these things from either personal/friend/family experiences or through my psychology degree. I'm not a clinical psychologist though, I simply graduated a psych program one day.
Before I go into the author's claims let's explain in a visceral way how stress becomes unhealthy. This is how I experience it: stress is normally fine, just like exercising is fine. Stress is just like lifting heavy things. If you do it every minute of the day, at one point your body will collapse and need to heal. So you don't do that.
Well, in some situations the stress can't go away. That is when your mental health starts taking a toll. Imagine if you have to lift 50kg all the time and it can't go away, want to stop? No, you have to lift right now. Broken arm? Lift! You have to! It won't go away. You can imagine that your body would collapse and burn out.
Don't get stress that you can't summon away, because if that stress becomes too much, then you have hitched a ride to the gloomy village of depression. Sometimes you don't have (or don't feel like you have) a choice though, that's the bitter sweetness called life, unfortunately.
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With that said, I think Techcrunch and this author are doing a disservice to the psychological conditions that were listed. Let me show what I mean:
> 2X more likely to suffer from depression
I get that.
> 6X more likely to suffer from ADHD
That seems like self selection people with ADHD seem to me to be better suited for a generalist role. It doesn't seem like you get ADHD because you choose to be a founder.
> 3X more likely to suffer from substance abuse
Stress is a nasty thing.
> 10X more likely to suffer from bi-polar disorder
Seems like self selection the mania states of people with bi-polar can be super productive (or destructive, depending on the person). But again, it doesn't seem like you get bipolar because you choose to be a founder.
> 2X more likely to have psychiatric hospitalization
Did I say that stress is a really nasty thing?
> 2X more likely to have suicidal thoughts
Chronic not-going away stress can do this to a person.
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Leave bipolar and ADHD out of it. Also, psychiatric hospitalization is better than whatever I whenever I'm in San Francisco. Getting help (or being forced to get help) should not be on this list.
> Farmgirl Flowers CEO Christina Stembel normally sleeps just 4 hours per night
Doing this for sustained periods of time will lead to reduced cognitive performance[0] and, eventually, severe fatigue and possibly depression. Sounds like optimal operating conditions for a CEO.
If the dotcom bubble taught me anything, it's that working all the time is neither cool nor a measure of success, but rather the opposite.
If a stat sounds like it was invented for dramatic effect, then it probably was.
This is nearly always something touted as a self virtue, but actually just a ploy to get subordinates to work unreasonable hours.
(I'm not saying that there aren't people working these kind of hours, but they certainly aren't bragging about it or trying to convince others to join in).
Yeah, it's likely to be hyperbole, but articles like that perpetuate dangerous ideals by reinforcing the myth that successful people are somehow superhuman, and that we all need to push ourselves with dangerous habits to be able to succeed.
For people with a normal need for sleep that’s worse than going two days without sleep. Six hours a night for a week degrades mental performance about that much.
Ms Stembel could be far out on the bell curve in terms of her need for sleep. People who are perfectly healthy on four hours sleep a night for decades exist.
>Ms Stembel could be far out on the bell curve in terms of her need for sleep. People who are perfectly healthy on four hours sleep a night for decades exist.
Out of curiosity I dug up this article about Ms Stembel and in it she talks about her sleeping habits:
"When I do sleep more, I’m like, “Oh, that feels good. I should do that more often.” But I definitely believe in the power of habit. I’ve kind of honed the habit of not sleeping much, so my body can respond accordingly. It’s very normal for me now, but it’s not ideal. I probably sleep about 4.5 hours a night during the week, and then I try to get one weekend night where I can sleep seven or eight hours."
Even she herself acknowledges that this is not ideal and tries to create opportunities to sleep for the normal 8 hours. The problem with sleep deprivation is that it accumulates damage in the body which becomes apparent only later in life, so by sleeping this little she might be creating problems for herself in the future without even realizing it now. According to sleep researcher Matthew Walker, people whose bodies require less than 6 hours of sleep do exist, but they are extremely rare. It might be that Ms Stembel is one of those people, but I would still place my bet on that she is chronically and seriously sleep deprived.
If she naturally sleeps eight hours a night and usually sleeps less than five hours she’s basically drunk most of most weeks. I hope she has a driver because she’s not capable of driving safely.
I admire this post as an exception to the usual cheerful failure porn. Failing sucks.
But-I-learned-something is the very least you can achieve without being in a coma.
The time is lost.
Your waning bank account measures your (and maybe your families) prospects in an undeniably meaningful way.
The silver lining is...there isn’t one. The loss of time, energy, and money is something to grieve for. Every day is a reminder that it all could have been better spent.
When jumping into a startup, the question “why not” has very real and consequential answers. Beware and take this shit seriously.
You can come out of a failed startup with something still, if you consider yourself to be the product. So perhaps people should constantly ask themselves if what they are doing every moment improves them in some way or not first? Perhaps if you don't feel that way doing entrepreneureal stuff perhaps you are not suited for it.
I consider any job a training schedule. Progress is then defined entirely differently. I comfortably scale down the amount of work I do by monitoring my own mood. I must be under sufficient stress not just to maintain but also to expand my abilities. Doing slightly less would just do maintenance, doing slightly more in the long run causes injury and burn out.
I get a lot of extra comfort from the knowledge I will continuously improve. If I keep the stress slightly to low I wont grow as much but the recovery window will be smaller. If it is slightly to high recovery takes longer and the speed of progress is less than ideal.
Needless to say: Nothing is as important as eating properly and getting enough sleep.
I'm able to do idiotic amounts of work and enjoy it but if I explain the above to people who know this they never seem to understand. It hurts seeing people ruin their health with work but I keep seeing it.
After lots of fiddling I'm 99% sure that a 3 day work week is ideal to fully exhaust ones abilities. (If I'm not recovered fully in 4 days I do slightly less the next week.)
I use to think it depends on the job but if the work cant be done any faster you just make longer days. Something like 1 day 16 hours, 1 day off, 2 days 16 hours, 3 days off. If I work 6 or 7 days 8 hours per day I do roughly 1/3 per hour.
As one coworker of mine "famously" said when he was again asked to work extra shift: When do I live?
After a few years of Apple --for no good reason at all-- forcing code rewrites and maintenance I could no longer justify keeping these apps on the App Store, so they are now gone.
Anyhow, the Tommy Teaches apps used a combination of spaced repetition, genetic solvers and other software witchcraft to improve the rate of learning.
I mostly developed these out of personal need, when one of my kids was having trouble with a few letters of the alphabet (I forget how old he was, very young obviously). I downloaded a few apps to try and solve the problem only to discover they really didn't know how to teach a kid anything. The simple example being that they would keep repeating letters he had absolutely no problems with and gave the trouble letters equal treatment.
Tommy Teaches worked extremely well. Our local schools asked me to develop a version for Special Needs kids, something I started to do but ultimately could not complete due to Apple making it impossible to make money to fund such development (which, I learned, is very expensive).
Just a quick note/anecdote to say spaced repetition, perhaps along with other techniques can work very well if applied to a domain that might benefit from the approach.
This article should be another datapoint in every entrepreneur's handbook that simply going through the YC and Silicon Valley VC community does not ensure good outcomes. Owning 100% of a company making $1M/year is far more rewarding and valuable than owning 1% of a company making $100M/year.
Consider YC as a last resort if you have no other options.
> Consider YC as a last resort if you have no other options.
I think you mean, consider "accelerators" / outside-investment from Angels and VCs as a last resort? YC can't be last resort, because it would be foolish to think you'd get in, given the quality of startups and founders that apply-- Might as well pack up bags and brush up on leet-code, instead, as that's a last-resort more likely to work.
> I think you mean, consider "accelerators" / outside-investment from Angels and VCs as a last resort?
More generally I mean, give up a piece of your company as a last resort. Not saying investor money is always evil, sometimes it's simply necessary to make it through a bad patch or to get off the ground if you're broke. But if someone is giving you money for your company, it means that they value it more than you, which is immediately suspect.
For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing marginal value. It's about what life you want to live. The ten percent life is... just not for everyone, and maybe not for anyone, which is why it needs to be incentivized so much to ever happen.
> It's not just that money has decreasing marginal value. It's about what life you want to live.
I reached a point where I realized that the life experiences I was having were essentially the same as what much richer people are able to enjoy. A great example is when we got a pool. My wife had talked about it for a while, we have young kids and an unusually large backyard for a downtown home, and thought it'd be a great addition to our property. So I looked into it and it was going to cost at least $40,000 to $60,000 for an in-ground pool.
So I went to Walmart and bought the biggest above-ground, self-assembly pool I could find. It cost me $400 for a 16' diameter, 4' deep pool which holds somewhere around 15,000 litres of water (IIRC). A couple of days later my wife and I were sitting in inflatable chairs, floating in our pool and drinking cocktails in our backyard.
At that moment I realized that for 1% of the investment I was having at least 90% of the enjoyment. The experience of laying in an inflatable chair with your feet in the water and the sun beating down on you while you sip Aperol spritzes is essentially identical no matter the size and type of pool so long as it's deep enough to float in.
The same goes for so many other experiences: a rich person can buy a $250,000 car, but at the end of the day, their butt is on a seat like us and their hands are on a wheel like us and they're stuck in traffic just like us. If you can afford a helicopter, that's certainly a step change in terms of experience, but the sacrifices you have to make to get one and the overall chances of reaching that point just don't make it an appealing path for me.
The truth is, if you want a pool because you like floating in water, then the Walmart pool is enough. If you want a pool because you want your friends to envy how much money you have, then nothing will ever be enough.
> For most people, owning 100% of a company making $1M/year would be preferable to owning 10% of a company making $1B. It's not just that money has decreasing marginal value. It's about what life you want to live.
Being in control of your life, or of anything, is a huge benefit and comes with a big premium. When one company acquires a public company, they usually pay more than the public stock price. If you don't drive to work, owning a car is very likely more expensive than renting, but many buy because control over when and how to drive is gained is worth the cost.
There is a small car rental company in my town that does just this although it's more like an hour rather than 15 minutes. They've got all of my details on file so it's as easy as a 10 second phone call because the person recognises me by voice.
Founders often have controlling shares in their companies. This means they control a $1B revenue company instead of a $1M one, can become CEO if they want, etc. CEO salary for a $1B revenue company is more than for a $1M revenue one.
Also, if you own 100% you are the only person who is worried that the company is doing well. As often said, with great power comes great responsibility and in this instance it means you are the only person responsible that your 100% owned company is doing well. You can't just hire a manager. $1M/year revenue won't attract any good managers. They are going for the $1B/year class of companies. If a company has multiple shareholders, it has multiple people who care about share value increases. Investors are usually well networked.
If you own anything, you're not a peon. However, owning 100% of something is simply a very different mindset than owning just 99% of something. In the former, you solely control you own destiny.
In the latter example, you're beholden or subject to others. Not necessarily bad, but a very different experience.
Kind of like long term dating versus getting married.
If you only own 1% of your company after raising funds, you've made some serious mistakes along the way. Even Bezos, prior to his divorce, still owned 16% of Amazon, and that's after they raised money and went public - he owned 48% prior to the IPO.
> If you only own 1% of your company after raising funds, you've made some serious mistakes along the way.
This was a simple example to illustrate a point. A more realistic example would be: owning 100% of a company making $1M/year is better than owning 40% of a company making $100M/year where investors put in $500M with a 4X liquidation preference. This case is even clearer here, but not quite as easy to parse.
Modern VCs allow founders to retain a large "percentage" of their company in stock or other ownership terms, but they use liquidation preferences and other mechanisms to effectively increase their financial leverage.
Better in terms of financial gains, sure. But in the ability of the business to have an impact on an industry, group of people or the world at large, the smaller business has infinitely less leverage.
Fundamentally these kind of comparisons are not really relevant. The $1 million/year business is not even in the same universe as the $1 billion/year one, nor are the motivations of the typical founders.
Bezos founded Amazon in a different era. It predates even Google. In fact, by the time Google was founded, Amazon has already IPOd. Back then the tech VC system was highly different. Bezos had to explain to early investors what the internet was. If you found a company now, you will be exposed to much different conditions.
Wait a second... Half joke: Isn't being founder and running a company about making mistakes all the time, learning from them and hoping you avoided the really bad mistakes?
no joke: I wouldn't criticize someone who
1. Founded a company
2. Had the company under his or other people management go to 100m USD
“Mistake” is very clearly referring to the topic of retaining equity, with the assumption that more is better. I’m not criticizing the founder in general; e. g. Microsoft has made many mistakes in its history, but clearly Gates is immensely successful.
Obviously if giving up 99% is what enabled you to get to the 100m, then sure, it could be considered worth it. But if we look at virtually any startup with a high valuation, the founders always manage to maintain more than 1%.
What comes to mind is the saying 'if you can't take the heat stay out of the kitchen'.
I think of this constantly when hearing about people who want something (YC, acting, medicine, sports, music career, endless list) but then for some reason aren't built to take the punishment (that others are).
There are some people that can take the punishment (if you want to call it that) and not miss a beat. Just like there are people that can climb mountains, race cars, play football, run marathons and live off in the jungle.
This idea that everyone should be suited for anything is just not correct.
And don't think 'well I won't know so why not try?'. Most people have some basic idea of what they are cut out for and can do and tend to stay away from (smartly) things that aren't for them.
I think one really important thing people need to be better at is choosing who they listen to. Gary Vaynerchuk is a social media star. He has about as much advice to offer a tech startup as Jake Paul. Now Jake Paul at least has the decently not to claim to be able to offer advice to Tech startups. It's like listening to Ashton Kutcher about how to do Venture Capital, if you want to do VC like Ashton Kutcher then step 1 is be a fucking movie star (it's also how you end up on a sofa next to Adam Neumann being very vague about what your financial interest in WeWork).
It's also true that even real entrepeneurs are speaking publicly for PR and so they're saying what they think they should say rather than actually what they think (or atleast to some extent self-censoring). It's important to really be critical about what you're hearing from these people, especially people you idolize.
Great article. Working on my own startup (https://encore.dev) I also feel the urge to measure my progress in terms of output, not outcomes. I have to constantly remind myself that what matters is the outcome. Focus on producing a concrete, visible artifact every day and use that as your measure of progress instead.
And make sure to stay sane; startups are not a balanced lifestyle but that just means we need to push ourselves harder to find balance, as opposed to pushing ourselves even further out of balance.
Encore looks like an awesome project. What would you say is the value-add compared to other serverless offerings by cloud providers? At the moment simplicity/ease-of-use seems to be its biggest strength.
Thanks, that means a lot! Unlike other offerings the focus is really on the development experience, hence the focus on ease-of-use and simplicity as you say. The goal is to provide a best-in-class developer experience; the serverless part is really just a piece of that, if that makes sense?
Great share. I've definitely found the residual effects of pulling a couple of coding all-nighters absolutely ruins my productivity the next few days. I just end up staring at the screen and not knowing what to do.
Also, I love the term "hustle porn". It's so true and destructive.
Glad the writer has written openly about this, and I hope he continues to get better and find more balance in his life.
Businesses are tough endeavours, and those who truly do it honestly and with love for their biz and their customers can seriously run the risk of draining themselves if they're not careful.
It's also tough because there is an entire industry of "hustle porn" out there, and the world is moving so fast it is easy to not feel like you're getting left behind when your business isn't moving forward the same as others.
VCs (like YC) and others are also in a numbers game. While I'm sure they're not planning for burnout and depression in their founders, their model practically requires whoever drinks from the cup to push until they either succeed or fail. A binary outcome is required, middling along is not allowed. Even pg himself has said a variation of the Vaynerchuk quote (can't remember if it was a blog post or tweet).
It's a complex topic, but if you're reading this, find some solace in the fact that there are many others out there who have similar ups and downs, but more importantly, work to find balance in your life. This means time for eating well, sleeping, and relaxing time (video games, walks, gym, spending time with family). By the way, "relaxing time" is separate from "sleeping time" -- don't pick one or the other.
This doesn't mean you shouldn't have strong work ethics or push hard when you need to, but constrain things and re-evaluate constantly. I sometimes have a hard week of 70-80 hours because of coding sprints or sales pushes, and then break for 2 days. Eg: Monday and Tuesday this week were chill days for me, as a break from the past 10 days.
Overall, try to plan out the trajectory of your business and the work you are doing. Don't just flit from one priority to another, take a step back, take a deep breath, and plan for a definite outcome in a short period of time (2-4 weeks). Do this constantly, and you're basically tinkering with the the trajectory of your startup based on your efforts.
If you can't do the above (maybe because you've got a few people already on the team, have customers and are just running about hair on fire every day dealing with operational and customer issues), I would recommend getting some professional coaching advice about how to eventually structure your biz to be more manageable.
Bottom line, none of the stresses should be permanent or long-term (despite what banks, VCs, or any other funders may say), so definitely work towards building smaller bite-sized sprints for yourself and your team.
Founder burnout is simply a result of the stress of the increased responsibility you have. Your employees expect a pay-check every two weeks, and even if you pay yourself nothing, you have to make that happen. Lack of income stability destabilizes a lot. You don't have a boss, regardless of who is on your board of advisers or claims to be your mentor, all they can offer is words, the founder has the responsibility and has to make the decisions. You may have friends doing their own startup, and despite your best efforts to resist, you compare your own success to them. You make excuses for those that surpass you, feel schadenfreude when others fail, and then feel guilty for even having such thoughts.
In practice, founder burnout is pretty rare. The stresses of running a business are real and can affect your life and decision making process, but the business challenges themselves are often even more difficult. Also, founders don't just start a company as any employee would start a job, they need to start with a huge reserve of enthusiasm or motivation. Emotionally, they start from a higher place, are subjected to higher than normal stresses, but their stress tolerance itself is not often the limiting factor.
The allure of startup culture has always been the chance to get rich like Mark Zuckerberg, Elon Musk or Jeff Bezos - "changing the world" is just hype. Most startups are just schemes to make the founders as rich as possible as fast as possible, with no real intent of ever delivering a product or service to market that actually makes a profit.
> Only recently, have a select few started to promote less destructive lifestyles for founders:
I think at the bottom of this is the futility in trying to emulate others. You are unique and the only one who can be responsible for your lifestyle choices is - you. Figure out what works for you in terms of workstyle, lifestyle and work-life balance, rather than using role models as a blueprint.
I know a few people who have been living on <5h of sleep for decades and it's actually right for them. Telling those individuals that they need 8h is not improving anything. That doesn't mean it can work for most people.
> Telling those individuals that they need 8h is not improving anything.
Of course not, but telling these individuals that they are outliers and shouldn't give this as advice on "how to be successful" will improve things. They desperately need some of that humbling self critique that we ordinary, impostor syndrome suffering people do all the time and we can help them!
> What I'm trying to say is, stop letting others telling you how you should live your life and figure out what works for you.
I'm no entrepreneur but I think the article is saying that this is easier said then done when you want to do something you are passionate about, eg. changing the world with some new software thing, and everyone who have done something similar is acting like the examples in the article. Like that farmgirl article doesn't once ask if her "seemingly superhuman work ethic" is an example to others or rather should be presented as how an extreme sports practitioner often is: "you are clearly an adrenaline junkie! laughs but really, how do you cope with the stress of endangering your health just to free climb that large rock wall".
Gary vee talks like he does something amazing while what he does can really be done by a good cold caller. I don't see what he has done to earn the recognition he has. I agree with the author. Selling a $90 poster that basically is the worst advice you can give to an entrepreneur.
> Gary vee talks like he does something amazing while what he does can really be done by a good cold caller. I don't see what he has done to earn the recognition he has.
Gary Vee's main resume star is that he has become successful and well known. He has become more of a celebrity than an oracle, and many of his side-companies have not done well. Still, his main points that the internet has changed the way of doing business and you need to utilize social media to be successful are sound.
He is a PR consultant, what would you expect him to sell?
PR conultant's way of doing things:
Spend the budget.
If project was a win, claim own success.
If the project was a failure, blame a business, never show results.
> PR conultant's way of doing things: Spend the budget. If project was a win, claim own success. If the project was a failure, blame a business, never show results.
Close but I don't think this is quite right ... "PR conultant's way of doing things: [Find and convince the client on your abilities.] Spend the budget. If project was a win, [convince your client that it was your] own success. If the project was a failure, [convince the client that it was their] business, [always] show results."
Thats missing the point of the poster. Its not about self destructive behaviour. You're not going to make it to month 48 by running yourself into the ground.
It just means results are not instant.
Maybe we should all be focused more on delivering actual value, instead of obsessing over what other people think on the internet..
That's one selective reading of the poster. But it doesn't say work hard for 48 months. It says "Eat shit for 48 months". What it's saying is that you can't have nice things unless you make yourself suffer.
I think the advice that the whole reason to be an entrepreneur is to become wealthy as opposed to having some sort of drive or care about your product or service is totally sound. i mean who doesn't want to be super rich? but i guess it's also stupid because if all you care about is being rich there are plenty of grinds you can do to get there. But i guess you have to be prestigious.
also caviar comes in a tube and people put it on crackers. i would prefer to eat other stuff.
Can't wait for more people to stop listening to Gary Vee. He's been pushing unhealthy BS for too long, and no amount of "do what works for you" caveating stops people thinking that's the only way to succeed.
Something of an irony that one of the best places to hear about anti-workaholism is on YC's forum.
Eh lost me at "boring monotony of the suburbs". I have zero problems with the burbs, I don't like these insult everything at the new place I go to pieces. I wish the guy luck though, I read the conclusion of the story.
So, in front of us we have a very eloquent and well written article talking about very serious issues that take place in the entrepreneurial community... and you're going to dismiss it because the writer decided to have fun for a split second?
I don't think it's eloquent; it's pretty poorly written IMO; it is more cutesy than serious. Despite your assertions, those are subjective things. If you feel that your opinion is more valid than mine, feel free to explain why.
I read up to the cinna-stix line and my only thought was, "why am I wasting my time reading this?" It doesn't appear to be thoughtful and it puts focus on all the wrong things.
I realized at that moment that this post was not really about depression. It was about not getting what you want, not meeting your own expectations, and having to deal with reality.
YC is, for many people, a path to building a business. For others, it is a status symbol, a place where they try to make the next "Uber for X" as a way to spend time working with friends on something cool. That has nothing to do with YC and everything to do with the person's mentality. It is not specific to entrepreneurship and has everything to do with saying, "oh shit, this is actually hard to do."
Ultimately we are all alone with our thoughts, feelings, goals, and pain. Nobody else can sense or really know these things, but us. Getting kicked in the face teaches us this reality. There is some pain in beginning to understand reality. In this context, disappointment is healthy. It means you recognize the incongruence between your mental model of reality, and reality itself.
Depression sometimes has no connection to outcomes, and at other times it is a lingering rot from past outcomes. It is a trick that the mind plays, a tiring mental race through the muck of the past that leaves no energy to address the challenges of today. Depression is not burn-out, fatigue, nor disappointment. It is a slothy form of mental pain about an irreconcilable disparity between past expectations and the present. Irreconcilable means there's nothing I can do today to bridge the gap.
For me, the useful part of depression is the clarity it can offer about the future.
Do you note the difference in the way I am writing about the topic? I am not talking about pineapple pizza, nor cinna-stix.
It's not a childish topic and I don't want to be the audience to someone who discusses it in a childlike way.
You may now have the break that you requested I give to you.
Some good points but no diagnose or solutions beyond the expression of the problem.
Here is what I'd add for it:
I don't care if you're make or female, people need to improve constantly in 3 parameters for their whole life-span:
1. Looks (basically proper nutrition and some degree of bodybuilding training)
2. Psychological strength
3. Affluence
You need a life meaning mission that makes you feel good at improving these, using that mission as the vehicle. If you can do that, you'll be an example and all the rest will fall into place.
If you unbalance these, you'd be screwing up and diminishing the overall life-satisfaction returns.
Startups, or business, in general, are only going to (when they work) improve affluence and (always) consume psychological strength.
Proper nutrition and going to the gym (and I mean lifting HARD) falls into improving looks which also helps in relieving psychological and physical stress.
If you break that delicate balance you're investing in some kind of deformed creature that will eventually show. Hence, this kinds of depression wouldn't be a surprise to emerge as a manifestation of breaking that sustainable self-improvment equation.
"people need to improve constantly"
No they don't. Plenty of people happy to be as they are. When you're constantly running on this treadmill of self improvement, you'll probably get depressed real quick.
Degradation is Nature's default. Guaranteed by entropy. But for sure you are free to totally ignore how to make good use of an opposing force and get older faster, less healthier, less attractive and less free while "feeling happy".
Getting into an incubator or getting money from investors is zero measure of business success. Business success is users and growth and revenue.
Whether YC blesses you is also zero reflection on you as a person. Rejection by YC means nothing at all.
I think business is about trying to make money, it’s not about YC and funding and the scene and investment rounds and hyper growth and beers after work and been seen as one of the cool kids.
Head down, work, balanced lifestyle, try to make something small succeed on your own.