PG is remarkably consistent in his advice; much of his writing is about developing a nose for "what's missing" and having the chops and resources to attempt a solution.
Also, I think 'Google' in this instance is more for motivation rather than a literal comparison. He's leaving out the part that Google was founded by graduate CS students a) looking for a thesis, b) into node-link graphs, and c) inspired by academic citation metrics. Would PG advise anyone to go to grad school to learn how to find scientific-discovery-based startup ideas these days?
This is what is fundamentally missing from most talk about "tech" startups by VC types these days. They're not actually interested in the nerdy stuff, just in the "disruption" stuff.
L&S were, and they hired other people who were. They didn't start with a business idea, but with a technical one. They filled in the blanks on the business side after they survived the .com crash.
I didn't get to Google until 2011, but it became clear to me after joining that in the past they had gone on a very nerdy mission to hire all the nerdy people and collect them into one place to do nerdy things.
(Unfortunately that nerdy thing ended up being selling ads really efficient, but that's another story.)
My fundamental point is that the Google story is very unlike the kind of stories that YCombinator or a16z like. It started, like you said, as a set of intellectual/technical interests. The other stuff, that VCs today like, came later.
In a way they did the opposite of the usual advice. They started with the hammer (the tech) rather than the nail (the business problem.) They certainly didn't start with a "Like X but for Y" statement like seems to be desired by VC today. And they didn't look like the typical .com story at the time (which was usually: give us lots of VC $$ so we can sell something on the web that is currently not sold on the web, but we'll just use the $$ to buy customers and make no profit...)
I would posit that if today's Google came to YCombinator today they'd be shown the "no thanks" door.
> Unfortunately that nerdy thing ended up being selling ads really efficient, but that's another story.
The irony is that both the thing and its side effects were anticipated very early on.
"Currently, the predominant business model for commercial search engines is advertising. The goals of the advertising business model do not always correspond to providing quality search to users. ... It is clear that a search engine which was taking money for showing cellular phone ads would have difficulty justifying the page that our system returned to its paying advertisers. For this type of reason and historical experience with other media, we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers."
(The Anatomy of a Large-Scale Hypertextual Web Search Engine, Sergey Brin and Lawrence Page, 1998)
Hopefully 2 Stanford CS PhD students hacking on their project would be funded by YC today :)
You bring up a good point about starting from the tech rather than the problem. Usually the advice from VCs is to start from the problem and iterate on the tech until you solve it. What was very fortunate for Google is that the tech translated into a great business problem. Open up any CS textbook and 'Search' is always a major section. It was also a great business because the problem is important, frequent, and had not been properly solved by the big players in the mid 90s.
"And then we realized that we had a querying tool..." (Page)
> Hopefully 2 Stanford CS PhD students hacking on their project would be funded by YC today :)
Around the dawn of YC, IIRC, when PG did the "summer founders" or something like that, a group of 4 of us Lisp hackers applied as a team. No response.
We were mostly in grad student-like lifestyle modes, and not tied down, were energetic, and already had various applicable experience.
But I think PG was mostly looking for barely-20 year-olds to drop out of college, rent an apartment in Harvard Square together, and sit around hacking in towels.
Since that's what he wrote in one article. Which I guess trumped the article in which he said Lisp hackers are great for startups.
Now his latest article says he's going after 14 and 15 year-olds. :)
I always wonder about the success rate of advice. Do we have any student from this talk of PG who succeeded later in life? Joined an ivy league school? Proceeded to create a startup? Had success with it?
Don’t get me wrong. This folklore is extremely important, if not just to raise the grades of one student. But as a founder, when I give advice, out of inflated ego generally, I also have vertigo from the height of everything that could go wrong about being mistaken about my advice.
I feel that worry too, but I can validate his advice, somewhat.
I'm 44 and spent most of my career working individually and with my closest friends on projects that felt interesting, and it went really well for us in all of the ways. I also met these friends at a selective school, though it was a state-funded high school (massacademy.org), not a university.
Also, someone once came to my very conventional elementary school in 5th grade on career day to talk about a very unconventional career path (being a full-time peace activist) and this had a huge impact on me, both because it validated activism as a career and perhaps more importantly because it validated not having a normal job.
Getting a very short lecture in school from an interesting non-teacher can be at least very memorable and perhaps life-changing.
> Be careful whose advice you buy, but be patient with those who supply it. Advice is a form of nostalgia. Dispensing it is a way of fishing the past from the disposal, wiping it off, painting over the ugly parts and recycling it for more than it’s worth.
But that's the thing. "Search" was not a great business problem. It still isn't. I used Google for years before their IPO and people were always like "how is this thing going to make money" and believe it or not there was a lot of skepticism even at IPO time that they even had a possible reasonable business model. (Same for Facebook at their IPO, too.)
Search is not a good business. Ad sales over top of search turned out to be. AdWords is the thing that catapulted Google towards (insane) profitability. And for the first few years, Google didn't really sell ads, or market themselves as even aiming to sell ads. But AdWords could only be successful because they had already captured the market on search, and so had a captive audience to show ads to (and relevance information based on their searches).
AdWords rolled out in 2000. Many of us had been using Google as a search engine since before the company had even been founded (1998).
Totally agree. What I mean is many research topics can be very interesting from a technical perspective but don't translate into solving problems that are frequent and important enough to build a business around. In the case of Search many business gurus didn't understand at the time that you can make a fortune with a free product. What matters is who has the traffic and who they're selling it to = eyeball meets ad. Page and Brin initially "expected that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers" (foreshadowing). Also they tried to sell to Yahoo for $1M so it took time to see the full potential, as you describe.
When Google started, you didn't need a business model for a "dotcom" (as we called them, before "tech stocks" became the "tech" that we now call ourselves).
We already realized the necessity of finding information amongst the exponentially growing wealth of Web servers (sites).
And Google obviously worked much better than the existing crawler-based search indexes and curated directories.
And lots of people thought a "portal" was a good place to be, if you could manage it.
> And Google obviously worked much better than the existing crawler-based search indexes and curated directories.
Funny thing is I recall using Google from the very day I first saw it come across Slashdot -- probably late 1997 -- before they were incorporated even... but I also recall that at some point around 1999 I actually switched back to using AltaVista or something similar for a bit. Because I preferred the search results I got.
It was actually a more competitive situation than people might remember in hindsight.
The big difference is that Google made it through the .com crash filter better than anybody else. That and they kept the good will of their customers by keeping minimal and straightforward and (for a while) ad free.
I recall once google came on the scene I ditched altavista and never looked back. I was a teen but my recollection was that Google included the relevant paragraph of text from the page shown in in the search results whereas altavista showed one line that was often indecipherable gobbledygook - perhaps the page title matched a keyword - and it made it so much easier to scroll through ten results and identify the one that was the highest quality
Plus the no fast no clutter homepage for google compared to how many links can we fit in one screen for the portals
There was a brief window where AltaVista improved and I went back to it after being Google since 98. Probably only for a few months. I often preferred the query hints you could give it to get very specific output. No matter, they went out of business.
The turning point that brought me fulltime to Google from then on (until recently switching to Kagi) was when they started having almost live results. It's hard to remember or imagine but search indices were often days, weeks out of sync for critical things like news, etc and Google was really the first to fix that.
I think there's a connection here to the old adage that "small companies make it possible, big companies make it inexpensive".
The purpose of VC can be viewed as trying to take a company from nonexistent to big while skipping the small stage, but small is where the action really is.
Yep, unless some new thing is acquired in a buyout, or if an entire group is spun off with almost no oversight, large companies are horrifically bad at creating new things. It's nearly impossible for them to do it in the case where the new product would affect existing revenue streams.
Very interesting to hear your thoughts and experience.
I wonder if we really shouldn't make a bit more out of the fact that there are different types of startups: those that pick off low-hanging fruit really well, those that combine novel technology with novel problems (for instance, the recent YC LLM meeting note-taking / transcription service), those that are scientific-discovery based (see, for example the NSF Small Business Innovation Research program), etc. I am not experienced enough to create an ontology of startup ideas, but I think it'd be an interesting exercise.
The nsf program basically exists to fill the gap between research and product market fit. Except They focus on commercialization plans which we know that in reality is subject to change (aka meaningless).
The real trick that made Google possible, and the following web 2.0 era startups, was that linux and commodity hardware was all that was needed at the time so engineers could strike out on their own. Comparing it to the current ML era where you need many millions of dollars of data and many millions of dollars of hardware to compete, the guys that wrote the transformers paper are stuck in bigcorp and aren't going to be the next Larry and Sergey. OpenAI might be one of the few new big companies but it's run by a VC/CEO, not the engineers that figured the stuff out, and he had to sell half the company to Microsoft anyway.
These things always happen at intersections. There are lots of smart people with ideas. The magic happens at the intersection of ideas, time (what technology is available) and luck. Apple Newton was too early. Apple iPhone was just right. Doom 3D was just at the right time when commodity hardware could do what the amazing software needed it to do.
The point I was trying to make is what are the situation where an independent small startup can make it big. Your examples are instructive, engineers were able to make id Software big because you didn't need a lot of hardware to invent 3D shooters, but Jobs gets the credit for the iPhone because the engineers needed hundreds of millions of dollars in capital to pull it off.
pg is giving advice based on him getting rich from that period of time where the small startup could make it big. But those conditions are probably rare going forward.
maybe. right now, if a startup has a new ML training technique or whatever, for a specific niche, cloud and VC capital will let them make a model that does way better for their niche than repackaging well funded models from OpenAI.
Wild to think that potentially the most innovative company of the last five years, and next five, was run/founded by a VC. It goes against all of the VC hate
Maybe? YC seems to have an inconsistent view on things that are research vs product. But it’s probably more nuanced than that. Search was a market though at that time. If you pitched an AI LLM before chat-gpt what would the odds have been?
I dunno, I toyed with the starting phase of YC application a couple years ago, and started working my way through what was involved in their application process and reading their materials, even watching some YouTube content, etc.
I didn't really see how a business that was starting from a more R&D angle would make it through.
And a lot of it seemed really pitched to the bizdev "hustler" founder personality, not to engineers/nerds.
The foundational $$ that has gone into the research to make the LLM stuff happen... was inside the existing big corporations (Google, FB, MS, etc.) and only left there once it had been proven.
Ilya Sutskever (OpenAI) for example was employed inside Google doing that kind of work and only left when he ran up against the limits of what he felt he could get done there. But the fundamental R&D had already been done. When I was at Google I saw some of it from a distance before I ever heard of OpenAI.
The VCs have come along at the tail end of the R&D cycle on this stuff in hopes of cashing in. Same as they did with crypto and N number of trends before. They're trailing, not innovating.
They're primarily interested in successful business models capitalizing on existing technology, not the actual development of new technology. Unless one has distorted the meaning of "technology" significantly.
I wouldn't fixate on the Google part too much. It's pretty clear he is using it as a common point of reference for 14 and 15 year olds. "You guys know about Google?, the giant company with the web site? Okay well let me tell you how companies like that are built."
Building a successful company depends on many things. The point made here is that you are unlikely to be expert enough, and motivated enough to build a successful business in an area you are not interested in, and haven't played around in. So to increase the amount of domains that you could create a business in from 0 to a small positive integer you should build things that interest you.
Of course if you have money, or know how to persuade people who have money, you can be something of an idiot and still develop a successful business. Usually you are not really developing the business in this case, more attaching yourself to a business that smart people are running for you.
In a pool of high school freshmen, most probably have a better chance of success following the first path, than the second.
Google in 1999 had the the fortuitous alignment of every possible factor: brains, Stanford connections, timing, extremely scalable and lucrative business model, funding, etc.
It was very different from the punch-the-monkey style ads that had taken over the Internet, though. Google ads were exclusively text based and unobtrusive. They relied on showing you the right ad for what you happened to be searching for at the moment, rather than grabbing your attention and forcing you to think about stuff you didn't really care about.
He should! As I hope to convince people of next month, there’s a wealth of classical AI knowledge that’s just begging to be applied to modern systems. That’s not to speak of the wizardry happening in neuroscience and drug discovery right now…
Isn’t “you shouldn’t focus on science to start a good tech company” a good indicator that our conception of “tech” company is completely broken? That we’re really talking about ways to milk money from gambling billionaires, not change the world with successful products?
Also, I think 'Google' in this instance is more for motivation rather than a literal comparison. He's leaving out the part that Google was founded by graduate CS students a) looking for a thesis, b) into node-link graphs, and c) inspired by academic citation metrics. Would PG advise anyone to go to grad school to learn how to find scientific-discovery-based startup ideas these days?