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Ask HN: Do YC Startups Lack Spine?
22 points by villageidiot on Dec 28, 2008 | hide | past | favorite | 63 comments
By that I mean the kind of business instincts that are needed to really make a killing in the marketplace.

There seems to be an abundance of admirable nobility in the aims of YCers but not a lot of ruthlessness.

Maybe this is a function of the relative youth and inexperience of most of the groups that apply.

Would YC be more profitable if they were more open to older entrepreneurs that are ready to rumble?




Textually this is a classic troll. But at least it's not an account newly created for the purpose, so I'll give you the benefit of the doubt and play along.

Let's start by clarifying your question. Did Larry & Sergey, when they started, have these business instincts about making a killing in the marketplace that you're referring to? Because if they did they seem to have been well hidden. And if they didn't, these qualities don't seem to be worth much.

Also, can you tell me more about the youth and inexperience of the people who apply to YC? No one, as far as we know, sees the applications except us.

Your last question I can at least answer with certainty: no. It takes 4-5 years for a startup to achieve liquidity. No YC-funded startup is that old; the median is only about 18 months old. Our profitability now is therefore noise, which means no change in the applicants would have affected it significantly.


Every village needs an idiot pg. see OP's handle


I appreciate you treating the question in the good faith in which it was intended. While the topic may be provocative, I felt it was relevant, based on my observations of YC. However, because I can only provide anecdote as evidence of my case, I asked the question to discover whether my observations about YC are shared or whether I am suffering from a delusion. Textually this may seem like trollish behavior but some of the responses to the question seem to belie this suggestion.

As for your point about Google, some ideas are so powerful that they fall outside the conventional expectations of business practice. The fact that Google's founders have, until lately anyway, been unassertive in the manner of Microsoft, does not indicate that Bill Gates' approach "is not worth much". Absent some ground-shaking idea like Google's, I would argue the assertive approach of Microsoft is the norm for a successful company and a key ingredient missing in the YC environment.


How "assertive" was Microsoft at first? It seems like they spent their first decade toiling along at standardizing programming across the many different OEMs and computer types of the day. It was probably another decade until they did anything that anyone would consider "ruthless".

They started off trying to build something people want (Basic for the Altair) just like any YC company. I wouldn't say that most YC startups display any less ambition than building a Basic interpreter.


Mircosoft was VERY assertive at first. Without laying out a detailed history, very early on gates had a keen business sense and was quite ruthless. They may have been 'building something people want', but the seeds of what microsoft would later become were without a doubt being planted. http://en.wikipedia.org/wiki/Open_Letter_to_Hobbyists


I don't think asking people to pay for your product is ruthless.


Not ruthless but certainly assertive.


QDOS produced by Seattle Computer and purchased by Microsoft after Digital Research dragged their heels on their promises to deliever CP/M to IBM, was a rip-off of CP/M. We can argue about this point but it's documented by Gates' biographers.

Gates was hungry for that deal and beat Kildall to the punch, doing what he needed to, bending the rules/law to get his foot in the door at IBM.

The essay by pg about "doing good" mentioned by someone in this thread might ring true when the valves are open and VC funding is flowing freely but in the new financial reality that we are in, I am arguing that it is the companies that have this kind of ruthlessness that will be the ones who make it, not the ones who want to "do good". Microsoft is not an outlier in this practice. It is self-evident that this is the American way of business.

http://books.google.com/books?id=iPWjNoSS9vUC&pg=PA120&#...


And so you think YC startups are failing to negotiate well with IBM? I'm curious beyond some vague idea of ruthlessness, that really just seems like a fairly typical licensing deal magnified in importance by history, if there are any specific examples of a YC company not being ruthless.

I still go back to my original comment, which is that when you boil this whole question down, it makes no sense at all.


I mentioned QDOS and the IBM negotiations only because I was disputing your statement about Microsoft not being assertive early on. I think this is clearly not the case. The aggressiveness of their negotiating tactics and their willingness to potentially get sued for copyright infringement relate to the context of my question about whether YC startups lack grit.

You are asking me for "specific examples of a YC startup not being ruthless". But I am asking for the inverse - examples of aggressiveness. I haven't seen any at YC. Have you? Perhaps you don't believe it's necessary or important but that was the premise of my original question. I insist that this is not a troll but a sincere question and an important one in the current economic environment, even more especially for companies not privileged by YC funding.


Most negotiation goes on behind closed doors, so you wouldn't see it (and I doubt Matt would be at liberty to discuss specific instances).

The YC founders I've met in person have been plenty assertive, and when it comes to business, some are pretty downright ruthless. They are nice guys outside of business (which is probably why you don't see them as ruthless or assertive), but they have just as much killer instinct as any other entrepreneur I've met, and more than some. PG seems to select for that - perhaps that's why I was rejected 4 times. ;-)

When I saw the title, my first thought was "Umm, wow. People really think that?"


Only you and thinkcomp have actually provided the kind of (contradictory) subjective feedback I was initially looking for.


How would you define ruthlessness I guess? I mean, I can name a lot of YC startups that are crushing their competitors by relentlessly making better products. From my batch alone there is Disqus (whose product is significantly better and gained much more traction than their closest competitor, Intense Debate) and Dropbox. They've both taken a lead over a field of entrants in terms of innovation.

I mean, they haven't thrown any bricks through their competitors' windshields, but they haven't passed up any chances to make their competitors look half-baked.


I think this statement is mired in sample bias.

What companies are you comparing YC companies to? Other successful companies or a random sample of other startups that are non-YC? Particularly with the examples of Microsoft and Google, your analysis is historical. In their pre-public-company days you may have been lured into making the same type of statement in regards to them because any business they were involved in at the time was probably minimally visible from the outside just as it is with many YC companies now. There is a lot going on behind the scenes that you probably don't know about and thus cannot consider. That is the nature of private companies.


Can you please clarify what you mean by assertive approach? You continually use Microsoft as an example, but I don't really think spending half a decade in courts is assertive.

Or maybe you could use some mid sized companies as examples as Google and Microsoft are both anomalies.


My guess would be that he means, for instance, shipping IE for free and essentially destroying Netscape was ruthless and/or assertive. He's probably forgetting that that occurred in 1995, one decade after Windows first appeared, and two decades after Microsoft was founded.


It's funny that you two have taken up the question. When I first read that comment about lack of killer instinct, there were certain YC founders who immediately popped into my head as people whose faces I'd have liked to hear him say that to...


:)


Evil is only useful once you step outside of a competitive market. EX: Cable company's seem to be Evil because they make more money that way, but trying to be more evil than the next pizza delivery company is useless.


Today, the best way to compete is to focus on cooperation, not competition. The behavior you're admiring isn't very effective when looking to cooperate with others.


This question doesn't make any sense. YC is open to older entrepreneurs. Who knows whether they're ruthless, or ruthless enough? And why accept your premise that what's needed to win is ruthlessness?


This really doesn't make any sense at all.


What is the optimum amount of ruthlessness for a startup to have?

I think this depends entirely on what industry sector a startup is targeting. For example, a startup in the drug dealing, extortion, pimping or organised crime sectors should probably be very ruthless and very "ready to rumble".

But for a website -- the sort of business most HN readers are more likely to be in -- ruthlessness is much less likely to be effective. The thing you're most likely to achieve with it is getting people to think you're an arsehole.


The kind of killing that Hewlett and Packard made in the marketplace was predicated on fair dealing and a commitment to their employees and their community. What entrepreneurs would you like to see HN readers emulate?


I can't say for sure, but I'm pretty certain no one's been turned down because they've been too "ready to rumble".


I doubt it pays to be ruthless when you have nothing to back it up. If you can't dominate, you have to cooperate.


>I doubt it pays to be ruthless when you have nothing to back it up.

Did the market cap of Microsoft suddenly drop while I wasn't looking or something?


Did Microsoft become an early-stage YC startup when I wasn't looking or something?


Microsoft was ruthless when they were early stage; that is how they got to where they are.


Not when they were two guys writing Altair Basic. They survived off sales to hobbyists. Being ruthless wouldn't have go them very far.


Check back in a few years. We're only three years into observing the YC experiment. The average exit in the valley takes seven years. Over the next five years, we'll have pretty solid data about whether the YC model, and its companies, can "really make a killing in the marketplace".


i believe the yc startups follow the "if you build it they will come" type of philosophy, as opposed to the "shove it down your throats" or "cut costs to make a bigger margin" vibe i'm getting from the OP.


The problem is that "if you build it they will come" DOESN'T WORK in a field where thousands of startups are competing for the same set of eyeballs. Unless you market aggressively, and cut costs enough to survive longer than your competitors, you will fail, guaranteed.


If you're two guys, two laptops and a server in an apartment, there aren't many costs to cut. That's the typical YC company. Marketing doesn't seem to do as much for a new company as PR, and simply being YC-funded is a big boost in that area.


Heh, maybe I'm a bit biased, as at one point I used to work for a startup(not YC) that was only 3 guys in an apartment, but also spent thousands of dollars a month on hosting for a site that had only a hundred or visitors a day, because they were expecting that any day now, "they will come" and viral growth will make them huge.

Being YC-funded is a boost, but without marketing and efficiency, it's not enough. There have been numerous YC-funded startups that ran out of money.


"if you build it they will come" doesn't mean you don't also market or cut costs. its about focus, not exclusivity. product comes first.

i get the feeling that "lack of spine" in the OP is implying that the focus isn't on the bottom dollar or self promotion, is all. focus on the product doesn't garner the direct results like the other two will.


Or the "screw your best friend over by stealing an idea he's been working on, implement it behind his back and launch it before he even has a chance to register the domain name he told you about over lunch". Google it.


Your googlebait is not effective, can you at least share the domain name with us?


Might be thinkcomp whining about how Zuckerberg stole Facebook from him... Only guy on here who seems to actively bring up his grudge.

http://news.ycombinator.com/item?id=328235


Sorry, but if you're implying that I was impersonating someone else (in this case, the person whose username is madoff, who I don't know) just to revisit this topic, you'd be incorrect. (You'd also be kind of rude.) I bring up what happened with Facebook when it has some contextual relevance. There's a lot people here who could learn from that series of events, and I think I'm entitled to discuss it just like anyone else. As you'll note, however, I didn't even mention it until you did--and I only noticed that due to a traffic spike.

And for the record, I agree. By and large, YC startups do lack spines.


you'd be incorrect. (You'd also be kind of rude.)

Sounds like someone needs a spine ;)

On that note, though, I apologize for accusing you of something you did not do.


Don't make me write you an open letter. ;p


Ff this is a ref to the "Facebook was my idea" drama, well, the screw you approach created Facebook. And the "nice-guy" approach? In this case, I think this proves the OP's statement well.

What is truly wrong of the OP is the age factor. Zuckerburg and Gates have both been accused of being ruthless thieves at an early age.


http://www.paulgraham.com/good.html


Can we think for ourselves for once? I don't know if you've noticed but a lot more companies succeed from not listening to pg's advice than vice versa.


Sockpuppet?

I'm not sure where your hostility is coming from -- I think that link sufficiently answers the question asked. I didn't make any comment about one philosophy of business over any other.


a lot more companies succeed from not listening to pg's advice than vice versa

Got any hard data to support your claims?


The S&P 500


s/from/while/


What business instincts are you talking about? Is this from the Brazen Careerist or something? It just seems like you're making generalizations driven by anecdotes.

If you're more specific and backup your claims with data (or even concrete examples) I think you'll get better answers.


In what way(s) do you think YC isn't open to older entrepreneurs?

If anything, I suspect older entrepreneurs aren't as open to YC than the other way around. In my own case, if I wanted $20K in expenses for a startup, I'd login to e*trade and transfer it, or I'd write a check for it. Doesn't seem worth giving up 6% for the cash, though if I were intent on striking out on my own, I'd almost certainly talk to YC, to see if a "3% for $1 and advice/contacts" deal could be worked out.


Where he draws the conclusion from?


I'd say most here want to build awesome products that people use! Most are not businessman first, but our journey lead us to be such....

Ruthless ... can anyone name a well known inventor who started off ruthless? Tough for me to even write that word as I want to create good in the world and profit from it. Being ruthless... blech!


Bill Gates.


Thomas Edison?


This would be a much more interesting question if you were to give specific examples of how specific YC startups are "spineless", and perhaps how they could be less "spineless". Without that, I'd simple respond: "They're not."


What exactly do you mean by ready to rumble?


I'm talking about assertively competitive business practices.

http://en.wikipedia.org/wiki/Let's_get_ready_to_rumble!


Sounds like the Bill Gates school of IT. The YC startup community has a different set of social mores which emphasize usefulness of the product, a certain trendiness with respect to what else is happening in the current web 2.0 world. We are not really the budding monopolist types. Yes, there is a certain timidness in the YC community about the dark art of business. But that's mainly because most of us have never worked :)


Well, I've worked in the business world. But I have no interest in "assertively competitive business practices". Most of the managers I worked for who were comfortable with that type of approach were exactly the reason I wanted to escape into the startup world and never look back at corporate life again. So, if you want to call that 'timid', go ahead. I'd rather do my own thing, make a good product and try avoid "doing evil" as much as I can. This probably sounds cliched or like I'm trying to win some brownie points but it's actually how I think. It's not worth it for me to live in that kind of "assertively competitive" way that I see my father and his colleagues living - or working, I should say. That feels like the old way of doing things.


You're talking about the Dark Side. Don Corleone. Donald Trump. Dick Cheney. Bill Gates. Cloak and dagger stuff. Yeah, I'm not very good at that either.


I know what the phrase means...what I meant is what exactly do you think a startup can do to play hardball?

To me it just doesn't look like they have the resources to devote to that. They can't stop a competitor using litigation. They don't have a group of lobbyists or senators in their pockets. They have to compete naturally, by building a better product.

So to repeat the question, what exactly do you think a startup should do, to qualify as a "ready to rumble" startup.


Evidence?




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