...If you look at a list of US cities sorted by population, the number of successful startups per capita varies by orders of magnitude. Somehow it's as if most places were sprayed with startupicide. I wondered about this for years. I could see the average town was like a roach motel for startup ambitions: smart, ambitious people went in, but no startups came out. But I was never able to figure out exactly what happened inside the motel—exactly what was killing all the potential startups. [1] A couple weeks ago I finally figured it out. I was framing the question wrong. The problem is not that most towns kill startups. It's that death is the default for startups, and most towns don't save them. Instead of thinking of most places as being sprayed with startupicide, it's more accurate to think of startups as all being poisoned, and a few places being sprayed with the antidote. Startups in other places are just doing what startups naturally do: fail. The real question is, what's saving startups in places like Silicon Valley? [2] Environment I think there are two components to the antidote: being in a place where startups are the cool thing to do, and chance meetings with people who can help you. And what drives them both is the number of startup people around you. The first component is particularly helpful in the first stage of a startup's life, when you go from merely having an interest in starting a company to actually doing it. It's quite a leap to start a startup...
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...trying to convince investors. They try to convince with their pitch. Most would be better off if they let their startup do the work—if they started by understanding why their startup is worth investing in, then simply explained this well to investors. Investors are looking for startups that will be very successful. But that test is not as simple as it sounds. In startups, as in a lot of other domains, the distribution of outcomes follows a power law, but in startups the curve is startlingly steep. The big successes are so big they dwarf the rest. And since there are only a handful each year (the conventional wisdom is 15), investors treat "big success" as if it were binary. Most are interested in you if you seem like you have a chance, however small, of being one of the 15 big successes, and otherwise not. [1] (There are a handful of angels who'd be interested in a company with a high probability of being moderately successful. But angel investors like big successes too.) How do you seem like you'll be one of the big successes? You need three things: formidable founders, a promising market, and (usually) some evidence of success so far. Formidable The most important ingredient is formidable founders. Most investors decide in the first few minutes whether you seem like a winner or a loser, and once their opinion is set it's hard to change. [2] Every startup has reasons both to invest and not to invest. If investors think you're a winner they focus on the former, and...
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...don't know another as counterintuitive as startup investing. The two most important things to understand about startup investing, as a business, are (1) that effectively all the returns are concentrated in a few big winners, and (2) that the best ideas look initially like bad ideas. The first rule I knew intellectually, but didn't really grasp till it happened to us. The total value of the companies we've funded is around 10 billion, give or take a few. But just two companies, Dropbox and Airbnb, account for about three quarters of it. In startups, the big winners are big to a degree that violates our expectations about variation. I don't know whether these expectations are innate or learned, but whatever the cause, we are just not prepared for the 1000x variation in outcomes that one finds in startup investing. That yields all sorts of strange consequences. For example, in purely financial terms, there is probably at most one company in each YC batch that will have a significant effect on our returns, and the rest are just a cost of doing business. [1] I haven't really assimilated that fact, partly because it's so counterintuitive, and partly because we're not doing this just for financial reasons; YC would be a pretty lonely place if we only had one company per batch. And yet it's true. To succeed in a domain that violates your intuitions, you need to be able to turn them off the way a pilot does when flying through clouds. [2] You need to do what you know intellectually...
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...September 2012 A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit." The only essential thing is growth. Everything else we associate with startups follows from growth. If you want to start one it's important to understand that. Startups are so hard that you can't be pointed off to the side and hope to succeed. You have to know that growth is what you're after. The good news is, if you get growth, everything else tends to fall into place. Which means you can use growth like a compass to make almost every decision you face. Redwoods Let's start with a distinction that should be obvious but is often overlooked: not every newly founded company is a startup. Millions of companies are started every year in the US. Only a tiny fraction are startups. Most are service businesses—restaurants, barbershops, plumbers, and so on. These are not startups, except in a few unusual cases. A barbershop isn't designed to grow fast. Whereas a search engine, for example, is. When I say startups are designed to grow fast, I mean it in two senses. Partly I mean designed in the sense of intended, because most startups fail. But I also mean startups are different by nature, in the same way a redwood seedling has a different destiny from a bean sprout. That difference is why there's a distinct word, "startup," for companies...
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...com/resources/top-47-active-venture-capital-firms-india-startups/ Top of Form Bottom of Form * Buzz * Entrepreneurship * Startups * Resources * In Focus * In Focus: 2015 In Review * In Focus: Indian Startup Hubs * In Focus: 2014 In Review * In Focus: Starting Up In India * In Focus: The Hyderabad Startup Ecosystem * About Us * Contact Us * We Are Hiring! * Submit Your Startup * Subscribe To Our Newsletter Submit Your Startup | Careers | Contact Us | Privacy Policy | Disclaimer Top 47 Most Active Venture Capital Firms In India For Startups Team Inc42December 22, 2014 22 min read INC42 STAFF Advertisement 873 SHARES FacebookTwitterLinkedin This article is part of our series on the essentials of starting up in India in which we had earlier compiled the Top 15 Accelerators, Top 20 Incubators andCoWorking spaces in India. Once a startup has reached it’s growth stage, it’s most important requirement is undoubtedly the backing by reliable investors and an ample amount of funding to scale up. Though the concept of starting up has gained momentum recently, but the small number of investors willing to show their trust and invest in new ventures has been a problem for startups. Many startups find it difficult to approach venture capitalists and quite a few times the investment structure of the investor is inadequate for the startup. See Also: The Top 37 Most Active Angel Investors Of India For Startups Indian Startup Hubs: Delhi Ecosystem...
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...How to Raise Money Want to start a startup? Get funded by Y Combinator. September 2013 Most startups that raise money do it more than once. A typical trajectory might be (1) to get started with a few tens of thousands from something like Y Combinator or individual angels, then (2) raise a few hundred thousand to a few million to build the company, and then (3) once the company is clearly succeeding, raise one or more later rounds to accelerate growth. Reality can be messier. Some companies raise money twice in phase 2. Others skip phase 1 and go straight to phase 2. And at Y Combinator we get an increasing number of companies that have already raised amounts in the hundreds of thousands. But the three phase path is at least the one about which individual startups' paths oscillate. This essay focuses on phase 2 fundraising. That's the type the startups we fund are doing on Demo Day, and this essay is the advice we give them. Forces Fundraising is hard in both senses: hard like lifting a heavy weight, and hard like solving a puzzle. It's hard like lifting a weight because it's intrinsically hard to convince people to part with large sums of money. That problem is irreducible; it should be hard. But much of the other kind of difficulty can be eliminated. Fundraising only seems a puzzle because it's an alien world to most founders, and I hope to fix that by supplying a map through it. To founders, the behavior of investors is often opaque—partly because...
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...round hole Many have the “Just Do It” attitude and don’t want management, that is where entrepenuers fails They need mananagement discipline of some sort Lean Startup comes from lean manufacturing at Toyota Want cross-Functional teams to work across all functions Henry ford = one of the great entrepreneurs ever and Automobile = Startup • Startups have an engine of growth: need to make adjustments to make your products better. • Feedback Loop: want immediate and automatic feedback that you don’t really think about. Steering is what must it different from other ways to get places. • Many startups are like rocket launches but they are no good. First you have to have vision, then strategy and then a product. Setbacks are a good thing and a learning experience. Who’s an entrepreneur? Internal innovators = entrepreneur • People working corporate America jobs can still be an entrepenur at their company, called intrapreneurs What’s a startup? “Startup is a humn insitiuition designed to create a new product or service under conditions of extreme uncertainty” Starts and entrepreneurs come in different sizes and forms Startups and innovation go hand & hand. Learning Validated learning: showing a team found valuuble truths about the present and the future Find a combination of your vision and what the customer wants Startup is an experiment to get validated learning IMVU was an experiment • Had its up and down. They had to learn that...
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...How to Raise Money Want to start a startup? Get funded by Y Combinator. September 2013 Most startups that raise money do it more than once. A typical trajectory might be (1) to get started with a few tens of thousands from something like Y Combinator or individual angels, then (2) raise a few hundred thousand to a few million to build the company, and then (3) once the company is clearly succeeding, raise one or more later rounds to accelerate growth. Reality can be messier. Some companies raise money twice in phase 2. Others skip phase 1 and go straight to phase 2. And at Y Combinator we get an increasing number of companies that have already raised amounts in the hundreds of thousands. But the three phase path is at least the one about which individual startups' paths oscillate. This essay focuses on phase 2 fundraising. That's the type the startups we fund are doing on Demo Day, and this essay is the advice we give them. Forces Fundraising is hard in both senses: hard like lifting a heavy weight, and hard like solving a puzzle. It's hard like lifting a weight because it's intrinsically hard to convince people to part with large sums of money. That problem is irreducible; it should be hard. But much of the other kind of difficulty can be eliminated. Fundraising only seems a puzzle because it's an alien world to most founders, and I hope to fix that by supplying a map through it. To founders, the behavior of investors is often opaque—partly because...
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...how few of the most successful people I know are mean. There are exceptions, but remarkably few. Meanness isn't rare. In fact, one of the things the internet has shown us is how mean people can be. A few decades ago, only famous people and professional writers got to publish their opinions. Now everyone can, and we can all see the long tail of meanness that had previously been hidden. And yet while there are clearly a lot of mean people out there, there are next to none among the most successful people I know. What's going on here? Are meanness and success inversely correlated? Part of what's going on, of course, is selection bias. I only know people who work in certain fields: startup founders, programmers, professors. I'm willing to believe that successful people in other fields are mean. Maybe successful hedge fund managers are mean; I don't know enough to say. It seems quite likely that most successful drug lords are mean. But there are at least big chunks of the world that mean people don't rule, and that territory seems to be growing. My wife and Y Combinator cofounder Jessica is one of those rare people who have x-ray vision for character. Being married to her is like standing next to an airport baggage scanner. She came to the startup world from investment banking, she has always been struck both by how consistently successful startup founders turn out to be good people, and how consistently bad people fail as startup founders. Why? I think there are several...
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...As one of TheLadders' original 20 employees, AMANDA AUGUSTINE knows first-hand how rewarding and challenging a job at a startup can be, especially when you're new to the workforce. Play your cards right and you will learn more in one year than your friends will pick up in five or more working at larger, more traditional organizations. The media likes to sensationalize the perks and fun of working at a startup, but startup life is no day at the beach. You'll find that most operate with a "work hard, play hard" mentality. While you'll enjoy plenty of happy hours and ping pong tournaments, you'll also find the work intensely demanding -- likely, far more than anything you've previously experienced. Here are seven tips I've learned over the years to help you not only survive, but thrive at a startup: 1. Embrace the mission. The most successful entrepreneurs are incredibly passionate about their work. It's the fire in their bellies that drives them to succeed. Similarly, if you're going to commit to working at a startup, you have to believe in its mission. Look for organizations that are doing something you're interested in. You won't make it at a business if you're not genuinely excited about the work. 2. Acknowledge the long hours -- and accept them. If you're going to make it in the startup world, you first need to acknowledge that the hours will be long. The second step is to accept this fact. In the beginning, it wasn't unusual for my team to work more than twelve...
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...something great. A couple weeks ago I realized that if you put those two ideas together, you get something surprising. Make something people want. Don't worry too much about making money. What you've got is a description of a charity. When you get an unexpected result like this, it could either be a bug or a new discovery. Either businesses aren't supposed to be like charities, and we've proven by reductio ad absurdum that one or both of the principles we began with is false. Or we have a new idea. I suspect it's the latter, because as soon as this thought occurred to me, a whole bunch of other things fell into place. Examples For example, Craigslist. It's not a charity, but they run it like one. And they're astoundingly successful. When you scan down the list of most popular web sites, the number of employees at Craigslist looks like a misprint. Their revenues aren't as high as they could be, but most startups would be happy to trade places with them. In Patrick O'Brian's novels, his captains always try to get upwind of their opponents. If you're upwind, you decide when and if to engage the other ship. Craigslist is effectively upwind of enormous revenues. They'd face some challenges if they wanted to make more, but not the sort you face when you're tacking upwind, trying to force a crappy product on ambivalent users by spending ten times as much on sales as on development. [1] I'm not saying startups should aim to end up like Craigslist. They're a...
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...hard problem. I've had to advise most of the startups we've funded about them, and despite years of experience I'm still not always sure I'm giving the right advice. One thing I do feel pretty certain of is that if you're against software patents, you're against patents in general. Gradually our machines consist more and more of software. Things that used to be done with levers and cams and gears are now done with loops and trees and closures. There's nothing special about physical embodiments of control systems that should make them patentable, and the software equivalent not. Unfortunately, patent law is inconsistent on this point. Patent law in most countries says that algorithms aren't patentable. This rule is left over from a time when "algorithm" meant something like the Sieve of Eratosthenes. In 1800, people could not see as readily as we can that a great many patents on mechanical objects were really patents on the algorithms they embodied. Patent lawyers still have to pretend that's what they're doing when they patent algorithms. You must not use the word "algorithm" in the title of a patent application, just as you must not use the word "essays" in the title of a book. If you want to patent an algorithm, you have to frame it as a computer system executing that algorithm. Then it's mechanical; phew. The default euphemism for algorithm is "system and method." Try a patent search for that phrase and see how many results you get. Since software patents are no different...
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...If you wanted to get rich, how would you do it? I think your best bet would be to start or join a startup. That's been a reliable way to get rich for hundreds of years. The word "startup" dates from the 1960s, but what happens in one is very similar to the venture-backed trading voyages of the Middle Ages. Startups usually involve technology, so much so that the phrase "high-tech startup" is almost redundant. A startup is a small company that takes on a hard technical problem. Lots of people get rich knowing nothing more than that. You don't have to know physics to be a good pitcher. But I think it could give you an edge to understand the underlying principles. Why do startups have to be small? Will a startup inevitably stop being a startup as it grows larger? And why do they so often work on developing new technology? Why are there so many startups selling new drugs or computer software, and none selling corn oil or laundry detergent? The Proposition Economically, you can think of a startup as a way to compress your whole working life into a few years. Instead of working at a low intensity for forty years, you work as hard as you possibly can for four. This pays especially well in technology, where you earn a premium for working fast. Here is a brief sketch of the economic proposition. If you're a good hacker in your mid twenties, you can get a job paying about $80,000 per year. So on average such a hacker must be able to do at least $80,000 worth of work per year...
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...entrepreneurs. This book is the teaching and inspirational aid for our kbs+ Ventures Fellows – a highly select group of kbs+ staffers from all levels and areas of the agency – who go through a six-month educational program to immerse themselves in the startup and venture capital world. Share this entrepreneurial inspiration with friends using @kbspvc or #kbspvcbook. If you would like to share any inspiration, thoughts or feedback, please contact us at @kbspvc anytime – we look forward to hearing from you. Thank you for downloading our book! Darren Herman Taylor Davidson Creative Entrepreneurship Darren Herman Taylor Davidson a kbs+ partner We have received explicit permission from all authors of the works found in this book. Unless otherwise stated, we do not claim to have written or own any of this work. We are purely aggregating it into a simple book format for the education of anyone who picks up this book. The price of this book is free; if anyone tries to sell this book to you, please report them to us. Hopefully this book inspires you as much as it does us. We do not guarantee you will start the next successful startup after reading this book but we do think it will make you at least one IQ point smarter. Enjoy it and after you are done with it, hand it to someone else to read. Sharing means caring. The author and publisher have taken care in the preparation of this book, but make no expressed or implied warranty of any kind and assume no...
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...I was accused recently of believing things I don't believe about women as programmers and startup founders. So I thought I'd explain what I actually do believe. Some accused me of being sexist—of being biased against female founders. To anyone who knows Y Combinator that would seem a pretty implausible claim. It's hard to argue I'm biased against female founders when I have a female cofounder myself. And with 3 female partners out of 12, YC has slightly over 3x the venture industry average. While 3 out of 12 is not 50-50, it would be very hard to find another firm of our size in the venture business where women run the show to the degree they do at YC. I may be the public face of the company, but it's impossible to imagine YC doing something that Jessica, Kirsty, and Carolynn were against. More thoughtful people were willing to concede YC wasn't biased against women, but thought we should be actively working to increase the number of female founders. As one put it, instead of being a gatekeeper, we should be a gateway. But that is exactly what Y Combinator is. The people who caricature us as being only interested in funding young hotshots forget that when we started, in 2005, young founders were not a privileged group but a marginalized one. VCs didn't want to fund them, and when they did they often as not tried to replace them with "adult supervision." The fact that young founders seem a privileged group now is partly due to our efforts. We attacked the problem not by...
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