I love this post. People always ask you "Are you doing a startup? A hobby? A side project?". I always respond "I just wanna make revenue, damn it, call it whatever you want".
There's this website called MyFitnessPal.com. Has over a million uniques. Run by just 2 guys from their own house. No coverage in TC, VentureBeat, or any startup publications. Yet they probably get more visitors and more revenue (and less employees) than 99% of the startups covered.
This reply made me smile, and is such a great example of why it's so hard to trust anything we read on the Internet, anywhere. I don't know which response to believe, if either, and don't know why I care so much either way.
they are both right. i've been using myfitnesspal for quite some time now, and remember reading that it was indeed a very small team (of just 2). now time has passed and they have obviously expanded. but they were extremely successful even at the beginning. i can't find the link right now but i'm certain that if you check out their blog, near the beginning, you will find something that resembles the 2man team story.
I would venture to say that almost every start-up begins with 1 or 2 driving forces, and branches from there. I am hard pressed to remember any that haven't. Anyone here think of one?
Not to be inquisitive, but I wonder how they make money. From the website it seems they only sell Fitbit [0]. Amazing how one such stream of income can support the whole enterprise and generate revenue.
This model (free service/soft + hardware) reminds me of sports-tracker.com [1] (one of few sites I simply love). They service (app, site) is also free and they sell heart rate monitors.
With same model (do free service, sell hardware), there is one difference which is interesting. Sports-Tracker sells their own hardware, MyFitnessPal just resells Fitbit.
I know HN loves anecdotes, but they're a great example for me. As an overweight guy whose relatively open about it (read: happy to discuss my weight and weight-loss difficulties) I'm constantly having this site recommended to me by non-technical non-early-adopters.
Figuring out what makes that happen is the magic key to plentiful riches, not so much tech-industry blogs. Of course, positive coverage in the tech press is unlikely to hurt.
One data point: a nutritionist at a gym I was using asked me to start using myfitnesspal as a food diary he could monitor. Maybe it's more about their trade press than our own?
Tooth-i-ologist doesn't have its own Wikipedia page. Just because a job title isn't protected by law or regulation, doesn't mean the job title doesn't exist.
Homeopath is a job title that exists and has a wikipedia page.
I'm not sure this qualifies Nutritionists as "real" for any value of real I personally care about ... then again I haven't clicked, because I don't really want to know about people who'll likely all hate me for eating too much steak ;)
I made a gross simplification with saying "Nutritionism doesn't exist". It obviously does exist since people call themselves it, and we can talk about it.
However it 'exists' and is true as much as Astrology and Creationism.
imho, it's more like the difference between a college educated programmer and one self-taught. You can find inadequately trained programmers (dietician) with some impressive degrees and some brilliant self-taught programmers (nutritionist) who naturally take to the subject.
That being said, all things being equal, I'd take a brilliant dietician (who has been trained in the whole system and science), over a brilliant nutritionist (who might only be great programming in one or two languages).
The analogy is flawed because self taught programmers are often able to programme computers, often just as good as university programmers, do not believe in radically different things from university programmers.
No 'self taught programmers' use their own "base 3 logic system" fighting against the "base 2 conspiracy".
Some of the things nutritionists believe are at odds with basic science, e.g. nutritionists who think you should eat green veg because the chlorophyll will oxygenate your blood... ignoring the fact that chlorophyll works in the presence of light, and there is no light inside your body...
Let's be clear here, Nutritionism is up there with Astrology, Creationism, Flat Earth Theory, Crystal Healing, and the Magic Power of the Stars to Heal You.
Good point, I agree that the analogy is not perfect, but I don't agree that Nutritionism is equal to the faux sciences you list, everything you listed has a philosophy that at it's core is faux science, the philosophy of nutritionism says that what we eat and how much affects us. It's the individual nutritionist that may base their philosophy either on real or faux science. Dietician:Nutritionist and Sports Science:Fitness Trainer is probably a more accurate comparison.
But then how do you differentiate between the people who believe in the magic healing power of $FOOD_DU_JOUR and someone who's based on science? That's the difference between a dietician and a nutritionist.
A Fitness Trainer is not a good analogy either, because you can't stay in business long as a fitness trainer if you have no idea of the basics of fitness or anatomy. E.g. a fitness trainer who said that you breath through your feet, so you should wear sandals when running knows as much about biology as a nutritionist who thinks chlorophyll can oxygenate your blood. However the magic super food nutritionist had a prime time TV show! High ranking, popular nutritionists can believe things that are nonsense, what hope do you have about a local nutritionist?
A fitness trainer who believes you breathe through your feet would probably suggest you run barefoot. Hey what do you know, he's just created one of the most popular running fads (although this could go with running barefoot or in sandals, as both are popular among hardcore runners).
And dietician's pushed the traditional food pyramid for years, which many current dietician's find fault with, years after nutritionist's pointed out the same thing.
I've met successful doctors, lawyers, trainers, etc., that believe in crazy wild theories that have no basis in anything other than what they want to believe. Success amazingly often has very little to do with if people are right or wrong (I'm sure there are some very wealthy astrologers out there).
By your theory, it doesn't matter which doctor you pick, they are all trained physicians, so they all believe the exact same thing. Need a psychologist, just read Dr. Phil's book, he's board certified. Or don't agree with Dr. Phil, then all psychologist's are bad.
True. I'm a med student who loves nutrition. Here in germany the DGE forces actual dieticians to use extremely outdated information (they HAVE to adhere to their handbook). The official curriculum is 30-50 years behind current state of research
And don't get me started on surprising amount of doctors that have no concept of science at all. They just say: "Wer heilt hat recht!"/"Who Heals is Right!"
Ask for proof. Competent people will be able to provide it. And explain it logically in depth.
Fitness trainers believe amazing amounts of bullshit. And teach that nonsense.
There are less than 1 % of trainers that have a decent knowledge of anatomy or of how to train you for maximum results. Their real job isn't delivering results, but keeping you busy and "motivating" you.
I get what you are saying, but formal education only tends to weed out the absolute nutjobs.
Just look at Dr. Oz or Charles Poliquin. Completely crazy.
TLDR: Ask for proof. From my experience you overestimate the impact of formal education.
Most startups don't have coverage from TC/VB/etc. Crunchbase listed around 90,000 companies at the moment, probably less than 5,000 of them have had coverage in a startup news source.
It is worth noting that Arrington had a history of investing in the very companies that he was covering. And had personal connections with many of the other investors who might invest.
Thus improved access to tech blogs can be considered one of the benefits of having well-connected investors.
Can't agree more. Its about creating more wealth for the founders. That is the whole idea. A lot of funded "startups" are just websites with big names behind it. great post.
Having had my own revenue-positive "startup" called a hobby, a toy, a blog and various other diminutions, generally by people who've never managed their own company's budget or, if they have, have blown millions in startup capital, this was great.
Whether your company's a startup or not can drive you up semantic walls, when the the focus should (for some people) being on building something of value, whether that value's for shareholders, investors, or just yourself, and to hell with all the labels.
"I managed $ABC million budgets..." always makes me think, "Was it your money? Or were you just dipping into the seemingly endless corporate coffers?"
I think working with big corporate budgets negatively trains you for running your own company. You can just throw money at things and if it doesn't work out, no big deal. Drop $80k on a booth at a trade show that didn't result in a single sale? Well, at least you got some good face-time, right? That kind of thing just doesn't fly when you're just starting out on your own.
It's much harder to manage a $20k budget and go from $0 to >$0 revenue than it is to manage a $1 million budget that just magically refills year after year.
Or were you just dipping into the seemingly endless corporate coffers
At both large companies I've worked at each department had its own budget, and each department head was responsible for that budget. If a manager keeps losing too much money, they get fired, if a department continually fails to turn a profit the department gets closed down. So while it's not the same as a startup it's also not like you have infinite money to throw around without consequence.
Well it's not as clear cut as the post suggests, though it's clearly stated as an opinion piece so they are entitled to whatever they want to think/believe.
The difference I'd like to point out is how scalable and reliable the business model is for generating value (aka money.)
For example, I run a web design company that offers custom services and consistently generates revenues each month. However it's not a scalable business. If I got 100x more sales next month, I would need more people and the number of people needed would most likely be a linear function of the number of sales I got. Also, it's not a completely reliable business model in the long run.
Compare that with that of Wix.com, which is a DIY website builder software. I would bet that they know that for every X free users, they'll generate $y in add-on sales. If they got 100x more users/customers, they would need more people and resources but likely it would be an logarithmic function.
Now if you had a "startup" like Wix without a clear focus on figuring out how to generate revenue, that's just foolish. That wouldn't be a startup. That would be wishful thinking.
Basically what I'm saying is that it wouldn't be fair to say that my business that consistently generates $x/month is better than a "startup" that might generate 1/10 of the revenue each month IF they are deliberately trying and succeeding at figuring out an effective, scalable & reliable business model because in year Z, they could be 10x my revenues.
This trend needs to change. There's too many guys out there running Wordpress blogs on shared hosting plans and/or making Android (or iPhone) apps, just to call it a 'start-up'...my Facebook friends list is full of these guys, calling themselves with ridiculously random titles like CEO/Founder/Co-Founder/MD of <insert-wordpress-blog_or_mobile_app_here>
Back in the days, a start-up was something different, something the society looked down, you know...a real challenge (which is why the society looked down). Today, the scenario is like as if its cool to run a Start-up (and fail).
X: "Hey dude, I run a startup..howz about you?"
Y: "Cool story bro..I runz one too..wanna be my co-founder?"
X: "sure thing bro...right away"
[now X can call himself a 'Serial Entrepreneur' because he sabotaged his old start-up for a new one]
I think the position is that having users is necessary but not sufficient for being a startup. NTS doesn't apply here, since no one is changing the definition of startup to exclude a counterexample; they simply disagree with it a priori.
I couldn't see any concrete distinction between the "bros" in his hypothetical and many things HNers would consider a "real" startup.
Maybe he was also attacking the very lean startup people who only have an email collecting landing page, a funny or inflated title and a blog filled with lessons for entrepreneurs when they come from a geek subculture and you are correct. It seemed more like a perfect NTS because of the "bro" references. Reading it again, I could see either interpretation being correct.
> Today, the scenario is like as if its cool to run a Start-up (and fail).
I think it is great that startups are cool. We need more entrepreneurs, not less. Most people don't have a clue what they are doing with their first company (I sure as hell didn't). Fail, and you won't make the same mistakes again the second time around.
The definition of startup that I like is Steve Blank's, a temporary organization designed to search for a repeatable and scalable business model. By that definition, his website was not a startup. It was a lifestyle business.
Note that this definition does not describe startups as inherently good thing. Just inherently different than other types of businesses in many key ways.
I can really relate to this. I have a site that provides a service, does about 175k uniques & 900k pageviews per month and generates revenue from paid accounts ($1k), adsense ($4k) & partnerships ($10k).
Do I consider it a startup? Not really. But I don't really consider it to be just a website either. I guess my definition of a startup is an entity that has a team behind it, provides some type of service & could be substantially scaled with funding or revenue.
I was waiting for that. I'm a longtime HN frequenter and didn't want to post under my real account so I used a username generator and low & behold the first suggestion wasn't taken - what luck... Debated on it's appropriateness but figured I had to use it since it wasn't taken.
There's absolutely nothing to be gained by arguing about word definitions, people treat definitions as axiomatic. People don't logically derive what a word means through etymology or historical usage, they define it as what they understand it to mean.
Telling someone that their definition of a word is wrong is like saying their preference for one colour over another is wrong. It's a personal view, accept it and move on.
Eventually, that makes communication impossible. If people are constantly reassigning different values to the same terms, you may have a conversation where each participant is actually discussing something different, and where the conclusions are therefore irrelevant.
To give you a current example, take REST. When a service says it has a REST API, it tells me absolutely nothing, since I don't know if they mean REST as in Roy Fielding's dissertation or REST as in "JSON instead of XML and some URL templates".
Their ability of communicating with me has been destroyed by people constantly reassigning different definitions to the term.
Hacker is a great one to pick on due to the name of this site. I'm in information security, and when I found a site called "Hacker News", I was expecting a bit more security research, not rockstar ninja bootstrapped VC-seeking programmers talking about Rails and the newest JS framework and how they founded a new startup with an MVP trying to disrupt a larger industry. That's not what hacker means to me. Writing code isn't hacking, it's writing code. The hackers I deal with on a daily basis are either my coworkers doing pentesting or the bad guys I'm paid to keep away from our networks. This is the only time I've complained about it, though.
Point being, words are often perverted by groups trying to describe their activities. This is how language works.
Call me old-fashioned, but if you're not making new technology, you're not a start-up, you're a small business. Making a small business is cool, and if your small business happens to be a website, that's cool too.
But if all you want is to make a successful small business, and you don't care about technology, you're not really part of my community, and I don't really want you there. I want my community to be people who care about technology first, and business second. People who care only about business and don't care about technology tend to be the kind of people who ruin the companies and the communities I like, where people care about technology first, even if those companies became valuable because they were full of people who cared about technology first.
All new businesses are startups, whether they use technology or not. They may not be technology startups, but they are still startups.
Indeed, legally, the first year of any business is considered its "startup" year (and possibly longer, in specific situations), and during this time the "startup" is eligible for tax breaks or exemptions under state and federal tax codes. This use of "startup" precedes Silicon Valley.
Yes, a bakery is a startup if it is just starting up. So is a taco cart, if it the vendor is just starting out. This is the classical definition of startup.
As someone said already, it is not how you call your "company" or the position you have in there. The results should be the important thing.
The whole thing about Startups, definition, is that every single John Doe, want to say he is a hacker "just because he knows how to code", and want to say he has a startup "just because he has an idea, and a software/site based on it".
Well, definitions might be OK, but I agree with you. At the end of the day what really matters is how much money comes into your wallet, it does not matter if you are called "the janitor of the website".
Startup is about starting a new business isn't it? If your first project was making money, but wasn't a business, with at least a rudimentar business plan, goals, and all the formality involved in doing real business... then maybe it was really just a web site that was making money as a side effect.
It looks like people enjoy romanticizing this darker side of starting up a new business. It's not your fault if you don't fail the first time you try :)
Trying to define startup these days is like trying to define hacker. The meaning changes, depending on your company. This is a good thing. It signifies a culture shift.
PG defines a startup as a business with very high growth potential.
According to my accountant, the IRS defines a startup as a business activity that is not yet profitable, but you're actively working to make it profitable.
By either of these definitions, not every new venture is a startup. This is just semantic. I don't think "not a startup" should be an insult.
EDIT: I see from another comment that Merriam-Webster defines start-up as a fledgling business. IMHO this makes the English language a little less rich, since you could just as easily say "new business", but it is what it is.
PG also stresses the importance of creating a new technology in his definition of startup.
A startup is a 'Useful infrastructure' previously and wholly 'nonexistent' that 'fills a need' for a population and thus earns revenue. I'm sure I've left something out but this definition helps me sort between startup ideas and content ideas in my head.
Somewhat related- foreign correspondent (a news show in australia) ran a story last night on the new goldrush for people creating apps. Besides the cliché camera work, it seemed to be full of 'founders' who had written a single, sometimes unproven phone app and were talking about getting hundreds of thousands of dollars in funding, and getting acquired for a billion dollars.
The guy who runs the accelerator program at my university once yelled at me for calling my startup a website when I was explaining it to him. He told me to call it a product or a service and that I should NEVER EVER call it a website - and that "fuck, my 5 year old son can make a shit website". It really made the rest of the phone call awkward since he kept talking down to me and I was being super careful to avoid the W word.
Thoughts on his advice? He was the only investor I've ever talked to so just wondering for the future when talking to other investors...
He sounds like an asshole, for one. But maybe there's a point there - if you want to get investment, you should be talking about your business. That means employees, roles, taxes, stock, lawyers, planned growth, goals, etc. The website may be the medium by which you operate, but if someone is to invest in you, they are going to want to see you thinking bigger.
Consider it the difference between someone with a corner store and someone wanting to build a new franchise. No one "invests" in a corner store.
A website is to a software startup as a bicycle is to a courier. Nobody invests in a bicycle; they invest in a profit-generating courier service. Similarly, nobody invests in a website; they invest in profit-generating online products or services.
This guy may have conveyed this lesson in an abrasive manner but it is valuable advice.
Trying to follow the logic here. Keep getting stuck. The problem appears to be that folks feel like the term "startup" is abused and watered down to the point of being meaningless. Admitting a self described content aggregator (from one source!) into the club helps out how?
I think it's awesome this individual displays the ability to generate $10K in free cash flow per month. (I edited this as it sounded snarky when I read it back) The more you widen the definition the weaker the definition becomes.
A startup usually comes with the connotation that you will scale it to some sort of ideal (whether that be revenue, the people or businesses you have an impact on, etc.). A site that pulls in a decent income via advertising is really just a lifestyle business with little chance of scaling. Now if you made a network of these sites or found some other scalable product coming from this site.. then you'd have a startup, no? No one says you have to build a startup though.
Merriam-Webster definition of Startup: "a fledgling business enterprise".
See a lot of zero revenue businesses that throw around the scale idea as justification for not having a business model, but the older I get the more I believe titles, whether for what your business is or what your role is, matter less than results.
What makes the startup world so exciting is its variety outside of the echo chambers: Food truck startups, jewelry startups, services startups. Many of which don't plan on or will never "scale" in a web sense, and then others that will scale in ways the founders couldn't imagine the first year or two out of the gate.
That that also means Quora, Yahoo, and WebMD are also lifestyle businesses. All rely on advertising. Heck, all are glorified blogs that depend on having as many pageviews as possible.
Those figures fit with what I remember about ad revenue. If I remember right, it's normal for around 2% of hits to convert into an ad click. If we pair that with a $0.50 mean earning-per-click (memory and a cursory search of the Internet say this is reasonable), we get:
$0.50 * (1.5 million * 2%) = $15,000/mo.
That leaves some leeway for Crranky to have worse performance and still hit his quoted $10,000/mo.
A startup is a company that has captured a small percentage of the overall market it is attempting to fulfill. For example, I would say Tesla Motors is still a startup.
By contrast, I would not consider crranky's Blogspot website a startup because I suspect it has captured most of the small, shrinking market it targets.
Both the OP's and that guy at the conference's attitude is wrong. One demeaning someone's work, the other chasing a ghost.
Where did that revenue-generating website go?
That said, this might not be the case, but if your work is creating the same value as the standard car salesman (i.e. none), you'll get corresponding respect.
A company with a goal of making revenue and dividends is a normal company (or 'a website' in some cases). It may be a large company or a small company, growing or shrinking - but not a startup.
A company with a goal of making huge (not 100%, but 100 times) growth is a startup.
100k company aiming to be a 200k company is not a startup;
100m company aiming to be a 200m company is not a startup;
100k company aiming to be a 200m company is a startup;
0$ company aiming to be a 200k company is a startup.
IMHO. Does it make sense?
P.S. and it is often determined by the actual business ideas. There are some ideas that can grow and scale if everything goes well; and there are some ideas simply that have a market ceiling of, say, a few million even if everything goes perfectly.
Think about the word "startup." The etymology of the word means, literally, "start up [business]". A new company that has yet to prove itself is a startup. The Merriam-Webster definition is "a fledgling business enterprise."
If that's not a startup, then calling what you're referring to "startups" is very counter-intuitive.
It's as if I had referred to a recently founded car manufacturer as a "new business" and then subsequently everyone started referring to 20-year-old car manufacturers as "new businesses."
A startup is simply a business that is in the first stage of building; i.e. has a product (website and software included in this definition) and hasn't started/has just started making money from it.
A 100k company is already a business and not a startup.
Both the author and his critique have different labels for the same thing. Its a non-issue.
A startup is company which doesnt have a stable cashflow and is searching for one. Thats about the only difference that really needs to be applied from a taxonomy point of view.
Impact is also completely unrelated to the label "startup". Private citizens, companies, NGOs, social communities and even projects-on-the-internet (eg: Linux) have had a huge impact on the world and its hard to say who has had more. Again another inane and useless conversation - who has more impact.
First make enough money to attempt to make an impact. Then you can try your hand at actually making an impact.
The best definition of a startup that I've heard so far is from Eric Ries's book, the Lean Startup:
"An organization dedicated to creating something new under conditions of extreme uncertainty."
I think anyone that wants to take a risk and actually create something should be allowed to call themselves at startup. Does it really matter if it's a business, website, startup? At the end of the day, it's pretty easy to tell who is serious and generally talented verses the people who are just hobbiest or not putting their full effort into their businesses.
I rather have 10k monthly from a blog than headaches and stress that will give me nothing in return besides telling my friends I am a serial entrepreneur.
I would say that a startup is something that generates value (hard to do), not cash flow (which is easy).
I had a lot of businesses that generated $10 K+ a month, some without me doing much at all, or working 5-10 hours a week. But they didn't worth a dime, so they weren't startups. I couldn't sell them for any meaningful amount. So is yours.
I think whether site or startup, it is just a (hopefully informed) crapshoot. In the end, the goals are to be happy, make money, and make a difference. Whether you do that via startup, or other means, doesn't matter. And, if you fail, you (hopefully) learn and can do better next time.
Sometimes it's not a website. When you make an app, the App Store really plays a big role in both promoting and selling it. I just wrote about how to get your apps promoted there:
Actually, a startup doesn't even need a website, or be anything software, a startup is a new company trying to create a new service or product that will bring revenue. No revenue, no company, no startup. Tesla motors is not a startup?
I always felt the same way doing internet marketing stuff. I had fun and was making money, but I didn't consider my company a "startup" because I wasn't really creating any new technology. I think that is kind of the difference...
Do what you want. Build what you want to work on. Bills need to be paid, but ultimately I would rather work on an application that provides needed functionality than on copying and pasting blog posts and negotiating ad deals.
Completely agree. My favorite 'startup' that's 'just a website', handsdown: Slickdeals. That forum probably pulls in more revenue than 99% of startups.
I always feel awkward with things like this... I'm more interested in building cool things and making them open source and/or interoperable than I am instantly trying to revenue-ize it. I'm so tired of all of these apps that do the same damn thing with (insert some random useless gimmick) that will never amount to much because they're all competing with each other for critical mass because their products are largely useless without a large-enough network.
I just like building things. Cool things are more fun to build, but not everything needs to be in that category. I'm in software because it's significantly cheaper than other ways to build things. I love working on open source software because you can build bigger and better things with a team, it builds good will and unless it's core to a business, there's no reason not to. I'm shooting for a certain dollar amount that would let me work on what I want when I want, not just for the things that come with the money. But on the route there I refuse to give up the enjoyment of building things with a preference to cool things.
On the other hand, I only hear about the feature as a product or network effect startups here on HN. Around town, folks I interact with and companies I all work with have real products and at least a real revenue source.
It's like going to comic-con and deciding the rest of the world dresses like that.
I also love building things, but, to use an analogy, I also love playing music. I practised for years and years, until I could pick up whatever music I wanted to play, and then I wanted more - some kind of validation - so I wanted to play to other people.
It is a bit the same with me and programming/developing. Revenue is my new metric for how well I am doing. It makes it harder - yes I can come up with a solution, but can I do it in a short time, suppressing my perfectionism (come on - we all have it), and in a responsive enough manner to get people to pay for my work? It is just taking it to the next level.
It is a big data local social gamified MVP'd pivoted to-do list built on a distributed paxos consistent lock-free real-time column-based k/v persistent memory grid.
Not really compatible; bootstrapping (in the business sense) is kinda the opposite of VC-chasing, which is what such buzzword-fests are typically a symptom of.
This is broadly my take on things; I love the inspiration that I get from the startup community, but I'm not motivated at all by the rapid growth aspect. I'm sure that if one of my slow-growth projects developed into something bigger I would change my tune, but I don't feel like joining the high-growth scene for the sake of it.
I admire people who can identify a useful, positive seed idea and grow it to something that enriches a wider audience though. That's kind of why I lurk around HN.
Paying someone for developing a (IMHO not really fancy and useful) webapp isn't the same thing as leading "real" startup. A "Startup Guy" works on his product 24/7, talking to investors, partners, costumers and much much more...
There's this website called MyFitnessPal.com. Has over a million uniques. Run by just 2 guys from their own house. No coverage in TC, VentureBeat, or any startup publications. Yet they probably get more visitors and more revenue (and less employees) than 99% of the startups covered.