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garry says...

Robert Scoble swung by our offices in North Beach in San Francisco and we sat down to talk about Posterous, design, and the future of web publishing.


alex says...

When you make the decision to start a BIG technology company you are inherently making a somewhat visceral and violent decision that you have evaluated a market and that the key big players that are collecting dollars from this market are not adequately addressing the needs of the customers and in fact are only serving about 10% of the true needs of a market. If this is not the calculation I would argue you are then only planning on offering an incremental value proposition, which inherently is not a BIG tech play. Starting a BIG tech company takes an incredibly long period of time. 6-10 years in many cases (just to start). A great example is Google taking down Yahoo. Up until about 4-6 years into Google's existence it was unclear that Yahoo was even concerned about Google. They were concentrated on building a portal destination with rich content for viewers (the 10%). They failed to recognize the real value they were sitting on which was search and advertising (the 90%). Real technology companies then have to have this 90% insight and patient founders.

The big players have a huge initial advantage. Money, smart engineers, resources and time, but as a stranger from the North you have a few advantages:
  1. The established players (Romans) are likely in a mature phase which usually comes with the trappings of being overpaid and having a culture of status quo. Innovators quietly have already exited stage left in many cases. 
  2. The Romans don't necessarily have an ability to innovate quickly enough when they see you coming around the bend.
  3. When it comes time to fight your engineers/warriors are invigorated, while the larger players are playing defense. Engineers are the most important component of BIG tech companies. Large companies often (Ebay, Yahoo) commoditize their best engineers - encouraging much of the talent to leave. This commoditization of engineers is the equivalent of death punch to tech companies. 
  4. If you have something new it will be tough for established players to change their missions to do what you are doing. Being a 10, 20, 50BN company and admitting you are dead wrong is hard. 
The slow motion reference here comes back to the point that starting large technology companies take an incredible amount of time. Most people in Silicon Valley think in 4 year blocks. "I'll do this for 4 years and see where we are, hopefully we can sell or something...". This mentality is not sufficient to create something truly huge. Mark Zuckerberg has on a number of occasions, referenced the Fbook platform as evolving "over 30 years". This is an ideal outlook for creating powerful technology. The key is that technology often takes a long time to fully bloom - timeframes most people can't emotionally encapsulate. This is likely why most entrepreneurs aren't making huge plays. It all sounds difficult when you ask people one on one what their appetite is for working for long and so hard. 

Now to the sex. There is absolutely nothing at all sexy or sex-related about starting a BIG tech company. The processes are extremely slow and painful. This is a common message entrepreneurs that have pulled it off seem to mention first. 

Follow me on Twitter: http://twitter.com/AlexdMoore


sachin says...

                     
Click here to download:
Steve_Jobs_is_CEO_of_the_decad.zip (1130 KB)

Even with my 13+ year obsession with Apple and Steve Jobs, I'm seeing many of these photos for the first time.

Congratulations, Steve. You've had a major impact on computing, design, and my life.


garry says...

I love this line. We don't hear much about the "electric light revolution" anymore-- but that doesn't mean we've all returned to candles.

Excerpt from Biz Stone's 2004 book "Who Let the Blogs Out?" -- back when he was working with Ev on Blogger at Google.

Biz was creator of Xanga, which is where I first cut my teeth blogging in a community in 2002. Before that I always wrote my own perl scripts to blog, the vestiges of with are partially memorialized in archive.org. My xanga on the other hand remains online.

Had no idea we would end up building our own take on things, but we certainly stand on the shoulders of giants.

Filed under: blogging

Blogwell says...

If you'd met the Wright brothers around 1900, when it was just the two of them and some hand-built models, you might have guessed that their flying machine startup was going somewhere.  Wikipedia article:

Despite Lilienthal's fate [died when his glider crashed], the brothers favored his strategy: to practice gliding in order to master the art of control before attempting motor-driven flight. The death of British aeronaut Percy Pilcher in another hang gliding crash in 1899 only reinforced their opinion that a reliable method of pilot control was the key to successful—and safe—flight. At the outset of their experiments they regarded control as the unsolved third part of "the flying problem". They believed sufficiently promising knowledge of the other two issues—wings and engines—already existed. The Wright brothers thus differed sharply from more experienced practitioners of the day, notably Ader, Maxim and Langley who built powerful engines, attached them to airframes equipped with unproven control devices, and expected to take to the air with no previous flying experience. Though agreeing with Lilienthal's idea of practice, the Wrights saw that his method of balance and control—shifting his body weight—was fatally inadequate. They were determined to find something better.

Even without hindsight it's clear they had ideas and momentum. They had done their own experiments, learned about others, figured out some non-obvious things, and developed an original plan of attack. They didn't have the answer to stability, but they knew how they were going to figure it out. They focused on specific problems and didn't get distracted by others. Obviously they knew they'd need strong engines and wings someday, but they decided to start with the control system and build everything else around it later. They were willing to solve the hard problems by strapping themselves to kites on remote hillsides rather than just tinkering with engines on the bench like some of their competition.

In the end, their Wright company made a lot of mistakes and wasn't the biggest financial success of the early aircraft industry, but it could have been. It's the sort of startup we like at Y Combinator: technologically disruptive with a good chance of cashing in.

You can see the same features in good early-stage web 2.0 startups. They are sometimes caricatured as being frivolous companies, but in fact the good ones are based on ideas as valuable as the Wright's scheme for controlling an airplane. When Posterous applied to YC in spring 2008 there were probably as many companies trying to create blogging software as ever tried to make flying machines. The Posterouses stood out because they had been thinking about easy web publishing together for years, built prototypes, tried things, and had some insights nobody else did and a plan for creating a successful product. They had thoughtful reasons why the problems they were going to focus on would make them popular among a growing class of users, while Blogger would continue to focus on its existing user base and stagnate. 

Good founders are open-minded like good scientists. For example, I challenged Garry's assertion that submitting blog entries by email was easier than web forms. Many people seem to prefer Gmail over desktop email software, so why wouldn't they prefer entering their blog posts on the web than their email client (which might even be Gmail?) Bad founders react to such questions like, "What? It's obvious! How dare you question my premises?" Garry's answer was more like, "Yeah, we wondered about that too, but we tried X and saw users do Y so we think it'll work." He had tested his assumptions, evolved his theory, and figured out important details that nobody else seemed to get.

Fundamentally, most YC-funded companies are in the business of providing a digital service that users pay for or advertisers sponsor. There are already thousands of web companies providing a wide range of services, so why will a brand new company make money? At the heart of a web 2.0 startup are several theories:
  1. Our new service will attract the following kinds of users: .....................
  2. They will use it for the following purposes: ..................
  3. Instead of a trusted brand, they will use a startup they've never heard of before because ......................
  4. Even though some of the value is social, we will be useful to the first users because ..........................
  5. Users will recommend us to their friends because ....................
  6. Big competitors won't be able to copy our features as soon as they notice us because ........................
  7. .................... will pay us $................... in return for ........................
  8. Once we get critical mass it'll be hard for new startups to steal our users because ..........................
Those are hard questions and they're interrelated, but startups continue to find answers to all of them. Make sure the existing players don't have better answers than you. For example, Craigslist has a very good answer to #8, so you need something big for #4. We get a lot of "Craigslist for X" applications, and often they miss that. For example:

YC: Why will users prefer you over Craigslist?
Founders: We'll be more localized. Craigslist has listings from all over the city, but we'll just show you listings from your neighborhood.
YC: Maybe Craigslist would be better if it were more localized, but until you're popular you'll have to be *less* localized in order to have any listings show up at all.
Founders: So we won't turn on localization at first.
YC: But then you won't be much different from Craigslist, and there's no reason for people to switch. Your special sauce only works after you're already successful. You need a way to get there.
It's clever of Craigslist to err on the side of large granularity, because it's a phase a startup would have to go through to compete with them. Or:
YC: Why will users use your software instead of Quickbooks?
Founders: Our software will be easier to use.
YC: Are there a lot of people who find Quickbooks too hard?
Founders: Yes.
YC: But a lot of people already know Quickbooks, so it's easiest for them to not change.
Founders: Sure, we won't take away their users. We'll get new users.
YC: How will new users find out about you?
Founders: Their friends will tell them.
YC: Do people tell their friends, "Say, I just found this really easy new accounting system!"
Founders: No, but when people start a business they'll ask their friends what they should use.
YC: But they're going to ask their friend who knows the most about accounting. Won't that person be a Quickbooks user? Won't they recommend what they know?
Suppose you have answers to all the above questions. You build it and nobody comes, so something is wrong. How do you figure out what? I don't have any universal advice, but helps if you have a complete, consistent working theory the team agrees on so you have a basis for debate and experimentation.

Experimenting is hard because people are naturally afraid to put their theories to the test. Often when startups take a long time to launch, it's because they're afraid of bad news. They fear people won't like their product, so they don't release. They plow forward based on their untested theory rather than testing and iterating. Teams that don't really trust each other or where one founder is intellectually domineering are less able to try different approaches. The best advice is to strap on some plums and put whatever you can to the test, so if it's wrong you can adapt and move forward.


guykawasaki says...

More on Startups.


Every venture capitalist is looking for a “Buzz Lightyear” company (one that goes “to infinity and beyond” like a rocket ship), but history shows that this may not be the best and certainly not only way. Test your knowledge: true or false? Both Microsoft and Oracle took more than seven years to reach $50 million in sales. If you’re starting a company, you need to read this post to see that “hockey-stick” growth isn’t the only way to success.

By Guy Kawasaki. Read this to avoid repeat posts.


garry says...

If your goal is to start a company, it is mostly a waste of time to work anywhere but a startup.
--Chris Dixon via cdixon.org

I agree. Large company experience prepares you for the rigors of navigating fiefdom and hierarchy and pleasing your boss. Those goals don't align you with creating value in the marketplace. But that's the entire point of startups! Get closer to the metal, not farther away.

Filed under: startups

sachin says...

Before Posterous existed, my blog was mostly photos and reviews. I'm going to shift back in that direction a bit more.

1. Naked Lunch
We end up here once a week or so for some of the best gourmet sandwiches I've ever had. Cod sandwich, tuna steak, salmon, they even have a foie gras sandwich but none of us have tried that one yet. Yesterday I had chorizo and egg. Phenomenal. The fried egg had a running yolk that broke and soaked into the top bun perfectly. The sandwiches are fairly small and come with no sides, but it works. You leave satisfied and not heavy/greasy. HIGHLY recommend this place.

2. 15 Romolo
We mostly come here to drink but they have great food as well. This place is hidden up an alley between all the strip clubs in North Beach. I was introduced to it by George Penston of Widgetbox. 15 Romolo makes fantastic drinks and it's never crowded. Even on a Friday night, in the middle of tourist packed North Beach, you can come here to get a table and some fine drinks. I think this is my favorite bar in San Francisco. Forget about Bourbon and Branch.

3. Giordano Bros.
We love Giordano's so much, we're actually on overload and have taken a break from this lunch spot. Giordano's is based on the Pittsburgh "Primanti Brothers" restaurant. "The secret? Take two thick slices of Italian bread. Top with your choice of grilled Italian meats and melted provolone cheese. Pile on some freshly cut fries, oil and vinegary coleslaw, and then serve on wax paper."

4. Molinari's
This is a pretty hardcore Italian Deli. Just grab a roll from the bread bin and hand it to the guy behind the counter. The basic Italian sandwich is awesome, and giant. You just can't go wrong here.

5. Good Luck Deli
I miss New York. I miss being able to walk into any corner deli and getting an awesome sandwich for $5. But at Good Luck Deli, you get just that. It's on the edge of Chinatown and owned by a nice Chinese couple, but there's nothing Chinatown about this place. It's friendly and clean, and they make great New York deli style sandwiches. What does that mean? A basic turkey and cheese on a roll, piled high with lots of meat, for only $5. Love it.

As you can tell, I'm a sandwich guy. I could eat sandwiches for lunch every day and not get tired of them. Anyone have good sandwich recommendations in San Francisco?


guykawasaki says...

This is the official update to "Shift Happens." It provides the latest stats the media marketplace and tech changes. Cool info--very useful at cocktail parties and for speeches.

*****

Get your latest tech news at http://tech.alltop.com/

*****

If you haven't seen "Shift Happens," here it is:


garry says...


AWESOME. Might have to build a few of these ourselves sometime soon. Backblaze does online storage/backup so it's pretty obvious that off the shelf cloud storage won't cut it in the long term.

Mad props to them for breaking it down all the way to parts lists. Talk about open source innovation!