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Comment by zupreme | Hacker News Reader

This is unfortunate, but all too common among so-called "unicorn" startups.

Often its their willingness to take big chances that gets them to the top of their market. But once they get there (especially after going public) the "adult supervision" takes over and they lose what made them successful in the first place almost as soon as the finance professionals or sales people take over.

I'm not sure why it's so hard to understand that technology companies should be run by technology professionals. Would anyone walk into a hospital and suggest that it should be run by someone other than a doctor?

Of course any successful tech company should employ finance professionals, but they should help the company achieve its mission, not define the mission.

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You think hospitals are run by doctors? That's cute.

Hospitals are run by hospital administrators who have special skills in this area and are usually not doctors. https://en.wikipedia.org/wiki/Health_administration

Administrators and doctors usually loathe each other because they see things from very different points of view.

I remember reading a PaulG essay[1] that explains why the above scenario happens. Willingness to take big chances might not hurt a small company as it does to a big company. Big companies try to maintain their position in their market rather than take big chances again & lose their position[2].

That essay goes on to say that this creates a chance for startups to make their presence felt, because big companies don't want to take risks anymore.

[1] - I can't find the link right now. Will update this post, when I do

[2] - This is slightly related to Gambler's fallacy https://en.wikipedia.org/wiki/Gambler%27s_fallacy

It doesn't matter if a risk does harm a small company - in the worst case it folds and everybody involved jumps into something else. The amount of disruption and economic damage is limited to the participants. If a large company goes broke the disruption and damage spread far beyond the pool of employees.

Small companies need to try to win (and risk dying in the process). Large companies need to try not to lose (and risk stagnating instead). It's an interesting consequence of the effects of scale.

Edit: I would relate it more to an Anthropic Principle than the gambler's fallacy. There is a lot of survivor bias in the stories that we hear about.

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