Web start-ups almost always fail. So why are these guys launching one?

A very nice backgrounder on the Redbeacon team that won TechCrunch50 this past year.

Most impressive item for me (besides the talent, prudence, discipline, and perseverance of the founding team, which is evident): having the willpower to defer VC funding until they can do it on terms that are reasonable for the founders (a lot of startups use this strategy now but to be able to do it after drawing interest from 19 VC firms in the wake of the TC50 win is commendable). Also, their realizing that getting premature VC funding can actually mess up a company by skewing its goals toward premature expansion.

These guys have a business model that will live or die by whether it can scale well, and that challenge still lies before them. But what they have done so far is really the perfect picture of a highly disciplined lean startup that is done right.

I must say, I am growing weary of the "fail" theme. It is just not in the spirit of an entrepreneur to be focused on failure and I wish those who write about them would stop beating this theme to death. Founders have better things to focus on, as do those reading about their ventures.

Differs from the normal startup stories you so often hear about - they don't have funding, they don't have much in the way of private cash, they're not ridiculously young, and it's taking them a while to get traction. They're basically going it totally alone on a wing and a prayer. Kudos to them.

How risky is it to be an entrepreneur? 10-30% chance of sucesss. On the surface this might seem like bad odds but we are talking about businesses that have the potential over a life time to be worth over 10million dollars. And so the expected value of starting one is 0.1 * 10million = 1million. These figures are arbitary but it's more to illustrate the point that they aren't that insane to start one. The thing about entrepreneurship is that if you fail you can always try again. Try 12 times and that puts your probability of success to 70%. Assuming the trials are independent, but they are not most entrepreneurs will succeed in 4 tries.

ex-googlers - I wonder how much of an advantage that gives them in terms contacts and possible future buyout.

(especially seeing as it is dead center in an arena Google could easily want to expand into)

So is the main difference between this story and any of our bootstrapped stories that they were high profile and declined the VC money?

This is what REAL business is. I'm so glad real entrepreneurs like these guys are getting some attention.

I'm not sure the slow start is what's called for here, if CL were so inclined they could permanently make these guys irrelevant in a week or two.

Startups founded by ex-Googlers have a 70%+ chance of failing? That seems incorrect.