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Comment by fsloth | Hacker News Reader

What I recall of chances of success, earlier failures do not correlate with success - either way. So basically one is throwing fair dice every time. I might be recall wrong...

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That is with dice.

Startups are not independent random events because some people are better at making startups than other people are.

I think your parent is saying that when you actually measure whether your claim is true, it isn't actually correlated in the failure case.

I remember reading something that corroborated this [1]. That source claimed that previous founders of successful companies had a much greater chance at additional success, but previous failures didn't increase your chances (ie. you don't, in fact, learn more from failure than success -- at least when it comes to founding failed startups).

Edit adding source: [1] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=933932

Ycombinator has made a lot of money based on the idea that some people are better at creating start ups than others. They don't just bet on ideas they also bet on people.

On the flipside, it could be that Y Combinator has made a lot of money by creating an environment that helps startups succeed. Apart from money, they provide founders advice, structure and a set of motivated peers. More cynically, they also provide prestige, validation and connections.

I have no doubt Y Combinator would still be successful even if their selection method was not very good. (I tend to think about top universities the same way—the quality of Harvard's admissions process is not the core reason they graduate so many successful students.)

Personally, I feel like the success of Harvard students is mostly selection bias with respect to their admissions department - i.e., everyone who gets into Harvard would be successful anywhere else.

But then again, I was just rejected from Harvard, so you might want to take my opinion with a grain of salt.

Studies of people accepted to Harvard but who chose to attend other schools support your theory.

I also thought that, but I couldn’t find any references to any of those studies when I was writing my comment. Do you happen to know where I could find them?

Yeah, it's probable that a couple of teams are less stellar than others, they can probably work it out though

It would be interesting to know about some companies that don't get to Demo day or that doesn't put out a great presentation

Right. And that source isn't claiming that people are all equally good at founding startups. Rather, it's claiming that previous failures don't substantially make a person better at founding successful companies. (They do find a very small 2% effect, but that may be statistical noise).

Two caveats: 1. That study only applies to venture-funded startups, so startups funded by other sources are not included. 2. There is a small difference between success rates of 1st time entrepreneurs (18%) compared with entrepreneurs who previously failed (20%), so previous failures may give a small boost in future success rates.

Thanks! This is the reference which I tried to recall.

That's your claim. What evidence do you have for that? What if it is just (or majorly, like 95%) just getting lucky?

Luck plays a big role, but there are also other important dynamics.

Domain expertise, creativity, intelligence, education, insights from other fields, financial resources, connections to other impactful individuals, personality, etc. Such things significantly affect how events unfold.

I believe resilience is the big one

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