That "zombie startup" that Aaron is describing sounds like a nice, sustainable company that isn't chasing growth but can live for a while, profitably, with the customers you have. Why shut that down? That sounds great!
You should decide this before you enter the startup scene, and ideally as you're beginning your career. Because if you think you're playing one sort of game but are playing it according to the rules of another sort of game, you're basically guaranteed to lose.
The assumption when you play the startup game is that you're playing for a big, low-probability payoff. There are a couple variations for just how big a payoff (are you looking to play the outsource-R&D-and-get-acquired game? show-I'm-a-good-programmer-and-get-aqhired game? build-a-billion-dollar-company game?), but in general, when people talk about startups, they mean hyper-growth. If you don't find hyper growth, you've lost at the startup game, and should call it and invest your time into either playing again or playing a different game.
If you want a lifestyle business, you should play that game from the outset, because it means playing several choices differently. Notably, you should seek a small niche with real customers first, you can afford to pick an area off the cutting edge, you should seek profitability over growth, and you shouldn't take (equity) investment.
In reality, you can only make effective decisions once you've had the experience of what you are deciding about.
Also, regarding the specific issue of zombie companies, they can always be brought back to life. There is tremendous value in having a fully working organization/team.
Also, why not play in a big, HIGH probability payoff.
For example, why not compete with Google or Amazon in what they think is their next market? This assures you a big market with at least 100M - 1B annual sale.
> why not compete with Google or Amazon in what they think is their next market?
These two things are at odds, because your startup generally can't compete with the likes of Google and Amazon because you simply don't have the resources that they do. VC money evens the playing field a bit, so at least you have a chance at getting your product out there and getting real customers before BigCo eats you alive. You can't have it both ways.
This sort of rhetoric shows how much of entrepreneurship isn't really about like, making money. It's meaningless emotional warble-garble, a kind of psychological warfare that people do to themselves to stay happy in a system of really emotionally punishing rules of one-upmanship.
Like one funded founder I know, I asked him straight, "Are you motivated by acting out college-age vengeances against your peers?" and he said yes! It's not really about, "I don't want that Google engineer lifestyle," because that person does, he just wasn't qualified (in some narrow sense) to do that. He just failed at it.
A lot of people don't grow out of that.
And it's not just limited to people who didn't pass the Google interview. There are plenty of Google engineers who said to, e.g., studying medicine in college, "I don't want that doctor lifestyle," when really they did not perform competitively in their first-year life sciences class! Medicine dropouts everywhere!
The startup handbook materials seem so incomplete. They don't honestly engage with the emotions of their audience, which is overwhelmingly disaffected college-educated 20-40 year old men of means.
In fact, the reason your rhetoric is so appealing is because it doesn't put these emotional things out into the open. It amplifies the weird psychological warfare, it doesn't question it.
The right question isn't, what kind of game you want to play? It starts with what a therapist would ask, "Why are you here today?" to lead to "Why do you think you're unhappy?", questions that make the audience of your line of thinking deeply uncomfortable and something to be avoided.
A lot of our decision making, historically, was just decided for us. Parents had children and married them based on economic benefits. Your work was just what your Dad did or through other close relationships. Now you have seemingly infinite choices. People are often making the wrong decision for the wrong reasons all the time. Sometimes it works out, sometimes it doesn't.
I think anything that helps you frame your actions and understand yourself and your motivations is fine. I know plenty of people who happily would identify with the 'collect a paycheck and get fulfillment elsewhere'. I also think it's perfectly valid to want to start a company to get vengeance on those who appeared to underestimate you.
The reality is there are many paths and it's very hard to judge what a valid or right path is.
Once you make it clear to them, though, you're unlikely to face that conundrum.
It’s largely been depressing coasting as a zombie. Making enough money to pay the bills but not enough to save or do anything for the future, but have been afraid to start something again for fear of going down this same route again.
Best of luck to you - sounds like a tough spot.
1) A company that is sustainable and effectively “runs itself,” growing linearly, generating passive income, and default alive, but without much input or massaging from the founders outside of thinking about and implementing strategy, and,
2) A company that intended to be a startup, that still requires heavy support, tons of the founders’ time and effort, and is constantly still trying to figure out how to acquire new users. It’s profitable, but only because of the founders’ active efforts.
One of these is depressing and leads to burnout. The other is fine.
Small businesses and startups (as YC uses the term) are different things. Your neighborhood coffee shop is not a startup that leveled off, it's a small business.
You can never reach that level returns if a business is sitting at 50k/mo.
I’ve been in a VC fund for 10 years and literally all the returns are from three companies, the others make no difference whether they zero out for return 3x