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Comment by extantproject | Hacker News Reader

37 Signals has sustained revenue. They are not a startup in the same sense as YC or Silicon Valley thinks of a startup but they have the linchpin of a healthy business -- and every healthy business dislikes competition.

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> every business dislikes competition.

Not true. A struggling business dislikes competition. A healthy business likes competition. A competitor validates your market and frames a choice. With a competitor, a customer doesn't just have the choice of buying from A or not. A customer now has to consider buying from A or B (or buying nothing). When you've got dozens of competitors, you've got a market.

Competitors do validate your market. That doesn't mean you like them (e.g. http://www.apple.com/getamac/ads/).

You're doing it wrong if it becomes a grudge match. See http://blog.guykawasaki.com/2006/03/the_art_of_driv.html

(Yes, I am aware that Guy Kawasaki marketed the Apple MacIntosh at launch.)

Sometimes you can piggyback of your competitors. See "How Starbucks Actually Helps Mom & Pop Coffee Shops": http://www.slate.com/id/2180301/

That's actually not true. You can certainly be a startup and have sustained revenue. In fact, most investors/VCs won't even talk to you if you don't have any kind of revenue. Getting that first customer is a must if you want to even get a meeting with an investor. This was iterated by 12 big NYC investors/VC companies last week at NYC's Internet Week event 'Financing Your Startup'.

A startup can be a healthy business with revenue -- of course -- but 37 Signals is not a startup. 37 Signals is a business in the traditional sense; they're focused on generating revenue instead of an exit.

A "lifestyle business".

It doesn't matter what kind of adjective you put in front of the word "business", they're still making money.

Sure, but so does a guy with a lemonade stand. It's being able to grow and replicate that.

From wikipedia: "Lifestyle Businesses are businesses that are set up and run by their founders primarily with the aim of sustaining a particular level of income and no more."

And that's great if you want to create a business that sustains your lifestyle.

Orange Julius and Jamba Juice are both basically glorified lemonade stands. Starbucks is just an upscale version of your gas station's coffee dispenser.

Sure, but my original point was that they don't seem to want to grow. They don't seem to want to be a chain of lemonade stands, they just want to be their own profitable lemonade stand. Which is great and fine, but it's perhaps not aligned with many of our aims.

I see what you're saying and I agree that they're more of a "lifestyle business" as defined in this thread. They're not the traditional type of startup, but they do share startup values to an extent.

What I'm getting at is that 37 Signals, while they might complain about competition, probably isn't all that concerned because they have a healthy revenue stream. Their revenue may be taken away later, but they'll be able to deal with that the same way they dealt with no revenue when they were just starting: making something people want and straight-up selling it to customers. In the meantime they're making bank.

I would say this is true in NYC, but not Silicon Valley. Our company is based in NYC and you're right about VCs not talking to you if you don't already have a concrete business model that's already generating revenue. However, it seems from my experience that the west coast is a completely different world. I'm sure there are many good reasons for this, but I wouldn't say that most VC's/investors won't talk to you, I would say that most NYC investors won't talk to you.

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