Comment by walrus01 | Hacker News Reader

Comment by walrus01 | Hacker News Reader

> Airbnb’s goal during YC was to reach what we call ramen profitability, which means making enough money that the company can pay the founders’ living expenses, if they live on ramen noodles. Ramen profitability is not, obviously, the end goal of any startup, but it’s the most important threshold on the way, because this is the point where you’re airborne. This is the point where you no longer need investors’ permission to continue existing. For the Airbnbs, ramen profitability was $4000 a month: $3500 for rent, and $500 for food. They taped this goal to the mirror in the bathroom of their apartment.

I wonder what the calculation for ramen profitability would look like in a fully remote-work environment, in a place where rent isn't $3500 a month... Anecdotally I've seen a few people renting pretty nice places in Phnom Penh, Cambodia for $500 a month. Some stayed there through the entire duration of the covid19 crisis due to travel shutdowns and have been working on various things.

Many digital nomads do this throughout Southeast Asia.

I’m not sure I would recommend it, though. Proximity to customers (assuming US/EU market) and angels/VCs is worth something, and I would suggest that it is worth a lot.

I will also add that when you factor in plane tickets, visa runs, etc., it is probably easier and just as affordable to find a cheap place to stay in your home country.

If you’re bootstrapping a business, especially if you have some tie to Asia like manufacturing or labor (e.g., “virtual” assistants), then the digital nomad option may be better. But for a VC-trajectory business, I somehow doubt it.

If you have US-based clients the time difference makes it hard to be “available” from Asia. It’s much easier to go south: Belize, Costa Rica, Ecuador, Chile, etc. The cost of living is about the same but you’re still in a time zone where it’s easy to keep in touch. If you have clients on the west coast then working from Guayaquil isn’t really any different than working from New York City.

> I would suggest that it is worth a lot

this is not a particularly scalable advantage. if you plan on reaching every single corner of the global market, what does customer proximity mean? if you have to have an office everywhere you do business in, is it really a tech driven business or are you just doing bespoke sales? what's the cost of every additional dollar of revenue?

The context of the discussion is ramen profitability and potential very early investment (angels, yc, etc.), and the commenter seemed to be looking for an inexpensive place to live.

Early start ups are typically going from zero to one, so they really need to find a small and passionate customer base somewhere. As many folks have said before, often times it makes sense to do things that don’t scale early. This might mean in-person visits. YC has many stories of this working, like Airbnb and Stripe.

I will also add that if you are looking to go down the VC path, being near VCs is important. You can raise VC being far away, but it is more difficult, and the associated costs will eat away at what the original commenter seems to be looking for, which is a cheap place to live.

Yes. It doesn't make sense. The prices (rent) adjust so that "if you can't very cleverly combine it with something else", which probably most people can't, then it makes sense to "stay where you are" and pay the premium compared to travel(-expenses) and a cheaper deal. If a significant amount of people would find feasible ways "to arbitrage (between locations)" the market would adjust (and prices in SV would drop). If you manage a setup in which you can profit, it is a special one and not the norm.

You can get places nearly that cheap without leaving the US even, you just have to be willing to be in a cheap state.

Indeed so, and the calculation for that as something feasible will only get better as rural broadband improves. Cautiously optimistic for starlink based on beta test results I've seen. There's lots of places I can think of in the western US states (and BC, AB, SK) that would be ideal for remote work if the network access wasn't presently slow or flaky.

Mine is health insurance profitability lol.

You can get free or very cheap health insurance in most of the US if you have low or no income, including if you're bootstrapping a startup. "Most of the US" means the dark blue states in [0] plus Wisconsin.

[0] https://www.kff.org/medicaid/issue-brief/status-of-state-med...

Even that can be finagled by paying yourself a below market salary and signing up for Medicaid.

What ramen profitability doesn’t include is health insurance. I did a gig earlier this year. Baby had a small incident and I paid $700 out of pocket. My wife was not happy with my venture, I started looking for a job very soon after.

Most college towns are this affordable.

Pnom Penh is one of the most boring and ugliest cities in South-East Asia

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