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Comment by hef19898 | Hacker News Reader

hef19898

The lesson drawn, and a good one as an investor, was the YC advice that start-ups should build stuff for other start-ups.

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Sell shovels in a gold rush?

Which is a solid plan. Unless, of course, you buy the shovels with futures on potential gold finds and expect the resulting shovel rush to go on forever.

It worked like a charm for AWS.

In what world is AWS a startup?

When AWS was starting?

You mean when they separated internal infrastructure of the largest ecommerce in the world to the point when it was possible to sell it in commodified pieces to other businesses?

That is not what happened and is a fake myth origin story. AWS was started from scratch with a small team in south africa. The best description of all the myths and the real thing I've heard is here: https://www.acquired.fm/episodes/amazon-web-services

It sounds good to perpetuate the "but Amazon.com had extra capacity they could sell" but it's not true.

Unfortunately if the only source is this 3 hour podcast, you are going to have trouble convincing anyone.

There are sources, I didn't go through them yet, but they are there. It's pages of unorganized links, but it's something.

I mean... a little disingenuous. AMZN was a $10-20B publicly traded company at that time. When is it a startup vs a product offering of an established company?

I think it's a bit unfair to characterize every company that is "starting" as a "startup", particularly when the "startup" in question is/was backed by one of the largest companies on the planet. I don't think people think of such companies' endeavors as startups, even when they are starting.

There is an exact answer to your question, and it has nothing to do with the size of the company: a startup is a company designed to grow fast. Everything we associate with the success of a startup is a byproduct of growth.

With that definition, AWS is a startup. So was the iPhone. Both invented their respective markets, and had to grow quickly to do it. If either of them had needed to raise money from VCs, smart VCs would’ve invested. But they didn’t need to raise capital, since they were already a successful company.

The shovel-seller isn't necessarily also a prospector. They do, however, make a lot of money off of prospectors, whether any gold gets ultimately found or not.

But, when the gold rush is over, the shovel-seller may have to do big layoffs.

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