Evernote CEO to entrepreneurs: "don't do it"
thenextweb.com
thenextweb.com
I have always had a really hard time heeding to the advice of rich people who tell you what all the right and wrong reasons to become an entrepreneur are, especially when they start preaching about how it's not about the money, but about the journey.
Also, "don't do it"? I'm sure companies that are having 100x more of an impact in this world than Evernote will ever have were started by people who very bluntly went against that sort of advice. Steve Jobs' "Stay hungry, stay foolish" comes to mind, and I'll side with his blissfully ignorant optimism any day.
If you make 30 million people's lives just a tad bit easier, then yes, you've changed the world. If you've caused other companies to take note and copy your business strategy/idea and THEY make people's lives easier, then yes you've changed the world.
Yes, he's rich, but I think he's saying that was a side effect of purer motivations. If you're in it to be rich, then you're in it for the wrong reasons. If you're in it create an amazing product and be impactful on a stranger's life, then you're in it for the right reasons.
Just my take. Could be wrong.
By that reasoning, if I kick a rock on the street and it shifts 10 feet to the left, I've changed the world too.
EDIT: more analogies
* Bic pens have changed the world
* Toilet paper has changed the world
* Shoes have changed the world
It is possible that it could cause major change (in a butterfly effect kind of way), but usually it would be hard to measure and predict.
But if you kick a rock and a few days later that rock ends up causing an accident of an "important" person you did in fact "change the world" by kicking that rock.
IMO, the other things that you mentioned have changed the world.
Just saying.
(Why do so many HN-type entrepreneurs want to make "change the world" apply to toy apps that really do nothing of the kind? There's no reason to feel insecure about building toy apps, so no reason to reframe them as being world-changing, either.)
"Right reasons". The judgmental-nis of that is what I don't like.
Why do people comment on HN? One reason that I do is because of the good feeling that I get from passing along what I know. I've always liked to teach others what I know online and also offline. Wrapped into that though is the acknowledgement from others that they like what I've said that ends up in the "mental" bank and makes me feel good.
I don't think you can have one without the other. And is there really anything wrong with doing for others even if solely for the "wrong" reason which would be the deposit into the mental bank?
Bullshit! Altruism doesn't involve calculating how much equity to give employees while unsteadily watching your potential valuation numbers.
If you're in it create an amazing product and be impactful on a stranger's life, then you're in it for the right reasons.
That's called open-source, and you don't charge for it.
If your end goal is to make money for yourself at all costs, don't expect any sort of respect or good people to work with.
The amount of good a company does is the number of people helped times the average good done per person. If your company is a medical clinic, the number of people is small, and the good per person is large. If your company is Evernote, the good per person is small, but the number of people is enormous. Don't underestimate the value of a company that improves each person's life just a little, but does it by the hundreds of millions.
iCloud enabled apps (see how well Reminders works on Mountain Lion) are starting to show how well cloud services can work. And Microsoft won't be far behind.
Services like Evernote will be taken down by the onslaught of "automatically synced" apps that is coming. Many of which will be going right for Evernote's jugular.
You say you shouldn't start a business because you want to get rich? I think Sheldon Adelson, Ray Dalio, and Mark Cuban might disagree.
You say you shouldn't start a business because you want to be your own boss? I think Vineyard Vines and 37Signals might disagree.
I think we're in this Steve Jobs era where every successful CEO wants to suddenly espouse Steve Jobs' philosophies as if that will somehow bring them similar successes. But in reality, for every Steve Jobs or Mark Zuckerberg, there are thousands of people who yes, just did it for the money. Some succeed, some fail. I'm not sure about the 99% failure statistic, but to just throw that out without any qualification is ridiculous.
I have a good friend who owns a local high-end video equipment rental business. You will never hear of him, but he makes about $250k a year and has an outstanding life. I can assure you he is no rocket scientist and he certainly isn't out to change the world. He just did it and didn't really do much investigating first. I think that's probably the best advice you can give- don't look for generalized advice. It doesn't help you and will probably harm you.
Excuse me. It is a way to make money. That figure assumes the definition of entrepreneur is only startups as discussed in places like HN, Techcrunch etc.
Not only is the figure of 95% or 99% wrong with respect to "entrepreneurs" (unless of course you increase the time to, say, 100 years at which case it may be true across the board) but its like saying "don't apply to Harvard or YC because the chance...". It doesn't take into account any particular persons idea or qualifications to be a success.
But most importantly, the definition of being an entrepreneur also includes running a small restaurant or opening a physical warehouse and selling exercise equipment or starting a website to sell new and used office desks or a million other ideas that will never make it to HN or TC that can make you a good living.
I believe he's quoting numbers from Shikhar Ghosh at HBS. Here's one article that google brought up with a little more detail about how "failure" is defined:
The statistics are disheartening no matter how an entrepreneur defines failure. If failure means liquidating all assets, with investors losing most or all the money they put into the company, then the failure rate for start-ups is 30 to 40 percent, according to Shikhar Ghosh, a senior lecturer at Harvard Business School who has held top executive positions at some eight technology-based start-ups. If failure refers to failing to see the projected return on investment, then the failure rate is 70 to 80 percent. And if failure is defined as declaring a projection and then falling short of meeting it, then the failure rate is a whopping 90 to 95 percent.
I founded a startup that's profitable and doing $5mm in revenue but would be considered a "failure" because at the beginning we played the hockeystick revenue projection dance (partly to appease potential investors, who discount whatever number you give them anyway, and partly because we were wildly optimistic).
These terms invalidate the given statistics, rendering them essentially meaningless. These figures are geared toward being consumed by finance professionals, not by people actually running small businesses or who found startups.
1. The 90..95% definition is stupid. Projections are irrelevant other than for purposes of planning, appeasing investors and roughly determining whether the business model is viable. Depending on the entrepreneur's goals, actual long-term ROI is all that matters.
2. In that respect, 70 to 80% failure to generate projected ROI is not bad. I've never been in the 80-percentile of anything of I've done, therefore these statistics are actually pretty encouraging to me.
If you're working for a startup hopefully you are doing it for better reasons.
The argument Phil Libin is making very silly and very typical kind of advice from people who are not really trying to help you at all.
This is such hogwash and brainwashing. People have to earn money and make a living. Nothing wrong with that at all. And if you want to change the world you have a better chance after earning a load of money.
There are people who have gone into medicine to make money (and not better the world and save lives) and are great physicians and provide a service. And they live in big houses have expensive things and enjoy themselves. That's fine. Nothing to apologize about. Same with entrepreneurship or any pursuit (education).
"If you’re smart enough, if you’re talented enough, if you have the drive, if you have the ability, and you’re motivated by making money, then you should just get a real job instead, like become a banker or an investor or a consultant or something. You’ll be much more likely to make a lot of money over the course of your career than by starting a company."
Totally depends on the person. I visited my dentist the other day who clearly didn't have a business head on him (we've spoken many times). He is better off and will make a better living as a dentist giving his intelligence and abilities. I'm married to a Physician and wanted to set her up in her own office. She isn't interested, she would rather just work for the Hospital and get a salary. Everyone is different. The best option for a particular person to make money depends on the persona and their abilities.
As an aside, as far as being a "consultant". In general (as always) a consultant doesn't really build any equity unless they have others working for them. They don't have anything to sell (to someone else as an entity) and over time need to constantly pick up clients and interact with clients. I built a business and after 10 years I had something to sell. It was something that didn't depend on me it had customers, employees etc.
You cannot escape this simple fact: if you're an employee, you are only getting a portion of the value you can and do generate. The only remaining question is whether you have the resources and environment to capture the value you can generate directly, without being the employee, to receive a larger slice of the value. (If you're, e.g. a doctor it's much more difficult than if you're a software developer; good thing I'm the latter.)
This article is disguised as a buzzkill for people who have startup dreams, but turns out to be an even bigger opiate.
Or, come up with a novel vaccine for one of our most vexing diseases of our time, then give away the formulation for free[2].
That's how you change the world.
Cue the capitalism-as-religion downvote squad, but this guy is a world class putz if he thinks a cloud-based notepad is changing anything but 1st world slight inconvenience.
[1]Norman Borlaug
[2]Jonas Salk
I personally still wouldn't. But it seems there are a lot of people cherry-picking with this "world" hyperbole and ignoring his actual point.
I think this is going overboard. It's perfectly reasonable for someone to want to start his/her own company for less noble reasons than "changing the world." This advises people to not give it a shot at all. Would I like to change the world? Yes, I would. Do I reasonably expect that it will happen? No, I'm more realistic than that. While I'm still young and don't have much tying me down, though, I want to give it a shot. I'd much rather try, fail, and then have to go back to the workforce than wind up staying the workforce my whole life regretting not trying to start my own thing. I suppose you could make the argument that any successful company will have to add value to the world in some way, and adding value to the world changes it, but that isn't the way the statement reads.
1. Not all CEO's work 20 hour days, and he probably doesn't either
2. Starting your own company can give you the ability to challenge the outdated 9-to-5 sit-at-your-desk status quo more than working for someone else can
3. His skewed view of upcoming entrepreneurs as only the subset that bother him for advice doesn't reflect on you or your ability to successfully launch your own business
4. Seriously, Evernote? It's cloud data with a bow around it.
5. Working long hours doesn't mean slaving away at the office for long hours, it means that you're always "on". If you start a business around something you're passionate about, you'll be thinking about it all day anyway.
6. Ryan Carson just told us last week that he works 32 hours a week, and his company impacts the world a whole lot more than Evernote IMO (subjective, yes, but Treehouse and Carsonified educate and connect people in a way they couldn't have done otherwise, whereas you can eliminate the need for Evernote by creating a folder or two on Dropbox).
7. If you fail, you can always try again and/or re-join the work force.
8. Most people would feel a lot better about trying and failing than not trying at all.
And the number one reason I'd say this video should be completely ignored is that you might actually succeed.
This video tells me very little about entrepreneurship. The real message is that Evernote is run by a pretty unlikeable guy who would advise you, without getting to know you, to be a working stiff your entire life instead of taking chances. Advice that he obviously would not have taken himself.
This sounds like terrible advice for someone who is not motivated to do the work of a banker or investor or consultant. I've seen many exceptionally driven people lose their drive when employed at the wrong occupation.
But, fuck the CEO of Evernote. How dare he tell people not to start a company? Not only is it idiotic (I mean, first and foremost, he did it so he's a hypocrit; but secondly, someone started every company that exists. So if people actually followed his advice we'd be stuck with the current crop of companies...forever) but it's downright evil. To discourage people from starting companies is to discourage people from building, from creating, from giving form to their dreams. And that's inexcusable.
tl;dr Evernote is great; the CEO is a fuckwit.
EDIT: I got my first downvote, but I don't care. Discouraging people from creating is evil, and when confronting evil there's no place for 'nice'.
So, in order to get invited (or invited back) to speak in front of 100s of people and plug your product/company, you change your speech (and backstory) until it fits the mantra-du-jour. 3 years ago, the speech would be "Fail Fast". A year ago, it would be "Learn to Pivot". Today, it's "Change the World!"
As others have mentioned here, Evernote is not really an earth-shattering, universe-changing product. That's perfectly OK in my book, but own up to that fact. It's tiresome to hear people rewrite history and their own motivations just to sell themselves.
- They will offer something novel or fresh
- They have the passion to change an industry that has otherwise been stagnant
- They want to offer choice or competition for a product that has been relatively monopolized
- And to a smaller degree if they're outside of the NYC/SF area, bring the tech scene to other areas of the world
People seem to be misinterpreting the article by assuming that these can't be factors at all. It's pretty clear that everyone needs an income. These should be interpreted as primary reasons and that I agree with completely.
If your primary goal is to make yourself money or get power, it is guaranteed that the rest of your company does not share your vision and if they knew about it, they would probably try to find other jobs.
My goal has long been to work on my interests without having to worry about money. But to do so requires financial independence. That's reality. So now I'm pursuing money and looking at ways of generating income without selling my time.
Is there any real evidence to show that people who pursue money don't end up successful? I doubt it.
I once read that the 2% of people in some defined group who set financial goals outperformed the other 98% combined.
> "I think you know what it is: it’s to change the world" Most people who start a company start it to MAKE MONEY. Of course, he presents us with a false dilemma: you can either aspire to change the world, or have the desire to make money, earn power, etc. These are not mutually exclusive options. It's noble and all to want to change the world, but most people probably are out there trying to make a living...
> "If you’re smart enough, if you’re talented enough, if you have the drive, if you have the ability, and you’re motivated by making money, then you should just get a real job instead, like become a banker or an investor or a consultant or something." I'd be fine with this if he finished the sentence with "become something you're passionate about." If you have all the qualities he mentions in the first part of the sentence, than pursue something you're genuinely interested in.
As a side note, I'd be interested to see a list of some entrepreneurs who started companies with the sole intention of changing the world...
yeah, consulting. the pie-eating contest where the prize is more pie. but at least you have a nice salary to pay back your MBA student loans. and you get to travel every week and get fat eating out every meal and drinking at networking events.
I couldn't agree with everything though - Evernote is second brain of the universe? Is it not under rating the human brain? Human brain is capable of many amazing things. If I am going to hear some one call something a second brain, it should be able to take decisions. Evernote is only a digital notebook that is accessible from many platforms keeping all the users away from a lot of dirty work(copying, syncing, etc.). That's it. I don't think that could ever CHANGE THE WORLD. That will only MAKE MY LIFE EASIER. I could even argue that entrepreneurship is more about MAKING MY LIFE EASIER than about CHANGING THE WORLD.
When I get five minutes of waiting time, I don't open evernote to write something or read something. I open my twitter account and follow up with the links on hackernewsbot and few other tweets from people I like. That makes me feel productive. If I don't feel like reading technical things, I open my facebook and check what my friends are upto and I still feel productive.
Bubbles like the one we have now are not common. It will continue until the Fed takes away the punchbowl, so make hay while the sun shines (and mix those metaphors while the mixing is good.)
Highest paid is fact, one month at a time is opinion.
Yes. We saw it a bunch during Bubble v1.
I thought it was nuts then: Weren't the people/VCs supplying the money paying attention? After a while, you realize that easy money covers up a lot of sins over several levels of the foodchain.
When money tightens, those sins will be expurgated, but until then: Party on.
EDIT: To expand a bit, it's not "normal" as ericflo says in another reply and I agree it's a "bad" sign.
I'm just pointing out that as long as those supplying the money are seeing positive returns, they're busy working their other opportunities. When Sequoia republishes "RIP: Good Times", out comes the microscope on spending and board meetings will go over details that were ignored before.
I will agree though that working at a company that isn't financially stable is not a good place for someone who needs financial stability. Imagine your boss telling you that your next paycheck will only be half - or they can't pay it at all, but you'll get paid back later. Imagine that happening occasionally throughout the year. Add to that a constant, looming feeling that your company could go out of business any day even though you love working there. If those kinds of things upset or stress you out then a startup probably isn't a good place to work.
Actually, I'm a mid grade officer in the Navy; I was recently told I was "part of the seniority plan" in my unit. I knew where Libin was going with that as soon as I read the subtitle. I answer to everyone!
The talk is definitely better than the flamebait title.
Based on all the talkers I hear, and the positive feedback they constantly get about how "cool" it is that they want to be an entrepreneur.. I think a good hard "don't do it" would be helpful fire under their butts to JFDI.
If you don't have anything good to say, don't say it at all.
Entrepreneurship is very much an individual sport in that there are no hard and fast rules. Take all advice with a grain of pepper.
Really though, if an entrepreneur is going to be dissuaded by this speech, they probably shouldn't be trying in the first place.
It's a laughable, tired cliche now, especially coming from a guy who made the equivalent of a digital hipster moleskine who isn't changing a god damn thing about this world. People are still broke, sick, and starving. But I can take awesome notes on my MacBook Air!
The better answer is "because it's interesting and fun and challenging and sometimes disappointing and a fantastic learning experience and you might get rich or go broke while experiencing the full, unfiltered range of human emotions and potential".
It also happens to be more truthful and conforms more to the modal outcome.
This is one of the best articulations of why I'm an entrepreneur that I've read. Thanks.
The only way to deal with this conclusion is to act: to go out there and experience working for yourself, and test your instincts and savy against reality. I don't care whether my projects succeed or fail at this point; I'm just happy I'm focused on exploring my potential and my desires.
I still have the day job, for security and capital, and I have only chosen to pursue ideas that DO impact people's lives (otherwise why would people use it?); none of this stuff is mutually exclusive!
See: thrill.That's why it sounds so ridiculous.
He just made the best implementation of it.
Personally, I'd rather have successful entrepreneurs selling this story than saying it's all about making money, sailing on your yacht surrounded with beautiful women, sipping on champagne. It's incredibly idealistic, but I think entrepreneurship needs to attract incredibly idealistic people more than any other type.
For the record, I've never used Evernote (pen and paper does the task nicely), so the above assumption of Evernote helping people is based on their business results from the video, which would imply a useful product.