Jon Fisher: selling the company should be every entrepreneur's goal | Hacker News Reader

Jon Fisher: selling the company should be every entrepreneur's goal

mercurynews.com

7 pointstaylorbuley7 comments

"Every entrepreneur should..." = bogus advice.

Every entrepreneur is different, and has different goals. Fortunately, there are lots of different things you can do with your business, so lots of people can be happy.

This is just a ridiculous attention ploy.

If your goal is to make money, then sure, selling should be your goal.

If your goal is to make something that might change the world some day, then maybe it shouldn't be.

Hyperbole aside, if you really believe in what you're working on and want to see it live on, an acquisition might not be the best option. Many acquisitions lead to product deaths as the team gets integrated into the acquiring company (meebo is a recent example).

I really love people who think far ahead instead of that 'getting rich' crap. I think (but i'm not 100% sure, it was Japan anyway) that the CEO of Sony said (somewhere in the 90s?); let's not think about what we do in 2 years but what we do in 2000 years. The number of years is arbitrary, but if you truly believe in what your company is all about, you should be capable of thinking well beyond your own existence instead of staring at the number of 0s on your bankaccount in the coming few years.

This article is of course about SV where you need 'enormous amounts of venture capital' to survive 8 years with your company. It's probably because i'm from the EU, but I don't really understand that.

Starting and running a company organically with the goal of it continuing beyond your own life, being profitable from the get-go and giving you a fulfillment (and fulfillment of all families your company will feed during it's existence) and a solid income, pension and so on without the insane stress/working hours and very low probability of success seems like a great deal to me.

If you've done it before, you'll know that getting a high leverage (technology) company profitable, is really, really hard. This does not apply to service companies, but service companies rarely have the big impact you're talking about.

A startup is an iterative process.

If you're incredibly lucky and happen to stumble upon the exact right business model on your first try and start making a ton of money immediately, that's great. Congratulations. But the chances of that happening with a startup are vanishingly small. It's much more likely that you'll launch something, it will fail, and you get to repeat that experience a few times while iterating towards the right business model and burning way more money than you ever thought possible along the way.

If your goal is really to maximize your impact on the world without thinking about an exit strategy, you should be trying to grab as much venture capital as possible. That will help you get big and make a big impact a lot faster than slowly bootstrapping towards profitability.

And what's so bad about making your goal getting rich anyway?

A service company doesn't have a big impact? That's relative I guess. The companies i'm talking about have a bigger impact than 99.99% of SV startups, simply because all of those won't survive and won't be employing many people and supporting many families. My previous services company (in which I still have stock and which exists now for about 20 years) has 400 employees, most with families, so that's supporting roughly 1600 people. That's more than your non services startup will ever do in general. It was also profitable from the start. As is my new one; we have been paying full management fees + salaries since day 1. And mostly anyone can copy it and there still won't be enough of them in the world.

I understand product companies and such are more interesting and scalable (I find that too) to investors and to get filthy rich, but they almost never succeed. You are not going to be the next Facebook or Google or probably even Yammer. If you do, kudos to you; however, like Facebook & Google you would not actually sell your company, so not relevant for this discussion. In the case of Yammer it is; it sucks ; your lining your own pockets and the world doesn't really improve long term probably (a lot of takeovers don't end very well for the original product/people anyway).

And that brings me to your last question; there is everything wrong with your goal of 'getting rich' if that's truly your goal. That's not a very popular opinion here and apparently misunderstood; I am rich (self made) and I want to get richer (because you cannot really run a company otherwise), but it's not near my life's goals and never was and never will be. I like what I do and always did, I have a great family, we all work in the businesses we run. We take time off, we enjoy ourselves, but we like working with our colleagues on great things. The buzz of opening a new office this week is enough for me to jump out of bed every morning. I don't see how more money can change that; I could've stopped working many years ago and I don't have to worry for the rest of my life anyway. How is that interesting though? I will never stop working anyway, because I like it. And I like starting up organically more than running the company, so how is a lot of money going to change that 'hobby'?

I believe that you have a different main goal in life as well, otherwise you probably wouldn't be successful, money as 'goal' doesn't usually seem to work. I probably also assume wrong that you would retire when you make that $100 million in your account (ie I don't understand the obsession with getting rich other then comfort & ease to do what you like, but you don't need that much more for that). We probably think the same more or less anyway seeing your profile on LinkedIn.

Congratulations on your success- but you must realize that a 400 person, instantly profitable service company is the exception, not the norm. The vast majority of service companies are two guys in a garage treading water and struggling to survive.

You probably won't be the next Facebook, but, generally speaking, it's a lot easier for a software company "Micro ISV" to get leverage and scale than a service company- that's why service companies don't get funded.

Thanks for the detailed response- it was a really interesting read and great perspective for me to think about.

Well, I am doing it again now and it works again. I think services companies don't get funded (in general, because they DO get funded once they get to a certain size) because they don't scale. If you invest $10 million in a service company, there is almost no chance you'll get a ROI of 1000% or even 10000%, but you actually, in my experience (but we actually might be an exception; the ONLY thing I see us doing differently from most companies on HN is that we watch the bottom line from the get-go; if there is $1 going out, there WILL be $1.3-2 coming in from the very first day we start) can expect 150-200% which is surely a better invest than most things you can invest in.

And of course, 200-10000% ROI is on that ONE company that makes it, out of N companies invested in. Again, in my experience with services, and i'm talking bars/clubs, laundry services and software services; all of which I or very good friends have experience with, there is not that much failure going on. One of my good friends opens bars/clubs ; he gets $300k investment, opens up, hires people, makes everything run and the investor gets about $1 million back after a few years. Every time, even in crisis times. Why? My friend is brilliant at this and it's definitely not 'luck'; he knows what he is doing. Accidentally I met another guy in the place I live now who I befriended who does exactly the same; different country, different rules, different times and he does EXACTLY the same; from the way he finds places, does the makeover/revamp, hires and trains people etc. I learned a lot from these guys; if you work the same way in a software company it works as well. Of course the skills are different, but the management style the same. I can honestly tell you that every services company I will start or mentor will make profit and enough profit to have a really nice life. And I know a lot more of these.

So I really think that there is a difference here :) If you want you can mail me, we can chat a bit, always interesting to meet people.

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