Comment by mechanical_fish | Hacker News Reader

Comment by mechanical_fish | Hacker News Reader

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mechanical_fish

Your argument seems to lean a bit too strongly on unsupported accusations of fraud:

Did it take less than 2 hours to create the booth, the signs, and perform the services? Unlikely.

What, you're saying that a team of college students, on a college campus, which presumably has a fully stocked stationery store within five minutes' walk, can't throw up some hand-scrawled signs in less than (say) 15 minutes for under five bucks?

Yeah, they probably had to already have the tire pump and gauge. I presume that "what do we have in our closets" was an important part of the process of choosing this business plan. ;) And I don't seem to recall anything in the "constraints" about not being allowed to beg or borrow anything, nor any rules about not being allowed to use stuff you already own. This isn't accounting class.

did they make the reservations at 6pm and then sell them before 8pm?

Why not? Remember: They're doing this in parallel, using multiple team members and multiple restaurants. And, given the anecdote ("this works better for restaurants that hand out little buzzers") we're not talking about the sort of reservation that needs to be obtained hours in advance. We're talking about people paying for the privilege of jumping the line and turning a 40-minute wait into a 4-minute wait. You can get through quite a few cycles of that in two hours.

"And I don't seem to recall anything in the "constraints" about not being allowed to beg or borrow anything, nor any rules about not being allowed to use stuff you already own."

What if "stuff you already own" includes a bank account with 2 million bucks in it? I also thought the solution was a bit dishonest, but then the whole thing should not be taken that serious from the start.

The reservations solution seems even worse, though I am not sure how exactly it works (would it piss off restaurants in the long run, or is it really a valuable service?).

Selling the presentation time seems to be the only valid solution.

In what way is offering to check someone's tire pressure and then inflate it for a nominal fee, or a donation, "dishonest"?

The first scenario is one a lot of Jiffy Lube-type garages and auto parts stores like Pep Boys do all the time (although typically with more than just tire pressure, e.g. transmission fluid).

The latter -- asking for donations and letting people pay what they want -- is something the Boy Scouts in my hometown used to do all the time. Free air for your tires, free coffee by the side of the Interstate ... I saw them doing free brake light replacement once. In theory they'd do it for free if someone really couldn't afford it, but in practice people pay what they think the service is worth (or whatever of that they happen to have on hand), so it's a sort of self-defined "sliding scale."

I don't see any misrepresentation there so I don't see how it's inherently dishonest.

Because the equipment presumably cost more than 5$.

And so would the clothes they are ostensibly wearing.

Hm, to set up the experiment properly could become an entertaining experience :-)

Edit: really, though, what is the actual experiment here? If all external aids are allowed, the only lesson left seems to be to think outside of the box.

If stuff you already own includes a bank account with 2 million bucks in it, and you burn through it in order to excel in one class, that's a lesson in itself. Or, more realistically, if a student had $100 in their pocket and used it as additional funding.

You can easily be in a similar situation in real life. You can get a mortgage on your house, or sell your car, or pawn family heirloom, etc. You can extend your runway (and hopefully increase the possibility or size of success), while ensuring deeper fall if you do fall.

So back to the class, if one group did spend invest their $100 along with the initial $5 seed funding, they'd have to earn more than the other groups to have a comparable return.

I wish I could mod this up twice. This is, like, Confucius deep.

If a student weren't allowed to sacrifice their entire life and all of their resources to excel at this one stupid class exercise, it wouldn't be a very good simulation of the entrepreneurial experience, would it?

You know what would have made for a great class? If one of the students had invested $2 million out of pocket to create an additional $100k in two hours. They would have presented that to the class. Everyone would have to agree that, objectively speaking, in dollars and cents, they would have "won". The next question to ask them is: do you feel successful? Have you accomplished whatever it is that you wanted to accomplish, when you signed up for a class on entrepreneurship? And does that make you happy?

Whatever their answer was, it would probably be educational.

For me, a take-home lesson from Startup School was that a lot of extremely talented and successful entrepreneurs are still searching for their answer to this question. They've invented something great, or they've made N millions of dollars, or both, and yet the question persists.

As far as a restaurant is concerned, why would they really care? It might annoy customers, but as long as the tables are still filling up, I feel the restaurant is more than happy, because they're still making the best of their available resources (tables and wait-staff).

It's a valid point how the artificial constraints are the envelope and the time, because the way she listed the rules was, clock starts when you open the envelope - it's almost a a ploy, or a method of trying to distract someone. Imagine, if you were handed an envelope and were told "there's money inside there", wouldn't you immediately start to wonder "how much?" and you would immediately want to open it. She restricted this thought by applying a 2 hour time constraint, from the time you open the envelope, which almost forced the students to think twice about jumping to the money. Instead, all the groups achieved something without ever really having to open the envelope. I think it was interesting, and a job well done.

>As far as a restaurant is concerned, why would they really care? It might annoy customers, but as long as the tables are still filling up, I feel the restaurant is more than happy, because they're still making the best of their available resources (tables and wait-staff).

It's scalping. It raises the cost of a dinner in the restaurant without additional gains for them. Obviously restaurants would not go this.

The situation is more complicated.

It raises the monetary costs of dinner for people, who want to pay to avoid waiting. For the normal-waiting patrons the strategy feels like increased congestion. (And they bear the costs.)

Why do restaurants have queues anyway? Why don't they just raise their prizes until supply meets demand? There's more than one scholarly article about this question.

As far as a restaurant is concerned, why would they really care? It might annoy customers, but as long as the tables are still filling up, I feel the restaurant is more than happy, because they're still making the best of their available resources (tables and wait-staff).

You answered your own question -- to the customer, it's annoying.

... and to the restaurant owner, it discourages walk-in traffic.

It's immoral in that it's dishonest (We have a word for reserving space at the restaurant by claiming to be a party of two, but not being one -- it's called lying). If you wanted to do this in the moral clear, you need to speak to the restaurant owner first, and see if they'll pre-allocate you tables.

I never said whether it was moral or not, which it definitely isn't...I was just referring to the students response to the task at hand, which I still believe for what they were assigned was a job well done.

Why not take ALL the reservations, and then force EVERY customer that wants to eat there to buy them from you?

Because you're fucking up the social contract that restaurants have with their customers.

I do feel that it was sketchy to ignore the rules the way these teams did. However, the restaurants do not have a contract with their customers. If they want to have a contract with their customers, they can, but calling their expectations of what customers will do a "contract" dilutes the term.

Actually, 'Social Contract' is a term on its own, that is many things to many people, but in general, it is the idea that societies have unspoken rules in order to maintain order. I do not think he is diluting the term, as it (or at least the concept) has been around for quite some time.

"seeing the constraints are artificial" does not mean "cheating" or using things outside of the constraints. I don't think the winning teams used more than $5 and 2 hours.

It doesn't take much to see that 2 team-hours is a much bigger asset than the $5, so you're better searching for the best way to use 2 hours, and maybe even ignoring the money.

It took a bit more insight to realize that hard to tap advertising space(and other opportuities) in a university town is a much bigger asset than the team-hours and the money.

You make valid points. My problem is less the specifics of the individual teams' solutions -- I don't dispute they were very clever and creative solutions -- but rather the impression that the greatest reward went to those who went furthest outside of the rules.

Team 1 were arguably entirely within the rules and made $200, Team 2 went a little outside (unless they were handed the envelope at 6pm) and made a little more, Team 3 ignored the 2-hour stipulation entirely and made $650.

Fundamentally, you're not rewarding creativity at money-making, you're rewarding creativity at rule-breaking.

If you watch the video, all teams were handed the envelop at the start of the week in class. They were allowed to think an form a business plan as long as they liked. They didn't know how much was in the envelop. Once they opened the envelop, they had 2 hours to make money.

Exactly. They weren't told they must open the envelope. The last team figured this out and (presumably) timed it so that their 2 hours coincided with the 3 minute presentation time.

Fundamentally, you're not rewarding creativity at money-making, you're rewarding creativity at rule-breaking.

And there's your insight. If what you want is money, and lots of it, finding creative ways to game the system is how it's done.

I am not lauding that, just pointing it out.

Maybe on Wall Street, but elsewhere you make a lot of money by creating something people really want, but not generally what they wanted.

elsewhere you make money by making people want things, not trying to predict what they want. People usually don't know what they want anyway...

> finding creative ways to game the system is how it's done.

And a good way to end a up crook or in jail. Business should be about creating value for both parties involved.

Actually the lesson was about managing valuable resources, not gaming the system. It was a warning that the system can be distracting and can easily confine your thinking.

The lesson was: don't let funding distract you from identifying the most valuable resources available to you. At worst, the cases you mention break the rules in rather insignificant ways. All three scenarios can quite plausibly be done entirely within the rules as defined, even if they didn't quite make it in reality.

Presumably, there were much less creative solutions that also failed to entirely obey all stipulations. It was an exercise, not a contest.

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