jackaltman

That's a valid point, that it could potentially be more expensive than it's worth. In other words, it is possible to spend too much on trying to make your employees happier.

I wasn't trying to argue that the optimal amount to spend on employee turnover is infinite, but I do think most companies dedicate less than the rational/optimal amount of effort on it.

I agree completely with this. I was writing about turnover of high performing employees, which is crazy expensive. Turning over low performers is valuable and important for companies to do.

Exactly. In this article I was focused on regrettable turnover (when you wish the employee didn't leave), as opposed to non-regrettable turnover, which is very healthy.

This is a great point. I've seen companies that are great and companies that are horrible about substantially increasing the compensation of their top performers. It makes a huge difference and should be an easy decision to make if companies take the time to think about it.

I agree with you -- I wrote this with regrettable turnover in mind. Parting ways with a low performer is definitely a valuable thing to do!

Great point, we're definitely aware of one more tool issue, so we have to make sure we're sufficiently valuable and lightweight to use.

It's not meant to be task management, but rather a shared repository for longer term goals with period status updates. Most companies today keep these goals in google docs and they don't get much interaction as a result, so we're hoping to address that.

I thought about this more and I think you're right. Some companies do become very short term focused when they go public, but when you not longer have to worry about short term survival you can plan much farther out in the future.

I love that these guys think of 4 years as short term and 20 years as long term. Young companies often set up this dichotomy as a couple months vs. a couple years, which just isn't enough. Long term thinking is a big potential advantage startups have over public incumbents that have quarterly expectations, but it's usually not taken advantage of. Not just on founders obviously, whole startup ecosystem fuels this.

Non-CS people doing CS will give a worse experience in a single specific case, but will improve the overall customer experience in the long run.

I'm not arguing that companies should get rid of departments, just that they should take CS seriously. I think having all members of the team talk to customers is the best way to give the whole company an orientation toward customer service. 37signals, Stripe, and others do this too, not just Amazon.

CIL is a public company in the ran-by-a-government sense, so it's a little different. BTU is the largest private sector coal company.

I think you should be able to compare the value of any two companies, no matter how different their distribution of possible outcomes or how differently they fit into an investor's portfolio.

I understand that startups are about promise and potential, and that a company with no revenue might be fairly valued at billions of dollars.

A startup (or any company) is worth something like the integral of of the graph of probability vs. outcome. The problem I see right now is that people are overvaluing the positive outcomes and discounting the low end.

"Because a small float was offered, and demand was prescriptive by the bankers, it's impossible to say that because of how it ended, trying to raise the price to $40 would have resulted in the same outcome."

I'm not completely sure what you mean by this, but I spent time on an ECM desk one summer and I they aren't aiming for a 75% first day pop. The bankers get paid less, the company raises less. You want a pop to satisfy buy-side clients and to keep a positive public perception, but 75% is too much.

The answer to the question is supposed to be "because it's driving startup valuations sky high", which I assumed is understood as a bad thing, but I see your point. I have written about that before - it has all sorts of problems like trouble with fundraising for later rounds, inability to get acquired, etc.

I like the idea of this post, but have a few qualms. For example, flipping "unexited portfolio companies" into "shots on goal" seems a little strange.

If the new word had been something better than "cracker" it would've had a better chance of catching on.

Hard to disagree with the observation that people are putting more and more irons in the fire, but I disagree with the author's solution - asking people to disclose everything they are working on at all times is a bad idea.

The nature of this new world is that most things we dabble in at the very early stages end up fizzling. Like an author with a new book, people will be less likely to take important risks if they know they'll be scrutinized from the beginning.

It's unhealthy and will make you fat - the dough is normally white bread which is awful for you, wheat bread has a slightly lower glycemic index but more calories and it is still bad for you. Cheese which is incredibly calorie dense and really fattening, tomato paste is basically water. Stay away!

Right - the incentive needs to be consistent with the platform; this is why you bring a dinner host a bottle of wine instead of the equivalent amount of cash.

I understand the different meanings of the word free, I'm just pointing out that there's a risk that incentive structures won't create the desired effect.

That's a good point.

i think it's fair to call the current manifestation of 'startups' comparatively immature.

the fact that I keep up to date on dinosaurs is my problem, not yours.

this is exactly the point -- startup best-practices change much more rapidly than best-practices for something like bridge construction.

It's complicated to go through all the allegations of risk, which are almost all unsupported by serious studies. The birth defects are absolutely a huge risk, but the allegations of depression etc are unfounded. Most dermatologists agree that those studies were supported by accutane competitors, and that fair studies show the drug actually reduces depression (by removing the stressing factor of acne).

Because most doctors are not focused on tech. There are probably a lot of smart things you could do that have nothing to do with tech that you just wouldn't think about.

The video doesn't replace everything. It covers the bases and then sometimes a small number of questions remain. She used to get a ton of interrupting questions - she knows the common questions and touches on all of them in the video. Sometimes one-off questions remain.

You're right, we shouldn't be surprised that VC returns looks like this, and it's well known that they do. The point I'm making in the post is that more mundane things our lives may look like this than we expect.

Pareto power laws can't be stepwise, the point I was trying to make is that 80/20 distribution can be, and they are related to but not necessarily the same as power laws.

Power law and the pareto principle are definitely very related, but I think one is an instance of the other. I'd argue that power law is one manifestation under the umbrella of pareto principle, as compared to a stepwise function where 80% of actions/people/whatever act one way, and then another class of 20% act dramatically different from the 80% but similar to each other.

VC fund returns aren't driven by 80/20 (although they may fit that description), but by the much smaller number of outliers.

I think Sequoia, YC, USV and some others have probably had statistically significant outsized returns. Always hard to know because if you let enough people try someone is going to flip a coin heads 10 times in a row, but I do think some funds have created sustainable advantages (through winner-picking skills or otherwise).

that could definitely be right. There do seem to be a number of funds that consistently hit winners more often year after year (say, something like 15% winners vs. 10%)

an alternative explanation to the best funds being good at finding winners is that they are good at avoiding the investments that have a low chance of being homeruns. this is where I was heading with my last paragraph but realized it requires a whole new post.

right, that's the study that says you should buy new clothes one at a time because you get diminishing marginal happiness from each successive item.

it's possible that the prevalence of power laws in normal life have been overstated by people trying to drive home a point ("normal life" curves are definitely less slack than something like VC returns) but I still suspect that the majority of people underestimate them.