Jessica (the author of this article) is too nice to give this article the clickbaity title it deserves: "The 3 things it takes to be a successful startup founder".
1,915 karma · joined November 14, 2016
Just go google "private blog networks" (pbn) or "link farm".
If you actually look into the details of the matter, what happened was that the co-founder acquired the failed company as it was put through a bankruptcy process.
People who weren't privy to the process thought it was stealing when it really wasn't different from any other acquisition.
Most failed startups fit into the following timeline: was burning more money than it was making => failed at raising more money => did a round of layoffs / cost cuts to get economics under control => couldn't right the ship and shut down / did a fire sale or acquihire
But, the above timeline doesn't teach you much about why the company really failed. The real answer almost always involves a multitude of contributing factors, and requires intimate knowledge of the startup's business.
For the most part, the only reliable source for this type of information is one of the founders, board members, or (sometimes but not always) c-level execs. And, even then, they have to be willing to be vulnerable (which is very rare).
If I could give some advice to Failory, it would be to think about how you can incentivize founders to share their stories. As it stands, they have little to gain and potentially a lot to lose (e.g. being labeled one of YC's "biggest failures")
Isn't a large portion of their FCF tied to reducing labor costs by substituting drivers with self-driving tech?
AB5 and Democrats potentially gaining unified control of Washington don't bode well for their cost structure either.
I disagree, and I think you're grossly overstating it.
I can see how you could characterize their stance as "supporting the status quo". But, there are varying degrees of "support", and this is pretty much the lowest degree of "support" imaginable.
Put another way, you're painting this as "with us or against us" when in reality there's a spectrum of support. Coinbase is standing just SLIGHTLY off center in one direction.
> And supporting the status quo in this political climate is a strange hill to plant your flag on.
Why do you think it's strange? The vast majority of employees prefer a work environment that is stripped of political conversation. And, such an environment is more conducive to focus and productivity.
Source: https://usa.streetsblog.org/2019/03/08/uber-got-off-the-hook...
What does that mean for the rideshare business? Are Uber/Lyft basically dead if they are years behind Waymo?
Do those people still think that it's going to take 10-20 years for this tech to reach say, New York, now that it's live in Phoenix?
You're probably right, but as long as it doesn't happen frequently and there's no way to mislead sensors en masse, it's not a big deal.
There are malicious ways to cause accidents with current-day technologies also. e.g. Park a car in front of a train, fly a drone into a plane, etc.
It's one thing to have a strong opinion on morality -- it's another to support violence against other moralities.
My only point was that it's not "easy and obvious" to "buy his debt and use it as leverage to extract political gain". There are many "outs" he can take if such an event occurred.
Uh, yea they are. A company’s valuation is based on both the cash they have on hand AND future discounted cash flows.
Once you correct your understanding of this, you will see that GP is explaining things correctly.
The company's value decreases by the buyback amount. Share price (ignoring positive signalling impact) remains unchanged.
E.g. Company has $100 market cap with 10 outstanding shares at $10/share. Company does $10 buyback. Afterwards, company has $90 market cap with 9 outstanding shares at $10/share.
If this happened, you don't think he'd be able to get another institution (or GOP constituent) to re-finance/backstop his debt for him?
2-300m in debt is a lot but his businesses pull in 4-500m in annual revenue. It's not a crazy debt-to-income ratio.
That is, if you talk to successful founders, they will generally wish they raised less money (due to dilution).
And, if you talk to failed founders, they will generally wish they raised more money (to increase likelihood of true PMF).
Also, I think that fear is a useful mental state when there is real and imminent danger. In startup land, you are right to be fearful, because you are much more likely to die than stay alive.
If you don't have the luxury of unlimited shots at success (due to a lackluster safety net or other life goals), it makes sense to maximize the likelihood of success in your current venture. There is a lot of "startup cost" to working on a new idea, and in a lot of fields, you will eventually succeed if you just stay alive/don't die.
Based on my reading of the study, the more accurate claim is: People no longer trust that their employers will take care of their long-term interests.
There's little doubt in my mind that this claim is true.
In particular, I'm curious about these questions pertaining to your life prior to having children:
- From 1 to 10, how much did you enjoy helping a friend out when it was a mild inconvenience to yourself?
- From 1 to 10, how positive of an emotional reaction do you get when you see a cute dog?
I have a completely unfounded hypothesis that the 'chemical' changes that PG describes are akin to how our brains react when we see cute pets.
It's great that you're planning out your next steps now. Finding a decent-paying job to make ends meet is first priority. From what you've revealed in this thread, I'm confident you'll figure something out quickly.
Eventually, after the stress from shutting down the company and finding a new job dies down, you'll have time to do some serious reflecting on what's come to pass. It doesn't sound like you're at that stage yet, but here's some advice when you reach it:
1) Recognize What Was Lost
Don't get stuck in denial. Be honest with yourself about what you've lost, and don't try to trivialize it (yet). Perhaps you had giant hopes and dreams and they were crushed. Perhaps you feel like shit because you didn't meet your goals. Whatever it is, lay it out and don't hold back.
2) Recognize What You've Gained
We tend to lose sight of the positives during a time of crisis/failure, but trust me, even if you can't see them right now, they exist :). Being the founder of a startup is one of the highest pressure jobs you can ask for. That pressure can feel like shit sometimes, but it also forces you to grow. That growth is valuable, in and of itself. Perhaps you grew your engineering skill set. Perhaps you became a savier business person. And, perhaps there were tangible assets or friendships that you gained -- those count too.
3) Honestly Assess the Situation
One thing I hate more than anything else is when people say "I wouldn't have chosen it any other way". Fuck that haha. The stress of shutting down a company and operating in close-to-failure mode sucks! Running a wildly successful company would have been much preferred.
That said, also be honest about how it's not all bad. You grew as a person and there are lessons you learned (or can learn) from the experience. And, you have an awesome story to tell one day :).
Don't label yourself as a failure. Your company was a failure. You failed to achieve your goal. You are not a failure.
4) Recalibrate Your Values and Move Forward
So, why are YOU not a failure? To answer this question, you have to take a hard look at your personal values. What do you think is important in life? What are you chasing after?
To me, values are the measuring sticks by which people quantify success in life. Whether or not we realize it, we constantly measure our actions against our values, and how we 'measure up' determines our self-worth.
If what you value most in life is being a successful founder, you are gonna feel like shit!
But, what if what you value most in life is becoming the best version of yourself OR acting with integrity OR contributing postiviely to society?
In my opinion, there's no such thing as 'good' or 'bad' values, but some values sure are hard to live up to (primarily because they're largely outside our control). The good thing is you can change your values to make sure they realistically align with your life.
If your values are straight, you're ready to move forward. Take some time off if you need it to completely unwind. The motivation will come back with time -- it's only human to have drive. Good luck!
Overall, there's a net in-flow of startups into SF, and so, the VC's follow.
That is, we all have an ideal self that we aspire to, and when we don't live up to this ideal, we feel bad.
At first, I thought maybe it was NECESSARY to feel bad in order to motivate oneself to reach your ideals.
Then, I thought that it might be impossible to feel good when we reach our ideals without feeling bad when we don't. That is, maybe the two are dualistic, by nature, and inseparable.
But, as I thought more and more about my past and how children operate, I became convinced that it's not natural to judge/chastise yourself when you don't live up to your ideals. For me, it's primarily a trained behavior that resulted from judgmental parenting styles -- think, a parent making a child thinking they are a 'bad boy' when they've done something wrong.
It's entirely possible to feel good about yourself when you reach your ideals without feeling bad when you don't -- it just takes a bit of rewiring. If you have any doubt, spend some time around children and you'll see that humans are naturally incredibly resilient to failure -- this should include failure at being happy.
Benchmark's stake in Uber is worth $9.1b -- many, many times the size of their fund. They will do anything they can to protect this investment.
They very likely believe that the best way to protect their investment is to keep Travis out, and this is part of the process. Decisions like this aren't made at an individual partner level. The entire partnership decided to file this lawsuit, and that means it's a calculated decision.
Evaluating decisions like this really comes down to understanding your values and owning them.
Values are the measuring sticks by which people quantify success in life. Whether or not we realize it, we constantly measure our actions against our values, and how we 'measure up' determines our self-worth.
In this specific example, there are two conflicting values: integrity and family. They are in direct conflict, which is putting the OP in a stressful situation -- acting in the most honest way here will lead to a worse life for the OP's family. Creating the best life for his family requires that he must lie.
So, the OP needs to ask himself: Do I value integrity? Do I value my family? If I value both, which do I value more?
Personally, I don't think there's really a right or wrong answer to these questions. There's no intrinsic value in the universe -- but assigning value is part of the human condition and we feel fulfilled when we lead a life of purpose (however arbitrary). When faced with difficult decisions like this, it's important to be aware of what your values are. The 'right' decision for you will be apparent.
"First, the safe withdrawal method of 4% is actually not safe - the safest method of withdrawal is called variable percentage withdrawal and not only takes into account the principle, but also the results year after year."
This is an argument for taking the annuity. When two options have the same expected value, volatility is a bad thing.
"Because you are taking an asset class that can be converted into shares/bonds which has a higher expected returns than an annuity because it can compound."
The author writes under the pretense that the $5K figure is EQUAL to the risk-adjusted rate of return on a $1M principal. Sure, there are asset classes that have higher expected returns than a guaranteed annuity, but that is because they are RISKIER. Obviously, people value risk differently, which is why in general, you can't say "always take $1M"
"Whereas the $1M cash, if moved to bonds and shares, even if it performed at 5% annually, it will mean on the first year break even, but on the second year it will compound (unless you spend all the money)."
The whole point of the $5K figure is that it is the same amount as the risk-adjusted return on a $1M investment. How the user chooses to spend that $5K monthly sum is up to them and they have the freedom to spend or invest that sum in the same manner regardless of which option he/she takes.
"You could say you invest the monthly savings from the $5,000 but simply put it, $1M in shares has a much higher expected return than $5,000 monthly in perpetuity."
Incorrect for the above reasons.
Assuming that $5K/month annuity is the expected rate of return on a $1M invested in a risk-free asset class (which is the assumption this article is written on) and you have the option to cancel the annuity and retrieve your principal at any time, it's pretty clear that the annuity is the better option because it has NO volatility.
From what I've seen (in this thread and in real life), people mostly combat this internal monologue in a couple ways that ignore reality (at times):
Counter Belief #1) I'm not as bad at skill A as I thought. (e.g. look at all these examples where I did well at skill A)
Problem: If the reality of the situation is that you aren't actually lacking in skill, this works. However, if your peers legitimately outclass you, you're just tricking yourself -- which presumably won't work for long.
Counter Belief #2) My peers are aware that I lack skill A, but are not negatively judging me for it. (e.g. what evidence do i have that they're judging me? they're probably just thinking about themselves all day)
Problem: This works when your peers aren't actively negatively judging you. But, how are we to determine if that's the case? Lack of evidence isn't proof at all -- especially in a work environment, social norms are that they won't express negative criticism to you (even if you ask for feedback). Certainly, there are environments where your peers ARE indeed actively negatively judging you in which case this counter belief does not work.
What is the right way to cope in a situation where reality is: 1) you ARE outclassed by your peers 2) your peers ARE judging you for it
One solution seems to be to get better at the skill than your peers. However, this isn't foolproof if you don't have the resources to do so.
The more foolproof solution seems to be: 1) learn to stop comparing yourself to your peers. your self-esteem should not depend on the relative amount of skill you possess to your peers 2) learn to stop caring what your peers think of you. your self-esteem should not be dependent on outward signals like this.
However, this seems REALLY hard to execute. How does one develop these sets of beliefs? Are there other logical solutions?