We consciously try to operate as much like a startup as we can. Except for Jessica, it's the side of the business world we have the most experience in anyway.
Yes, actually it extends even to that. Part of the reason we're not interested in taking outside investment is that we worry if we had a lot of money it might harm more than help us.
who is giving negative points without even adding their own comments? It was a question/comment and if you realy think about it developers do need people that understand business as well.
The prevailing wisdom around these parts is that, while hackers do need someone with business sense to build a business well, hackers are basically smart enough to acquire said experience. Having both the skill to build something and the wisdom to know what to build in the mind of a single person is much stronger than having 'business people' and 'developers'. Also, YC is less concerned with developers in general; they pretty much have the pick of a self selected lot that's already pretty entrepreneurial, so adding a business person to the mix doesn't really tend to help all that much.
"Having both the skill to build something and the wisdom to know what to build in the mind of a single person is much stronger than having 'business people' and 'developers'."
I very much disagree, though with the specifics rather than the general point. It's very difficult to keep a full mental model of both the technology you're using and the problem you're solving in your head at once. Either you veer over to the technology side, building something that's cool but not as useful to users, or you veer over to the business side, coming up with great ideas for users that can't be implemented in any feasible time period. This is one major reason why startups can fail to build something people want.
You need at least two people that trust each other to keep everything centered - one to build things and one to critique what's been built and suggest ways that it can be made more user-friendly. It doesn't have to be hacker + businessperson: hacker + hacker with each of them writing code and then looking at what the other has written for improvements is probably more efficient, and gives you a swing person if you need something implemented fast. But it's very rare that it can be done by a single person.
Speaking from my personal experience, the most valuable thing I seemed to gain when we went from from one person to two is companionship. Having two people on board made it much easier to keep up the momentum, because I now didn't have as much need to put down work to hangout with my friends; I was already working with a friend!
I've found that separating out the technology and business concerns (at least in the companies that I've worked at) leads to, occasionally, bad solutions, tension, and a lot of the creativity is squelched. Sometimes, good ideas look uninspired from merely a business perspective, uninteresting from a technical perspective, but in reality they're great ideas.
A good example is the DOS licensing deal. Making a CP/M compatible operating system (poorly) isn't that bright. And from their business perspective, IBM couldn't see it's platform being commoditized, because they failed to understand how portable software would become. But Bill Gates understood.
I think more ideal would be two hackers who understood business, or possible one hacker who understands business and one business person that can hack. The point is, no silos!
"the wisdom to know what to build in the mind of a single person is much stronger than having 'business people"
I completely agree. Infact I am a single person and can deal with both parts. But this idea is in conflict with what YC has said: "We're reluctant to accept one-person companies, though we have funded a couple."
my comment was from my perspective not a vc. Of course when I put efforts on the business side of things I feel I am as effective as doing the development. But as someone looking at a VC as an option instead of self funding, I think that I could reduce my efforts on the business side and do more on development.
The original comment was "we worry if we had a lot of money..." my question/comment was if more money is bad then offer more expertise.
"Ideally you want between two and four founders. It would be hard to start with just one. One person would find the moral weight of starting a company hard to bear. Even Bill Gates, who seems to be able to bear a good deal of moral weight, had to have a co-founder."
That does seem to be true. But I wouldn't think that implies a need for specialization, nor that it would help.
For further comments on the subject, Philip Greenspun has written substantially about how small teams of two or three consultants handling everything associated with a project would outperform, in terms of time, money, quality, and customer and consultant satisfaction, more specialized, supported teams.
That's contingent upon picking the right people, and training them the right way: communicating the right values, building up a well rounded skill set, getting people thinking about the customer and how to them to pay for stuff. When VC's took over and the structure was rearranged to encompass business specialists, and hr experts and so on, the company rapidly collapsed. There were other factors too: Joel Spolsky writes that the consulting market collapsed in general, but ArsDigita had big customers, which actually didn't go away, they just started doing things in house because ArsDigita got worse.
Agreed. I've worked in a startup that grow too fast and a new VC brought in "experts" and everything just collapsed. Of course it was also during startup bubbles.
I would probably apply design-by-contract methods. HR, finance and others do play a good role in a company but as long as they are contained :)
I guess startups would eventually want to become a real company and there are costs in that as well. you can minimized that but you can not completely avoid them
I dislike working in 'real companies' so much that I've hedged my bets, in case we're successful: we plan on basically growing by mitosis, spawning little, autonomous exclaves of our company (of which we have partial ownership, non-controlling ownership).
I bet other hackers dislike working in 'real companies' too, so it might even be a magnet for more independently minded hackers. The most independently minded hackers are likely to go off and start their own, though.
The awesomeness of YC comes from the fame/experience of the founders. Adding people will dilute the awesomeness, thus lowering the overall success of YC companies... presumably.
that doesn't even make any sense. if they are awesome then bring in more awesome people. or do you think that too many awesome people would make yc less awesome.
Maybe one day. We've thought that one day, if we get big enough, we might get an in-house investment banker to beat on acquirers. Some acquirers' M&A groups are not very nice people. YC founders, who generally are nice people, are sometimes at a disadvantage. It would be handy to have a thug on call that they could send in against the acquirers' thugs.
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