Why Not To Do A Startup
I’ve been doing a lot of thinking about startups lately, and I’ve come to realize that they’re really not for most people, probably even most people who attempt them. All of the guys who are and should be doing startups write about how great they are, but I feel like the opposing viewpoint is largely glossed over. So, always the contrarian, here is why you might not want to start a startup.
For one, the mainstream media focuses almost exclusively on the outlying startups that work out extremely well. Almost every startup-related article you read in Wired or The New York Times is about some guy who started a free dating service, worked 10 hours a week on it for a year, and now collects millions from Google ads, or some 14 year old trailer-dweller who grew her MySpace layouts website into a million page views a week.
Even in Y Combinator you have a few examples of companies that went from conception to acquisition in under a year. Those happen, and your odds of that are probably far better than winning the lottery, but it’s still highly unlikely. It’s on the order of a few percent, and that’s with the YC advantage. Without it’s clearly a longshot. And just like the lottery, everyone thinks their chances are better than they really are.
In reality, startups are a lot of work over a relatively long period of time. Your most likely experience starts with 6 months to a year of working with no salary, trying to simultaneously build a product and raise some funding. Eventually you get a small angel round, which means a paycheck and some breathing room, but you’re still getting paid less than guys who break rocks with other rocks while everyone you still talk to from your business or CS program is making a six figure salary with full health and dental.
If your startup does well, you have years more of this to look forward to. Your user base grows slowly but steadily, your product improves, the competition is always nipping at your heels but never quite catches up because you’re that much better than them. Google either doesn’t release a competitor or they do and it’s more like Orkut and less like Google Maps. The self-perpetuating cycle kicks in, and you keep getting better and better, and users love you more and more.
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