undefined | Better HN

0 pointsevanhamilton14y ago0 comments

Sure...I think that's a big part of Rich's point. If you're bootstrapping or building a lifestyle business, this isn't the way you want to go. Neither is right or wrong (though some specific instances certainly seem a bit gross).

(And regardless, eventually you will need to make money)

0 comments

5 comments · 1 top-level

ktizo14y ago· 4 in thread

I remember this the first time round.

If you manage to be sneaky with an exit strategy, you never need to make money as you bail with a ton of cash before that becomes neccessary.

And when things like Instagram come around, the amount of people making businesses purely with the motive of sneaky exit strategies starts to completely overshadow the amount of businesses created that are genuinely valuable.

Then things can get very messy.

drusenko14y ago

None of these companies are "trying to be sneaky with an exit strategy". They are trying to grow very large, independent businesses. If you build to flip, you are most likely going to fail -- it's just not a winning strategy.

But putting off revenue != built to flip. Having a ton of usage and figuring out how to make money is easy. Getting a ton of usage is hard. They are focusing on the hard problem first, and the easier problem second.

drusenko14y ago

@zmanji: Absolutely. What evidence do you have to the contrary?

Here's evidence I have: Steve Anderson, one of Instagram's earliest investors and a board member, is also on our board. Just because they're not trying to make money on year 1 doesn't mean they weren't ever planning on making money.

3 more replies

zmanji14y ago

Are you honestly saying that Instagram's team was "trying to grow a very large, independent businesses"?

ktizo14y ago

None of them?

That sounds more like faith based economics than anything else, of couse some of them must be doing this.

And offering a service for free at point of use can often be much easier than turning it into revenue later, especially if you have millions in the bank from investment already. There are plenty of stale corporate corpses littering that particular road, but with founders that did quite nicely out of it.

j / k navigate · click thread line to collapse