The people who really strike it rich - the Elon Musks, Larry Pages, Evan Williamses, Marc Andreessens, Steve Jobses, Mark Zuckerburgs, et al - all seem to devote significant thought and attention to figuring out where the opportunities are that are almost ripe for a company to come in and pick them. To an outsider, it looks like they single-handedly changed the course of history, but if you read in-depth biographies or listen to them speak in person and then try to trace through what their thought process might be, there's a lot of attention to paid to what social or technical trends are just on the cusp of developing, and what the implications of them are. Good entrepreneurs realize that they can't do it alone, so they're always looking out for things that lots of people want to have happen, but need a slight catalyst to get things moving.
I didn't sift through all the available opportunities and choose changing education. I was personally interested in this problem - it mattered to me on an emotional level. I've interviewed Evan Williams and Mark Zuckerberg personally and I see the same pattern there.
It kind of sucks to say "You just need to be interested personally in solving a problem" but it's true. I don't think you can simply identify a problem and solve it, without the personal passion.
Business books like to talk about the "hedgehog" principle:
http://ilead.byuh.edu/node/133
This is what it means in practice. It helps if all of the sets are relatively large, and the intersection is quite narrowly focused. Usually when I've had "small" successes (projects beloved by a handful of users, but not enough to make any money), it's because I was following my passion but not considering how many other people cared about the problem. When I've had outright failures (like the graveyard of projects that I never completed), it was when I followed my passion for a project that large amounts of people would want, but didn't pay any attention to whether the problem was tractable with the resources I had available to me.
Sam Altman indicates this is true in his first lecture at Stanford's startup course.
Studies of successful entrepreneurs are nothing but confirmation bias in action. Sure you can point to N successful people who did X, Y and Z, and follow that with an unjustified claim that X, Y and Z are the keys to the kingdom, but unless you go out and scour the ground for people who also did X, Y and Z and failed, you've said exactly nothing interesting.
In particular, you have not increased the posterior plausibility of the claim "people who do X, Y and Z are more likely to be successful" more than a tiny little increment.
I say this as a successful businessperson who has worked for a number of failed startups and knows a fair number of people who came within one business decision of "success" (defined as being a millionaire with less than five years of work).
These studies of only successful business-people are completely vacuous. It isn't enough to show that "People who were successful did X, Y and Z." You must also show "People who did X, Y and Z had a better chance of success", which is a completely unrelated question, and whose answer can only be ascertained by investigating a reasonably large sample of people selected on the basis of doing X, Y and Z, not on the basis of being successful.
I've started large companies and tiny / failed ones; although I look back at my own execution problems for the ones that didn't make it, I recognize that the ones that succeeded were lucky, and we were just lucky enough to be able to take advantage of that luck.
For example: - tons of cold calls and regular sales calls until we accidentally signed up the right kinds of customers - having some customers who told us how we should be running our business, and being smart enough to listen to them - recognizing at one point, "hey, we're making all our money from customers who ask for Y, why do we think our business is X?" (i.e. what hipsters these days call a "pivot")
etc
I love the ones who think they're badass -- they're too busy being badass to slog through the mire and get to the mountain.
I'm not saying ego is good, because it can take you down if not managed. But to say that there are no positives is a little bit extreme.
I guess I haven't seen this much! Yes, if you're a shrinking violet and can't put yourself out there you will have a hard time succeeding in almost any domain, but the ability to do so can be learned.
In my experience, when someone says "ego" it usually means "asshole".
Amen. Amen.
I'd love to hear more about your past adventures. What were the large companies and the failed/tiny ones?
I also did an enterprise DB company, Zembu, that pretty much sank without a trace (the tech ended up in DB2). I made a drug at Talima that is still in trials so who knows? Terrajoule.... well the jury is out.
And castAR I plan will be huge!
You can see some background by looking me up on Linkedin: D. Henkel-Wallace. I should resurrect my Wikipedia page.
In practice, it's hard to acquire enough information. This is where luck comes into play. You need luck when your information is limited.
But in practice, I don't think we should be overly humble worshipers of this "luck". Yes, it's pretty important, but I think you could reach a point of having enough information and reasoning ability where luck is a notably smaller component of success than skill. I think that we have a ways to go in terms of improving our information and reasoning ability.
* For example, startup ideas are rarely strategically chosen amongst carefully thought out alternatives. They usually just emerge from a side-project.
* And founders really struggle to [isolate](http://lesswrong.com/lw/bc3/sotw_be_specific/) what it really is that gives them a competitive advantage over their competitors.
I think that in 50 years, people will have gotten "good enough" at startups such that luck is a smaller determinant of success than skill.
Alas, not even in theory, because other actors are generating new information. Some of that new information will specifically be in response to your actions.
Even if over time skill and knowledge increase, that will be true for everybody. So luck will continue to be as important. Possibly more so; it seems to me that increasing knowledge reduces the opportunity for individual skill to make a difference.
The idea is that a Markdown-formatted document should be publishable as-is, as plain text, without looking like it’s been marked up with tags or formatting instructions.
Thus, the use of a Markdown-style link in the present context is not a mistake. Moreover, even if it were, it wouldn't justify your smug and snarky tone, which you would do well to avoid in the future.
What specifically in the post is 'Reddit markup'? Looks like plain old Markdown and/or CommonMark to me.
Kind of reminds me of this:
After his service in the war, Socrates devoted himself to his favorite pastime: the pursuit of truth.
His reputation as a philosopher, literally meaning 'a lover of wisdom', soon spread all over Athens and beyond. When told that the Oracle of Delphi had revealed to one of his friends that Socrates was the wisest man in Athens, he responded not by boasting or celebrating, but by trying to prove the Oracle wrong.
So Socrates decided he would try and find out if anyone knew what was truly worthwhile in life, because anyone who knew that would surely be wiser than him. He set about questioning everyone he could find, but no one could give him a satisfactory answer. Instead they all pretended to know something they clearly did not.
Finally he realized the Oracle might be right after all. He was the wisest man in Athens because he alone was prepared to admit his own ignorance rather than pretend to know something he did not.
This is one of the reasons I'm so passionate about Treehouse. We can empower more people with the skills to build their first product, without raising capital. Once they have a working product, they're much more likely to be able to raise capital.
And yet, very few people similar to Elon Musk ever find themselves in the position of being rich enough to field an army.
In a future where resources aren't so constrained we'll start to see "geniuses" everywhere.
I kinda developed this theory playing on a modded minecraft server where we'll hit peak engineering. I'm trying to simulate industrial ascenscion on there right now, moving from nothing to self-sustainability to post-scarcity. And whilst resource aquisition goes up exponentially, the machinery I build becomes more and more complex, and the time I spend engineering things goes up dramatically. I moved from half an hour of thinking on each project to spending an average of a week on most of my current projects. The next one down the line I'm projecting at about a month, gathering data, designing and testing.
Now I understand that directly applying that to a larger system isn't prudent, but I notice distinct similarities in other projects I take on, with the only difference being time scales and project complexity. Which makes sense, since civilisation as a whole, or even a career take a lot longer than the two months I've been playing around with the idea in a simplified system.
So I personally believe that once we hit that point, we'll be at a state of peak engineering, where our progress and the size of the projects we can take on is limited by the amount of brainpower we can spend on them. What I'm saying is that there won't be geniuses everywhere. We'll be more productive as a whole, but there's a ceiling on how much can be done by one person in a given timeframe.
Zip2 details on Wikipedia: https://en.wikipedia.org/wiki/Elon_Musk
That said, I can't help but recall a quote from one of the greatest pro golfers:
"The harder I practice, the luckier I get" - Gary Player
Note: the logic only flows one way, in that working hard does not mean one will be successful. Also, there are scant examples of self-made (eg. not inherited) successes without working extremely hard. In other words it's a mostly necessary, but not sufficient condition.
I always wonder what people mean by "risk" in this context. If risk is a probability of failure, then if someone has minimized that probability through other means (seeing an opportunity where others haven't, working real hard, etc.) then it isn't risk. If others aren't trying to do the same thing and failing at it, then it might not be risky.
The "risk" thing may just be part of the badass image, but I've read in other places that entrepreneurs actually tend to be risk averse. Rather than simply taking risks, what they (we?) do is to use their skills and knowledge to arrange matters so that their own risk is reduced, even if the same activity might be more risky for someone else who doesn't have the same insight.
EDIT: Also the risk to reputation and social stigma that goes along with being poor...and enduring this for years...until you're not :).
And in other cases, the risk could be real after all. For instance the high probability of failure for start-ups is a pretty straightforward measure of risk, and the people who start start-ups are probably incurring that risk on average.
1. Luck/Serendipity - Your startup launches for the first or fifth time & boom gets traction, which money/success immediately follows. Think Pinterest, Uber, Facebook, Youtube; basically it's like winning the lottery!
and
2. Network - You know the right people & or convinced them to give you their resources (their connections & money). With this you can do the hard work (have the runway) to make things happen, though maybe not.
Good luck everyone!
Facebook was instant in the fact that when launched it took Harvard by storm and then grew like a weed thereafter.
Actually, I really am impressed, and it looks like Carson has good reason to brag. That's cool. But I don't feel like there is all that much substance here.
For one, I think Carson himself is discounting that the difference between doing nothing and making $450K on the sale of a business is actually bigger than $450K and the $100M business he's building now.
He's living proof that there is more to it than luck, but he's saying the opposite.
I guess what's really bugging me here is that the message here is meant to be valuable -- "Anyone can do it." But paradoxically, when Carson and others like him give themselves no credit for their success, then there is nothing we can learn from them. It's like participation trophies -- they don't really teach anybody how to search inside themselves and find the way to win.
That's the whole point of the post. There aren't any quick tips, todos or silver bullets I can give you that will help you. The post isn't meant to be ultimately affirming. It's just reality as I see it.
> Summary: Hey, I run an awesome company and look at my face on this magazine.
I'm sorry that's your takeaway. I've failed to communicate to you the reason I wrote it.
As humble as your position is, I'm trying to say that you should be proud of your success, because there is probably good reason for it. I'm not one to tell you whether you actually believe that or not, but I would suspect it to be true.
But, I do totally agree about "quick tips, todos, or silver bullets". Regardless of that, I'm sure there is something reasonable special about you that has driven you in particular to create at least three moderately successful businesses. Something we could probably learn from.
Yes, there's a lot of luck involved, but it takes hard, risky work that most people aren't willing to put in just to have a chance at capturing that luck.
"The more you try, the luckier you get".
There may be an element of luck that may affect to a significant extent (think lottery) without or having little attempts but in the long run it pans out. This highlights not only the importance of sticking it out, but sticking it out long enough, even after getting smashed many times over.
But of course, there has to be a specific and unique insight as a starting point, ala how can you make something better than whats out there now?
Its not surprising that people whom are passionate about their circle of competency, those who would venture in all directions from their initial locus/loci, seemingly random areas would pick up observations that others miss.
And only those with a genuine passion and interest will continue sticking out, even in the darkest times.
That said, you can get lucky and happen to work on one of the trends or you can try to spot one and ride it consciously. There's a factor that doesn't change though, you need to be able to execute and I think Ryan is giving himself way too little credit for being good at execution.
In particular he had already garnered a significant following with carsonified conferences and his blog before thinkvitamin (now treehouse) took off at the time.
There's always the cautionary tale of friendster, who could have been Facebook if they had been better at product management.
Kind of like the idea that a bank loan officer should avoid business loans to people pursuing their passions and instead focus on the loaning to people who have hard data about why their business will make money.
I'm not certain how valid it is as advice, it feels like something that might suit some entrepreneurs but not others.
In startup culture successful founders are portrayed and stereotyped as being in their early 20s, college dropouts, first time founders, etc. but when you dig deeper you find that this is far from true.
One age, the HBR recently analyzed data from Crunchbase and other sources and found that the average entrepreneur funding age is 31[0]. This means most have around 10 years of industry experience before getting funded, on average. YC would skew a lot younger (it probably shouldn't, but it does).
Second is the "first time" myth. If you look at successful entrepreneurs, even those who appear to be hits with their first company - you'll find that they all have at least some experience with delivering a product that people used before their big hit. It is a big leap to go from just having ideas and reading articles to actually building a product to completion, find even a hundred people to use it and then running through a few user feedback based iterations.
The same startup lore that mythologizes young first time founders usually also always mention a previous product from the founders that had some success (blue boxes, facesmash, altair basic, etc.)
The data shows that entrepreneurs have product or industry experience and aren't in their early 20s. You can fill that time in with your own products and aim to work on the basics such as getting a product built and launched, listening to users, etc. If you can't do it at a 100 user, $10k scale the chances of you being able to do it at a million/million scale are likely slim.
There is also no reason why the 100/$10k startup can't scale up to a million/million startup - you just need to put a price on the product or your time from day 1 (product scales better) and grow steadily. But it is also good to know when an idea has reached its limits and you should exit, investing your time in taking the next idea to x.
For some entrepreneurs they'll be comfortable spending that pre-time before the "big swing" idea in other startups (and perhaps failing) or small-scale products, or alternatively 4-5 years in industry.
[0] http://blogs.hbr.org/2014/04/how-old-are-silicon-valleys-top...
This idea seems laughable to me. As if you can perfectly time and control those outcomes. Ha! :)
> What changed when you did treehouse vs those other smaller businesses? Was it the fact that you didn't need to worry about money in the short-term anymore (because of those small exits), or something else?
I didn't make quite enough from those exits to be financially independent, so I still need to make Treehouse work from a money perspective personally.
The simple thing that changed was the scope of the idea. It was world-changing scale - millions of potential lives affected.
