VCs Killing Startups

While VC’s are a necessary part of growing a startup, they can kill it too. I’ve seen this happen too many times where the VC’s kill the goose that laid the golden egg. They’re so driven by financial goals that they interfere with great startups that just need a bit more time to ‘gel.’

A recent study commissioned by Eric Paley at Founder Collective found that by pressuring companies to scale prematurely, venture capitalists are indirectly responsible for more startup deaths than founder infighting, technical debt and slow customer adoption — combined. via Techcrunch

Quite honestly, if you create a startup and start making money from it, why really scale? With scale comes so many other headaches. The reason I say that is Mike Carson (aka Uglychart) was recently interviewed by Indie Hackers about his company Park.IO. He’s a one man shop that runs everything on AWS and allegedly makes a small yearly fortune. The one takeaway I got from this interview was that he wants to be a one man shop. With growth comes so many other headaches and the danger of losing control.

The same goes for Engineering firms. My buddy in CA says the same thing, he never hired people and grew his consulting business because he hates managing people. He’s always too busy but makes a great six figure income.

Where’s the line? Hard to tell but it really depends on the Founders. If it were me personally, I’d do what Mike and CA buddy have done, keep it small but profitable.

Bitcoin is not dead

According to Howard Bitcoin is not dead. I agree with him that price is a big indicator of where things are going but I can’t help but wonder that this sudden uptick in cryptocurrency jobs is just a lag effect from when Bitcoin was $19,000.

I know people on both sides of the Bitcoin/blockchain fence. The risk takers tend to be long Bitcoin whereas the lower risk folks tend to think it’s a sham.

That, right there folks, is a market. The Bulls and Bears in our daily life.

Update

I posted this article back in April of this year. Since then Bitcoin and other cryptocurrencies have collapsed in a spectacular fashion. The air camp out of this sector and many people got caught holding the bag. 

When I get to around to reposting the conversation I overhead in the old office, about a guy’s son investing all his savings in Bitcoin, I think you’ll cry. 

Do I still have some Ripple and Ethereum, yes. I will probably hold that stuff till it’s worthless. 

Did I lose BIG money in this? Nope. I cashed out a lot of positions on the way up and reinvested the ‘house’ winnings in other crap.

What works; What Doesn’t Work

The most important lesson I’ve learned while working at a Startup is to do more of what works and jettison what doesn’t work, quickly. That’s the way to success, the rest is just noise and a waste of time. This lesson can be applied to everything in life.

Data is your friend

We generate data all the time, whether it’s captured in a database or spreadsheet, just by being alive you throw of data points. The trick is to take notice of it, capture it, and then do something with it.

It’s the “do something with it” that matters to your success or not. ¬†Your success can be anything that is of value to you. Time, money, weight loss, stock trading, whatever. You just need to start capturing data, evaluate it, and take action on it.

This is where you fail

Many people fail by taking no action on the data they captured and evaluated. They hope that things are going to get better or that things are going to change. Maybe they will, maybe they won’t but you must act on what the data is telling you now.

NOW!

My Examples, what Works/Doesn’t Work

  1. My $100 Forex experiment worked really well for a time, then it started to flag. The data was telling me that my trading method was no longer working. Did I listen? Nope. I blew up that account. This didn’t work for me.
  2. Writing RapidMiner Tutorials on this blog ended up getting me a job with a great job with RapidMiner. This lead to an amazing career in Data Science. Writing and taking an interest in things works.
  3. Day trading doesn’t work for me. I blow up all the time. What works for me is swing and trend trading. Do more of that and no day trading.

Keep it simple, stupid

The one thing I’ve also learned working at a startup is to keep things simple and stupid. You’re running so fast trying to make your quarter that you have no time for complex processes. Strip things down to their minimum and go as light as you can. This way you can adjust your strategy and make changes quickly, you can do more of what works and jettison what doesn’t.