Paul Graham explains what a startup is and how it differs from other types of businesses.
That difference is why there's a distinct word, "startup," for companies designed to grow fast. If all companies were essentially similar, but some through luck or the efforts of their founders ended up growing very fast, we wouldn't need a separate word. We could just talk about super-successful companies and less successful ones. But in fact startups do have a different sort of DNA from other businesses. Google is not just a barbershop whose founders were unusually lucky and hard-working. Google was different from the beginning.
To grow rapidly, you need to make something you can sell to a big market. That's the difference between Google and a barbershop. A barbershop doesn't scale.
For a company to grow really big, it must (a) make something lots of people want, and (b) reach and serve all those people. Barbershops are doing fine in the (a) department. Almost everyone needs their hair cut. The problem for a barbershop, as for any retail establishment, is (b). A barbershop serves customers in person, and few will travel far for a haircut. And even if they did the barbershop couldn't accomodate them.
Writing software is a great way to solve (b), but you can still end up constrained in (a). If you write software to teach Tibetan to Hungarian speakers, you'll be able to reach most of the people who want it, but there won't be many of them. If you make software to teach English to Chinese speakers, however, you're in startup territory.
Most businesses are tightly constrained in (a) or (b). The distinctive feature of successful startups is that they're not.
Over at Hacker News, npguy asked Y Combinator co-founder Paul Graham about "the most frighteningly ambitious idea" he'd ever been pitched. Graham declined to answer, citing confidentiality, but Eliezer Yudkowsky responded with what another commenter called the Yudkowsky Ambition scale:
1) We're going to build the next Facebook!
2) We're going to found the next Apple!
3) Our product will create sweeping political change! This will produce a major economic revolution in at least one country! (Seasteading would be change on this level if it worked; creating a new country successfully is around the same level of change as this.)
4) Our product is the next nuclear weapon. You wouldn't want that in the wrong hands, would you?
5) This is going to be the equivalent of the invention of electricity if it works out.
6) We're going to make an IQ-enhancing drug and produce basic change in the human condition.
7) We're going to build serious Drexler-class molecular nanotechnology.
8) We're going to upload a human brain into a computer.
9) We're going to build a recursively self-improving Artificial Intelligence.
10) We think we've figured out how to hack into the computer our universe is running on.
Paul Graham's Hackers and Painters, published in 2004, contained the following footnote:
If the Mac was so great, why did it lose? Cost, again Microsoft concentrated on the software business and unleashed a swarm of cheap component suppliers on Apple hardware. It did not help either that suits took over during a critical period. (And it hasn't lost yet. If Apple were to grow the iPod into a cell phone with a web browser, Microsoft would be in big trouble.)
Then again, a few footnotes later Graham writes:
Maybe he meant Flash? (via oddhead)
Paul Graham asked the founders of the startups he's funded what they know now that didn't going in. Here's what they said.
I've been surprised again and again by just how much more important persistence is than raw intelligence.
Paul Graham on the difference between the "maker's schedule" and the "manager's schedule".
When you're operating on the maker's schedule, meetings are a disaster. A single meeting can blow a whole afternoon, by breaking it into two pieces each too small to do anything hard in. Plus you have to remember to go to the meeting. That's no problem for someone on the manager's schedule. There's always something coming on the next hour; the only question is what. But when someone on the maker's schedule has a meeting, they have to think about it.
Graham is right on about this.
Update: Gina Trapani adds:
As a freelancer, I get lots of requests to "grab coffee" (as Graham describes) with folks who are just interested in seeing if working together is a possibility. Whenever that happens, my heart sinks. If I'm on deadline or deep in a programming project, grabbing coffee midday with someone I don't know and might not have any good business reason to talk to changes the tenor of the entire day. When I can, I usually I turn down these types of speculative meetings because the costs are too high-but I always feel bad about it, and never know how to word my response. (Generally I say, "Sorry I'm just too busy.")
A common misconception about freelancers is that they can do whatever they want whenever they want, but that's not actually true if you want to get anything done. Large chunks of uninterrupted time is the only thing that works.