Y-Combinator

Snap. Forbes magazine put out an issue featuring Y-Combinator. The cover has a picture of cofounder Paul Graham. I am wondering why there is so much buzz about this company.

Yes. I get it. Paul and his company backed some winners like Reddit, Loopt, and Justin.tv. What I am trying to figure out is why having Graham's backing is so important?

Initially you got a $5k investment from Graham. That's not much money at all. Now the initial investment has risen to $11k plus a little more depending on how many people are in your start-up. That is still not a lot of cash.

Maybe this is all a big marketing thing. If you are in with Y-Combinator, you are going to have the clout and access to a lot of rich angel investors and venture capitalists. But isn't it best to bootstrap yourself and keep all of your company for yourself?

There is only one way to find out. Either try to join Y Combinator, or strike out on your own and see what happens. Let's do just that.

Angelgate Scandal

Mike Arrington of TechCrunch goes to some joint called Bin 38. He sees a number of super angel investors meeting there. They disinvite him from their get together. Mike suspects the worst. He thinks there is some type of collusion between these people. It must be so. Why else would they not want him there?

Hello. The dude writes stuff in TechCrunch. You don't want your private business being the next blog story. Too late. Mike has been making insinuations and posting secret emails and such. LOL. Don't we have something better to do then to follow the hype about unsubstantiated rumors?

Look. Product good stuff. Get customers. Be excellent. Then with a little luck, success is going to come your way. People are going to want to back you. Who knows? You might be the next Google or FaceBook. Probably not. But you might be. And if you show some promise, the angels are going to find you and invest. Turn the tables around and have them fighting for you. Then it won't matter what these angels discuss in their private dinners. They will all want you taking their money and returning a huge ROI. But hey. I guess the Angelgate diaries make for some good page hits. Whatever.

Solve Your Own Problem

Some time back I had a good idea for a simulation. It was going to be more like a game. The problem is that it is going to take a lot of time to develop the darn thing. I tried getting started a time or two. But it was tough to follow through. I left the thing alone for a long time.

Recently I read a post from the 21st Century Programmers blog, or something like that. It said to be successful you need to write an app that solves a problem you have. Ok. I am game. No pun intended. You got to forget about producing a commercial winner. Or at least you should not concentrate on commercial quality at first.

Develop a small thing that solves a problem of yours. Do it quickly with the minimal set of features. Actually do it with less than the minimal set of features. Then keep iterating by adding features and fixing bugs. This will get you the traction you need to produce something good. Hey. I will give it a try. You never know. I might just succeed. Now I just need to find an interesting enough problem I am encountering to solve with some code. I will let you know once I get the minimal thing coded up.

Trolled

Oh you got to hear about this Craigslist ad. A startup needed a web site developed. They wanted login capability. There has to be a bunch of databases involved. The site must be dynamic and professional looking. Those seem like reasonable requirements. Here is the stickler. They cannot pay any money.

Ha ha. This must be a joke. Good one. They promise 10% of the profits from the first 3 months of the web site being up. In the mean time they offer a bunch of troll dolls as down payment. LMAO. I got to contact these people to see if they are pulling a prank or something. I will let you know what I find out.

Freelancing

People that work for the man dream about working for themselves all the time. You can just work from home and chill right? Well I read an article and a ton of comments contradicting that theory.

Although you work at home when you freelance, you are always at work. Some work 80 hours a week freelancing to make ends meet. The pay is often sub par. You also will encounter a bunch of non-paying clients.

On a different note, it is hard to get a loan if you are self employed. You do get to be your own boss. But there is a heavy price to pay. You also spend a lot of time getting gigs. These costs may very well be just too high for me to go at it alone 100%. I am not willing to jump into a severe test of character if the rewards are not high enough.

Surplus Store

I keep getting this circular in the paper for a local surplus store. They seem to have great deals. I figured I should give the place a try. They had some grass seed which was 45% off the price I normally pay. They also had some beef jerky that was a whopping 66% off the price I paid last. How could I lose?

When I got to the store, I noticed a lack of shopping carts. Some lady even tried to steal the one I was using. The items from the circular were nowhere to be found. They had some other grass seed which was more expensive. I bought a bag because it was still below the cost I normally pay. However the damage was done. I felt like I visited a gas station with low 87 octane gas, only to find they ran out of 87 octane.

The other disturbia was that they did not have the flavor of beef jerky I liked. They had advertised that they did. No dice. They had a whole lot of other flavors at a very low price. I decided to pass on them. The store was a bit dilapidated. Shelves were propped up with cinder blocks. The aisles were too narrow. The only interesting thing about this place was the stories they told in their newspaper ad. They tell you how they came to buy the closeout items they offer. I am not sure whether that will have me coming back for a second visit. Sure the value is high. But I could not help but feel disappointed with my first trip. I doubt this will affect their stores. The store was very crowded. In this economy, people are scrappy and need surplus stores like this.

Success of Lew Cirne

I heard an interesting interview with Lew Cirne, CEO of New Relic. He previously founded Wily Technology and sold it for $375M to CA. I like his story because the guy loves to write software. He worked in private industry before starting up a company. That is where he got the idea for his first product. He confesses that he had a lot of other dumb ideas for products. Then the right one hit him light a lightning bolt.

Lew recommends that you do not force your idea to come to fruition. Just solve a problem that you are very passionate about. For Lew and his first startup, the problem was making Java programs self diagnostic. Lew first built a prototype. Then he gave presentations with a few PowerPoint slides and a lot of demo time.

Unfortunately applets and Java running on client machines did not take off. So Lew repurposed his product for servers and pivoted his company. He hired a lot of expensive sales people, and was never able to break even on financials. But they were growing by hiring and making more sales.

Lew says you must hire awesome people. They also need to be both gifted and decent. He found most hires through his extended network. Lew boasts that Wily is still one of the top products at CA, the company that bought him out. I find it interesting that out of the 260 employees of his company, only 15 were engineers developing the product. Most everyone else was in sales. His next product focuses on Ruby rather than Java. He is positioning the product to sell itself via software as a service. If the past is any indicator, Lew will be successful and selling once again for the big win.