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Comment by swombat | Hacker News Reader

I am naturally skeptical of unknown people asking for details that belong in the business plan. If you're a potential investor, I don't mind sending you the plan, and without an NDA, but for random sites to ask for such details just seems wrong. Moreover, I think that any business owner who gives in to such requests is either desperate or stupid.

I applied to thefunded.com at some point, and they asked for those kinds of details too. I'm not quite sure what they offer in return for all this confidential information, and actually, the fact that they ask for it and that their members have all given it kind of rules them out as a community worth belonging to, imho - full of "entrepreneurs" who are either desperate or stupid.

Would love for someone to contradict me and let me know what I've missed out on by not sending our business plan to be reviewed by unknown parties at thefunded.com.

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Hey guys, Sam from YouNoodle here. The research and development project behind this was the biggest of its kind ever conducted. If you want to learn more about predictive analytics you can read some of the well-informed recent articles about Startup Predictor.

Harvard Business Publishing: http://discussionleader.hbsp.com/anthony/2008/08/younoodle_i...

The Telegraph: http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/...

American National Public Radio: http://tinyurl.com/625gva

Venture Beat: http://venturebeat.com/2008/08/07/younoodles-startup-predict...

We are listening to your privacy concerns and will be making changes to how we convey our measures to protect you. Realize you're giving us sensitive information and we take our role in handling that very seriously. Appreciate any further comments or feedback you guys provide as we are iterating fast on this.

Thanks for being a part of the discussion, Sam. As a startup founder, here are my privacy concerns.

-- I'd like internal details of my startup to NEVER be released without my knowledge (including ownership breakdowns, investment amounts, number of employees, strategy/expected launch date, revenue/traffic numbers, etc.), under any circumstances - even anonymously. (If you released info on a "video startup in Minnesota", but left out the name, that would be potentially be enough to be traced back to http://zencoder.tv.)

-- If you want to use my information in the aggregate, that doesn't bother me as much, and I understand that you may use information about my company as a part of your predictions.

-- Obviously, you should take data security very seriously and go above and beyond 99% of companies in this area.

-- I should be able to cancel my account with a click of a button, and this should remove all of my private information from your system.

These would make me comfortable with YouNoodle, and if I felt certain that you'd follow these standards, I'd probably try it out.

If you could make it a desktop application and store data locally I'm sure you'd have a lot more takers. I'm sure you want to use information from your users to improve your system -- so let people send in anonymized information (and let them see _exactly_ what's being sent and remove anything they're uncomfortable with).

I'm guessing it's unlikely you guys will do that. But if someone else does I'd be happy to try it out :-)

From the Harvard Business Publishing Article:

> "Before the 1950s, lending depended on the wisdom and judgment of loan officers. Then, a company called Fair Isaac developed a way to use four simple variables to develop a credit score that reliably predicted the risk of lending to an individual."

That is a very misleading analogy. YouNoodle is not the present-day analog of Fair Issac. This goes back to the idea that while it's very difficult to predict random events individually, you can predict them well in aggreggate. Fair Issac isn't really betting on customer X defaulting on a loan -- they're really betting on a thousand customers like X. Same with insurance premiums. A model won't be a great predictor of one person, but if you have hundreds of thousands of customers, you can have a much more accurate estimate. This is the law of large numbers. For a simpler example, you wouldn't want to bet on the outcome of a single coin toss, but it's a pretty safe bet that if you toss a (fair) coin a million times, the heads percentage will be very close to 50%.

Fair Issac played the game by lending to lots of customers. YouNoodle is trying to play this game for each individual case. They're bold enough to mathematically estimate the value of one individual startup, and say that they have some confidence in it. It's the analog of making a loan to 1 person, insuring 1 person, or betting on a single coin flip. Probability tells you this is very risky. VC don't make thousands of bets like insurers or banks do. For the bank, my individual outcome doesn't really matter to the big picture. VCs on the other hand invest in a very small number of startups - each startup matters.

I haven't used their site, and I don't have a startup to use with it (so if this is exactly what they do then I apologize), but a tool that states "20% of startups in your industry with similar circumstances succeeded. Here are some ways you can increase your percentage." and then shows different ways that a startup could increase its chances based on the statistical data would be interesting to me as a startup founder, and I think it would be helpful to VCs and others as a pre-screening tool for their investments.

In the same spirit, someone should take one of those iPhone "Magic 8-ball" apps and have the app upload a sound recording from the moment the iPhone is tipped around for an answer. Then you could go to a site and listen to an internet radio stream of all the questions people are asking and using the iPhone to scry about.

The giveaway is that some of the questions would be impossible to use in valuating a company. For example, how do you know the founders? And describe your product in words...

"how do you know the founders" Is a very valid question. They are trying to measure your chances of success If you don't get along with the people you have to work with your chances are greatly reduced.

If your co-founder is a child hood friend chances are you know them very well. If you just met them at the WWDC a couple months back chances are they might be an ass.

obviously their historical data implies that as long as some people have known each for more than two years the exact number is irrelevant. So it probably doesnt matter if you ve known someone since childhood. This conclusion is derived from the options they give.

The way they actually phrase the question is, "How do you know about this startup?" (I.e., not how do the co-founders know each other.)

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