BitGeek

He errors in assuming that if your company has 10X potential you should take venture capital. He doesn't recognize that Venture Capital increases the risk of you having a 0X result. (Probably becuase he's only had good experiences.)

I'd rather have a %75 chance of %60 of a $15M company than a %2 chance of %10 of a $300M company.

No. The price of milk, oil and gas are all effected by inflation.

Inflation comes from only one source- an increase in the money supply. When the government prints lots of money, inflation gets high (like the %10-%20 we're seeing now). When the government isn't running printing presses in overdrive, then inflation is lower.

Milk, Oil and Gas prices are affected by a lot of factors such as regulation of these industries, farm subsidies, discoveries of new resources, productivity improvements, etc.

But when you define "inflation" as a measure of prices, then you speak in error. Using the CPI as a measure of "inflation" is really untenable, and its a measure of just how economically ignorant americans are that every news report uses the term "inflation" when the government releases their current CPI numbers (which, by the way, are so manipulated that you can't compare them from year to year as they don't measure the same thing from one decade to the next...)

CPI is a fabrication designed to keep people from realizing how much of their money is being stolen by the government thru the mechanism of monetary inflation...

BTW, the constitution has written into it the requirement that it be run on a gold standard-- this trick is not new and the founding fathers were well aware of the actions of the bank of england. WE were on a gold standard up until the 1930s-- the period where we were the fastest growing economy on the planet. Since then, we've been slowing down, and this is not a coincidence.

This is really important for startups because if you are measuring your returns in USD you will get a very differnet number than if you are measuring them in Euros, and both of those will do poorly compared to an objective standard like gold.

We have the situation where the economy has not grown very much but the DJIA is at 14,000 or something.... people think this means the economy has grown, but the reality is that the dollar has simply declined.

The dollar is not an objective unit of measure, due to monetary inflation.

This graph is in error. Historically the price of gas has been declining over the period shown, if actual inflation figures were used.

The NYT uses government provided CPI based inflation- and CPI is based in part on the price of gas, etc... and chronically under-reported... thus trying to represent the price of gas adjusting for "inflation" measured by the price of gas doesn't really work.

Real inflation-- which is defined as growth in the money supply- would show that the price of gas has declined strongly over this period-- primarily because of the effects of the "robber barrons" who drove down prices to gain market share, and because productivity has made gas a much safer and easier item to get from oil... though I expect in recent years the prices would be going up because of increased government regulation and asinine "environmental" requirements.

Your plane analogy was responding to a strawman anyway... thus it was pretty asinine to begin with.

I'm sure concensus management has worked for you-- never said it didn't and haven't said its impossible. However, the problem is that you're saying people must have a co-founder, and that they must manage this way... and there's a big difference between having a cofounder you've known a long time and getting a cofounder because you foolishly followed the advice of a self styled guru.

If my response seems harsh, its because your tone is pretty strong. If you expressed your opinions in terms of preferences it would be one thing-- but you lay them down and defend them like they are religious law, and do not respond to the fact that this religious law does not work in all situations... which brings us back to the plane analogy-- its great for trying to make me look stupid, but its piss-poor (actually irrelevant) for arguing against what I was actually saying.

And are they really even called founders when you can only name one?

Right, but were they founding employees (with one clear leader) or were they all founders who had equal say?

PG advocates consensus management, and that's the real sticky wicket.

A software / internet company doesn't have to build factories, doesn't have to build hardware, doesn't have to coordinate nearly as complex a marketing campaign, doesn't have to raise as much money, and doesn't have to have as many engineering disciplines on staff.

Thus, where Apple neede hardware and software and marketing guys (really three founders, though Woz should count double)... plentyoffish.com only needs one guy. And when Apple was at the revenue level pof is at now, I think they probably had a thousand employees, probably at least hundreds.

so, the requirement for multiple founders (if it ever existed) is now less likely.

I know I'm not answering your question because its an academic question for me-- I've chosen my path already.

I think really, at the end of the day, number of founders has no factor on the success of startups, but founder fights are a significant factor in startup failure.

So, whether you are solo, or you have 5 other founders, you need harmony between you and your other founders and/or you and your other employees, to have success.

No, he doesn't. He generally reports on things in a pretty factual way... the only politics is in his choice of topics to cover. He's a libertarian.

The best way to help people is not to give them money, but to use that money to build businesses, either by investing in them directly, or via public markets, etc.

You just give it away and it becomes a curse... for instance, a lot of the poverty in africa is due to aid killing local businesses-- there are no tailors anymore because the western world ships them shirts en masse, and so they just sell those...

Frankly, I'm of the opinion that the number one cause of poverty, world wide, are misdirected and ignorant attempts to "help people".

Certainly, social security, for instance, is the number one cause of poverty among the elderly in the US.

I know oliver stone was being ironic when he wrote that, but he was spot on accurate.

A great movie...

And don't for a second think that getting a cofounder is a requirement for success.

For instance, look at plentyoffish.com

Not only did this guy not get a cofounder, he has never gotten any employees. He's making millions by himself, a total solo effort.

In fact there area lot of examples out there of people doing this... many of them are of the professional blogging/seo/domainer variety. What people on here would deride as "lifestyle businesses" (Personally I don't think you get to deride someone's choices until you've done better than them.)

But further, there's a whole movement of "micro-isvs" - a poor term as it came from someone with a microsoft perspective-- but these are people who make software themselves and sell it. Many of these businesses are on their way to becoming large enterprises. Omni Group is an example of one that's had several years, but Delicious Monster is one that's only been at it a few years- very successful, good number of employees now, single founder. And of course there's scores more.

You know, what we really need is a version of TechCrunch- but one that covers these non-VC backed startups- the companies that won't get coverage in TechCrunch because they are not following the latest fad and burning money on lavish parties to invite Michael Arrington to. For all the little companies you never heard of on TecCrunch there are other little companies who are going to be more successful ... but are under the radar now. I think this is what leads to a distorted perspective of the startup landscape.

actually, most of the companies I've worked for were started by an individual, and most of the successful ones were as well.

But my point is that there has to be someone in charge. You can have "cofounders" so long as they know that the buck stops with you. (Or you can be a cofounder so long as you know the buck stops with someone.)

My original post was based on my experience. PG responded with absolute (and absolutely asinine) claims about statistics. I'd like to see him provide some evidence. Giving him more "starting cred" is the problem with the YC way of doing things- its a cult of personality and the personality in question gives some good advice but also some bad advice.

However, you can look at any list of the richest people, or any list of successful startups, and you'll note that most of them were founded by individuals. Though you gotta restrict your data to companies that have lasted a decade or so- otherwise you havent' given the founding teams time to split apart.

Dauntless--

No need to warn me, I've seen the strife of having co-founders, and I've seen the harmony of having a solo found er and co-founder teams that lasted 20 years.

I don't think its a factor of finding "good" co-founders. I think unless you have known the person a long time, you can't know if they are "good" or not- its not whether they are good or not, as the most earnest, responsible, loyal and considerate founder may still be the death of your company. Its fundamental to the nature of trying to manage a company by consensus.

Consensus management doesn't work- or we'd be up to our ears in all the communes the hippies started in the 60s and 70s.

Actually, I'm not confusing them, PG is. What I advocate is having a single leader, and whether you call employees 2-4 "co-founders" or not, they all know who is boss.

PG thinks that you have to have consensus and multiple founders all with an equal say. Thus, multiple leaders.

The whole cofounder thing has taken on quite a weird perspective-- I think because PG doesn't have much experience with it, but is adamant, and most of his readers have never worked for a startup, let alone started one, so they believe he's preaching the gospel.

There has to be a leader, that's my point.

Exactly. And be aware of the risks. As a solo founder you need people you can bounce ideas off of. (And in my opinion this is the purpose of an advisory board, or even friends who have no skin in the game)... and as a group of co-founders you have the serious risk of conflict among the group.

You presume you have to have a cofounder...even that having a cofounder is an advantage-- while you recognize the results of having one.

I'm telling you that there is no significant advantage of consensus management-- that there is a big detriment.

Ok, I see why they did it, now they need to advertise the fact on their home page for everyone to see.

Pretty asinine to call yourselves a security company and then just role over like this-- no court fight, no resistance.

Further, this also goes to show that any company in a MLAT country is vulnerable to being made to turn over the information you're paying them to keep private.

and of course, given the way the US is going they will always have an excuse for getting this info- drugs, terrorism, pedophilia., but as we have seen in the past these excuses are a veneer that wears thin and it becomes outright spying.

Hushmail is now compromised- and they didn't even resist. Any further breaches won't even be newsworthy, and the feds know they will role over... so any time a hushmail.com adddress comes up in an investigation, they'll just demand the info.

My title gave a little bit the wrong impression-- it sounds like I'm saying that cofounders are bad. I'm not.

What I mean is, if you don't already have a cofounder, don't get one. You don't need one.

If you find someone, then maybe that's great... but understand the risks.

But you should never go get one because you think you need one... that's a recipe for failure.

If you've known someone for awhile and you know they would be a great person to start a company with (and you have the emotional maturity to be abel to tell that- I mean, how many people think they are going to get married to the person they are dating, 5, 8, 12 times before they meet the person they know they are going to marry and with whome it works out?) ... if you already have a cofounder, even if you don't have an idea for a company yet... then start a company with them. Nothing wrong with that.

My point is just that if you don't have this person... don't hesitate for a second. Just go forward and get employees or go without them.

If it means you don't get YC funding because of PG's bias, then you didn't want it anyway.

Just don't hesitate to start a company without a cofounder... most successful businesses are founded by individuals.

Well, I think it depends on what those 2-3 bad moves are... I don't think its that tenuous-- when you're self funded. ( When you take outside investment, at least in the US, its a situation where you take a lot more risk...)

I'm glad you and your co-founder have a good relationship. Nothing wrong with that at all!

Right... somewhere "get a cofounder" became a blocking requirement for starting a company, and that's a mistake. Go forward, and make it happen, and don't worry if you don't have a cofounder.

Apologies if we're stating to go in circles...

1. Not if you take them into your confidence and make them know that you value their opinion. Who doesn't want the CEO's ear? Its really all about the attitude you show them (and their personality, which is something you can select for.)

2. I think that you should hire with the same criteria and standards that you find a co-founder, and you should reward people based on their contributions. I've watched co-founders work themselves inot a cushy CTO role where all they did was go to conference and pontificate via long (never read) memos to the rest of the company, while another cofounder- the VP of engineering- did all the heavy lifting.

3. Maybe- if your cofounder is someone you knew before founding the company, then I think this is true and it could be a critical factor in the quality of that particular compnay. Like I said, if you already have a founder, or you already have someone you know who is perfect (they aren't but that you think so means they are close enough) then great- be co-founders.

But the general word is- don't start a company without finding a co-founder first, and that's not right.

I have worked on teams where the "boss" and the people on the team had a very healthy working friendship. This included lots of outside of work activities, generally because we were to a large extent a family. But this isn't necessarily easy, and like you say if you have a cofounder who can provide that, then it would be foolish not to start a company with them.

"the single biggest determent of a startups success is product/market fit, not team"

I believe this must be true because I can't count the number of times when I've heard investors say "it doesn't matter about the product, we invest in the team." (I'm not being sarcastic, its only dumb money out there.)

I think its kinda arrogant to say that founders are superior and thus its disparaging to call someone an employee.

Employees should be highly valued.

Inadvertantly you've highlighted another problem with having cofounders, especially in a startup- you have an intrinsic clique of inner circle people, the founders.

Actually, the converse is true- most successful companies in the US are founded and lead by a single individual.

There is an underlying reason that those companies that failed failed- no two people are alike. When you take two people and give them equal say, you are sowing the seeds of conflict which will-- and this is a guarantee- end up resulting in someone leaving or the company failing.

Right, and that mutual support can come, in large part, from other employees. One company I worked at, due to the personality mix, was kinda rough, and we were in a tough time funding wize and market wise-- but the office manager, and older german woman with a strong will, took it upon herself to fix things and thru random help, negotiation and general positive attitude really made things a lot better- she was a one woman support organization for a 12 person startup.

Finding great people to be employees is very important, and I'd say more important than finding a co-founder. In a way your co-founder has to embody everything... but each employee can contribute a part to the whole.

IF you treat an employee with respect and take him seriously and explain why you are doing Y instead of X, that employee will tell you again when he has other ideas.

You can have as close a relationship with an employee as you do with a founder.

I think the problem is that people get stuck on labels here-- the idea that only cofounders can have an opinion or will have their opinions listened to is probably pretty accurate in reality, but it doesn't have to be that way.

In fact, one of the most valuable and rarest commodities in a high tech startup is humility. Always hire for humility along with confidence- they aren't contradictions!- and show it yourself.

I think that employees are generally pretty good about letting people know when they are doing the wrong thing... even if they think you're not listening. You don't have to listen very close to tell which way the wind is blowing.

The problem is that too many people are too arrogant to take the direction of the wind seriously, and this can actually be worse with co-founders because their grousing can drown out the employees.

Hey there- That's what happens when you have creative collaboration with someone.

Every employee you hire should be sharp enough to be able to do so, and the good ones will be bringing ideas to you unbiden.

If you've got a co-founder, great. Nothing wrong with that... its just that the idea that you need one is in error, and if you ever have to present to someone who thinks that way, your first couple of employees you can call the "Founding team" or "cofounders" or whatever you want.

Its just that in order for the company to function- you need a vision and a direction.

Startups too often find themselves going in circles wasting time because everyone's second-guessing everyone else... and this is more likely to happen when you have cofounders trying to reach consensus rather than a founding team with a clear leader