In the startup world right now, there's a lot of evidence of a bubble in privately funded companies, but less of one in the public markets. But there are two differences between now and the.com bubble. Specifically:
- most companies have real cash flows this time - investors are smarter
As valuations have gone up, investors have started transferring risk back to the founders and employees with things like liquidation preferences. What that means is that if you take funding at some ridiculous valuation, you'll need to exit at an even higher valuation to actually make money as a founder or employee. But there doesn't seem to be the same appetite for these high valuations in the public markets right now.
The upshot is this: take more cash than options right now. There's a good chance your options will be worthless at this point. If you want equity, ask for actual shares instead.
As for worst cases, you'll likely see weaker companies fail and stronger companies reduce headcount to better manage costs.
Sierra Nevada: building what nasa did 30 years ago, this is designed for cargo and people. it is strictly suborbital. https://en.wikipedia.org/wiki/...
30 years ago NASA was building space shuttles. If Sierra Nevada were doing that, I would be impressed.
I remember reading this back in the day, but this article has not aged well. Joel is a smart guy, but this advice is frankly ludicrous.
In Joel's world, Apple would have never scrapped Mac OS Classic and launched OS X. And Microsoft would have never scrapped the old DOS underpinnings and started over with the NT kernel.
Starting over happens all the time in software projects, and I'll admit that in many cases it's a waste of time. But quite often, it's an excellent idea. The world changes, and despite what Joel thinks, software really does age.
In the case of Netscape, I would say that their rewrite worked out pretty well. Mozilla was a big jump forward in browser technology, and then Firefox (which itself was a rewrite of Mozilla) has become a truly successful browser.
I've been telling people that Drupal 7 is coming real soon now for two years! We've developed and redeveloped entire sites, all the while hearing from our developers that Drupal 7 was coming out and that we would need to think about our upgrade path.
As far as I can tell it's vaporware. Release it already.
What you're really saying is that "if only the chip had been a little more expensive to produce things might have been different." Adding a few little tweaks to devices was a heck of a lot more expensive in the 80s than it is today. The reality is that had Intel done what you asked, the x86 might not have succeeded this long at all.
Ok, well no we're nitpicking over the nature of "disruptive" technology. I would say that disruptive technology is very rare. Disruptive technology changes the way people do things and is widely adopted. That change tends to "disrupt" existing technology.
For example, digital cameras were disruptive to film companies. They changed photography, were quickly adopted, and forever altered the film business. Digital photography was a big systematic shift that moved rapidly -- far faster than did film when it was introduced.
Aftermarket car parts are not disruptive. The first person to make them was innovative and discovered a new market, but no existing companies were run out of business because of them. Flashy spoilers and wheel rims were not rapidly adopted by a wide number of people, rather they continue to be purchased by a small and select market. These parts were an incremental improvement over the value of a standard automobile.
Not every entrepreneur wants or needs VC money. It's entirely possible to find funding for businesses without going to a VC. It's entirely possible to create successful companies with personal equity financing (investing your own money) and debt financing (getting a loan). People do this all the time, and they make great products - some disruptive and some incremental - that make good money.
Going to a VC for capital probably requires a technology with enough growth potential to warrant the associated risk, but not every idea or product requires a VC. A good entrepreneur when and where to find financing.
By the way, there are companies that profitably offer incremental improvements to products from established companies. Take aftermarket car parts for example. You can buy all kinds of stuff to trick out your Honda Civic, but none of the companies involved have anything to do with Honda. These aren't disruptive products, but they're definitely profitable for whoever makes them.
I'm going to make a comment that is way out there for Slashdot, but I honestly and completely think this is true:
The difference between an "evil" barrier to entry and a "good" barrier to entry is marketing.
Take Google. They have a huge database of webpage information that they've spent millions of dollars gathering. Anyone who wanted to enter the search engine market would have to find an enormous amount of capital and gather those same webpages. Should Google share their internal webpage databases to anyone who asks? Should they be open and let their information be free?
Nonsense! Google has a huge barrier to entry and that's why they practically own the search engine market right now. Google has marketed this barrier well and thus nobody notices or cares that Google has thrived on the backs of an Internet that mostly belongs to other people. They provide a service and they provide it well.
Take Apple. They deploy a DRM system in iTunes and a bazillion people own iPods these days. Nodoby cares that their music is or isn't free. People use their iPods and buy music from iTunes because the whole system is easy to use (a feature people want) and available at the right price (another feature people want). Why are these things so prominent so as to disguise the underlying DRM? Marketing.
The usual Slashdot response to this is that marketing is evil. But I propose that this argument, true or not, is pointless. The majority of people simply don't care. People love their iPods and people love Google.
Isn't this coming from the director of the laboratory whose only successful prodcut is a glowing green ball that changes colors with the stock market?
Seriously, what kind of disruptive innovation has ever come from the MIT Media Lab? Companies have put money in there for years and gotten nothing in return.
By the way, looking for disruptive vs. incremental technology changes is complete and utter nonsense. Entrepreneurs look for where they can make money. There's plenty of money to be made in all kinds of places in our economy, ranging from mom and pop restaurants all the way up to the latest and greatest gizmo. Game changing technology might be interesting or it might not. The road is littered with companies who changed the game and then were crushed by other players.
Money is made with smart market analysis that asks what do people want and how much are they willing to pay. Throw in a way to keep competitors out, and you have the beginnings (but not everything) of a good startup whether you make new fangled ball bearings or web pages. MIT Media Lab not required.
A common mistake in financial planning is to just add and subtract money together over time to decide whether or not something is profitable. Profit = Revenue - Costs, so this makes sense to mose people. Let's assume that Universal gets 55% of rental dollars (like ticket sales) and that they get $10 per DVD (wild guess).
($38 million in ticket sales*(55%) + $9 million in rentals*(55%) + ($10 per DVD * 2 million DVDs)) - $49 million production costs = $-3.15 million.
Surely the movie is close to being profitable, right? Well, not exactly. You also have to consider Universal's cost of capital, which is essentially the opportunity cost of making a risky investment. In layman's terms, Universal could have put their money elsewhere instead. Roughly (and with lots of guessing), let's say that the cost of capital was 15% (market average is 10.4% and movies are far riskier investments than the market).
Assuming the capital investments followed a pattern where the movie's costs came in year 0, the advertising in year 1, the ticket sales in year 2, and the DVD rentals in year 3, then the Net Present Value of this investment would now be:
You really need to stop thinking that the technical implementation is the magic that makes it all work and that you possess the keys to the kingdom by having more than passing knowledge of the technology. There's just a lot more to running a business than that.
Who said that the next implementation of Meetup would be run as a business? This is Slashdot, the biggest open source news site lacking a business plan there is. Most people reading this page would do something like this because it's cool or because they want to make a mark on the open source world. It's been my experience that most geeks don't even consider a business plan before bravely going off and doing something crazy. Many of them make loads of cash regardless.
Don't get me wrong. I would have a business plan before I did anything goofy like this, but I'm not your average DIY geek with too much free time on my hands. Meetup is facing competition from all of those people who leap before looking. There are lots of them.
See, here's the problem: what Meetup did is really not that far beyond a good PHP programmer who knows a thing or two about MySQL. It's cool, but we're not talking about something like Salesforce.com or Turbo Tax Online. This is a simple web app.
And here's the thing, someone is going to recreate Meetup. Their new page will have less brand recognition, and people will probably pay $19 for the Meetup name for a little while. However, this will not last forever. Meetup isn't Microsoft -- they have no extended brand or monopoly power in the face of competition.
Prediction: Meetup.com will be appearing on the Dot-Com Deadpool shortly.
BTW, if I were running Meetup, I would have investigated a completely different approach. These little web apps that become big should think about extending their services for a fee. For example, something like customized invitations for $20 a box or a set of subscriber only options.
This is a dupe, but I'll put in my thoughts anyway:
Most of the television torrents I've seen have been free of advertisements. I know those ads are obnoxious, but they're the bread and butter of whatever network you (the show ripper) took that show from. The least you can do is leave them in the file and let the downloader decide what to do with them.
End of thought. Back to my regularly scheduled dupe righteous indignation.
Why don't you try turning the firewall on? It will block the RPC calls that are necessary to infect your machine with the most recent series of worms and allow you to install whatever patches are necessary worry free.
This attack vector has been known for years, and the TCP windowing nonsense has too. Programs like tcpkill have used the RST trick in conjunction with TCP INS windows for a while and have seen quite a bit of use. What's new with this attack that wasn't already in the wild?
Umm, sorry. The Creative Nomad Jukebox 3 has been able to record with high quality line-in for quite some time. In fact, the Nomad Jukebox has the added feature of being able to record straight to WAV files without being degraded by an MP3 encoder. The iRiver, and most other devices, seem to lack this feature. THIS feature is what audio snobs demand, and anything that would replace a DAT recorder is going to have to do at least 44kHz lossless recording.
However, the iRiver has a sweet form factor, and it looks like it has more intelligent features like the ability to act as an external hard drive, something the Nomad lacks.
They do this all the time. Mars Pathfinder represented an "ultimate test" of the imaging capabilities of global surveyor, and they have quite a few images to prove it. Have a look here to see a good example. Unfortunately, with a resolution of 1.5 meters per pixel, the rover would be far to small to be visible.
The requirements for being a licensed engineer in the state of Texas are pretty crazy. A guide can be found here. To summarize:
An engineering degree that meets some basic requirements
4-8 years of experience, depending on your degree
Detailed log of what you've done for these last 4-8 years
Experience under another licensed engineer
Five references, three of which must be other licensed engineers
Two exams
There is a serious problem here, notably that there are few licensed electrical engineers and no licensed software engineers. Since you need a licensed engineer to create a licensed engineer, few if any qualified people will ever be able to license themselves.
There are exceptions for people who have been in the field for something like 12 years, but you are still required to have a detailed log of everything you've ever done. Simply put, most people never get this far.
Personally, I would love to have my license to go along with my EE degree, but it's just not realistic to waste my time. I don't even know any licensed EEs, much less have a company willing to hire me and place me under another licensed EE to gain the required experience.
My suggestion for the state is this. The word "engineer" has become watered down in the past several years. As it stands today, licensed engineers are allowed to place "PE" after their name, as well as calling themselves "engineers." Thus, the state should probably allow "engineer" to be used in whatever context people want and only let licensed engineers use the "PE" designation.
Licensing is important and has its place in quite a few fields, so I also recommend that the state evaluate ways to open the door for more people to be licensed in the high-tech fields. Perhaps the restrictions should temporarily be made more lenient to "seed" the field with licensed engineers, thus allowing for easier licensing of new engineers in the future. Finally, I recommend that the legislature let the engineers figure this out, rather than figuring it out for them.
Slashdot Mirror
In the startup world right now, there's a lot of evidence of a bubble in privately funded companies, but less of one in the public markets. But there are two differences between now and the .com bubble. Specifically:
- most companies have real cash flows this time
- investors are smarter
As valuations have gone up, investors have started transferring risk back to the founders and employees with things like liquidation preferences. What that means is that if you take funding at some ridiculous valuation, you'll need to exit at an even higher valuation to actually make money as a founder or employee. But there doesn't seem to be the same appetite for these high valuations in the public markets right now.
The upshot is this: take more cash than options right now. There's a good chance your options will be worthless at this point. If you want equity, ask for actual shares instead.
As for worst cases, you'll likely see weaker companies fail and stronger companies reduce headcount to better manage costs.
Sierra Nevada: building what nasa did 30 years ago, this is designed for cargo and people. it is strictly suborbital. https://en.wikipedia.org/wiki/...
30 years ago NASA was building space shuttles. If Sierra Nevada were doing that, I would be impressed.
I remember reading this back in the day, but this article has not aged well. Joel is a smart guy, but this advice is frankly ludicrous.
In Joel's world, Apple would have never scrapped Mac OS Classic and launched OS X. And Microsoft would have never scrapped the old DOS underpinnings and started over with the NT kernel.
Starting over happens all the time in software projects, and I'll admit that in many cases it's a waste of time. But quite often, it's an excellent idea. The world changes, and despite what Joel thinks, software really does age.
In the case of Netscape, I would say that their rewrite worked out pretty well. Mozilla was a big jump forward in browser technology, and then Firefox (which itself was a rewrite of Mozilla) has become a truly successful browser.
The Awesomebar is a debacle? Wow. Gee. For me, it's the only thing that keeps me using Firefox. I love the Awesomebar.
I've been telling people that Drupal 7 is coming real soon now for two years! We've developed and redeveloped entire sites, all the while hearing from our developers that Drupal 7 was coming out and that we would need to think about our upgrade path.
As far as I can tell it's vaporware. Release it already.
What defines a "widespread pattern of errors?" In small elections or close elections, changing a small fraction of votes could affect the outcome.
This system assumes three things:
What you're really saying is that "if only the chip had been a little more expensive to produce things might have been different." Adding a few little tweaks to devices was a heck of a lot more expensive in the 80s than it is today. The reality is that had Intel done what you asked, the x86 might not have succeeded this long at all.
Ok, well no we're nitpicking over the nature of "disruptive" technology. I would say that disruptive technology is very rare. Disruptive technology changes the way people do things and is widely adopted. That change tends to "disrupt" existing technology.
For example, digital cameras were disruptive to film companies. They changed photography, were quickly adopted, and forever altered the film business. Digital photography was a big systematic shift that moved rapidly -- far faster than did film when it was introduced.
Aftermarket car parts are not disruptive. The first person to make them was innovative and discovered a new market, but no existing companies were run out of business because of them. Flashy spoilers and wheel rims were not rapidly adopted by a wide number of people, rather they continue to be purchased by a small and select market. These parts were an incremental improvement over the value of a standard automobile.
Not every entrepreneur wants or needs VC money. It's entirely possible to find funding for businesses without going to a VC. It's entirely possible to create successful companies with personal equity financing (investing your own money) and debt financing (getting a loan). People do this all the time, and they make great products - some disruptive and some incremental - that make good money.
Going to a VC for capital probably requires a technology with enough growth potential to warrant the associated risk, but not every idea or product requires a VC. A good entrepreneur when and where to find financing.
By the way, there are companies that profitably offer incremental improvements to products from established companies. Take aftermarket car parts for example. You can buy all kinds of stuff to trick out your Honda Civic, but none of the companies involved have anything to do with Honda. These aren't disruptive products, but they're definitely profitable for whoever makes them.
I'm going to make a comment that is way out there for Slashdot, but I honestly and completely think this is true:
The difference between an "evil" barrier to entry and a "good" barrier to entry is marketing.
Take Google. They have a huge database of webpage information that they've spent millions of dollars gathering. Anyone who wanted to enter the search engine market would have to find an enormous amount of capital and gather those same webpages. Should Google share their internal webpage databases to anyone who asks? Should they be open and let their information be free?
Nonsense! Google has a huge barrier to entry and that's why they practically own the search engine market right now. Google has marketed this barrier well and thus nobody notices or cares that Google has thrived on the backs of an Internet that mostly belongs to other people. They provide a service and they provide it well.
Take Apple. They deploy a DRM system in iTunes and a bazillion people own iPods these days. Nodoby cares that their music is or isn't free. People use their iPods and buy music from iTunes because the whole system is easy to use (a feature people want) and available at the right price (another feature people want). Why are these things so prominent so as to disguise the underlying DRM? Marketing.
The usual Slashdot response to this is that marketing is evil. But I propose that this argument, true or not, is pointless. The majority of people simply don't care. People love their iPods and people love Google.
Isn't this coming from the director of the laboratory whose only successful prodcut is a glowing green ball that changes colors with the stock market?
Seriously, what kind of disruptive innovation has ever come from the MIT Media Lab? Companies have put money in there for years and gotten nothing in return.
By the way, looking for disruptive vs. incremental technology changes is complete and utter nonsense. Entrepreneurs look for where they can make money. There's plenty of money to be made in all kinds of places in our economy, ranging from mom and pop restaurants all the way up to the latest and greatest gizmo. Game changing technology might be interesting or it might not. The road is littered with companies who changed the game and then were crushed by other players.
Money is made with smart market analysis that asks what do people want and how much are they willing to pay. Throw in a way to keep competitors out, and you have the beginnings (but not everything) of a good startup whether you make new fangled ball bearings or web pages. MIT Media Lab not required.
A common mistake in financial planning is to just add and subtract money together over time to decide whether or not something is profitable. Profit = Revenue - Costs, so this makes sense to mose people. Let's assume that Universal gets 55% of rental dollars (like ticket sales) and that they get $10 per DVD (wild guess).
($38 million in ticket sales*(55%) + $9 million in rentals*(55%) + ($10 per DVD * 2 million DVDs)) - $49 million production costs = $-3.15 million.
Surely the movie is close to being profitable, right? Well, not exactly. You also have to consider Universal's cost of capital, which is essentially the opportunity cost of making a risky investment. In layman's terms, Universal could have put their money elsewhere instead. Roughly (and with lots of guessing), let's say that the cost of capital was 15% (market average is 10.4% and movies are far riskier investments than the market).
Assuming the capital investments followed a pattern where the movie's costs came in year 0, the advertising in year 1, the ticket sales in year 2, and the DVD rentals in year 3, then the Net Present Value of this investment would now be:
(-39) + (-10)/(1.15) + ((25 + 13) * 0.55)/(1.15)^2 + (9 * 0.55)/(1.15)^3 + (10 * 2 million)/(1.15)^3 = -15.4 million
Based on some educated guess work, I think it's safe to say that Universal is still way in the hole on this one.
Bloggers badly blog bashing belief bloggers blog badly.
Wash, rinse, repeat.
You really need to stop thinking that the technical implementation is the magic that makes it all work and that you possess the keys to the kingdom by having more than passing knowledge of the technology. There's just a lot more to running a business than that.
Who said that the next implementation of Meetup would be run as a business? This is Slashdot, the biggest open source news site lacking a business plan there is. Most people reading this page would do something like this because it's cool or because they want to make a mark on the open source world. It's been my experience that most geeks don't even consider a business plan before bravely going off and doing something crazy. Many of them make loads of cash regardless.
Don't get me wrong. I would have a business plan before I did anything goofy like this, but I'm not your average DIY geek with too much free time on my hands. Meetup is facing competition from all of those people who leap before looking. There are lots of them.
See, here's the problem: what Meetup did is really not that far beyond a good PHP programmer who knows a thing or two about MySQL. It's cool, but we're not talking about something like Salesforce.com or Turbo Tax Online. This is a simple web app.
And here's the thing, someone is going to recreate Meetup. Their new page will have less brand recognition, and people will probably pay $19 for the Meetup name for a little while. However, this will not last forever. Meetup isn't Microsoft -- they have no extended brand or monopoly power in the face of competition.
Prediction: Meetup.com will be appearing on the Dot-Com Deadpool shortly.
BTW, if I were running Meetup, I would have investigated a completely different approach. These little web apps that become big should think about extending their services for a fee. For example, something like customized invitations for $20 a box or a set of subscriber only options.
This is a dupe, but I'll put in my thoughts anyway:
Most of the television torrents I've seen have been free of advertisements. I know those ads are obnoxious, but they're the bread and butter of whatever network you (the show ripper) took that show from. The least you can do is leave them in the file and let the downloader decide what to do with them.
End of thought. Back to my regularly scheduled dupe righteous indignation.
...all firewalls are turned off.
Why don't you try turning the firewall on? It will block the RPC calls that are necessary to infect your machine with the most recent series of worms and allow you to install whatever patches are necessary worry free.
Plus, it just makes your PC safer in general.
This attack vector has been known for years, and the TCP windowing nonsense has too. Programs like tcpkill have used the RST trick in conjunction with TCP INS windows for a while and have seen quite a bit of use. What's new with this attack that wasn't already in the wild?
Not true at all. People have been able to do this for years with tcpkill (another) and it does not require sniffing the ISN.
Umm, sorry. The Creative Nomad Jukebox 3 has been able to record with high quality line-in for quite some time. In fact, the Nomad Jukebox has the added feature of being able to record straight to WAV files without being degraded by an MP3 encoder. The iRiver, and most other devices, seem to lack this feature. THIS feature is what audio snobs demand, and anything that would replace a DAT recorder is going to have to do at least 44kHz lossless recording.
However, the iRiver has a sweet form factor, and it looks like it has more intelligent features like the ability to act as an external hard drive, something the Nomad lacks.
I just bought a new 15" Powerbook Aluminum, and it came installed with 10.2.7. I'm not sure how it differs from 10.2.6.
They do this all the time. Mars Pathfinder represented an "ultimate test" of the imaging capabilities of global surveyor, and they have quite a few images to prove it. Have a look here to see a good example. Unfortunately, with a resolution of 1.5 meters per pixel, the rover would be far to small to be visible.
It records and it has an FM remote control. It can even record from the FM remote control. Oh, and it's cheaper than the iPod.
- An engineering degree that meets some basic requirements
- 4-8 years of experience, depending on your degree
- Detailed log of what you've done for these last 4-8 years
- Experience under another licensed engineer
- Five references, three of which must be other licensed engineers
- Two exams
There is a serious problem here, notably that there are few licensed electrical engineers and no licensed software engineers. Since you need a licensed engineer to create a licensed engineer, few if any qualified people will ever be able to license themselves.There are exceptions for people who have been in the field for something like 12 years, but you are still required to have a detailed log of everything you've ever done. Simply put, most people never get this far.
Personally, I would love to have my license to go along with my EE degree, but it's just not realistic to waste my time. I don't even know any licensed EEs, much less have a company willing to hire me and place me under another licensed EE to gain the required experience.
My suggestion for the state is this. The word "engineer" has become watered down in the past several years. As it stands today, licensed engineers are allowed to place "PE" after their name, as well as calling themselves "engineers." Thus, the state should probably allow "engineer" to be used in whatever context people want and only let licensed engineers use the "PE" designation.
Licensing is important and has its place in quite a few fields, so I also recommend that the state evaluate ways to open the door for more people to be licensed in the high-tech fields. Perhaps the restrictions should temporarily be made more lenient to "seed" the field with licensed engineers, thus allowing for easier licensing of new engineers in the future. Finally, I recommend that the legislature let the engineers figure this out, rather than figuring it out for them.