Comments on: Guide to Evaluating Startup Ideas

By: Darryl

Darryl — Wed, 30 Jun 2010 20:10:32 +0000

Point number 3 is indeed very interesting. Is anyone aware of any benchmarks for cost-of-acquisition for financial products?

By: webwright

webwright — Fri, 11 Jun 2010 11:01:59 +0000

I've always been a fan of Pmarca's masterful startup post: "The only thing
that matters". He contends that the only thing is "the market". I tend to
agree. I've seen a LOT of mediocre teams see great success and a lot of
great teams fall flat. Here's the post:

*http://pmarchive.com/guide_to_startups_part4*

By: StartupDojang

StartupDojang — Fri, 11 Jun 2010 09:05:23 +0000

This is an interesting post. So if I were to choose a startup to join, I would put on my venture capitalist hat. Most VCs will tell you they do not invest in ideas, but rather the startup team. Sequoia invested in GOOGLE when there were already hundreds of search engines available, some of which had significant market share. At the time, GOOGLE could have easily been seen as a terrible idea. However, as we know now, GOOGLE revolutionized web search. Sequoia invested in Larry and Sergey as opposed to the idea. That is not to say the idea has no merit, but the team is highly weighted when compared to the idea.

www.startupdojang.com

By: webwright

webwright — Sat, 05 Jun 2010 06:09:27 +0000

Yeah, don't get me wrong, I think Redbox is killing it. They have a great
short-term value prop and their growth is impressive! But if I was going to
dedicate my life to a startup and had a potential co-founder who was jazzed
about creating a RedBox competitor, I'd be leery. I think RedBox is on the
same train that Blockbuster is on, which is going over a cliff. Their
train-car is just farther back in line. Of course, who knows about timing?
RedBox might have 10-15 years of legs for all I know.

Markets are hard to guess about though. Everyone with a brain thought
search engines were a non-opportunity when Google came around. When the
first iPod hit the market, was anyone thinking that MP3 players was a market
waiting for someone to come in and clean up?

By: webwright

webwright — Sat, 05 Jun 2010 00:18:14 +0000

That's a fair point (regarding consumer/hockey stick). This is a startup
focused... My personal definition of "startup" is a "newish company that's
aiming for rapid growth and equity upside". Lots of people have different
definitions of a startup, which is fine. If your definition is radically
different, then take this post with a grain o' salt.

My examples are often consumerish (heck, I'm a consumer!), but I think these
generalize to b2b businesses as well. Solving a "hair on fire" business
problem is probably quite a bit more powerful than just about any consumer
play.

By: webwright

webwright — Fri, 04 Jun 2010 05:37:10 +0000

I *almost *wrote a bit about people, but was trying to stick with evaluating
IDEAS... But your point is dead on-- people are damn important. Not only
for the success of the business, but for just enjoying how you spend your
day. I tend to be a bit contrarian on people-importance however -- I tend
to think the market is the most important thing by a wide margin. I'd take
a C level team working in a grade A market over the inverse any day (you can
always fix a team-- fixing a market is harder). Of course, I'm just being a
parrot here... See: http://pmarchive.com/guide_to_startups_part4

By: Willis F Jackson III

Willis F Jackson III — Wed, 02 Jun 2010 02:52:47 +0000

Nice post. I think you are wrong about RedBox though. In the long term, they are on the wrong side of the market. In the short term, they are cannibalizing staffed store sales (think Blockbuster) pretty hard by resegmenting the market.

By: Willis F Jackson III

Willis F Jackson III — Tue, 01 Jun 2010 19:52:47 +0000

By: Vikas Shukla

Vikas Shukla — Sat, 29 May 2010 09:59:00 +0000

I originally stared the Finance and Stocks forum at http://diggsamachar.com/adrforum to discuss the stocks and ADRs ( American Depository Receipts) – primarily because I had good interest in the stocks and also to enable interaction and discussion about the stock market.

It went very well. People posted relevant and good messages. To award some of them I enabled the signature which allowed people to put links to their blogs or website. But this led to the decrease in the quality of the people. How can I ensure that the quality of the messages do not go down when I enable signature ?

By: webwright

webwright — Fri, 28 May 2010 15:41:59 +0000

Hi Arthur! Thanks for commenting!

I like #4 as a different animal. Insanely useful (or addicting– like Twitter or World of WarCraft) is always my #1. But you can imagine a product that was insanely useful, but ONLY for left-handed dentists. Or mothers with twins. A lot of insanely useful products have small markets that are hard to break out of. Some small markets can expand (like Craigslist did out of SF or like Amazon did away from books).

But the #1 and #4 are definitely kissing cousins. Given that it's a big world you can always expand like Amazon did, I think #4 really is only a big consideration if you want to have a HUGE “change the world” impact. Maybe you only need 1000 true fans?

See: http://www.kk.org/thetechnium/archives/2008/03/…