[aaron-lebo]

Do startups really cost as much as we act like they do? I mean, yeah, if you've got 10, or 30 or however many engineers, it's gonna be expensive, but there are a lot of projects that can be bootstrapped and really don't take many people. Instagram can be built by a single person working nights. You probably aren't going to get a unicorn out of that, and you'll obviously have to scale up, but it's cheaper than it has ever been. Tech is almost free these days.

The disconnect between how cheap/easy new tech is these days and how few interesting experiments we've seen in the last decade, especially in the web space, suggests that it's something other than the money. We're just not really building things because VCs and startup mantras have convinced us we need a million dollars to do anything and it's just not he case.

Do bootstrappers have an advantage in an environment like this? They've always had to tighten their belts, so they should have some advantage relative to these bigger ventures that have bills/investments to pay for.

To respond more directly to you, your conjecture should be pretty easy to test, look at metrics like the stock market plotted against when successful companies are founded. The data are there.

To provide an example, I'm bootstrapping. I haven't made more than 40k a year last decade, got student loans, about to get out of school, don't have a job, got limited funds to fall back on. This economic crunch isn't any worse for me than the past 10 years, so if the idea is it can't be done, thus far I'm doing it. Odds are I won't succeed, but it's doable. If I was making 100k and had connections, it may be easier, but I also wouldn't have the time available. Cheap machines, free OSes, and a decade of HN and other free resources don't cost much. Everyone's sitting at home, anyway. Not much better to do, not much to lose.

[tpxl]

Startups don't cost anything, unless you make them so. Chasing scale for the sake of scale is stupid. If you're actually selling something that's not fluff you get a couple of customers, improve your product then roll out when you need to.

I'm running a startup right now. The first year cost 0 for me and my partner (besides gas). All the engineering work was done on my gaming PC and the feedback from potential clients was gathered by my partner.

After we got something going, it cost us about 2k for servers (256GB RAM, 50TB storage, 32 CPU cores total) and around 4-5k for graphical product and website design in the next year.

If we're lucky, we're getting a contract this year netting us about 100k/yearly revenue, which will cover all costs + good wages (we were on no/minimal for two years) + another engineer (bus factor of 1 is not fun).

Disclaimer: What I wrote applies to software B2B startups, hardware startups almost necessarily cost a lot, B2C may be harder, but still not that hard if you're not selling fluff.

[bennyelv]

The biggest cost is your time. You've valued it at 0...

If the startup idea requires someone (or more than one person) to work on it full time in order to succeed then that's not a valuation that is practical.

[jimmySixDOF]

It's better to say: The biggest investment is your time.

Sweat = Equity

[jlbnjmn]

Sweat * leverage = equity.

Time used wisely is an investment, but time used poorly is an expense.

Being able to tell the difference is key.

[bennyelv]

That’s only a practical way to think about it if you have enough other income to cover your expenditure. Equity doesn’t pay your rent.

[qppo]

How did you pay your rent if you didn't give yourself a salary?

[icedchai]

I know it's mostly unheard of in America, but some people have a thing called "savings." Others are even further ahead and have "investments."

[tpxl]

I had a full time job on the side, plus I lived with my parents.

[blaser-waffle]

> plus I lived with my parents.

So you were paying for it, just in a different way.

[Retric]

Bootstrapping misses out on scale. Search engines need a massive index to get going. Uber is a less appealing product with fewer drivers covering a smaller area. The same is true for any websites which scale based on users or content creators etc.

It’s possible for bootstrapping to scale just as far, but it opens the door for competition to outgrow you very quickly.

[aaron-lebo]

Reddit faked users and content at the beginning, as the founders have stated. If you were building Reddit today, it's something that directly benefits from network effects, as does any social app or site. Search engines are difficult, but DuckDuckGo isn't a massive operation, and it doesn't take a ton of manpower to spider the web, nor was machine learning even really an option 10 years ago (not as easy as it is today). Sure, Uber is less appealing, but it's a very physical product. There are some businesses that require capital and scale, but to get a basic minimum viable app up is not something that takes a large crew.

You've got to make something that enables you to make a living, and then you scale up. If you have the option to get funding first and then build, yeah, it's probably a better way to do it because you'll be able to build in a lot more comfort and you'll be able to do more, but that's the whole point of bootstrapping, you bootstrap, then you grow.

It's that I can think of probably half a dozen pretty sizeable websites in sizeable markets that have had next to no competition for years, and they're not exactly technical marvels nor in some cases user friendly. Why have we not seen competition as the price of tech dropped and dropped and dropped over the last two decades? The things you can do on a cheap, cheap droplet are pretty wild.

The very notion that in an industry where you can literally build things anywhere that the expected approach is that you move to the most expensive locale in the US says that we've really taken a very narrow and kind of unimaginative approach. We're supposed to be an industry all about innovation. Where is it?

[sansnomme]

DDG piggybacks off Bing.

[hef19898]

All true for companies aiming, or forced to aim, for unicorn status. A bootstrapped Uber can be a viable, profitable local business, so.

There are so many business models out there that don't require blitzscaling to succeed. I would be worried if my access to VC money to outgrow any competition would be my only competitive advantage I have.

[PeterisP]

A bootstrapped Uber-like company can't survive the entry of a funded Uber-like company in that local market, as their expected initial promotional campaign and discounts will have you running at a loss for months which you can't afford unless you have substantial cash reserves.

This particular example (prolonged "dumping" of services far below cost in the business of taxi-like-services) is what we've seen in practice a bunch of times in many cities as there have been multiple 'waves' of richly funded new entrants trying to come in.

[hef19898]

Taxi services are doing just fine, even if the are pressured by Uber. So there is that.

[Retric]

Taxi are allowed to pick people up who hail them on the street or at a subway stop etc. That’s a huge protected revenue source.

[darepublic]

Also some ideas depend on network effects more than others. Make something that is useful even if nobody else is using it and you protect yourself from this

[hef19898]

I agree, being bootstrapped, and lean, is one huge advantage right now. And being able to live from your own company, without any investors, is more than a lot of unicorns achieved so far.

[aaron-lebo]

Yond Cassius has a lean and hungry look, He thinks too much; such men are dangerous.

[hef19898]

I like that citation, where is it from?

[aaron-lebo]

Bill Shakespeare's Julius Caesar

https://www.enotes.com/shakespeare-quotes/yond-cassius-has-l...

[hef19898]

Thanks!

[mattacular]

> Instagram can be built by a single person working nights

Oh

[aaron-lebo]

You don't think so? What's Instagram doing tech wise which is so complicated? Yeah, at scale, they're doing a lot of stuff you can't do as a single person show, but the core website, the core app? I've been on small teams that have built stuff just as complicated. They're displaying photos within a web site with basic functionality like likes and comments. It's not complicated stuff.

https://github.com/pixelfed/pixelfed

https://www.patreon.com/dansup/overview

What about Pixelfed? That's a single person looking for a thousand dollars a month for part-time wages. You can mock all you want, but check your biases at the door.

[yowlingcat]

You're not really addressing GP's point, IMO. The tech isn't really the hard part about Instagram. The market penetration and now monetization is. No one is going to use pixelfed over Instagram because the whole point of using Instagram is for the network effects (clout). If people move/continue to move off Instagram, it will be for something that more effectively connects them to fame and reach, like TikTok.

No, it's not complicated stuff to build something like TikTok and Instagram. But it is complicated to do all the other important parts besides building it, which are just as important if not much more so. To get people to use it, and to incrementally improve it 0.1% more week over week -- that's the part that you need a full company to do, and that's the thing that a lone founder will struggle to do.

[aaron-lebo]

This is undoubtedly true. My point is, if you don't build, you can't do any of what you are laying out. My point isn't that you should recreate Instagram, but that these kind of apps and apps like it are not difficult. Virality is worth more than you think, and figuring out how to make 80k a year is much easier than trying to make a unicorn.

It took Twitter 10 years to increase the message size. It's not hard to incrementally do that as a single founder, you can probably make changes like it in a single night, and you can probably do that with a lot more ease than if yo've got a team and expectations.

[yowlingcat]

I'll take the counterparty to your claim. My counterpoint is that you don't need to build to do any of what I'm laying out. You can validate the market for what you're trying to do with content, lead generation forms and spreadsheets. My point is that it _doesn't matter what_ you build if you don't perceive the right customer need and react to it appropriately. At least for me, it's very easy to focus more on building something (because it's fun) than it is to go back to the drawing board if an idea isn't good enough (because that's psychologically exhausting).

[silveroriole]

Am I reading this wrong, or do you think that Twitter had a short message length because of... technical constraints?

[aaron-lebo]

You're reading it wrong. I'm saying that iterating on a nightly basis isn't difficult.

[yowlingcat]

What does your company do, and why should anyone listen to you? I mean this genuinely. For all we know, you could be running a nearly defunct startup, giving advice that folks shouldn't take. Or, it could be the opposite. Anyways, as I allude to in a sibling comment, cost optimization is the wrong thing to look at when it comes to running a startup. The best way to cost optimize a startup is...to shut it down. If startups are by default hemorrhaging money either quickly or slowly, how do you make them justify the investment with an ROI?

Bootstrapping doesn't intrinsically have anything to do with this kind of strategy. If your idea doesn't have product-market fit, bootstrapping will just make its failure slower and less painful to the founder (assuming the founder continues being able to make money through independent income streams). But it also risks stretching out an idea that would have otherwise failed fast (maybe into a more productive pivot) into a zombie.

With all that said, I think that, for reasons DHH has elucidated and demonstrated far better than I, bootstrapping remains the better way to build businesses for the vast majority of people in the world. But even with that said, it doesn't take out the low success rate of starting a product driven company. Product building is capital-H Hard.

[aaron-lebo]

I'm a nobody and I don't have any work that I'm ready to show you.

You shouldn't take my advice, I very well may not know what I'm talking about. I'm just laying down some beliefs I've got that I plan on testing out. You can't know if you've got a market fit unless you try. That's all I'm advocating.

People give advice on everything here every day, a lot of them won't tell you that they very well could be wrong, but I'm very aware I may be.

[anon9anon9anon]

Yeah but the counterpoint to your position is making $40k a year is some peoples busting their ass, peak of career earning, wage.

Not everyone with technical skills to make something lives in the USA and pulls the high wage (yes $40k is a very very high wage) that you have.

If you have not broken $15k a year for the last decade, and had spent that decade busting your ass, working nights, weekends, etc and had managed to pull yourself into the, by comparison, fabulously paid world of $35k (myself but not USA based) would you now be considering working nights?

Another decade of not having a life, working 10-14 hours a day, for ???

maybe you might make something someone will use?

I don't understand this.

I would expect petty crime to have a better risk/reward profile than this.

What you describe is complete and utter insanity.

[aaron-lebo]

Yeah, I probably would, because I've worked as hard as anyone for the last 15 years. I'm underpaid. 40k isn't poverty around here, but it's not a lot of money. I just don't need or want much else other than freedom, I enjoy learning and building, and if I build anything, I want to build it in my home, not somewhere else. I think you can appreciate that.

Doing what you love where you live is not insanity, it's what the vast majority of people want.