[drewcrawford]

I'm a little mystified by this idea, can you help me out?

When you filter "all startups" by "the sort of startups I am likely to start", that search query doesn't terminate at a factory in China, or negotiating to buy a hundred racks at Rackspace. It terminates with three software developers in the spare bedroom for a quarter, at which point ideally a continuous revenue stream has been generated that can fund the next project.

By analogy, the fact that most furniture purchased in America is mass-produced is not really relevant to a master woodworker, if demand for his work far exceeds supply. You can make the argument that he is "at odds with measurable features of the material world", but I believe a fairer characterization would be that his value system is just different than IKEA's, that they exist in different markets.

[patio11]

I wish you, the author, and everyone else happiness. I am really not trying to convince you of the moral righteousness of the VC value system, which I don't participate in directly. I'm just trying to explain accurately how it actually functions: anyone who says that VCs are aiming for acqu-hire exits is mistaken. Don't believe it, don't repeat it, don't make consequential decisions based on it: it will not end well!

[jacquesm]

VCs tend to like acquisitions like that a lot more than they do outright failures, especially if they get some or all of their investment back. Same player shoots again.

Think of them as the emergency landing instead of as an alternative exit and it may start to make more sense.

[tptacek]

I'm not sure what the kinds of startups you're likely to start has to do with the structure of funds at venture capital firms. VC's don't just have a history of screwing founders into turning down lifechanging money; they also adopt industrywide standard deal terms designed exactly to prevent things like acqui-hires, such as 1+Nx liquidation preferences.

[joshu]

i like steve blank's definition of startups: it's an organization in search of a business model.

thus if you get a revenue stream after a quarter, you are a "small business" and not a "startup"