[michaelochurch]

I'd take Rich. I hate that I would, but I would.

I'd make that call not so I can quit working full-time. I'm only 29. I'd take it so I can start working full-time. So I can guarantee that I focus on real work for the rest of my active life. Liberate the cognitive 1% from subordination, and creation (real work) happens. (Humility is not a virtue in people like me. If we don't raise up our confidence to overwhelm Authority's much more toxic arrogance, with the intent of the latter's decisive and irreversible demolition, the world loses.) It'd be selfish for me not to take Rich, with that option. Then I could go off and be as King as I want.

That said, I think this selfish mentality (Rich > King) is, on the whole, really bad for startups. Rational people will close out lifestyle businesses (and walk away, wealthy) because they aren't likely to get another one if a competitor takes theirs down. That's a shame. The build-to-flip mentality has created a VC-istan ecosystem no longer worth caring about.

In VC-istan, we have an array of dumb ideas and shitty cultures, and no one cares for shit about the future. We have a lot of well-connected VC-funded Founders who are just glorified PMs with the mentalities of dinosaur executives that "startups" were supposed to kill off.

We need to bring back the lifestyle business and make it a viable lifestyle and career (even if individual business shall fail, which is inevitable). A Fleet of 50,000+ small companies doing interesting things and working toward Real Technology. We won't get there as things are now. There needs to be a reliable path for technical minds to find safety and capital. Given that there's no real source of capital for small, lifestyle businesses-- at least, not yet-- it doesn't exist yet. But the world fucking needs it.

[ChuckMcM]

Two comments, one actual and one meta :-)

So your statement is that you'd take 'rich' so that you could work on 'king.' (trust me working full time on "real work" has King written all over it). Tom Lyon (emp #7 at Sun) told me early on in my years there that you really needed 3 startups, one paid for by VC's that taught you about what startups were all about. Then you need one that you founded but was VC funded that let you exit with enough money so that you could fund #3 without any outside investment and run it the way you wanted to run it. Sort of the three step plan to becoming a "king." Of course that middle one needs a "successful" (aka lucrative) exit :-)

The meta-comment is on the term you've coined "VC-istan" which seems to characterizes VC funded companies as a dysfunctional collection of feudal enterprises in the way that the various former provinces of the USSR were in many ways dysfunctional feudal states (and now nation states). I bugs me. I cannot help but read it as a put down on both groups and like other generalizations I find that by grating on my sensibilities it makes it more difficult for me to see the points you are trying to make (which are generally reasonable, well argued points). I can fully accept that I'm the only person who gets that vibe from the term but I don't really have any way to test that (except by calling it out :-)

[_dps]

FWIW Chuck, I agree that the phrase "VC-istan" rubs me the wrong way in Michael's otherwise quite interesting and compelling writing. For me there are two reasons, one bad and one not-terrible (note I don't have any "strong" reasons... as Chuck says this is merely something that irks me):

1) The bad reason: while I'm a startup founder who has deliberately eschewed VC money for many reasons that overlap Michael's analysis, I have many friends who thought VC was the right choice for them. These people are not stupid, dinosaurs, corrupt, or anything else that warrants a pejorative. They made a rational cost-benefit decision that they believed to be best for them. It irks me to have a significant group of people whom I respect categorized in this "feudal" taxonomy, as you put it.

2) The not-terrible reason: if you follow Michael's writing you find that he has had one or more bad experiences with startups in the past, and he has never mentioned a good one. If you are someone who believes that good startups do exist, then it is very easy for your monkey-brain to short-circuit to "sour grapes" whenever he discusses the VC ecosystem, even though I mostly don't believe that to be the case. I think it detracts from the strength of his writing to give lazy readers an easily-avoided prompt that might lead them to inaccurate conclusions. If one merely wants a shorthand for "the VC-ecosystem", I think VC-land conveys the same grouping of concepts without provoking a potentially suspicious reaction. I know that I have a very minor ego vs id battle every time I read "VC-istan" in his essays, and I suspected others did as well.

[michaelochurch]

My dislike for "VC-istan" isn't uniform. There are good VCs and good VC-funded companies out there. And as you said, pragmatic concerns (cost/benefit) are more important than hollow principled stands that make no sense in the context of individual variation. If you can get a decent VC and it makes sense for your business then, by all means, work with him.

If you are someone who believes that good startups do exist, then it is very easy for your monkey-brain to short-circuit to "sour grapes" whenever he discusses the VC ecosystem, even though I mostly don't believe that to be the case.

I'm a hard-core cynic about the VC scene and even I will agree that plenty of good startups exist. :)

[hkarthik]

From a timeline perspective, let's see how the rule of 3 startups would work out to become King.

Ages 22-25: Fresh out of college, work for a startup as an employee and learn the ropes, build connections, and level up with the right skills.

Ages 25-30: Strike out on your own with Startup #1. Work at it for 5 years (because the VCs totally own you) and then bail.

Age 30-33: Start another startup with VC funds, but negotiate better terms. Work at it for 3 years to get the 7 figure exit.

Age 33+: A full 13 years after you began your career, you're finally ready to bootstrap a business with no VC at all. Maybe now you can actually slow down enough to get married, have a family, and put down some roots. Well hmm, now with all those responsibilities on the line, it seems foolhardy to risk your own cash from the previous ventures when VCs are willing to give you money again...

[ChuckMcM]

There is another path, marry an engineer and delay starting your family for a few years. It worked out pretty well for me. While she was working we always tried to balance risk between the two jobs so that either one of us having our job go poof would still have enough runway to recover.

I certainly agree doing it all yourself is going to be a challenge.

[michaelochurch]

What's sad is that, as bad and wasteful as that trajectory sounds, it's the 99.9th percentile outcome.

[michaelochurch]

I've actually used "istan" for things I like also, e.g. I might use "high-IQ-istan" for the collection of intelligent people. It's just that a negative one (VC-istan) stuck. I make up lots of words and only a tiny percentage catch on.

There's nothing pejorative about "-istan". It's (probably) a cognate of "stone" and means "homeland" in Farsi. Nothing pejorative.

I agree that it's probably distracting or confusing and I know some people don't like it, but I can't come up with anything better. "VC-sphere" sounds more ethereal (so it might include the blogs and stray comments), "VC-land" sounds more concrete (like it might pertain to the land, e.g. Silicon Valley, in particular).

Your point about the 3 startups makes a lot of sense. I've heard the same about records. The first makes the name (because new artists can't get decent terms), the second makes the money, and the third is for creative vision.

The issue with companies is that so many more people are involved. I'd want to be in someone's 2nd if optimizing for money and 3rd if optimizing for interesting work.

[writer]

The current VC model, throw money at the wall and see what sticks, has worked pretty well.

Yes, funding dumb ideas is a side effect. So what? If the returns are sweeter than funding more conservative, organic growth oriented businesses, then that's where the money is going to go.

Access to capital is not a natural right. If you need investment for your 'lifestyle business', it's your burden to demonstrate that you can outperform the status quo.

'Finding safety' isn't really complementary to striking out on your own.

I propose that your rage might be better directed at the current state of academia instead of the VC ecosystem. That seems more in line with your goal of promoting long term innovative thought.

Yes, in academia you won't necessarily own the rights to your inventions, nor see most of the economic benefit. But it's never been easy to have it all...