Why Smart People Have Bad Ideas

This summer, as an experiment, some friends and I are giving [seed funding](http://ycombinator.com) to a bunch of new startups. It's an experiment because we're prepared to fund younger founders than most investors would. That's why we're doing it during the summer—so even college students can participate.

We know from Google and Yahoo that grad students can start successful startups. And we know from experience that some undergrads are as capable as most grad students. The accepted age for startup founders has been creeping downward. We're trying to find the lower bound.

The deadline has now passed, and we're sifting through 227 applications. We expected to divide them into two categories, promising and unpromising. But we soon saw we needed a third: promising people with unpromising ideas. \[[1](#f1n)\]

**The Artix Phase**

We should have expected this. It's very common for a group of founders to go through one lame idea before realizing that a startup has to make something people will pay for. In fact, we ourselves did.

Viaweb wasn't the first startup Robert Morris and I started. In January 1995, we and a couple friends started a company called Artix. The plan was to put art galleries on the Web. In retrospect, I wonder how we could have wasted our time on anything so stupid. Galleries are not especially [excited](http://www.knoedlergallery.com/) about being on the Web even now, ten years later. They don't want to have their stock visible to any random visitor, like an antique store. \[[2](#f2n)\]

Besides which, art dealers are the most technophobic people on earth. They didn't become art dealers after a difficult choice between that and a career in the hard sciences. Most of them had never seen the Web before we came to tell them why they should be on it. Some didn't even have computers. It doesn't do justice to the situation to describe it as a hard _sell_; we soon sank to building sites for free, and it was hard to convince galleries even to do that.

Gradually it dawned on us that instead of trying to make Web sites for people who didn't want them, we could make sites for people who did. In fact, software that would let people who wanted sites make their own. So we ditched Artix and started a new company, Viaweb, to make software for building online stores. That one succeeded.

We're in good company here. Microsoft was not the first company Paul Allen and Bill Gates started either. The first was called Traf-o-data. It does not seem to have done as well as Micro-soft.

In Robert's defense, he was skeptical about Artix. I dragged him into it. \[[3](#f3n)\] But there were moments when he was optimistic. And if we, who were 29 and 30 at the time, could get excited about such a thoroughly boneheaded idea, we should not be surprised that hackers aged 21 or 22 are pitching us ideas with little hope of making money.

**The Still Life Effect**

Why does this happen? Why do good hackers have bad business ideas?

Let's look at our case. One reason we had such a lame idea was that it was the first thing we thought of. I was in New York trying to be a starving artist at the time (the starving part is actually quite easy), so I was haunting galleries anyway. When I learned about the Web, it seemed natural to mix the two. Make Web sites for galleries—that's the ticket!

If you're going to spend years working on something, you'd think it might be wise to spend at least a couple days considering different ideas, instead of going with the first that comes into your head. You'd think. But people don't. In fact, this is a constant problem when you're painting still lifes. You plonk down a bunch of stuff on a table, and maybe spend five or ten minutes rearranging it to look interesting. But you're so impatient to get started painting that ten minutes of rearranging feels very long. So you start painting. Three days later, having spent twenty hours staring at it, you're kicking yourself for having set up such an awkward and boring composition, but by then it's too late.

Part of the problem is that big projects tend to grow out of small ones. You set up a still life to make a quick sketch when you have a spare hour, and days later you're still working on it. I once spent a month painting three versions of a still life I set up in about four minutes. At each point (a day, a week, a month) I thought I'd already put in so much time that it was too late to change.

So the biggest cause of bad ideas is the still life effect: you come up with a random