skysight-inc/HackerNews huggingface dataset:
I was not implying that anyone was a simpleton. And I was not talking about the millions of sole proprietors out there that operate small businesses out of their homes for their neighbors. I was talking about the situation posed in the post, i.e. a Web site available to the whole world where personal information will be collected by users and shared with other users. In that case, I think it makes sense to get legal entity protection and protect your personal assets.

I also don't think at all that "any suits against a website are likely to be class action suits." Those are just the suits you hear about. Individuals can sue for almost anything and do. Most of these suits will likely be frivolous. But just to deal with them takes time and money. It adds much more stress if you are also personally named and liable because you don't have a corporate veil behind you. Any trial lawyer will tell you that even if you have a rock solid case, i.e. the case against you is completely frivolous, there is still a non-negligible probability you will lose.

And now that I reflect further, I still think the best advice is to at least become an LLC, even for all those small sole proprietors out there. It is just so quick and simple to set up. And if you have any kind of assets, e.g. a house, it just isn't worth the risk. One disgruntled customer with lots of time can cause you a lot of damage. And in the case where you have a really small business that just got started, you don't want to have the possibility for it to sink all your personal assets. If it really did cost thousands and took lots of time to set up, I think the balance would be different. But it just doesn't. You can do the whole thing in under an hour. Given that, I just don't see how it "is the best choice for their business." They spend more time and money on car, health, and home insurance. Why stop there?

I guess we'll just have to agree to disagree :)
This is a fine piece of flash/flex engineering -- congrats guys!
What if you know a good designer (css/html), but they have no programming experience? Would a partner that knows how to hack but currently lacks design skills be more effective?

I too have no design skills, but believe I can create at least a decent site if I tried. The hardest part is overcoming the fact that you probably can build a decent looking site if you tried.
Dot Bomb 2.0 is coming
Open is Not Better... Better is Better.
interesting concept, however i dislike the name "mynewcompany.com" and turns me away.
Hans Rosling's 2006 Talk at TED (Inspiring Video)
Completely agree. While keyframing may never make it into Mini-vid (maybe a quiet advanced feature?), it will most certainly be in our complete music animator product (which we really need to decide on a name for :) )
Heh. Yes it currently requires Flash 9 and we have zero checking for upgrades. Right now, we are under the horrible assumption that more or likely you have been to YouTube, which requires Flash 9. That will be fixed by the end of the day. Sorry about that oversight!
Meetro And AOL Quietly Developing New Forum Products
Any YC startup in this space?
Is this all that hard to do? There are quite a few good JavaScript libraries, some arguably better than what's baked into Rails, each offering a range of suitable UI effects.

I would prefer to have the ease of choice of such libraries (JQuery, for example, over Prototype.js) and write the not-so-hard JavaScript myself.
The World's Most Advanced Bionic Arm
Fuzzwich - Animate Your Thoughts
I find this story fasinating, especially with the numbers of soliders living with lost limbs around the world. I'm curious about how robotics will be included into the mainstream in the future.
I've found I do best hacking at night and in the mornings, but am better and worse at different things in each case.

At night, I'm more likely to keep plugging away at something until it's done. Also, it's often easier to concentrate on only one thing at a time. It's quiet, and there's no nagging idea that there's something else I could be doing. I've also got a whole day's worth of memory and context stored up.

At night, I'm less likely to make intuitive leaps that solve problems, and I'm less likely to want to do things that are mentally difficult. I'm more likely to get frustrated at complicated problems and make stupid mistakes.
How are companies in Silicon Valley hiring?
I looked at it, but decided against it, and did things myself, after having bought some books (the nolo.com LLC ones). In the end, since the books are pricey, I don't know if I actually saved any money, and certainly didn't save time, but I feel a bit more connected to the whole process, and learned a few things on the way.
This writer is either the stooge of the carriers, or not very sharp.

The most revealing phrase is "forcing the agency into an auction for spectrum that would arguably have far less business value." The government is supposed to be operating in the interests of its citizens, not creating artificial scarcity so businesses can charge them a lot.
Here's a (somewhat dated) example of how creative financing could work for a tech startup (read the paragraph which beings "Say I decide to become an Internet Service Provider..."): http://www.pbs.org/cringely/pulpit/1999/pulpit_19990527_0003...

Cringely focuses on the the dark-side perspective of taking it too far, but it also shows how you can create an infrastructure without a lot of startup capital.
Google Joins Linux-Oriented OIN
I'm available as a beta customer if they are interested...
Wow. This is an excellent, realistic article. Some of the great nuggets:

"Consumer loyalty is directly linked to the amount the consumer invests out of pocket. Apple has a fiercely loyal base partly because they feel really stupid spending an extra $300 on a product that isn't something special. With social networking sites the amount spent is zero - and the loyalty corresponds.

Facebook and mySpace are only as valuable as the next big thing. In other words: they are fads. Now, fads can be successful if they're managed right, but they all share one thing in common - they won't be around tomorrow. If you need proof, look no further than Frendster. In 2003 they had 20 million users. Today, they have less than 1 million die hards. Those are fickle crowds.

So, why is this a problem? Because eventually investors - be they VC's or acquiring organizations - want to see some growth in their investment. With a fad-based industry, all value becomes speculative and opinion based. In order to make money, investors need to assume that tomorrow, the perceived worth of the product will be higher. Let's pick on Facebook a little. Facebook now needs the next investor to believe it's worth $2 billion at least. - invest $1 billion, recoup $1 billion. Sorry if I laugh a little."

And:

"Let's put this into perspective: We have a product that has a monetary value of zero to its users being used to build further products of negligible value - and these products are actually being sold or invested in!"

And this has me asking the question: is it not better to charge for a product and therefore create a loyal and mature customer base on top of actually getting some real revenue? I mean sure, you might not have 30 billion users, you will probably have to make something that is higher quality than something that is free, but the results to me seem to be much more valuable.
This guy doesn't even have a grasp of the basic facts of the web app business. The core of his argument is that an ad-supported business is ipso facto a fad. So is Google a fad? Are all the ad-supported businesses of the past 100 years?

Look no further than Friendster for evidence of users' fickleness? Friendster wasn't killed by the market; it committed suicide.
Biggest Mistakes You've Made?
That first nugget ignores that some people invest a lot of time and effort into their online identity via a social networking site. They aren't going to switch in a heartbeat.
I saw him give a speech a couple weeks ago along with some chief FBI cybercrime person and he pulled out that card during the speech to show off... Of course he said it was mainly a novelty thing and those particular picks were pretty much useless but I don't think there's much of a legal problem if he can pull it out in of a room full of FBI.
He's right. Let's all quit and get jobs crunching numbers in the finance industry. Better yet, lets become farmers. Everyone needs food right? That market isn't going away any time soon.
Sitting on ideas only to see other people implement them and whiz by me. In hindsight, I've learned that I shouldn't wait and do what I need to do right now.
I don't think I'm saying that ad-based businesses are a fad at all.

What I am saying is that ad-based businesses aren't stable enough to warrant the valuations that we're seeing right now. The core audience - the user - is not loyal enough to justify valuations that would take years of sustained behavior to see any ROI.

The cause of Friendster's demise is irrelevant - it's the speed at which it happened that proves the point. 19 million users lost in under 2 years is fast even for web apps.

Ads are a perfectly legitimate form of revenue.
One thing is certain -- without users, you will not make money. With users, you have a chance.
I almost gave up on it before the gapminder.org part -- now that has a lot of startup potential.
Social App users don't switch by packing up all their belongings and moving them to another site, they just start up a new profile and build there instead.

If you think of it that way, it's not an either-or proposition. I can continue to have my profile on your site, but I won't venture there as much, you lose the ad revenue, and the downward spiral continues.
When did he ever imply that? Just because he is suggesting that the market might see a recession or a bust doesn't mean he is saying all people should get out of the market.
> I don't think I'm saying that ad-based businesses are a fad at all.

"Consumer loyalty is directly linked to the amount the consumer invests out of pocket."

"With social networking sites the amount spent is zero - and the loyalty corresponds."

"Facebook and mySpace are only as valuable as the next big thing. In other words: they are fads."
If you have to ask the question, you probably don't have to worry about it. :-)
I loved this talk when I saw it a few weeks ago. TED is so ripe with good ideas.
I agree with you. I disagree with the article's "zero loyalty" claim.
They've already built some cool stuff (http://www.gapminder.org/downloads/applications/) but it only scratches the surface.
Google isn't an ad-supported business, though. They are an ad business, period. Not many companies have the privilege of being an ad provider, which functions much more like a traditional company.

And there haven't been Internet companies for the last 100 years. 50 years ago switching newspapers would've been a much different thing than switching websites today.
Good judgment comes from experience. Experience comes from practice. Practice entails making bad decisions. ;-)

I've always been hesitant to make decisions when I didn't have all the information. My current approach is to gather a reasonable amount of information, throw my energy into a particular course of action, and be willing to turn on a dime if contraindications present themselves.

To sum up: My biggest mistake has been my fear of mistakes.
comment-karma/comment is probably a bad measure as commenting on threads that don't make it to the front page would be discouraged.

comment-karma/time is probably a good measure.
Paul, you're completely ignoring my main point by focusing on this idea that I'm suggesting ad-based models don't work. I'm not saying that.

What I'm saying is that because consumers that don't invest out of pocket are fickle and that ad-revenue follows consumers, valuations of companies that survive solely on ad revenue should reflect this.

Right now they do not, hence they are overvalued. When a company is overvalued, it's not a good time to invest. The fact that there continues to be a market is based on the fact that Facebook, or a site of equal stature hasn't actually had to justify its value.

Once it does, the house of cards will adjust a little.
Be suspicious of graphs that don't have units or precise labels.
Point is that it's close enough to zero that you won't be able to react fast enough to it.
In fact, as you'll see in tomorrow's post, I'm going to suggest the opposite.
I think fickleness is more closely related to switching costs than sunk costs. In other words, I don't pay a dime for Gmail, but it would be quite difficult to move away from. Facebook probably doesn't have quite that much of a lock on your data, but I guess that depends on who you are and how you use it.
Meetro always appeared to be a wannabe business built around a single feature missing in other IM networks -- if they ever gain any traction, the primary networks will just implement Meetro's functionality. Glad to see they're branching out, although I'm curious about what would make their forum offering unique in an already-cluttered space.
1. Having a go at it alone.
2. Taking too long to launch - fail early, fail often, iterate.
3. In-efficient outsourcing.
I don't know how much true is what your saying, a month back I switched to Facebook from Orkut and I find lots of ppl doing the same. Facebook is a clear winner thats why I joined in and if something better comes, I won't mind switching again.
Here's a counter-example to this idea. I made justoneclubcard.com a few years ago. I think it's a clever idea and useful to a lot of people. I even get emails all the time from people telling me how great they think it is.

But it is rare that people spread the word to other people i.e., very little traffic comes from email websites, small blogs, or directly typing in the URL. Instead almost all of the traffic comes from lifehack type websites discovering it and linking to it.

So in my case I don't see the specific p2p type word of mouth he talks about. I think that only applies to certain products where you actually want your friends to use the same product as you e.g., "dude, you've got to get a myspace account".

What do you guys think?
That's a good point actually, but I think though that you can't discount the user's emotional attachment to sunk costs.
Moonlighting for so long, the sin of sins.
Anywhere.FM goes after online radio (3700 users, 265,000 songs)
Since its launch last Thursday, the service has attracted more than 3,700 users who have uploaded more than 265,000 songs.
"consumers that don't invest out of pocket are fickle"

If consumers who didn't pay for stuff were not making investments in other ways, I suspect it would be easier to get users to register. Time is an investment, as is trust.
You're making my point. Facebook started to pass Orkut three years ago, and you didn't change until last month. It doesn't happen in a heartbeat. "Zero loyalty" just doesn't fit the facts.

2007, fb way ahead: http://blogs.zdnet.com/social/?p=114

2006, fb ahead: http://changesgood.wordpress.com/2006/09/23/myspace-is-in-vo...

2004, fb catches up: http://www.blogpulse.com/2004_review/2004review_socialnetwor...
Well... I'd be very skeptical to listen to a guy with such a cheesy blog title. He is "Building leadership...". Often most of these folks usually don't bother with even a basic logic in their "predictions" and "explanations".

Quote: Facebook and mySpace are only as valuable as the next big thing. In other words: they are fads. Now, fads can be successful if they are managed right, but they all share one thing in common - they will not be be around tomorrow. If you need proof, look no further than Frendster.

I don't see much logic in that.
Those are good points.

>That's a non-sequitor. The reasoning is the same as "Google won't be around for long; for proof, look no further than AltaVista

Difference being in everyone of your examples:

1. The product is in a near monopoly position
2. None rely on ads as a sole means of income
3. Microsoft isn't overvalued. Google will probably see a share correction soon, or at least during the next downturn.

>Users and customers can often be two disjoint sets. Broadcast TV provides significant value to its viewers, but its viewers aren't the customers; the advertisers are.

Good initial point there. Interesting though that you picked broadcast TV. It's no secret that traditional TV is losing audiences fast. In fact, you could argue that TV proves that my analogy works across mediums. Again, the big difference is that valuations are reflecting reality here, whereas this isn't the case in web land.
Yeah true, I agree. Call it resistance against change or little loyality, it takes some time to shift. Friendster is still #1 in Philippines.
Copywriting for eCommerce
Damn, this makes me want to code right now... but I will read some YC posts first :-). It's good to get a good inspirational kick in the rump now and then though.
New York Times Sees Sense: Paywall Comes Crashing Down
Buy.com Challenges eBay on Facebook
LiveJournal Loses Founder to Google?
Zimbra Attributes Google Docs to its Growth
Design Decisions: When to prompt for an upgrade
Tractis Makes Contracts Digital, At Last
I don't know. This has the potential to get under a lot of people's skin, and that's always a good thing from a VC point of view.

I can realistically envision people saying "they banned overhear.us at work" in a few months.

Question though: What stops this from being a platform for marketing - i.e. Is there a danger that the company floods the forum with bad info? What about insider information? Are you not liable if I post that my company is tanking this quarter?
Apple updates iWeb, with web widgets, themes, domain, link to .Mac photos/videos from iLife and iPhone
Techcrunch's Michael Arrington lures startups into his money pit
Facebook takes over Palo Alto
This guy must have hit a nerve to generate so much vitriol. I think many of the comments here hit on some good points. I think the blog post we are discussing hits on some good points. It is possible that we are all right.

We need to be honest here and admit, however, that the vast majority of the free to use consumer startups that we are seeing will be challenged generate US$1 Billion in revenue a year. Or for that matter, even US$100 Million. That is why there is little talk about taking the majority of them public, because other than as a delivery vector for advertisements, there is scarce value in this crop of startups. To be perfectly frank, these are less than ideal platforms for ad delivery as well.

What can be done? We can try other models, and I'm sure many will. There are a boatload of virtual worlds, virtual world platforms, and MMOs coming on line this fall. ALL of them plan on using ads, microtransactions, and subscriptions. They are in the good position of being able to use all three of these at the same time, and all of them will. I predict though that by December all of these companies will have their models DESTROYED by two guys on their couch in boxer shorts developing a FREE virtual world on their laptops while watching SportsCenter and eating ramen. There will be 1000 college students "building portfolios" around the country that will make gigabytes of content for the new LINUX of virtual worlds. It will all be P2P or hosted on Amazon, and it will piss many a VC off. So the only thing these businesses will have left will be advertising.

This is the situation web 2.0 is in. People keep investing in the hope that some little twist will be the magic one that brings in the most ad bucks. Charging for these things is not an option, there will be free alternatives if you wait 6 weeks. Even virtual worlds can be duplicated in 6 weeks these days! What can we do?

It's easy to point out the holes in what is currently being done, it is much more difficult to offer a WORKABLE solution.
> 2. None rely on ads as a sole means of income

Google does. (Aside from products like the Google Search Appliance, which are basically negligible in revenues.)

> It's no secret that traditional TV is losing audiences fast.

Well, yeah, but it's had them for 50 years. If you wanna argue that FaceBook won't be around in 50 years, you'll get little argument from me. However, there's a good chance I won't be around in 50 years, so I also don't really care.

I thought your point is that there's a good chance FaceBook won't be around in one year. That's certainly possible, but I don't really see a case for it from the evidence you've presented. All your arguments apply to broadcast TV c. 1950, but if you'd bet that CBS would be out of business in 1951, you would've been very, very, wrong.

If you want to make the more general point that advertising-supported businesses are hurt badly in recessions - that's true, and fairly well-known throughout the financial industry. However, lots of businesses are hurt badly in recessions. In 1929, nearly the entire financial industry was wiped out - thousands of banks closed, investment trusts (the 1920s equivalent of hedge funds) disappeared and didn't reappear until the 1950s, mutual funds underwent stiff regulation, stockbrokers quit and (legend has it) committed suicide. That's far worse than what happened to the entertainment and advertising industry. Capital goods also suffer, the auto industry downsizes, construction gets hit hard, farmers foreclose on their mortgages, etc. Basically the only industries that do well are consumer staples, entertainment, and vices (alcohol/tobacco/gambling).

One of my major reasons for making the leap to entrepreneurship is that if the economy soars, I do much better with my own business, yet if the economy tanks, my job at a financial software startup is toast. If I'm screwed anyways, might as well enjoy the upside.
This is totally a great move for the NYT. Their ad revenue will go through the roof.
deja vu anyone?
Owning All The Results: Stretching for Startup Leaders
>Google does

Google is ads, it doesn't rely on them. See AK's response to pg in this thread.

I not saying anything about Facebook's ability to survive, I'm saying it's a bad investment because it is overvalued, hence we're going to see a correction in the tech market. It seems everyone is missing that point, choosing instead to go nuts about how ad-supported models are working.

Sure they're working, they're just very vulnerable. When you've got ad-supported models that are over valued, you're even more vulnerable.

I don't think you can use the depression as any indication of what happens during a recession though. In recessions, it's possible to effectively shield oneself from a good deal of harm, whereas the depression came and found you.

I agree with you on the last para. I think you're much better of controlling your own destiny in pretty much every case, even if you lose your shirt.
Zimbra attributes Google Docs to its growth or Zimbra attributes its growth to Google Docs?

I don't think that Google cued off Zimbra's growth to create their Docs offering, nor do I think Zimbra believes that.
SF Chronicle Trims Business Section; The Best Are Gone
Your last comment reminds me of what my high school wrestling coach used to say. To paraphrase:

Focus on the things you can control. Don't worry about what someone else is doing, just do what you need to do.
Not to toot my own horn but this is what my startup is all about:
http://www.uuorld.com/

Should have a simple beta in a few days...
Ironic that you should say that, given the topic at hand. :-)
The more I play with it and think about it the more impressed I am. The level of user constraint is spot on. You are constrained enough that it's super simple to use but there's plenty to play with for a long time.
I absolutely loved this book, it gave incredible insight into successful entrepreneurs. A recommended read for everyone on YC.news (Although I'm sure you knew that already).
I often look to the comments of a particular user, like people I know or PG.

It would be nice when looking at a comment to immediately get the full context with the submitted story and top level comment. I find myself hitting "parent" many times, when a "root" button would be useful.