My thinking around that is it's pretty much the same effort to build something small or something big (especially since you have to start small to go big). Might as well go for the big ideas. But curious if others have different views (or similar for that matter)?
You might've had a solid calendar scheduling app in 2015, but by 2024 everyone is eating your lunch from every angle, while the plumbers continue to plumb. And the major moats like network effects or marketing specialization usually only apply to larger businesses.
His advice was to always go big, grow quickly, and sell quickly. Even if you go smaller for a higher chance success, the income stream likely will crumble as soon as you stop actively pressing forward with the product because of the intense competition in the software space. The lower risk option of growing and selling quickly, in his estimation, was the best risk-adjusted return.
The effort to do something small is definitely less than when you try something big. And my little experience even hitting small is exponentially difficult.
So the concern here is that it may be as hard (or very similar) to start something small vs trying for something big .. I will note that going for something big also likely means starting small (so again same effort)
You can have a big idea that makes no money (like Quibi, a streaming service that raised 1.75 billion and shut down after 6 months). You can also start as a door to door salesman selling baking powder and accidentally create Wrigley's gum. You can also assemble custom computers as a side hustle and then scale the business to become Dell.
You have no clue what's going to become a big business. You have no clue what idea will require a lot of work, and what idea will just go viral. Candy Crush makes more money than No Man's Sky.
The thought that you can predict what idea will make it big is laughable. VC's invest in hundreds of companies because while they're pretty good at picking companies, they know it's largely a crapshoot.
>Some people's entire jobs is to find a track them (whole VC industry)
I mentioned this. What percentage of companies that a VC invests in actually go big?
I'm not denying that VC's are great at their jobs. But I'm pointing out that the best of the best at this have ~5% of the companies make more than a 3x return. 50% lose money.
Not in the sense that everyone should always aim for it, but simply as a "reality check". You won't be able to directly compete with large established players - so don't.
If you wanted to start a company like Zuckerberg's you had one place (Silicon Valley) and a time period of less than ten years in which things like that were getting funded (or alternately, a similar window in China that may or may not still be open)
You'll always be able to find people who want to be partners in a restaurant, whether or not they are out of their mind is another question.
If there was a recipe for Mark Zuckerberg's wealth there would be many of them. There's is no tried and true set of instructions that makes someone a billionaire, it feels dumb to even have to type that.
Only an extremely naive individual, perhaps an 8 yo kid, would believe such thing exists; particularly if it's on a book that costs $19.99, lmao.
Without context, this could either be very nice or not remotely feasible. A charitable take would be that you have next to no expenses, and some other personal salary or have another household income, and you own your own home, and you're basically already prepared to retire anyway and this would be an amount that you'd be able to earn in perpetuity, then... maybe?
But if it lasts only a few years then that's just a nice boost to savings or a down payment on a small condo. In my high CoL city, if you earned the equivalent of a flat $10k/m after tax and managed to get it all up front, and not have to spend any of it on literally anything else, then you'd be able to pay cash for a townhome and be back to needing at least a few grand a month for living out the rest of however many decades you have.
It's retirable money if it's the floor of what you earn over the course of an entire working life, or some other variables prove favorable, but I guess it's quite bleak how not far that money goes these days.
Or an expensive drug habit, or paying loan sharks, etc.
Describing mortgage payments as a scam seems pretty out there. Renting isn’t any cheaper, and with a mortgage at least your home is an investment
I don't agree, or at least it depends what "a very good life" looks like, but that's not the point, and I think it's just a strangely framed association between MRR and retirement, which is usually discussed in terms of an aggregate at some specific point.
If I make $10k a month as revenue and take it all as salary, I'm left with probably ~$7k or less after taxes, assuming I'm not paying an accountant, doing all my own paperwork, all the usual caveats. That's potentially a great salary depending on lots of factors, but it's only a retirable amount if a very healthy portion of that goes directly to retirement savings/investment. If you don't own a home yet, it's easily possible that $2-4k of that could go right into shelter costs, $1-2k to miscellaneous daily expenses and bills or transit. It's great if you're single, own a home, have no dependents, are frugal, have roommates etc... and as an income in retirement at a typical retirement age, it's probably pretty great in many cases, but as a young person you'd need to keep it up for a few decades consistently to retire on it, and idk how safe a bet it is that a small project would continue earning that money long term.
All of that might be implied, or it might not, idk anything about the person who posted it originally, but $10k a month after paying for a high CoL mortgage or rent, food, a kid, I just don't see it. $10k a month USD living in SF? $10k a month AUD living in Sydney? What about $10k a month CAD living in London?
There's just not enough information to make such a confident assertion, imho.
The great American philosopher Russ Hanneman comes into mind: https://www.youtube.com/watch?v=0oV4IVy8tvE
†Fact check: not top 99.97 I as originally stated, just top 99.9 according to https://docs.dpaq.de/17706-global-wealth-report-2021-en.pdf - $1M threshold = top 1.1%; $5M threshold = top 12% of the 1.1%
Yes, in theory, and in most cases, among many others.
The rest of your comment provides useful context, and I agree, it's a great place to shoot for and build from, such that if it grows to those numbers it's certainly possible to rely on in full retirement mode.
That's not even an engineering salary, and you haven't factored in operational costs. It needs to be higher than this. And there's also no guarantee the business will last.
Plenty of people retire without engineering salaries in the US. $5k/month after taxes and expenses can be enough (or it can be a fraction of what you need).
Agree that thinking of it as a never ending money tap is the bigger issue.
But yeah if you gave me $10k/month pre-tax today (assuming it was never-ending) I’d be done working for the rest of my life.
The main issue with this narrative is that social security is on track to be insolvent in less than a decade. If that happens, then the long-tail of regular non-rich people are going to be in a world of hurt.
Have you ever built something small? I mean the whole thing, including the parts you know you're not good at and the parts you've never done before. If not, maybe start there.
A big idea can be aspirational: "I will make the biggest bestest X the world has ever seen." You can have that goal and still make the smallest most interesting part of X as your first iteration.
If you prefer a more rational approach, there are standard methods of business/product assessment that you can apply at the idea stage to rule things in and out. Success or failure is rarely guaranteed, but if the idea is big, unexamined blind spots can bite you years down the road.
Another factor is resources: do you have time/money/drive/attention-span/grit to see a big idea through to maturity. There are many steps in that process and each step has its own challenges and potential for failure.
I think it's optimizing for learning versus revenue, which don't have to be mutually exclusive. Sometimes you need to start with one to get to the other.
Your thinking have huge mistake, because you thinking about money, without considering market.
What I mean, market is not a single flat place where all 6 Billions walking and you will look at them from crystal tower.
But real market space is multi-dimensional, for simplicity I will tell analogy.
Imagine, Newton method of finding roots of equations. For simple case it could been considered rough 2D surface, like Moon surface projection, with indefinite number of holes, and some holes are huge, and others are tiny.
And height of edges of hole, which you research are important, because they are practically proportional to energy need to overcome edge of your hole, so it defines some tension, or budget to come to other hole, or it named enter barrier.
And hole width define, how many money could be here.
What important for business, as I said before, you are not only person on Earth, there are at least hundreds millions smart people (about 10%), who also want to make some money and making research of their environment, so your concurrents are aware about surface line of market, and where it have holes.
And typical human avoid small holes, prefer to enter large holes or even huge holes.
So, when you enter tiny hole, huge probability, you will not see any market concurrence there.
What also important, start small doesn't mean, you will not become big any time, as you could make some fat in small niche, and than you could make try to enter bigger niche, or few neighbor small niches, etc.
In reality, McDonalds and Walmart began in regional small niches, and enter mega-cities after make fat in niches (for mcdo way you could watch "the founder" cinema, for Walmart, read "made in America").
Sure, if you have few spare Billions, you could start already big, but I bet, you would not ask this question having Billions.
PS any way, you are not alone, ask if you consider cooperation.
You also need to think about what your product actually is, how many people want it, how much they want it, and how much they'll pay for it. Market size might make the big-or-small decision for you.
Finally, I think you need to consider what sort of problems your individual knowledge and experience gives you insight into. There are already thousands of PDF converters crowding search engine results. You need to find something that no one else has thought of (even if it's just a variation on someone else's product) so that there's something that makes your users want to give you money, rather than just using whichever competitor was top of the search results today.
The Path Appears To Those Who Walk.
Instead of thinking about what to build, think about what to solve, so that you are not running around with a hammer looking for nails, and instead you are looking through the toolbox for the best tool for the problem at hand
My advice:
1) target a large TAM - is there a large enough market of people that are willing to pay for that type of solution?
2) try to maximise problem-founder fit - what are your unfair advantages and do you have access to early adopters who can give you feedback and spread the word?
Execution is much easier on something small.
(Side note: Facebook wasn't big to start. Facebook started as "Stalker-R-Us on Harvard College Girls")
Getting that kind of money from a big corporate job, I would guess, is a lot more hassle-ridden than if you did it on your own. I also think the competative context is important to understand.
I actually have been experimenting with a tool[] I made to very quickly get an understanding of just how competative the marketplace is for a particular idea -- big or small. I have a million ideas, prefer the "smaller" ones, and prefer to enter where there is a real market opportunity.
https://already.dev
You mention Zuckerberg - even Facebook was made through having experience in the right market and taking an existing product to the next level, and probably a bunch of iteration along the way.
Microsoft started as a BASIC interpreter for 8bit microcomputers. MSDOS was a re-branding of QDOS as in quick-n-dirty-OS.
It may be at first, but if your goal is $30k MRR then at some point you could consider your task to be "done" (ideally, in reality its never like that). There are businesses that once set up it takes a lot less effort to keep afloat than to keep growing (and that's why they are attractive).
It is very, very hard to raise money for something small though. Maybe you can get a loan, but anything anywhere near the favorable terms that VCs give you is impossible. Games use publishers for equity funding and the terms are terrible.
So, if you are going for something big, you are better off going for pipe-dream-big. And know that once you start you will basically be on the growth-train until IPO/acquisition or exit with an empty handed. If you are going for something small, you will almost certainly have to bootstrap, which means it will take time.
Whatever it is you want to do though, just do it now. Time flies and it doesn't forgive.
Most people think of TAM as "how big could this be". But an equally important side is "how many people might be willing to buy this". Because that measures how easy sales will be.
Big ideas have larger TAM and therefore it's a little bit easier to land that first sale. Even with a very early stage product. With a large TAM you can pretty much throw infinite darts at the board and maybe on will land.
If you target too specific of a market (.dwg => .pdf converter for civil engineers). You'll have an easier time finding your market, but fewer chances to land the sale.
The World Wide Web was a much 'bigger' invention than FaceBook; but Tim Berners-Lee's net worth is a tiny fraction of Zuckerberg's.
No idea. Just hit the market with what you have. Iterate until you find people willing to pay for your thing.
A dollar irl is worth more than one hundred billion in a fentanyl-fueled fantasy.
This creates two different types of companies. With VC-backed you'll have an abundance of cash, because that cash is buying you time, growth, etc. If cash is the problem, then do big ideas. A common strategy is to grow one vertical and ignore the others, while paying off the ignored verticals with cash. This is your YouTube without ads, your Android without an app store.
With smaller ideas, you'll be self-sustainable and resistant to enshittification because you're not buying (tech/product) debt with all that money. You can't actually build things that need multiple verticals, like Facebook or Google; you'd run out of money long before. And you often can't hire senior level talent.
The downside is the big idea will usually buy out all the small ideas. You built a PDF converter for a game and then Zynga offers you $10m cash for it. Is that really a downside?
Also one thing that's always overlook is distribution. How do you reach the market? Slack lost ground to MS Teams despite having the better product because MS dominates enterprise channels. Big ideas are able to dominate distribution and siege you no matter your moat.
Small ideas will need less maintenance and constant development but you could spend more time on bespoke features for customers.
Small ideas win everytime for me.
The general YC advice is to find a way to validate your idea and “fail quickly” with the least amount of time and effort.
That’s kind of orthogonal to the potential scope of the problem, but applies to how to get started.
The question to think about is can the small idea potentially be big? Or is it a TAM limited scope? Don't forget there is horizontal vs vertical scaling to think about too.
The answer won't be the same for a multi millionaire looking to spend his time working on a cool project or for a low wage worker trying to make it and quit a boring job.
If you already have financial freedom, i guess you should aim for the stars, as in go for something big.
I you're trying to reach financial escape velocity and get rid of your 9 to 5 job, you might want to try small ideas first as it should be easier targets and you probably only need one successful project to be free. Then you can go for the big ideas.