What is Digg?66 Comments
- Rowen7, on 10/10/2007, -2/+54#10 Marginal Niche
Web Startups fail by choosing a small, obscure niche in the hope of avoiding competition. If you make anything good, you’re going to have competitors, so you may as well face that. You can only avoid competition by avoiding good ideas.
#9 Copying Success
Web Startups fail by trying to duplicate a great idea. If it’s been done once then chances are others have tried, and failed. There can only be one amazon.com or ebay.com. Come up with your own unique and fresh concept.
#8 Inflexibility
Your business plan should be an organic document that can adapt to change. Web Startups fail because they refuse to deviate from the plan. Listen to others, get advice and keep your eyes open; adaptation is the mark of a successful business.
#7 Getting the Wrong Help
Good people demand good wages. Hiring the cheapest person is a recipe for Web Startup failure. Old sayings become old because they are true, the best example being “you get what you pay for”.
#6 Listening to an Un-Expert
Web Startups fail by acting on advice given by an unqualified person. Anyone can claim to be an expert at something and often we lack the knowledge necessary to determine their qualifications. To protect yourself from the Un-Expert get a second, third or fourth opinion. It never fails to ask around.
#5 Forgetting the User
Web startups fail because the websites are designed from the perspective of the business owner, not the user. In an entrepreneur’s excitement and passion for their idea, they can often lose sight of their customer’s accessibility needs. Focus groups and user trials can be a great way to improve customer interaction with your website.
#4 Running out of Runway
Web Startups fail by forgetting or downplaying funding. Every startup that isn’t profitable has a certain amount of time left before the money runs out and they have to stop. This is sometimes referred to as runway, as in “How much runway do you have left?” It’s a good metaphor because it reminds you that when the money runs out you’re going to be airborne or dead.
#3 Spending Too Much
Often caused by listening to the Un-Expert, Web Startups fail because they over spend needlessly. Unless your doing volume of business equal to chapters.ca you do not need a dedicated co-located IBM Xeon server when a $20.00 hosting account will suffice.
#2 Believing the Hype
The web is all about Hype; from get rich quick schemes to seemingly endless unsolicited emails claiming to have insider information. The reality is that the people who get rich quick from the internet put a lot of thought and energy into their projects, just like anything else. The internet is a great medium for scammers
#1 A Half-Hearted Effort
The failed startups you hear most about are the spectacular flameouts. Those are actually the elite of failures. The most common type is not the one that makes spectacular mistakes, but the one that doesn’t do much of anything—the one we never even hear about, because it was some project a couple guys started on the side while working on their day jobs, but which never got anywhere and was gradually abandoned. In other words, starting startups is just like everything else. The biggest mistake you can make is not to try hard enough. - 31073, on 10/10/2007, -3/+20doesn't 10 and 9 somewhat contradict each other?
- dustedotnet, on 10/10/2007, -2/+14"Un-Expert"
- TheSkinsFactory, on 10/10/2007, -1/+13This list is a joke. Besides #10 and #9 directly conflict with each other, I'd like to know what the author's credentials are? After reading it, most of it is "Captain Obvious" crap. Show me a Top Ten List from the Founders of Digg, Facebook, MySpace, Amazon, Dell and others and I'll believe it. Hell, look at GoDaddy and how successful they are.
Here's some advice from a guy who started his company with $6K and a couple of credit cards in 2000. We did almost 1 million in revenue last year.
- Work your ass off. No one got rich from working 9 to 5.
- Believe in what you're doing, because if you don't, no one else will
- Be the best at what you do or at least shoot for it
- Niches are great, contrary to what this guy's list says. The Skins Factory created a user interface design market when there was very little competition. After applying the bullets above we became a recognized entity in our niche. Niches are great because they set you apart from a very crowded internet.
- Contracts, contracts, contracts. Do not do a deal without a contract. It is your only protection. - inactive, on 10/10/2007, -0/+1011) Don't steal unless you know you won't get caught
- redhotpenguin, on 10/10/2007, -0/+9Paul Graham has a good take on this also, and much more comprehensive.
http://paulgraham.com/startupmistakes.html - jkharris07, on 10/10/2007, -4/+10A web startup isn't going to work unless there are committed people that are dedicated to making it work.
- bugbear, on 10/10/2007, -0/+6Mostly plagiarized from http://paulgraham.com/startupmistakes.html
- drafhk, on 10/10/2007, -0/+6You forgot:
"- Don't waste your valuable time on Digg." - d1on1x, on 10/10/2007, -0/+5ROFL / Check #9 from the comments above, then click the link:
In a gross error in judgment I used material for this post from other authors without their permission. I offer my apologies and have removed the material as soon as I became aware of my mistake.
- Andy
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priceless! - bpapa, on 10/10/2007, -0/+4yeah seriously. This Digg post should just redirect to Graham's article.
- rjregenold, on 10/10/2007, -0/+4I think he was suggesting that if that's all you need, then don't waste money on a dedicated server.
- tech42er, on 10/10/2007, -0/+3Correct. IF you copy elements of a competitor, but give it a new twist, you can be profitable. If you just have a video site, no one's going to care. Everyone uses youTube. If you have a video site that is integrated with a social network and allows videos to be shared among people, you might have more success. One interesting idea would be to just create a utility that would allow videos taken by cell phones to automatically upload to, say, youtube and google video. You could distribute the program on an ad-supported site or you could integrate it with a competing video site (so the videos go to, say, youTube, google video, and fanashe.com, a startup). There are many opportunities to make something people want to use that is profitable.
- rory096, on 10/10/2007, -0/+3Also some of the things in the digged article are taken word for word from Graham's essay.
- TheSkinsFactory, on 10/10/2007, -1/+4Yes, that's the first thing I thought and totally lowers my expectations of anything useful coming out of it.
- 31073, on 10/10/2007, -0/+2#10 You can only avoid competition by avoiding good ideas.
#9 Web Startups fail by trying to duplicate a great idea. - jmnormand, on 10/10/2007, -0/+2#0 copyright infringement... most of the time...
- tech42er, on 10/10/2007, -0/+2Yes, but they're both true. You have to have a good idea (yet another youtube competitor isn't going to work), but, on the other hand, your business plan can't be: sell construction paper over Internet to construction paper enthusiasts. Remember the dot com boom/bust.
- jkramlich, on 10/10/2007, -2/+4#9 Copying Success - I would argue with this one quite a bit. If you listen to the problems that users are having with your competitor you can produce a better service. I run a non profit organization, http://www.Gigoit.org we are essentially an eBay for free stuff. Our largest competitor right now is FreeCycle, of which I am a former user. FreeCycle had many issues and is extremely slow to respond to it's users. My long time friend and I wrote our own competing service and we get amazingly positive feedback. Our only shortcomings right now are a limited userbase and time/money. Since the service does not generate enough income we are unable to work on it exclusively. Within a few months I will have enough money saved up to work on it full time. I'm confident success will follow soon after.
If you have a good idea, determination and the will to stick with it you can be successful. Just don't think it will be easy. - parsap, on 10/10/2007, -1/+3He has some good points, but did he seriously suggest running your web startup company on a $20/month hosting plan? What the *****?
- ericdigg, on 10/10/2007, -0/+2If you say to your self I just need VC to invest few million dollars to help my brilliant idea kick off, then you probably should reconsider because if you can't make profit on your own, no one probably wants to invest in you. I find many answers in this Q&A from linkedin to be especially true:
http://www.linkedin.com/answers/startups-small-businesses/starting-up/STR_STP/31668-974357?goback=%2Esrp_1_1187989884201_out - johnslater, on 10/10/2007, -2/+4The last point isnt fair. You can have a day job and still create a great startup. Look at all the large ones, they started with very little funding and were side projects. #1 is just stupid.
- lexbaby, on 10/10/2007, -0/+2No. #10 says don't try an idea that is useful to only a relatively small number of people. #9 says to do something different.
Putting them you get: Do something unique that a lot of people will find useful. - Haplo, on 10/10/2007, -1/+3"#9 Copying Success
Web Startups fail by trying to duplicate a great idea. "
Yup, Google failed when they started their "Alta Vista" (who??).
"Old sayings become old because they are true"
Uhm, no: old sayings become true because there are plenty of people repeating them without using their brain. You can't make a point with dragging ***** into your argumentation.
Article failed by generalizing. There are plenty of examples of companies that didn't fail, yet made some of those "mistakes". If there was a rule set for starting a business, where would be all the fun? - tech42er, on 10/10/2007, -0/+2#1 isn't about people working on a startup while working on their day jobs; it's about only putting a halfhearted effort into the startup. If you really don't care about it, it won't go anywhere.
- inactive, on 10/10/2007, -1/+3That is true but the level of luck that you need to make *any* business work is the least 25%, a decisive percentage.
- inactive, on 10/10/2007, -0/+2You my friend haven't met the RealWorld™
- tech42er, on 10/10/2007, -0/+2The first 3 are what the article listed as #1.Niches are good. Marginal niches are not. If I decide to sell homemade organic gourmet dog biscuits over the Internet, I doubt I'll be profitable. The point about contracts is very good and should have been included in the article. Nice job with your startup, by the way.
- tomis, on 10/10/2007, -0/+2You can come up with a few reasons: No business plan, no strategy, not enough enthusiasm. But mainly; no business plan.
- inactive, on 10/10/2007, -0/+2Ive always wondered about starting local. Like a small site that does autos for sale in your local area. The downside to the internets is that nothing is local. When i want to look for something, i want something nearby. Craigslist fills some of the void, but I think theres alot of room for more localized shopping, auctioning, etc sites. Plenty of room for small startups, and a small site like that is much more manageable than trying to be the next big ebay.
- MikeonTV, on 10/10/2007, -0/+2Should say "10 reason why I (author) fail"
- adamz6969, on 10/10/2007, -0/+1http://adamsblogg.blogspot.com/2007/09/freelancers-find-work.html
- dtrinh, on 10/10/2007, -0/+1Steve Chen worked at Facebook while working on Youtube. Definitely agreed.
- bugbear, on 10/10/2007, -1/+2Mostly plagiarized (often verbatim) from http://paulgraham.com/startupmistakes.html
- brucerchapman, on 10/10/2007, -0/+1The author is Paul Graham, and his credentials are impeccable as he runs a successful early stage funding company. He probably sees one lame business plan per day. You should go to Paul Graham's site (the author of the dugg article has taken it down due to his plagiarism) and read all of his articles.
Besides, he says 'marginal niche' not 'successful niche'. Big difference. - tech42er, on 10/10/2007, -0/+1They don't contradict. The point is you have to find something between an unoriginal clone and a very tiny niche.
- Smoov, on 10/10/2007, -0/+1It's not a bad list. I've been through several startups (unfortunately not as an owner) and two of them were big successes and several others were failures. Most of his points are right on target. I would move #3 and #4 to the top. The primary reason most startups fail is running out of money--insufficient capitalization.
- felyduw, on 10/10/2007, -0/+1I'm sure that you as a customer isn't enough for a successful business. I may be wrong though.
- UltimateFerg, on 10/10/2007, -1/+2Sound advice - but nothing revolutionary...
- vertinox, on 10/10/2007, -0/+1Actually the only reason a start up fails is because of the "no money". You can have a solid well written business plan, but if you still don't make any money because of other issues (like your web site sucks and requires registration) then you are still going to fail because of the "no money issue"
- thailand1972, on 10/10/2007, -0/+1Niches are important for most small businesses. It means less fish to catch, but you have less competition and you can personalise your service more (which is a strength of a small business, which is what you assume a startup to be). It's depressing to read that "all the good ideas have already been thought of". Most successful companies don't believe that.
- bepo, on 10/10/2007, -0/+1Maybe number 11 should be failure to read past the fist sentence.
- psykiv, on 10/10/2007, -0/+1Hey, construction paper is getting harder and harder to find... If I knew a website to buy it in large quantities cheap, they'd have my business.
- njs1970, on 10/10/2007, -0/+0They forgot the most important reason:
#11 - not asking the market what they wanted in the first place. (i.e. Market Research)
Coming up with a "cool" idea and then trying to find a market for what you're selling is the bass ackwards way of doing it and if you ARE successful, it's down to sheer dumb luck that the market wanted it, even though you didn't bother to do your due diligence.
It's exactly the problem businesses have offline. I live in a small town and someone spent time and money setting up a shop opposite where I live selling ... wait for it ... military books. He lasted 6 months and probably wiped out his savings because it never even occurred to him that maybe the town doesn't NEED a military book shop.
Ask them what they want, ask them how they want it and ask them what they'll pay for it (if at all) - then work your ass off to deliver it to them.
Send follow-up offers.
Rinse. Repeat.
Simple. - inactive, on 10/10/2007, -0/+0*****
- inactive, on 10/10/2007, -0/+0For a web startup to work their server should be proper.
- RadicalEdward, on 10/10/2007, -1/+1Exactly. Can you say... digg?
- ctkeene, on 10/10/2007, -0/+0Many businesses fail because not enough thinking was done around the initial idea. One of the toughest questions for a new entrepreneur is how to determine the potential for a new venture opportunity. How do you know if an opportunity is just okay or could be the next Google (not that the Google guys saw that one coming when they started out!)
At INSEAD, I taught a course entitle “Venture Opportunity.” From that course, I developed a white paper on the Top 10 Business Idea Mistakes, which is located at http://www.keeneview.com/2007/01/top-10-business-idea-mistakes.html - bngu, on 10/10/2007, -1/+1From personal experience, $20/month for a VPS for my web startup has worked well for me so far, why buy hardware and rackspace when you don't need to. It more than handles the traffic so far, though I must admit I would really like to push the limit on my web server and see when it falls over but so far I haven't been able to get sufficient traffic to do so. It is built with Ruby on Rails so I am interested in finding out how scalable it is.
- highlander15, on 10/10/2007, -0/+0Well you need committed and dedicated people to make ANY business work. Why is your comment specific only to web startups?
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