Steve Jobs' memo to startups

http://omis.me/2011/10/31/steve-jobs-memo-to-startups/

by swombat • 15 years ago

308 125 15 years ago

kalleboo• 15 years ago

Source?

edit: did some googling and it's from the biography. This is what I hate about tumblr. It's all completely random stuff with no context, no sourcing and no discussion, just those pointless reblog "notes"

edit2: of course, biography not autobiography, dunno what I was thinking

edash• 15 years ago

This isn't hosted on Tumblr, it's Wordpress. And Tumblr's done lots of great work around attribution: http://staff.tumblr.com/post/1059624418/content-attribution

Aqua_Geek• 15 years ago

The article is a repost of this Tumblr post: http://daslee.tumblr.com/post/12161787609/steve-jobs-on-star... (look at the "via" link at the bottom), which is apparently taken from the biography.

prostoalex• 15 years ago

Which autobiography?

kenjackson3• 15 years ago

It's actually a biography -- the new one by Isaacson called "Steve Jobs".

sax• 15 years ago

Perhaps this is nitpicking, in this day and age. But that's his biography (as opposed to autobiography).

BTW, how would you do things differently than reblog "notes"?

aangjie• 15 years ago

It's not nitpicking to me... it(autobio vs bio) does make a huge difference even in this age.

funkah2• 15 years ago

Huh? What does Tumblr have to do with anything?

alexwolfe2• 15 years ago

So true. This term seems to be abused more than ever now a days. I've seen too many people who are just starting a company (literally), throw this term around. It's not something to be proud of unless you have something to be proud of.

smacktoward• 15 years ago

The crazy thing is that you hear people talking about how they've "started a company" when they haven't figured out how to make their new operation do the primary thing a company does, which is MAKE MONEY.

If you're not making money, you're not a company. You're a collection of people that might be a company, someday.

latch• 15 years ago

You are flat out wrong. Not every tech product/company/idea comes together in a weekend, a month or even a year. Companies doing new science can go for years, and even decades, without even having a product, let alone clients or revenue.

untog• 15 years ago

If you're not making money, you're not a company.

Uh? You're a company when you sign the paperwork to make a company. I get the sentiment behind what you're saying, but the statement doesn't make sense.

If you're not making money, you're not a profitable company. But that ought to be reasonably obvious.

philwelch2• 15 years ago

I guess Amazon wasn't a company until years after they went public.

alexwolfe2• 15 years ago

Also, starting a company and being an Entrepreneur are not the same thing. There are many owners of small businesses that would certainly not consider themselves Entrepreneurs. I never hear that term tossed around by the owner of the local Deli.

davidw• 15 years ago

"Launch a company and cash in" is what YC owes its existence to, for another point of view... From PG's description, it doesn't seem like it was exactly easy.

jwingy• 15 years ago

So what?

I don't know what qualifies as 'cashing in', but there's more to life than just running a company. Just because you've decided not to stick around for 20-30 years doesn't mean everything you did up until then wasn't hard work.

ticks• 15 years ago

I don't think he's talking about hard work. He is talking about people who are driven by short term thinking. People who don't really care about their work.

achompas• 15 years ago

Right. For all of Apple's incredible work, this is a curious quote from a man who commissioned a biography because

    "I wanted my kids to know me," he said. "I wasn't always
    there for them, and I wanted them to know why and to
    understand what I did." [0]

I don't judge him for his life choices, but growing a business is a serious commitment. Jobs is kind of ignoring that point.

[0] http://www.poynter.org/latest-news/romenesko/148601/jobs-ask...

bomatson• 15 years ago

Entrepreneur, defined: "A person who organizes and operates a business or businesses, taking on financial risk to do so"

http://bit.ly/uMwlXV

Much respect for entrepreneurs that see it through the whole road, but it doesn't make all the other brilliant entrepreneurs just 'unemployed'

cgarvey• 15 years ago

Does this mean I should drop the title "Social Media Expert Bootstrapping Startup Entrepreneur" from my brushed-aluminum oversized business card?

DavidChouinard• 15 years ago

This is my personal favourite quote of his:

“The problem with the Internet startup craze isn’t that too many people are starting companies; it’s that too many people aren’t sticking with it. That’s somewhat understandable, because there are many moments that are filled with despair and agony, when you have to fire people and cancel things and deal with very difficult situations. That’s when you find out who you are and what your values are.

So when these people sell out, even though they get fabulously rich, they’re gypping themselves out of one of the potentially most rewarding experiences of their unfolding lives. Without it, they may never know their values or how to keep their newfound wealth in perspective.”

snarfy• 15 years ago

This from the guy who took the $5000 for breakout after Woz stayed up for 4 days straight fixing design issues caused by bad specs from Jobs. Fucking managers.

lachyg• 15 years ago

You should read the biography to get some context and understanding. I'm not saying that that was wrong, or even that it actually happened, but I'd actually read it before making a comment like that.

funkah2• 15 years ago

I've noticed some people can't let go of this, so dedicated are they to the idea that Jobs was a charismatic but otherwise worthless manager type. That he was all flash and no substance. A bullshitter.

That's too bad.

steve8918• 15 years ago

Steve Jobs said to Woz that he personally couldn't remember this happening, but that if it happened, then he apologized.

Kids do a lot of stupid things. I've done my share of stupid things as well in my early 20s. To vilify him for something he did 30+ years previous and for something he apologized for is ridiculous.

nirvana3• 15 years ago

Do you have a citation for the "design issues" thing, or are you just making that up?

It was over 4 days because Bushnell needed the game fast. The design was completely in Woz's hands and the incentive was to do it with as few chips as possible, also from Bushnell.

Your claim that Jobs took all the money is a lie. The allegation is he split the original fee with Woz exactly as promised, and simply never told Woz about the bonus. The whole amount was less than $5,000.

It amazes me that people are such Apple haters that they will resort to making up such lies in order to bash the guy who created the personal computer industry (along with woz) and helped create everything from the switching power supply to the smartphone.

jpdoctor• 15 years ago

“I hate it when people call themselves ‘entrepreneurs’ when what they’re really trying to do is launch a startup, so they can cash in and move on.

Of course, this is exactly what is desired from the investor POV, so why the people they fund should act differently is a stretch.

kenjackson3• 15 years ago

PG wrote a good post on this topic (a counterpoint I would argue). Unfortunately I can't find it. But it's about why selling your company makes sense -- why you should give it to people who are optimzied for running a business. Or something to that effect. Probably worth rereading if I could find it.

pg10• 15 years ago

I think this may be the one you mean: http://paulgraham.com/prcmc.html

amirmc2• 15 years ago

The talk you link to in that essay leads to a 404. Is it this talk on YouTube (http://www.youtube.com/watch?v=0CDXJ6bMkMY)?

If so, maybe you want to update the link.

kenjackson3• 15 years ago

That is the one. Looked right at the name in the list of essays and skipped it. Thanks Paul. Good to reread.

hedgehog• 15 years ago

There's a typo down in the credits (Jessica's name).

mosburger2• 15 years ago

There was also a great debate between PG and DHH (of Rails fame) on what defines a "startup," as well as some philosophical tangents on what made one successful. It was a really good discussion.

This quote reminded me of that thread, but I'll be darned if I can find it now.

luckystrike• 15 years ago

I guess you meant this thread -

http://news.ycombinator.com/item?id=173000

noonespecial• 15 years ago

I kind of think the opposite. Entrepreneurs are the ones that create viable businesses, cash in, and move on (usually to try to do it again.)

Steve, on the other hand, created the mother of all lifestyle businesses. (for his value of lifestyle, of course)

gizmo4• 15 years ago

I think that's stretching the definition of lifestyle business a bit much. Surely not every person who starts a business for the long haul is building a lifestyle business?

A lifestyle business is a business you start in order to live a certain lifestyle. The dictionary definition talks about generating an income that is sufficient to sustain a lifestyle, but no more. Steve certainly didn't start Apple because he wanted to maintain a specific lifestyle.

nirvana3• 15 years ago

I don't know if there's a definitive definition of "lifestyle business", but I've often seen this phrase used derogatorily, on hacker news, to dismiss any business not taking venture capital, not trying to be the next google, or not being built to flip.

In a way, Apple is, then, a really good example of a "lifestyle business" as that term is used here. They didn't take a lot of venture capital, they weren't built to flip, and they weren't trying to be the next anything. They focused on long term business success.

Choices made based on long term business success (Such as, retaining enough control to make sure the business doesn't get flipped against the founders will) often, on this site, results in the accusation that you're "just building a lifestyle business".

philwelch2• 15 years ago

Maybe leading and inspiring talented people to build world-changing products was Steve's preferred lifestyle.

pg10• 15 years ago

I can't say he was mistaken, since he was only saying he disliked it. But I don't think there's anything wrong with selling a company at any stage. Steve's problem with selling seemed to be that you're shirking work by doing it. But that isn't necessarily, or even usually, true. A lot of people who sell startups go on to do other things, and often bigger things. If we were still running Viaweb, we could not have started Y Combinator.

runevault2• 15 years ago

Probably depends on if the idea is your one true dream, or just something you found interesting enough to invest the time/take the risk. That would have a huge impact on if the money is worth giving up being in control of the company/product's destiny.

hkmurakami• 15 years ago

I remember a quote from Startup School which went something along the lines of,

"Don't pick an idea for the sole reason that it will allow you to do a start up. Find a problem that you're truly passionate about solving, and things will take care of themselves"

veyron• 15 years ago

What he's criticizing is doing a startup specifically so that it could be flipped later. If you are in it to build a real company, you actually go through the hard work that Jobs is talking about.

Did you start viaweb to sell it to someone else later, or did you start it to build an actual sustainable business?

daleharvey• 15 years ago

Would it be less or more worthy of criticism if pg had specifically planned to sell viaweb and start ycombinator?

pg10• 15 years ago

We started it to sell. We were not interested in online stores. Some of the problems were kind of interesting, but neither I nor Robert nor Trevor thought of Viaweb as our life's work.

Incidentally, building a business to sell doesn't mean it can't be sustainable. Viaweb made Yahoo lots of money.

ColinHayhurst• 15 years ago

I too mostly "hate it when people call THEMSELVES entrepreneurs". But I do love it when people say and prove that they are looking to change the world. If that involves building and selling a company, then why not? By selling Viaweb and then growing YC, pg has done more to change the world than he could have done by staying put.

FaceKicker• 15 years ago

What exactly do people view as "wrong" about building a company to sell? Companies are sold because it's in the interest of both parties involved in the transaction, so it must serve some legitimate function in the economy. Perhaps it's a little different if they're bought by a larger company only to eliminate the smaller competitor, but I doubt that's why buyouts usually happen.

It seems really silly to me to criticize someone for wanting a high payoff to labor ratio or not wanting to dedicate their life to everything they do, but I don't know - what's the reasoning?

gizmo4• 15 years ago

Then the interesting question is: would you be willing to sell YC in the next couple of years if the price is right?

(My hunch is that you're not going to sell YC anytime soon -- even though you probably could sell it -- simply because you're not done yet.)

andrewljohnson• 15 years ago

I don't think YC can be sold. Too much of what makes YC special is tied up in pg and interpersonal connections with angels and other investors in SV. I don't think you could just hand off the process to a VC firm or something and expect to get the same level of applicants.

Maybe someday that won't be true, and maybe I'm wrong today, but my hunch says that once it's sold, it will begin to decline, and everyone who might consider buying it knows that.

pg10• 15 years ago

YC is different. We didn't even think of it as a company at first, just an interesting project. It has turned out to be one of those cases where a side project takes over your life (sort of like Facebook, though much more gradual), but that wasn't planned. We just kept getting more applications and either had to grow or start rejecting people we thought were good.

I never considered what I'd do if someone wanted to buy YC, because companies like YC aren't buyable. But even if someone wanted to buy it I could not imagine selling it, because I don't need the money and it wouldn't be worth the risk that the acquirer would ruin it.

tlammens3• 15 years ago

Another example would be Elon Musk who would still be doing Zip2 instead of giving the world PayPal, SpaceX or Tesla Motors.

jasongullickson• 15 years ago

This is a good point, but begs the question, why is it necessary to start a new company (and depart the previous one) to pursue these ventures?

I'm sure I'm just oblivious to some legal, financial, etc. benefit of building separate company "entities" for each project but personally I prefer the idea of starting the next General Electric than a string of noun-deprived orphan companies.

Keeping your name associated with the trail you leave behind keeps you honest; perhaps this is what Steve was getting at?

llambda• 15 years ago

It seems to me a silly assumption that selling is somehow a form of giving up: if you stay forever with one thing you might miss an opportunity to do something even more powerful; for Steve I suppose Apple is the exception to that rule, but even so he had influence with NeXT and Pixar while absent from it, albeit a forced absence.

Indeed selling might just be the necessary antecedent to the next big thing.

podperson• 15 years ago

I think this quotation (which I liked when I read it at the end of the biography, and which made me think of you at the time) strikes a bit of a sore point.

In the end, some things we do for money and others for love. I think Steve Jobs saw himself as someone who almost always did things for love. He saw making money as simply being a way to fund the next project (which is how artists in general feel).

It's interesting that your response to this quotation is:

"Steve's problem with selling seemed to be that you're shirking work by doing it."

I think that's part of it, but the other part is that you're not doing what you're doing with the right frame of mind.

"A lot of people who sell startups go on to do other things, and often bigger things."

Why is "bigger" in this sentence rather than some other word? "Better" for example.

One of my favorite quotations in the book comes from Larry Ellison. He says he was complaining to Steve Jobs that his plan for turning Apple around (the reverse takeover of NeXT) wasn't going to make either of them nearly as much money as his plan (buying Apple and giving Steve 25%) would and Jobs replied (from memory, so it's probably inaccurate): "That's why you need to have me as a friend, Larry. You don't need any more money."

EGreg2• 15 years ago

I found that like Steve, I tend to dream big. But at the same time I don't have any big connections.

My advice to entrepreneurs would be to get the right people involved your first venture, even if it means giving up way over 50% of your company. Because it's better to exit a successful venture, with money, connections and a track record, than own close to 100% of your first venture and spending years growing it. Chances are, this isn't your last idea and you will want to start other companies in the future. When you do, you'll have more money, resources, connections, and people willing to fund you (if you want) as a serial entrepreneur.

That said, I was never able to do it myself. My first project out of the gate is super ambitious and aims to change the face of the social internet, help people accomplish things in the real world, and improve privacy for everyone.

It's coming along and we have over 30k daily users. http://qbix.com

But it took a long time to get here. And now I am thinking that we might just be able to make it on our own steam.

So in a way, I am kind of pursuing my dream, and never had the time to start and exit a successful, but ultimately temporary, venture.

away3• 15 years ago

The quote is taken from the biography. In that paragraph Jobs is not talking about whether or not he thinks people are shirking by selling. He is saying that real entrepreneurs make companies that last and have a "legacy".

I do find it surprising though that you tell people to do what they love but then in these comments you admit you didn't like doing viaweb. In your essay you wrote, "The test of whether people love what they do is whether they'd do it even if they weren't paid for it." And it seems that you only did that startup because you were going to get money, which I suspect is true for the vast majority of y-combinator start-ups.

gsharm• 15 years ago

Your writing was a much bigger deal than ViaWeb.

erichocean2• 15 years ago

My guess is that he's talking about this problem: http://blog.wilshipley.com/2011/04/success-and-farming-vs-mi...

"Founders and angel investors usually don’t particularly care if the companies they created live or die after they sell out, because they’ve gotten their money and moved on. There’s no stigma to having a company you founded fail after you leave it. In fact, again, it's a badge of honor: “Bob Smith founded Flopper.com, sold it for $46MM, then got out before it tanked! Genius!”"

daimyoyo• 15 years ago

With this in mind I wonder why he chose to sell Pixar. While he made a tremendous amount of money from the sale, I don't think it was really enough to make a tremendous change in his lifestyle.

T-zex• 15 years ago

He did not start the Pixar. He bought it and then sold it.

sjwright• 15 years ago

Half true. He bought a division of LucasArts; it wasn't even called Pixar until the sale meant it needed its own name. The idea of Pixar being a feature length animated movie house wasn't even conceivable until Steve Jobs was there to negotiate with Disney for financing and distribution.

amirmc2• 15 years ago

As a result of the sale, he also became a major shareholder in Disney and joined the board. That might have had a bigger impact for him than just the monetary value from the sale.

yardie• 15 years ago

Indeed, I think people really underestimate the importance of having the Disney catalog in the iTunes store. And when I say Disney I mean Disney, ABC, Miramax and the other subsidiary studios.

nirvana3• 15 years ago

He sold Pixar, because it gave Ed Catmull and John Lasseter the opportunity to do what they'd always wanted to do, at Disney.

Pixar was created because Disney was missing he market. When Disney bought them, the Pixar guys started running the show at Disney.

Steve Jobs bought a small division of Lucas Arts that was going to be shut down otherwise, and, along with those guys and others turned it into Pixar for the purpose of realizing this market.

When he sold it, it was a real company, and it enabled the cofounders of Pixar to pursue their dreams. It was a win-win.

pittsburgh• 15 years ago

Between this post and comments from startup school along the same lines, there seems to be a lot of people complaining about founders looking to make a quick buck without having to work hard for it.

I live in SF. I'm running a startup, and many of my friends are as well. Where are these lazy, get rich quick people I keep reading about? Am I just lucky to only be surrounded by hard-working entrepreneurs who are trying to build long-term viable businesses, or is this problem being overblown a little?

This is me genuinely asking, not making a statement in question form.

middus• 15 years ago

What's wrong with looking to make a quick buck without having to work hard for it in the first place?

anon8084• 15 years ago

There's no rules, you can do whatever you want. But i think a lot of people have realized history shows the get rich quick type of folks tend not to actually contribute anything to human progress and more often than not are looking to take advantage of others for their own gain (allowing them to save time to riches). My question: Why would I ever want to deal with anyone like that, and why would anyone else?

gizmo4• 15 years ago

My guess is that we hear disproportionally much about those companies that are built to flip.

jnorthrop• 15 years ago

I've always believed there are three kinds of entrepreneurs. 1) Those that want to build an empire from scratch. 2) Those that want to build to sell and retire rich. 3) Those that want to generate an income stream that will allow them to live the lifestyle of their choice (maybe working 3 days a week).

All are valid and I consider all of them startups.

antimora• 15 years ago

From the Economics stand point, overall it's good that there are small start-ups whose sole purpose to succeed in some specialized area and later be bought off by a larger company that can use in some strategic maneuver. This is analogous to X-prize factor.

In fact, Apple has benefited tremendously by buying off companies to enhance its products (e.g. touch screen). Had everyone out there decided to build long sustaining companies, there would had been large economic inefficiencies.

HSO• 15 years ago

This is a very good point.

Also, in my case, I know that there are some things I'd like to do that are almost impossible to do when you're small or it would be a complete waste to reinvent the wheel.

Some biggies already have the technology I'd need to get closer to my dream, so I think the ideal path is to keep developing and getting a high profile in a niche that is under the radar and not easily replicable, and scope out potential buyers, not just by money offered but by product/vision fit.

In short, it's a mental thing, not what happens on contract paper, that counts.

shawnc• 15 years ago

The whole startup, get funding, sell the company idea is a new one to me - and yet i've been self-employed for close to 12 years. I had one job after High School, and that was working with my dad.

So my opinion on this is likely not so valid - but I think that those that enter into it for the 'quick buck' are few and far between, and also those that succeed at it are even fewer. It's not the 'ideal' way to go about starting a business, and I don't think it's the norm either.

It's a sweeping generalization - which is easiest to make and from reading his Bio, Steve's normal communication style as well.

AndrewWarner• 15 years ago

I don't see the attribution, so here it is:

Walter Isaacson page 569 of the hard cover.

textlaundry• 15 years ago

Apple wouldn't be alive without the existence of so-called "Cash Startups". The entire iLife suite, Siri, and a host of their other products came from buying out small companies. I wonder how Steve would have responded if the Dropbox guys showed him that quote in their negotiations.

jbp• 15 years ago

Exactly, Steve wouldn't be back at Apple if he(Next) didn't sell out. No Apple A4/A5 if PASemi didn't sell out. No Siri either if Siri didn't sell out.

mekoka• 15 years ago

It's worth noting that Steve Jobs was one of the few lucky ones to work doing something that they love. Working hard in this context still qualifies as hard work, but believing that it's all what entrepreneurship is about is a rather naive and delusional view of things.

saturdaysaint• 15 years ago

Ha, he must have forgotten offering to sell Apple to Commodore back in the Apple I days for a few hundred thousand dollars. Not to say that we should punish people whose views change, but it does seem that a lot of his success in Apple's early days was based on quickly and smartly capitalizing on small projects (eg quickly bringing Woz's engineering feats to market), not necessarily building the enduring platform that became his mission. From the Isaacson bio, he strikes me as a gambler/experimenter whose first company (thanks to much skill, foresight and luck) just so happened to make sense as a long term concern.

alecbenzer• 15 years ago

I think the guts of what he's saying is just "I hate when people call themselves 'entrepreneurs', when really they just want to get rich quick."

edit: quotes like this make me feel like I better understand how Jobs really might have thought (as opposed to how some of his fanboys think, which is what I kind of assume he would think like). Another quote I like is this one:

> We’re born, we live for a brief instant, and we die. It’s been happening for a long time. Technology is not changing it much – if at all.

Hyena• 15 years ago

He's making a subtle distinction because he objects to the word "entrepreneur" in this context. I see this as a valid objection; perhaps we should consider retiring "serial entrepreneur" for someone who does this frequently. What they're actually doing is building a business that builds businesses. A term for meta-firms might be good.

brudgers• 15 years ago

If you go to YC, you already have started selling your company.

Not that there's anything wrong with that.

But there is no reason to kid one's self.

kvnn• 15 years ago

I think we've gotten to the point where we are submitting, upvoting and discussing content solely because it has to do with Steve Jobs.

This (out of context) quote benefits me in absolutely no way. It might, if there was elaboration or example.

Anyway, in my opinion this is a low quality submission and I'm irked by it.

lightyrs2• 15 years ago

Amen.

lightyrs2• 15 years ago

I've been working out of the TechStars offices for the last few months and most of these guys don't care what their product is as long as they can sell it to investors. In Job's world, the customer is the consumer. In the startup world, the customer is the Angel/VC.

CamperBob• 15 years ago

"Don't bother. Whatever you're working on, we've already patented it."

rokhayakebe• 15 years ago

Can you elaborate on this, please?

Do you mean the minute you publish your work it is already patented?

idspispopd• 15 years ago

It is an interesting situation, there seems to be the one-brand, one-tech company. Just ripe for sale, when there is no reason(other than funding) that a founder couldn't start a small tech company or group, and grow various new technologies under the same umbrella, turning each into a product, and thus money stream.

zmonkeyz• 15 years ago

If your product consists of various products that you build and sell why wouldn't you be an entrepreneur?

ChrisNorstrom• 15 years ago

Just because Steve Jobs says it doesn't mean it's true. He's human just like everyone else.

The thing is, NOT every project, not every product, not every service can be grown into a full blown company. It just doesn't work that way. Go to any store and look at all the bottles of shampoo you can choose from, all those brands belong mainly to 1 or 2 companies, Unilever and Johnson. Same with food products. If every little shirt, and every brand of crackers where its own company with it's own marking, and distribution, and it's own packaging plant, it's own lawyers, it's own administration offices, it's own headquarters... We'd be paying triple for everything. (although we would have a lot more jobs... correction, the Chinese would have a lot more jobs...)

Some products just can't be monetized to support themselves so they MUST be acquired by a company that can integrate them into its own profitable services (or product line) and compete better with other competitors doing the same.

If nobody flipped it would screw over entrepreneurs by forcing them to commit themselves to one industry, one company, one product line their whole lives instead of being able to create companies, sell them, repeat. Thereby going in and out of numerous industries and markets instead of just one.

Can you really see every product becoming its own corporation? On the other hand, companies like Google and facebook (who's only difference from competitors were features) grew into their own massive companies. Sometimes it works, sometimes it doesn't.

Starting a company, growing it, and optimizing it are three different things. Very rarely are there people who are good at all three. Jobs is one of them, Zuckerberg another, but they're lottery stories. Their advice may not work for the majority of people.

- My 2 cents.

Steve Jobs' memo to startups

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