Entrepreneurship = Growtha startup is often characterized as a fast-growing company, only newly created company can not make itself into a start-up companies. For any venture company, set up in what is technically, whether to get venture capital, or whether the exit mechanism, these are not necessary, the most fundamental is that growth. Text / JohnTian a startup is often characterized as a fast-growing company, only newly created company can not make itself into a start-up companies. For any venture company, set up in what is technically, whether to get venture capital, or whether the exit mechanism, these are not necessary, the most fundamental is that growth. If you want to start your business trip, I understand that this point is very important. Entrepreneurship is so difficult so that you can not be crowded out and expect to be successful, you must understand that growth is the need to pursue you throughout the. The good news is that if you get an increase, then other things will naturally any return you, which means you can grow as a compass on the road ahead of you, so you need to make decisions in the face of all time . Towering trees (Redwood) we started to talk about this topic from the most obvious place is often overlooked: not all companies are start-ups. In the United States, each year the company reached a new record on one million, but only a small part of the start-ups. Most are commercial services - restaurants, barber shops, plumbing services, etc., except for very rare cases, these can not be called a start-up companies, a barber shop would never be characterized as fast-growing companies, However, a search engine company is clearly yes. When I say start-up companies are characterized as rapid growth, I mean in the two is obvious. First I said qualitative or design (designed) in the sense that having goals and prepare, because most startups fail. But from the nature of natural side, the start-up companies is not the same as a towering tree seedlings sprouting from the outset with a different fate. The difference is that why there is a different word 'startup', to specifically describe the rapid growth of those companies. If all firms are essentially the same, but some rely on luck or its founder efforts to make for fast growth, that we do not need a single word to describe the. We just need to become a very successful its companies and less successful companies. But in fact, start-up companies have other business completely different DNA, Google is not a very lucky or very hard, founder and successful barber shop, Google from the outset different. To get rapid growth, you have to be able to create a number of things to sell to the mass market (product or service), which is the difference between Google and a barber shop where a barber shop (barbershop) does not have the nature of large-scale expansion. For a rapidly growing company, it must have: 1 business (product, service) providing the majority of people want 2. provide products or services to cover all of these people and to serve them in the first , the barber shop is very fit, because everyone needs a haircut. But the biggest problem they face is that the establishment of the chain, that it does not satisfy the second. A service object barber shop is person to person, very few people will travel long distances for a haircut and go to a store, but even if someone is willing to do so, barber shop is not likely large enough to accommodate. Software development is the best way to solve the second, but eventually you will be bound by Article. If you develop a software to teach the Hungarian people speak Tibetan, so you can cover the majority of people want, but the market is still too small; if you developed software to teach Chinese people speak English, it is not the same, this When you are in the field of entrepreneurship. Most business either be first bound, or is bound to be the next day. The difference between a successful start-up companies is that more than two could not restrain himself. Ideas (Ideas) to start a business trip seems more than an ordinary commercial open a lot better, if you are ready to create a company, why not start with the most promising type of it? The problem is that this is a very efficient market, if you write software for the Hungarian teach Tibetan people, you will not encounter too much competition; and if you write for the Chinese people to teach English in the software, you face It will be very competitive, because it is clear that it should be much larger payoff. Those constraints restrict ordinary fast-growing company is actually protecting them, which is a compromise or trade-offs. If you open a barber shop, then you only need to compete with the local barber; and if you want to create a search engine, it would have to compete with the world of. However, for restricted common business development constraints, its most important protection not from competition, but a new idea (idea) is scarce. If you are in a particular neighborhood next opened a barber shop, geographical location not only limit your future development or protect you against strong competition from competitors, it also helps you define your company. Bar + neighborhood (Bar + neighborhood) is to carry out small business a good idea, of course, such a company subject to the conditions of constraint. You are in the field (niche) not only protects you, but also define you (what). When you really want to start a business, then you have to think about some very innovative things. A start-up companies must be able to provide some greater market services or products, these ideas are so priceless that all other obvious ideas have been abandoned. The idea of space has Nike Air Max Humara been turned over and over, so the start-up companies must be based on those who have been ignored all the above, I said people should try to find those who have been ignored most of the other people off the idea before, but that does Most start-up companies is not the place to start. In many cases, the success was the result of start-up companies, because of its founder saw the other people do not see in them it seems obvious idea. Maybe later they will find that idea before they found is indeed a lot of other people's blind spot, and then trying to start from this point. But when the official launch of the successful start-up companies that moment, most of the innovations are unconscious. So the difference between a successful entrepreneur is that they can not see the same problem, specializes in technology and to confront those problems by this technology, both of which are a very good combination, because technological change is so quickly, a lot of bad ideas will inadvertently become good idea. Problems Apple co-founder Steve Wozniak had encountered one wants to have their own computer, which in 1975 was unusual at that time a problem. But changes in technology is to become very common, because he not only wanted a computer, but also know how to build it, Wozniak can build their own one. And for his own problems and then evolved into the apple millions solved. But at that time, the idea of Wozniak's obviously ordinary people is a very big market, so Apple has established. Google also has a similar initial experience. Larry Page and Sergey Brin wanted to search the Web, but most people do not like is that they have the technical knowledge, which they can not only find deficiencies existing search engines, but also know how to improve them. In the ensuing years, the problems they encounter a problem everyone will encounter, because with the rapid development of web pages you have to choose a good search engine, and this process you will find old Some algorithms good enough. Like Apple, like the body development, while other are all aware of the importance of search time, Google has firmly in a good status. This is a start-up companies connected idea (idea) and between technology, rapid change in one area will uncover and solve major problems in some other areas. Sometimes these changes are progressive, and they change things can be solved. It appears that Apple is driving change, changes in chip technology eventually Steve Wozniak designed to withstand his computer. In the case of Google, the most important change is the rapid growth of Web pages, but it is precisely when there is no change to solve but with the huge demand of the market. Another connection start-up companies and technology start-up companies is that the establishment of a new way of doing things, from a broader sense, is a new technology. When a start-up companies begin to think not only generated by the technology-driven, and its products are also included in these techniques (which we usually call 'high tech'), this time to merge the two very easily. But more than two connections are not the same principle, in the first connection, the creation of start-ups we are neither driven by technological change, while its products often do not contain the relevant technology, in addition to some broad sense of technology. Rate (Rate) of a company's growth rate is so fast it can be regarded as a start-up companies? This does not specifically answer. 'Startup' is a pole, rod (pole), rather than a threshold (threshold). In the beginning, start a project and a vision statement is almost the same, you are trying to not be merely the creation of a company, but to open a fast-growing companies, at the same time you need to find some ideas in line with the type of . But at the beginning, what you have just some of the promises it. Starting a startup is like as an actor, 'actor' is also a pole (pole), instead of a threshold (threshold). As he began his acting career when an actor is a constant to audition staff constantly work to make him become a successful actor, but when he successfully Shique not necessarily just to be an actor. So the real question is not what kind of speed to make a company into a start-up companies, but the success of start-up companies tend to what kind of growth rate. For the founder, this is not just a theoretical problem, because it is equivalent to ask you whether it is on the right track. In general, the successful start-up companies will experience growth in the following three stages: 1. do understand that they are doing this initial stage, the growth of start-up companies is very slow or no growth 2. With the start-up companies have to understand the big What most people want and how to cover these people, increase this time will be very fast 3. The ultimate success of the venture Jordan Aero Mania company will become a big company, then growth will slow, partly because of the limitations of the interior Another part of the reason is that the company's services market has begun to limit their development these three stages together to form an S curve, and really decided on a start-up companies is the growth of its second phase, the length and slope ( slope) determines how much the company will grow. The slope is the company's growth rate, if you want to define a let every founder understand numbers, it is the company's growth rate, which is a measure of a company's business indicators. If you do not know this number, you do not know who you are currently doing is good or not. When I first saw a lot of the founder, it will ask their growth, sometimes they told me, 'Every month we will Air Jordan 6 add 100 new customers.' This is not growth, my real concern is not their new customers specific data, but with respect to existing users, new users occupied ratio. If you are a new user every month get a constant Nike Dunk SB Mens quantity, then you're in trouble, because it means that your growth is on the decline. At Y Combinator, we measure their growth every week, which is partly due to start-up companies from the Demo Day each time is very short, and partly because of the early start-up companies that need to quickly understand the feedback from users to continuously adjust currently doing their own thing. In YC, a better growth rate of 5-7% per week, if a week can reach 10%, then you're doing a very good already. But if you can only do one percent, then explain what you are doing now is problematic. The best way to assess it is revenue growth, and yet earn money for start-up companies, the other way is an active user. This rationality is that regardless of whether the start-up companies to start making money, its revenues are likely to be a constant multiple of the amount of active users. Compass (Compass) We often recommend start-up companies to get their view can achieve a growth rate, but they are just as possible to try to achieve their goals. The key word here is 'only' if they decide to weekly growth to reach 7% and eventually achieved, then they will be successful in the week, except they do not need to do any other; but if they is not reached, then at that point they would have failed, and there will be a corresponding warning. Programmers will recognize what we are doing, we are just beginning an entrepreneurial company into an optimization problem. Any person tried to optimize the code are aware of focusing on a narrow point of how amazing the impact will have to optimize the code meant to simplify existing procedures, changes, often simplified result is to spend less time and memory. You do not have to get to know the program is how it works, just let it run faster. For most programmers, this is very satisfactory results. More narrow focus can make you feel to solve the problem is how fast. Focus on achieving a growth rate that can simplify complex business problems encountered in the process, you can use this target growth rate for all your decision-making, any need for this growth is the right goals. Do you spend two days to attend a recent meeting? Whether you need to hire a programmer? Do you want to focus on the market? Do you want to spend time in some large customers on the other? Whether the product needs to increase a feature? All this growth rate as long as you can to develop as a center, you can make a decision. To make their own assessment of weekly growth does not mean you do not have long-term thinking, once you have experienced a week did not reach the target (which is the single most important thing, but you have failed) after suffering you encounter in the future Similarly pain, you will probably make you lose interest in all things painful. You would be willing to hire new programmers, he may not contribute to your growth in the week, but some of the new features it brings in some coming months could bring you a lot of users. But to make such a decision to the following two conditions must be met: 1. The new hire will not cause interference effects on short-term goals 2. If you do not hire new people, you have enough reason to worry that he will not reach the target so this is not to say no consider its future, but to consider whether it is necessary. In theory, this climbing style similar growth start-up companies will bring trouble, they may stop at a local peak. But in fact such a thing will not happen from week must reach a growth rate that allows the founders had to take action, and inaction or indifference with respect to, the action probability of success is much higher. 90% of cases prove, just waiting for another form of policy delay. For which seat to climb the peak, the founder's intuition is often better than they know. Coupled with the entrepreneurial idea is not so sharp (spiky) and isolated, most good ideas (idea) side tend to have a better idea. Optimization and focus on revenue growth caused the biggest is this process allows you to find better entrepreneurial idea, something you can achieve growth targets in this process as a pressure required to move forward. If you start from the original plan and the need to constantly adjust to maintain the growth rate of 10% per week, for example, the last you will find that your original vision of the company and may be completely different. But many can make you any week for Air Jordan 4 10 per cent growth would surely be a good idea to your original idea. Conditions are similar to small business, located in a specific area and are bound to help define a bar, with a rate of growth constraints helped define a start-up companies. You'd better follow guide you grow encountered various constraints, rather than being swayed by your original vision; like the fact that scientists always follow the guide and not as influenced by their own assumptions. As Richard Feynman said, when the imagination of nature more far-reaching than the human imagination, he meant that if you follow the facts and the truth, you will find more cool stuff. As in start-up companies, as growth constraints as the facts and the truth, every successful start-ups at least partly from the growth of the product of the imagination. Value (Value) every week to find a few percentage points to the growth of the product is very difficult, but if you find you may find a gold mine. Read the following form and you'll know: our ancestors rarely encountered such a case of exponential growth, because our intuition here is not have any guiding role. When such a fast-growing start-up companies, even if a founder is also shocked. If a company's growth rate is 1% per week, then the one-year growth rate is 170%; and when their weekly growth rate of 5%, the year was 1260 percent growth rate. If the income of the company was $ 1,000 a month (this early in YC is very typical of a number) and a week for 1 percent growth, then 4 years after its monthly income is $ 7,900, which is more than in Silicon Valley Area A good programmer salary is less. If a startup weekly growth rate remained at 5%, then 4 years after its monthly revenue will reach $ 25 million. Small changes in the growth rate on a very big difference in the final result will be, which is why there is a separate word 'startup' to describe the start-up companies, and why startups are doing is general company can not do, Let's say financing, to be acquired. Of course, this is why they often fail. Taking into account a successful start-up companies will be how priceless, if its failure rate is not high, anyone familiar with this expectation value of the people will be shocked. If a start-up company can give its founders to bring $ 100 million in revenue, even if their chances of success of only 1%, he built this start-up companies expected value as high as one million, while another group of smart and determined people together, their probability of success is certainly more than 1%. For some the right people - young Bill Gates, for example, the likelihood of success of between 20% -50%, it is not hard to understand why so many people wanted to invest in his. In an efficient market, the number of the number of successful start-up companies fail startups are proportional, which means that, if successful, more start-up companies, failure of start-up companies should be more. This means that at any time, the vast majority of start-up companies will be established to work in the absence of anyone involved in the field over, and this effort is called business. This does not bother me, that those with higher Beta coefficient with other professions such as actors, novelists. I have long accustomed to this, but it seems to many people in a difficult, especially for those who build the common business of the people, some people do not understand why these so-called start-up companies can get all the attention . If they take a step back to see the complete picture of it, they probably would not be so angry. They are still based on mistakes of their ancestors views on the value (median) in its concept, not an average. If you are startups criteria are based on the median, then the whole concept of start-up companies to open up is a ruse. You have to invent a bubble to explain why the founders want to start their own business projects and investors want to invest them. However, the concept of use value in an area has so many variables are wrong if you look at the average income rather than the value, then you can understand why investors like them, and if they are not the type of person the median, then They chose entrepreneurship is a rational choice. Transaction (Deals) Why invest in people so fond of start-up companies? Why are they so keen to invest in photo sharing class App, rather than those that can be fixed profitable business? For obvious reasons are not so obvious. Any test of an investment is a risk-free rate of return issue, startups can override this test because, although it suffered a huge investment risk, but if successful, the proceeds will be very high. But this is not the only reason people like to invest start-up companies, for general slow growth of business, if their risks and rewards are maintained at a very low level, then the risk-free rate of return would be better, so why VC is still only on high interested in growth companies? The reason is that they can recover the capital return, especially after startups IPO, or be acquired when. Another way to get a return from the investment in the form of dividends, although obtained from a certain percentage of income, but few VC investment in these companies, which is why it? Because it is easy to control by a private company will be transferred to their own purse earnings (say, to buy expensive to control their own supplier of accessories), which makes the company's earnings situation looks bad. Any person receiving dividends by investing in private companies need to always pay attention to their reports. The VC who like to invest in venture companies and not just because of their return, there is a reason is relatively easy to supervise their investment. In the case of the founder can not let investors benefit their own benefit. So why the founding fathers wanted to bring VC money? Growth! Constraints good idea and rapid growth are to be able to operate in both directions, not only need an idea of the scale of growth. If you have such an idea but can not achieve rapid growth, then your competitors will soon catch up. Growth is too slow to have network effects business is especially dangerous. Almost every company needs some money to start their projects, but even in the case of start-up companies are often able to achieve profitable financing. Sell a profitable company stock behavior may looks a bit stupid, but it's certainly smarter than buy insurance. In essence, this is the most successful way of looking at the financing of start-up companies. Companies can use their profits to grow, but funding from VC can make growth more rapid. Financing allows you to choose a faster growth rate. With funds to achieve rapid growth is often a good start for most of the VC firm's requirements, because VC who need them, rather than they need VC. If you prefer, a profitable start-up companies can use their earnings to growth, slow growth may be some risk, but is unlikely to collapse. The VC who will need to invest in start-up companies, especially start-up companies is very good, otherwise they could be out of the market. This means that any future venture company has Air Jordan CP3 sufficient funds are available, and because of these large-scale successful startups, VC who can still benefit from their investments. Almost all successful start-up companies will receive a takeover offer from another company, and why? What makes other companies want to acquire these start companies? Essentially are the same, everyone wants to succeed in business the company's stock: a fast-growing company is a great value. Let's say eBay purchase Paypal is a good thing, because Paypal now occupy 43% and more of the growth of its sales. However, the Offeror has more reason to want to start a company, a fast-growing company not only has great value, but it is also dangerous. If you keep expanding, it may invade the acquirer their field, many products also based on the acquisition of such concerns, even if the acquirer is not a threat to their own start-up companies, they may think of a competitor. From this perspective, the start-up companies for the acquirer has double value, so acquirers are typically willing to pay more than the average investor. Understand (Understand) entrepreneurs, investors and acquirers combination forms a natural ecosystem, the ecological running well, but those people do not understand it tends to invent some conspiracy theory to explain certain things. Just as our ancestors once on the natural works (such as whether the Earth round) explained the same, but its operation is no secret. If you're from the wrong assumption that (Instagram worthless) start, then you can only give a secret boss Mark Zuckerberg invention compelled to buy Instagram to explain this were acquired. For those who know that this assumption is absurd people, Mark Zuckberg bought Instagram because it is valuable, but also very dangerous, and really let him make the acquisition decision is its rapid growth. If you want to understand startups, understanding growth, I want to say is driving the growth of anything in the world. It is also why startups often are based on technology - as has the rapid growth of the company's 2015 Latest Nike Shoes idea is so scarce, and the best way to find this idea is to find some changes in recent years, where the technology is driving rapid change The best source. Growth is so much business entrepreneurs choose the most rational choice because: growth has enabled successful companies are so valuable, so that despite a huge risk, but the expected value of entrepreneurs still high. Growth is the main reason why the VC who want to invest in start-up companies: not only because of the return on investment is very high, but compared to investment and stock acquisition dividends, venture company will be more easily regulated. Growth explains why the most successful start-ups, even in the case where they are less in need of money for investment from VC still there: it allows them to choose their own growth. At the same time growth explains why most start-up companies will receive acquired many companies, the acquisition of a fast growing company not only valuable but also dangerous. If you want to be successful in one area, you need to understand that driving force. Understanding the growth itself is part of the entrepreneurial process. When you start doing something you really solve the problems of ordinary business harder than some, you need to search for those who can bring high growth idea, because these are very valuable idea, it is very difficult to find. Start-up companies is by far the best media reflect your newfound start a business trip and you decide to do as a researcher: you are not going to solve any particular problem, you can not know exactly what the problem can be solved, but you have to try to find something not previously been found. A startup founders do is actually similar with an economist, most of them do not have a very significant discovery, but someone will find some correlation. (Via: 36 Krypton Paul Graham)