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Founders Over Ideas

The founder is a lot more important than the idea itself for many reasons, but here are the top four. Big Ideas Start Small The first is because most big ideas don't sound like companies at the start, and that's because they aren't. Most start as "side projects" or "hobbies". Steve Wozniak & Steve Jobs built their first computer because they wanted their own and couldn't afford to buy one. They weren't trying to build one of the largest tech companies on the face of the Earth, that would've been quite a scary undertaking for a 20 and 25 year old with little to no business experience. Suddenly their friends wanted one too, and so they started building more to sell. Brian Chesky and Joe Gebbia needed money to pay rent, so they rented out airbeds in their San Francisco apartment during a design conference. This is how airbnb started. Larry Page and Sergey Brin were working on a PHD in Computer Science at Stanford and decided to build a search engine as part of their dissertation. That's how Google was born. Mark Zuckerberg built Facebook because he wanted to connect with some of the students at Harvard who were in his classes. Initial Ideas Always Evolve The second reason is because almost every idea changes as founders start to build and learn more about their users. All of the world's most successful tech companies started off with the founder trying to do something much smaller or different. This almost has to be the case, because most founders of top tech companies would've thought they had no chance if they knew what they were in for from the start. For example, even though AWS is responsible for the majority of profit that Amazon generates ($13.5B in 2020... thats profit, not revenue), it was started almost by accident. Amazon was growing fast and needed reliable cloud infrastructure. If Jeff Bezos knew he would have to build AWS in order for Amazon to succeed, it's very possible that 30 year old Bezos may have pursued a different idea. Amazon started by selling only books online, and look at them now. A couple of 23 & 24 year olds decided to strap a camera to one of their heads and stream live video 24/7 of his day. They called it Justin.tv - this evolved into allowing other people stream themselves while playing video games. Emmett Shear, Justin Kan, Micheal Siebel, Kyle Vogt & Kevin Lin sold Twitch for almost $1b to Amazon in 2014. At the start, nobody could have predicted Justin.tv would evolve into Twitch, not even the founders themselves. Otherwise they would've just started Twitch from day 1. After quickly becoming a hit with students at Harvard, Facebook expanded to other Ivy league schools. By the end of the year, it had dropped it's university-focus and became a platform for the masses. Good Ideas Sound Bad The third reason is because most great ideas sound pretty bad at the start. There was no market for personal computers when Apple launched in 1976, it simply did not exist. Almost nobody believed Airbnb was a good idea in the beginning, because everyone's first thought was: "Why would anyone let a random stranger stay in their apartment, what if it's a serial killer?" Even Paul Graham, who is arguably one of the world's leading experts on startups and angel investing, tried to convince the founders of Airbnb to work on something else when they first joined Y-Combinator. If great ideas sounded good from the start, there would always be a ton of people pursuing them, which would make them very competitive by nature. In almost every case, the best ideas are ones that appear to be "creating a new market" or starting in a space that already appears saturated. Google and Facebook both fall into the second category. There were 10 other search engines when Google launched and 3 other popular social networks before Facebook launched. It appeared that the ship had already sailed but even as outsiders Mark Zuckerberg, along with Larry & Sergey, saw something that everyone else in the space was missing. For the first category, think of Airbnb in 2008, Uber in 2009, Amazon in 1994, or Coinbase in 2012. These all either created a completely new market or entered a space that had not been disrupted in a very long time (meaning there was no market for technology in those spaces, simply because there hadn't been any tech created up until that point in time). Big ideas don't seem like they will make much money from the start The final reason is because if you set out to make a lot of money, you're doomed to fail. If the founders of Google set out to build a technology company that would one day be worth over a trillion dollars and have over 100,000 employees, it's pretty likely they would've given up after the initial excitement wore off and they faced their first real big obstacle. In the early days when Google was raising capital, their deck didn't even have a business model slide. In other words, they weren't even talking about how much money Google would make, or how it would even make money for that matter. The mission was simply to "organize the world's information and make it universally accessible and useful." If the founders of airbnb were just trying to make money, they may have gotten into real estate and started renting out more apartments in San Francisco. Instead they sought "to help create a world where you can belong anywhere and where people can live in a place, instead of just traveling to it." If Elon Musk was trying to make money, he likely wouldn't have started Tesla (and likely not SpaceX either). A few years ago in an interview, he himself said he didn't believe Tesla would be successful and he put a large majority of his entire net worth into it between 2003-2009. Amazon started by selling books online. Why not just go to the local library? To outsiders, this likely sounded like a lousy idea that would never make a lot of money. Apply to our Founder's Program here Email pablo@onesixonegroup.com if you have questions about our program.

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