BIG PROBLEMS ARE RARELY SOLVED BY COMMENSURATELY BIG SOLUTIONS
“We tend to think that when a
problem is big, the solution must
be equally big. And this makes
sense: You’ve got a hole, and
you need a peg the same size.
But that’s not usually the way the
world works. Usually the way the
world works is, the solution starts
small, and then snowballs.”
Money Is Easy.
Entrepreneurship Is Hard
In the category of debates that shed more heat
than light, the most heated is whether tech
entrepreneurship is in a bubble or a golden age.
The answer is, probably both. It depends on
whether you’re investing money or getting it.
New York Times
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That’s just one of the many
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It’s hard not to look at the frenzy that preceded
the offering of Facebook or the billion dollars
Facebook paid for 18-month-old Instagram five
weeks before and not flash back to 2000. For
perspective, Facebook closed its first day as a
public company more valuable than PepsiCo,
Amazon, and 10 other blue chips in the Dow
Jones Industrial Average. Sure, the company is
going to be a massive moneymaker one day,
and its price has fallen since the IPO. But a $104
billion market cap out of the gate? That is mania pricing.
On the other hand, if collecting a billion dollars for a photo-sharing app
after 18 months’ work doesn’t signal a golden age for entrepreneurs, what does?
VCs such as Ben Horowitz and Mark Suster point out that technology has
slashed the cost of starting an Internet company a hundredfold, even as broad-
band adoption and social media have hugely magnified the potential rewards.
The angel investor Basil Peters adds that the Federal Reserve’s easy-money
policy has gilded the golden age still further: Investors are so desperate for an
investment that might earn more than the pittance available from banks and
Wall Street that they will happily fund a start-up, even if they would never
previously have dared to. “Never before in history,” he told me, sounding
vaguely Churchillian, “have entrepreneurs been able to create so much value
for so little capital in so short a time.”
Money may be easy, but we at Inc. haven’t forgotten that entrepreneurship
remains hard, really hard. Every easy angel dollar has hundreds of good ideas
in hot pursuit. Just ask would-be founder Kurt Varner (page 72), whom
editor-at-large Leigh Buchanan found sleeping in his Honda in Silicon
Valley as he tried by day to drum up support for his start-up. Leading a
real company is an endless string of challenges and heartbreaks from which
neither Fed policy nor tech advances can shield you. The 21 entrepreneurs
who share their stories in the “How I Did It” cover package (page 48) over-
came physical handicap, crime, loss, cyberattack, burnout, and legal obstruc-
tion to keep their companies going and their employees employed. It’s all a
reminder of why entrepreneurs are such a special and necessary force in our
economy. Bubble or golden age, that hasn’t changed.
eric schurenberg firstname.lastname@example.org
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