Given all of this, I think that if you’re smart and hard working, you should have at least an 80-90% chance at succeeding at a startup.
Uhm, I don’t think you’re multiplying together the likelihood that you don’t fail in each of the ways you outlined. You got so close by identifying all the hurdles you have to go through—and then instead of doing the math, you basically said “these look like stuff that can get overcome by a smart and hard working individual” and slapped the “80-90%” label on it.
I counted 21 distinct ways you said a startup can fail. 0.99^21 = 0.8. I’m pretty confident you envisioned more than one person failing in that way out of a hundred.
I counted 21 distinct ways you said a startup can fail. 0.99^21 = 0.8. I’m pretty confident you envisioned more than one person failing in that way out of a hundred.
This strikes me as a case of what I call the Conjunction Fallacy Fallacy, because if we actually did multiply all that together, the startup success rate would be more like 1% or less.
Doing a successful startup is hard. Surpassing the default 90% lack-of-major-success rate for experienced startup founders, startup founders who are nephews of VCs, startup founders who impress even VCs, etcetera is hard. The best of our community have not yet demonstrated that they have surpassed this level. It could be that with sufficiently systematic training our community could achieve outsized returns by not just being specific but also acquiring sufficient skill levels of See Through Conventions and Avert Office Politics and Use Conditioning Correctly and Be Really Original and Cooperate With Cofounders and MurphyJutsu and Learn From Others Experience and Be Calibrated and so on. It’s not the sort of thing where you can read LW and breeze through it. Your post was downvoted because it displayed a tremendous ignorance of the problem’s magnitude, trying to hit a 16-pound nail with a 4-ounce hammer.
Your post was downvoted because it displayed a tremendous ignorance of the problem’s magnitude, trying to hit a 16-pound nail with a 4-ounce hammer.
Sorry if it wasn’t clear, but my intentions weren’t really to make an argument, they were to open a discussion.
Open
My motivation behind this post stems from Aumann’s agreement theorem. It seems that my opinions on startups differ from most of the rationality community, so I want to share my thoughts, and hear your thoughts, so we could reach a better conclusion.
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I really mean for this article to be a starting point for discussion. I think that if we outline the components and discuss each one, we’ll make a lot of progress in coming to an agreement. So let me know which components you think I omitted, and which components you think I’m mistaken about.
I wanted to attempt to take an Inside View at startup likelihood, and get feedback. So maybe I did start off with a 4-ounce hammer, but the idea was to bulk that hammer up so we could attack a problem that I think has major upside, and that suffers from notable cached thoughts.
Interestingly, if you assume these are the only ways a startup can fail, and that for a typical startup creator (who is self-selected as smarter and more conscientious than average) each of these has an independent 90% chance of working out (what seemed to me like a reasonable estimate), then the overall chance of the startup succeeding is 0.9^21=0.11, remarkably close to the actual base rate. This particular model is unlikely to be accurate, but it is another way of illustrating your point.
Uhm, I don’t think you’re multiplying together the likelihood that you don’t fail in each of the ways you outlined. You got so close by identifying all the hurdles you have to go through—and then instead of doing the math, you basically said “these look like stuff that can get overcome by a smart and hard working individual” and slapped the “80-90%” label on it.
I counted 21 distinct ways you said a startup can fail. 0.99^21 = 0.8. I’m pretty confident you envisioned more than one person failing in that way out of a hundred.
This strikes me as a case of what I call the Conjunction Fallacy Fallacy, because if we actually did multiply all that together, the startup success rate would be more like 1% or less.
Would you mind giving your thoughts on how much you think being specific improve ones chances at startup success?
Doing a successful startup is hard. Surpassing the default 90% lack-of-major-success rate for experienced startup founders, startup founders who are nephews of VCs, startup founders who impress even VCs, etcetera is hard. The best of our community have not yet demonstrated that they have surpassed this level. It could be that with sufficiently systematic training our community could achieve outsized returns by not just being specific but also acquiring sufficient skill levels of See Through Conventions and Avert Office Politics and Use Conditioning Correctly and Be Really Original and Cooperate With Cofounders and MurphyJutsu and Learn From Others Experience and Be Calibrated and so on. It’s not the sort of thing where you can read LW and breeze through it. Your post was downvoted because it displayed a tremendous ignorance of the problem’s magnitude, trying to hit a 16-pound nail with a 4-ounce hammer.
Sorry if it wasn’t clear, but my intentions weren’t really to make an argument, they were to open a discussion.
Open
Close
I wanted to attempt to take an Inside View at startup likelihood, and get feedback. So maybe I did start off with a 4-ounce hammer, but the idea was to bulk that hammer up so we could attack a problem that I think has major upside, and that suffers from notable cached thoughts.
Interestingly, if you assume these are the only ways a startup can fail, and that for a typical startup creator (who is self-selected as smarter and more conscientious than average) each of these has an independent 90% chance of working out (what seemed to me like a reasonable estimate), then the overall chance of the startup succeeding is 0.9^21=0.11, remarkably close to the actual base rate. This particular model is unlikely to be accurate, but it is another way of illustrating your point.