Venture Capital & How to Start a Startup

Paul Graham offers up two very useful articles:

  • How to Start a Startup:
    You need three things to create a successful startup: to start with good people, to make something customers actually want, and to spend as little money as possible. Most startups that fail do it because they fail at one of these. A startup that does all three will probably succeed.
  • A Unified Theory of VC Suckage:
    But lately I’ve been learning more about how the VC world works, and a few days ago it hit me that there’s a reason VCs are the way they are. It’s not so much that the business attracts jerks, or even that the power they wield corrupts them. The real problem is the way they’re paid.

    The problem with VC funds is that they’re funds. Like the managers of mutual funds or hedge funds, VCs get paid a percentage of the money they manage. Usually about 2% a year. So they want the fund to be huge: hundreds of millions of dollars, if possible. But that means each partner ends up being responsible for investing a lot of money. And since one person can only manage so many deals, each deal has to be for multiple millions of dollars.

Beatallica: Milwaukee-based parody band & the music wars

Xeni Jardin:

On the NPR program “Day to Day” today, I report on Beatallica, the Milwaukee-based parody band known for Metallica-infused covers of Beatles songs. As reported previously here on Boing Boing, Sony Music accused them of violating copyright laws, demanded that their webmaster pay “unspecified damages,” and forced the band’s ISP to shut down their website.