a useful q&a in peter thiel's cs183 that's not in zero to one
Q: …If a startup can bootstrap instead of take venture capital, what should it do?
Paul Graham: VC lets you borrow against future growth. You could wait until your revenues are high enough to fund x. But, if you’re good enough, someone will give you money to do x now. If there’s competition, you may need to do x quickly. So if you don’t screw things up, VC can often help you a great deal.
Peter Thiel: If you’re doing something where you don’t need to move as quickly as possible, you might want to rethink taking venture funding. But if there’s any sort of winner-take-all dynamic—if there is a power law distribution at play, then you want VC. Giving up 25% of your business is worth it if it enables you to take over your industry.
@a Makes me wonder how familiar he is with the concept of network effects. A16Z has some great discussions on that topic: https://a16z.com/2018/05/16/network-effects-positive-feedbacks-increasing-returns-complexity-silicon-valley-history-innovation/ but it strikes me that he's internalized it from a different direction than most.
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