Using growth as a compass
Paul Graham has an essay called "Startup = Growth." I read it in my own reader, ReadIN. I got through the first half on the afternoon of November 1st and picked it up again on the evening of November 3rd, reading until after one in the morning. On that second half I wrote 27 notes in the margins.
When I was almost done I stopped and wrote down a separate thought. I really think this is the bible, and Paul Graham is basically the godfather of startups. He says to launch something small and use growth as the force that makes it evolve. Any company can borrow that. My company will use it as its model and compass, to evolve and get better.
Looking back at those 27 notes, some are barely anything. "Good ideas matter." "This part's kind of fun." But there are a few things I keep coming back to.
Startup equals growth
He says a startup has to make something lots of people want, and reach all those people. When I was a teacher, my biggest problem was that I couldn't reach everyone I could teach, because my time is limited. That's the best thing about the internet. You can sell to a big market.
Further on he says understanding growth is really the whole job. Next to that I wrote that this line is really really really really really really really really really important. Startup equals growth. Once the product is out, you have to do everything you can to get more users. Growth is the only goal.
I counted later. Nine reallys.
So once a company starts to take off, growth can be its only north star. Whatever you're doing, you start by asking if it's good for the company's growth. And your time as well. Every time you make a decision, is your time actually going into growing the company?
In a footnote he says that if you dress up your numbers with tricks, like counting users as active when they aren't, then even if you fool investors, "you're throwing off your own compass" (Paul Graham, "Startup = Growth"). That's where I thought, Paul Graham has really built a company. There's a lot you can fake in the numbers, and you can fool investors. But it's simple in the end. You can't fool yourself.
10% a week is not a small goal
There's a table in the essay that turns weekly growth into yearly growth. 1% a week is 1.7x a year. 10% a week is 142x.
Thinking about it that way is scary. Growing 10% every week is really not a small goal.
He says the founders themselves are often shocked by how it turns out. People tend to overestimate what they can do in a day and underestimate what they can achieve in a year. That's compounding, the power of compound interest. You make small, small progress every day. Then you end up doing a lot of homework.
It starts as a project
All of that comes after the product is out. What about the very beginning?
There's a part about actors. When an actor is starting out, they're just a waiter going to auditions. The way I read it, don't start by setting up a company. Start with a problem you want to solve, a project. Before a startup becomes a really good company, it's just doing a project. It has to happen organically.
This keeps showing up across Paul Graham's essays. Really starting a company is more like there's something out there I'd like to try. It isn't that I already have a grand plan. ReadIN happened that way. I was using all kinds of AI tools to automate my own workflow, and the need was real.
There's one more idea worth bringing up again and again and again. He says ideas like this are so rare that you should look for the ones that only recently became possible because something changed. For me that's AI being everywhere. It's why things like mind maps and AI features could show up this fast.
Starting a startup means becoming a kind of research scientist. You have to find what other people haven't seen. So, you have to work very hard to protect those organic ideas.
He also says most startups end up going nowhere. What I took from that is don't be afraid to fail. It's worth a shot, you know.
I don't look at ReadIN's growth yet myself, because we haven't really started pushing it to users. We're still in the validation stage, and we probably have about 3 loyal users. Right now, whatever users need is our compass. But once growth starts, growth is the one factor behind every decision, and everything else is noise.
In a footnote he mentions he got something wrong in an older essay of his, "How to Make Wealth." I haven't read that one yet. I'm going back to read it.
My AI reader, ReadIN, is in private beta. Want to try it? → Try it