We Have Learned Nothing

The fact that the survival rate of startups hasn't improved doesn't show that our knowledge hasn't improved. Startups are competitive, with only 1 or 2 VC-scale winners per market. So, the claim is like "race car technology hasn't gotten better, because there's still only one winner per race."

The fundamental premise seems wrong to me. Entrepreneurship is not a science. It is closer to a craft or an art, but even then, the inclusion of market dynamics and competition means that there is never a static “winner” in the same way that a craft like carpentry can have multiple masters.

Marketing is especially the key element here, and there is and never will be a permanent science of effective marketing. Culture is always changing and what gets attention today is blasé tomorrow.

The Lean Startup methodology is likely applicable only within a very narrow niche: a newly discovered green field with plenty of low-hanging fruit. Web apps in the late 90s and 2000s. Mobile apps after that. Agent integrations now. These are areas where the barrier to entry is low, problems are plenty, and there's space for a thousand flowers to bloom.

In contrast, for a company that can't be started by a single app developer - getting out of the building won't help. Nobody in the space worth talking to will talk to you, for starters.

> The New Pundits have been around long enough, and are widely known enough, that their relevant books have collectively sold millions of copies and are taught in virtually all university entrepreneurship courses.[4] If they worked, it would show up in the statistics. Instead, there has been zero systematic progress over the past 30 years in making startups more likely to survive.

For me, this is where it breaks. There are two assumptions that the author must be challenged on.

1. Enough people know about these methods

2. Of those people enough use the methods properly

Judging from my own experience I can’t confirm neither of these. Even those people that know the approach rarely have the rigor to treat startups as a series of experiments. Ego plays a large part.

If you believe that an achievement involves skill, and that people can hone than skill, then I think you should believe the people who have done it know on average good advice about how to do it. You don't have to believe this, you may believe that many people simply got lucky, and no skill is involved. I think most of us do believe that skill is involved in starting a business, so let's just assume it is. I think this implies that successful and well-intentioned business-starters should on average be able to give good advice. Not that they all will give correct advice every time, or that their advised approach will be correct for you every time. But that they on average "know something". My impression is that they largely agree with the method put forward in the lean startup. I haven't read all these other book that tfa is dissing, but I think it's basically arguing a very difficult view. Why should I believe this random guy when the people that have done it many times are telling me he's wrong?

Maybe the more rational conclusion is that it is purely a random chance that a startup would succeed, so we should just increase the amount of startups in the first place instead of restricting it.

Methods improved the baseline, but also increased competition, keeping outcomes flat. Totally underweights systems and then blasts into methods not working. “Just do something different” is not a strategy... In fact, many great businesses look conventional early, and only later reveal their advantage.

I don't think this article is very good, at all.

A product being good enough isn't enough. At some point you also need to price it, and communicate it's existence persuasively to the market and win market share, and it has to be distributed effectively.

Most businesses fail because they solve for the easier bit (product) and then have no idea about the rest.

nice execution. the demo video sold me more than the text

serious question:

> no change in survival rates

> less series A

would this not imply that companies got more efficient at using their seed funding?

(But then again: The real dip in series A funding starts in 2018; so we might still see a dip in 10y survivability starting 2028)

As a dabbler in startup punditry (I've written a couple of books on startup positioning), I find Jerry's take very thought provoking.

The crux of the issue for me is what Dr Iain McGilchrist highlighted — we attend to the world in two very different ways. One mode of attention is a broad, open awareness to what's 'out there' and the other mode is a much more narrow focus on the parts and pieces.

For startups, when you look at the actual cases, many successful founders, almost by definition, had to stumble across their insight in some emergent fashion. They either experience some pain and set about solving it (Dropbox); see some opportunity on the horizon (OpenAI); or stumble onto some idea while working on something else (Slack).

If you want to do a startup, or your current idea isn't working, and you don't have that vision of emergent opportunity, then what do you do? "Just look for some emergent opportunity" isn't very compelling advice (even if it's probably the most accurate).

This is where the punditry emerges. You have to use your other mode of attention in an attempt to brute force some insight through narrow-focused analysis, and that analysis is inherently constrained to your (by definition) barren environment. That gives you the Lean Startup, customer development, etc etc. This far more analytical approach requires (a) intense discipline; (b) a lot of luck because you're starting from a point of no opportunity; (c) enough volume to actually do the interrogation of reality.

And it may not work because it's simply using the wrong mode of attention, anyway!

Nevertheless, frameworks that exist in this realm all sound reasonable because, on one level, they are: what else can you do but interrogate reality in some methodical way? But the question TFA raises (in my mind) is whether shaking the tree like this — IF you even can with appropriate discipline — reveals emergent opportunity for startups at a scale that's reflected in the broad outcome data, and the answer appears to be no.

Interestingly, the book The Heart of Innovation[1] tries to tackle this by going to the extreme. It's not about finding some clues in fast iteration or mapping out a canvas with a nice value prop, it's about finding 'authentic' demand that's so compelling it's something users can't not do. (The 'not not' concept is hard to explain but creates a much more rigorous bar for innovation IMO.)

That's their backward-looking observation for innovations that stick (and reflects most of the cases in the book), but they're still faced with the same dilemma of what to do if you aren't blessed with emergent opportunity.

In that case, their solution is to ramp up the analysis even harder, with 150-200 "Documented Primary Interactions" observations. I.e., brute force observations even harder. Some of the authors are part of a startup accelerator with an (apparently) high hit rate, so it's not just speculation.

All told, it's amazing that billions and billions of dollars are allocated to startups and so little is invested in studying innovation itself, especially given how slight the predominant frameworks are. Yet new ways of thinking exist (like McGilchrist, or the Heart of Innovation approach), so I wonder if frameworks for innovation are still in their absolute infancy, really, where the ones that succeed suffer the memetic curse: simple enough to travel; too simple to be effective.

[1] Excellent overview here: https://commoncog.com/the-heart-of-innovation-why-startups-f...

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Startup punditry is a business niche being capitalised on and it's being regarded in this article like a commune of knowledge. It's mildly insightful entertainment literature, with customers. On a philosophical level it's absolute value is tainted by its existence in the market. Most things are, but it living in the context of entrepreneurial endeavours, it taints it substantially more than most.