On a Bus: From Stranger to Startup in 72 Hours

June 5, 2012 7:37 AM

11 buses full of strangers have 72 hours to build and launch startups on the road to a meeting with investors at SXSW. StartupBus is a tech industry boot camp on wheels.
posted by rageagainsttherobots (102 comments total)

Hm. Undoubtedly these will be superior applications most deserving of investor funding.
posted by leotrotsky at 7:42 AM on June 5, 2012 [5 favorites]

OK. Now we're in a tech bubble. Even the dumbest dot-com wasn't as stupid as this.
posted by Slap*Happy at 7:45 AM on June 5, 2012 [44 favorites]

Little do these hipsters know that they are actually part of a new reality Hunger Games show that will start about halfway to Austin when their buses "break down unexpectedly". LET THE GAMES BEGIN HIPSTERS.
posted by mcstayinskool at 7:45 AM on June 5, 2012 [16 favorites]

Startup culture is one hell of a circlejerk
posted by MangyCarface at 7:45 AM on June 5, 2012 [12 favorites]

Startup culture is one hell of a circlejerk

You got that right, Senator!
posted by Juffo-Wup at 7:46 AM on June 5, 2012

What's the secret to success in hi-tech industrial entrepreneurship - talent? vision? drive?

No, you have to be selected to get on this stupid fucking bus. Guys with money will be waiting for whatever random shit you come up with on the drive to them. This is redonculous.
posted by Meatbomb at 7:47 AM on June 5, 2012 [1 favorite]

I'm just gone post this and leave

How Venture Capital is Broken
posted by JPD at 7:50 AM on June 5, 2012 [9 favorites]

Little do these hipsters know that they are actually part of a new reality Hunger Games show

I'm hoping for a plane crash in the Andes.
posted by mhoye at 7:50 AM on June 5, 2012 [2 favorites]

Is there no tech startup reality tv show yet?
posted by jeffburdges at 7:51 AM on June 5, 2012

So, is this this gameification I keep hearing about?
posted by Thorzdad at 7:53 AM on June 5, 2012 [1 favorite]

Ooh, I hope we find out what happens when they stop being polite and start getting real!
posted by Horace Rumpole at 7:53 AM on June 5, 2012 [7 favorites]

May the odds be ever in your favor.
posted by Hollywood Upstairs Medical College at 7:53 AM on June 5, 2012 [3 favorites]

Great. Another four 'social' buzzword laden concepts of pure wank. The difference was these were developed on a BUS!
posted by Thoth at 7:53 AM on June 5, 2012

OK. Now we're in a tech bubble.

My first thought as well, although I am not confident in that thought by any means. There is definitely a bubble, but it seems to be a 'start-up bubble', not a tech bubble, for whilst many of these companies are using tech, their products are not tech, but rather products and/or services. Fine distinction, but one well-worth making.

But is it a bubble? On one hand, lots of money flowing toward random ideas. People without experience in an area, forming a company and rushing into it. Hot investor cash running amok. Startups on boats (unreasonable inst.), on buses, and a whole service industry for start-up culture.

On the other hand, there is record unemployment, economic stagnation, technology has made creating new tools easier, and the current generation of people sees the world through a lens of tech. There's a lot of wealth held by the people at the top, and increasingly they're not companies, they're individuals. Previously, company boards allocated resources to individual inventors. Now, individual investors are allocating resources to companies!

I would love to hear opinions from all sides about this one, because it seems to be a global phenomenon yet each case and experience will be highly localised.

As far as if it's a bubble, I guess we'll know if it pops...
posted by nickrussell at 7:54 AM on June 5, 2012 [1 favorite]

The bus will pull into a station, and everyone will get off. The station is in the middle of a playing field, about 20 miles across, covering desert, forest, mountains. The edges of the field are clearly marked.

Each person receives a money belt. In the money belt is 50,000 in cash.

Make it past the markers, and you keep the belt. First one over the markers gets a pitch meeting at Y Combinator.

The armed opposing team gets to keep the belts as scalps. Gameplay begins in 30 minutes.

Sponsored by Budweiser and GoDaddy.
posted by jquinby at 7:56 AM on June 5, 2012 [6 favorites]

It's more like busing young musicians to L.A. telling them they're going to get signed with a record label. Then when they arrive, they're courted by the softporn producers.
posted by RobotVoodooPower at 7:57 AM on June 5, 2012 [1 favorite]

"Pop quiz, hotshot. There's a bomb on a bus. Once bus goes 50 miles an hour the app becomes available on iTunes, the bomb is armed. If it drops below 50 becomes promoted on HuffPo, it blows up. What do you do? What do you do?"
posted by Fizz at 7:58 AM on June 5, 2012 [1 favorite]

I read Hacker News for the geek content, but the smug self-amused startup blowjobbery just gets to me after a while. "LOOKING FOR TECHNICAL COFOUNDER" makes me want to say "Oh, you have a crazy idea you came up with in the shower this morning and have no idea how to do it, right?"
posted by mrbill at 7:58 AM on June 5, 2012 [5 favorites]

Here's my startup idea: A firm of start-up pitchers who eat nothing but onions, asparagus, stinky cheese, and meat of dubious freshness. Clients hire my firm to place one of our Stink Ups on a rival's bus, thus distracting competing groups from completing their pitch and tainting those that do with an investor-repulsing patina of funk.
posted by robocop is bleeding at 7:58 AM on June 5, 2012 [1 favorite]

Alternately, combine this with Penn & Teller's Magic Bus. That's a TV show I would watch. "Come up with a good startup idea, or you'll NEVER GET OFF THE BUS..."
posted by mrbill at 8:02 AM on June 5, 2012

We're all bozos on these 11 buses.
posted by flapjax at midnite at 8:03 AM on June 5, 2012 [4 favorites]

buses full of strangers
building startups on the road
along the dusty highway
where once walked old Tom Joad
would those buses stop to help
a weary traveler on his way?
i reckon not, cause what the fuck?
like, how much would that pay?
posted by flapjax at midnite at 8:05 AM on June 5, 2012 [14 favorites]

I'm glad I'm not the only one that didn't find a single thing here to not hate.

(If you need an app to tell you what to do with your garden "extras" UR DOIN IT RONG)
posted by DU at 8:07 AM on June 5, 2012

11 buses full of strangers.tumblr.com

Just add a .tumblr.com. It'll sell itself. I'm telling you guys...just add .TUMBLR.COM!
posted by Fizz at 8:11 AM on June 5, 2012 [3 favorites]

If only we were not a bunch of pseudonymous internet commenters wasting time producing free monetizable content for Metafilter Network Inc we have a leg to stand on while snarking about people trying to do stuff.

Which is to say I feel outrun by a bunch of goofs on buses chasing vulture capital at the biggest iReachAround outside of TED.
posted by srboisvert at 8:12 AM on June 5, 2012 [4 favorites]

Metafilter: a bunch of pseudonymous internet commenters wasting time producing free monetizable content
posted by Fizz at 8:13 AM on June 5, 2012 [2 favorites]

I hear the winners will get to bid on a Semper Augustus bulb... and my sources tell me that we're going to see the bulb market go to 3000 florins on that number. Although my money's on the new crop of Admirael van der Eijck's...

These are wonderful times to be alive and investing!
posted by mrdaneri at 8:17 AM on June 5, 2012 [3 favorites]

(If you need an app to tell you what to do with your garden "extras" UR DOIN IT RONG)


It's like harvestation's ridiculous younger sibling.
posted by zamboni at 8:18 AM on June 5, 2012

Startup culture is one hell of a circlejerk

I think you're making the mistake of seeing this as some sort of exercise to actually start a company that makes a product of lasting value. That couldn't be further from the truth; this is the HR equivalent of "Flip This House".

It's all about the splash-and-dash.
posted by mhoye at 8:21 AM on June 5, 2012

If only we were not a bunch of pseudonymous internet commenters wasting time producing free monetizable content for Metafilter Network Inc we have a leg to stand on while snarking about people trying to do stuff.

monetizable CON-tent!
motherfucker i'm HELL bent!
on makin' my SMUG snark!
don't like it? go READ Fark!
posted by flapjax at midnite at 8:28 AM on June 5, 2012 [3 favorites]

the weirdest brand of hate I've seen in a while.

That's gotta get some interest from investors, then, no?
posted by flapjax at midnite at 8:29 AM on June 5, 2012 [1 favorite]

I agree, item. I've know people who've been on the Startup Bus and have judged it. It's a lot of fun for a lot of people, and most people in here seem to be taking it much more seriously than what it is mean to be. It's a great opportunity for people to network, have a good time, try something new, and maybe get a shot at taking a simple idea and taking it further. Maybe the ideas are silly... so what?
posted by txsebastien at 8:29 AM on June 5, 2012 [1 favorite]

The bus is actually a rocket to Mars. Enjoy the rest of your lives, strangers!
posted by orme at 8:32 AM on June 5, 2012 [5 favorites]

I have a brilliant plan which is guaranteed to make all of us filthy stinking rich. It's simple, really. We will all sell start-ups. I will sell you all start-ups, and you will go sell them to the masses with a small percentage kicked back up to me. Even better, if you can convince some of your friends to also sell start-ups, you can take a percentage from their sales (of which I also get a small percentage)! And if your friends get their friends to sell start-ups, why, the possibilities are endless!

My start-up kits start at a mere $999.99, and it's a bargain at twice the price. Place your orders now!
posted by backseatpilot at 8:33 AM on June 5, 2012 [1 favorite]

I don't understand all the hate. A bunch of kids are getting together to develop new business ideas and maybe even raise some money to bring those ideas to fruition. Yes, most of the ideas are probably crap and will go nowhere. Yes, this enterprise sounds self-counsciously hipsterish. But new products and services have to be born somewhere. And when hungry, ambitious youth start small new businesses, it helps keep bigger, older businesses on their toes. Good for these kids for dreaming big and for being fortunate enough to be able to pursue those dreams.
posted by brain_drain at 8:37 AM on June 5, 2012 [4 favorites]

I did this last year. A friend of mine recommended me, and we both went on the SF bus.

My wife drove with me from LA to San Francisco. We stayed a few days in SF, and then got on the bus to Austin.

It was fascinating. Probably the most grueling development experience of my life. It's all of the core problems of normal development, but on a bus. With twitchy power, near 0 internet, and jostling all the time.

We paired with a great group, but our product was just meh. We did't get much done, largely due to the environment and mixed skillsets. The closing bit in austin was awesome. We ended up hanging out in the Driskill Lobby overnight working on the pitch elements.

I spent the next day working on the product at my sisters house and then flew back to Los Angeles.

Interestingly enough, I started using a cloud based development tool during the trip. I ended up talking to those guys and getting a job with them in SF based on the startup bus experience.

Although that role didn't work out, it did get me to San Francisco where I am today.

It's easy to poke fun at the whole thing. Does it make good products? Probably not. It does encourage people to try to succeed on their own, it does show people the true difficulty of shipping something, and it's kind of a neat concept.

So we are definitely in a tech bubble, but anything that encourages people to be self-sufficient in a business sense, to create new products, be it electronic or physical, regardles of whether you like buses or not, is a good thing.
posted by Lord_Pall at 8:37 AM on June 5, 2012 [18 favorites]

As usual, porn got there first.
posted by LarryC at 8:39 AM on June 5, 2012 [10 favorites]

Oh yeah, just to add a teeny tiny bit of snark. A lot of the ideas are Twitter for Cats grade. But I think the act of trying to create it helps cull them out.

Also at least on the SF bus, a lot of people were solving problems that only very young people who live in san francisco and work at startups have, or inventing things that make everyone's life more difficult.
posted by Lord_Pall at 8:40 AM on June 5, 2012 [2 favorites]

Not being able to look at a laptop screen or book in a moving car for more than three minutes without getting nauseous, I'm wondering how they could possibly write code without a barfbag handy.
posted by Mr. Big Business at 8:43 AM on June 5, 2012 [2 favorites]

We ended up hanging out in the Driskill Lobby overnight working on the pitch elements.

Fingers crossed that this is secret code for something else.
posted by chavenet at 8:44 AM on June 5, 2012 [2 favorites]

I wonder if you could do some sort of thing where you make a point of making sure each bus has some diversity of background or seeding the busses with a bunch of vague problems to be solved to get around the "young people from $wherever problems" filter.

(For problems, I'm thinking things from a vague high level like "people with accessibility issues have trouble with many websites" or something similarly open ended.)
posted by rmd1023 at 8:46 AM on June 5, 2012 [2 favorites]

Can we introduce these douches to the other douche that wanted to put a reality television show on Mars?
posted by Rhomboid at 8:48 AM on June 5, 2012

The bus is actually a rocket to Mars. Enjoy the rest of your lives, strangers!

"…So it was decided to build three ships, you see, three Arks in Space, and ... I'm not boring you am I?"

"No, no," said Ford firmly, "it's fascinating."

"You know it's delightful," reflected the Captain, "to have someone else to talk to for a change."

Number Two's eyes darted feverishly about the room again and then settled back on the mirror, like a pair of flies briefly distracted from their favourite prey of months old meat.

"Trouble with a long journey like this," continued the Captain,"is that you end up just talking to yourself a lot, which gets terribly boring because half the time you know what you're going to say next."

"Only half the time?" asked Arthur in surprise.

The Captain thought for a moment.

"Yes, about half I'd say. Anyway - where's the soap?" He fished around and found it.

"Yes, so anyway," he resumed, "the idea was that into the first ship, the 'A' ship, would go all the brilliant leaders, the scientists, the great artists, you know, all the achievers; and into the third, or 'C' ship, would go all the people who did the actual work, who made things and did things, and then into the `B' ship - that's us - would go everyone else, the middlemen you see."

He smiled happily at them.

"And we were sent off first," he concluded, and hummed a little bathing tune.

posted by zamboni at 8:53 AM on June 5, 2012 [7 favorites]

Never get off the bus
posted by fearfulsymmetry at 8:53 AM on June 5, 2012

I don't understand all the hate. A bunch of kids are getting together to develop new business ideas and maybe even raise some money to bring those ideas to fruition.

It's because this is the equivalent of "design my logo for free, because it's great exposure."

I'm a bit cynical on this topic right now, but understand what this is: A bunch of guys with lots of money create a coliseum atmosphere where people without money dance for the the possibility of getting to work themselves into an early grave because they might end up with some portion of the kind of money the VCs have.

Yes, there are benefits. The gladiators who survived the Coliseum were pretty at swordfighting, too.
posted by fatbird at 8:54 AM on June 5, 2012 [4 favorites]

But new products and services have to be born somewhere.

Yes, but the world doesn't need more stupid iFart buttons.

I think what's annoying is the idea that something they might have done as an assignment in a college class is being done with the expectation of getting tens of thousands of dollars of VC funding. It just seems so absurd.

I mean, if it's something that you can come up with an implement on a bus trip then it's not really worth that much in the first place.

Can we introduce these douches to the other douche that wanted to put a reality television show on Mars?

Don't tell me you wouldn't watch that.
posted by delmoi at 8:56 AM on June 5, 2012

It's because this is the equivalent of "design my logo for free, because it's great exposure."

Not really. They're designing their own logos - the work they're doing probably doesn't really have any value to anyone else, and probably doesn't have any value to anyone at all.
posted by delmoi at 8:59 AM on June 5, 2012

Lol. Apparently the winning team was some custom breakfast cereal thing.

Also the bit at the end was great:

Four weeks after moving to NYC Jono has a full-time job as a user interface designer at Unpakt, a site that helps people find professional movers

Because apparently that's a super-hard problem for people? And they need a dedicated website to do it?
posted by delmoi at 9:05 AM on June 5, 2012 [2 favorites]

Not really.

The logo is not exactly my point, which is that the VCs wave wads of cash at a bunch of kids and say "work really hard to come up with an idea and then execute it, in an environment we create where we laud you endlessly as a godlike entrepeneur, but really you just provide the sweat." A competitive atmosphere like this just increases the number of kids competing, which ups the odds that a workable idea will result.

If we really want to torture the metaphor, the logo is simply any profitable business, and the kids are designing it for free by coming up with the idea that will result in a profitable business... and then working 90 hour weeks for a couple years to see if it can work, if they're lucky.

The factory owners have figured out how to hand the hard work of actually designing the product to the minimum wage employees on the factory floor, besides making them build it. But they're still the ones sitting back in their office with all the cash.
posted by fatbird at 9:07 AM on June 5, 2012 [1 favorite]

But new products and services have to be born somewhere. And when hungry, ambitious youth start small new businesses, it helps keep bigger, older businesses on their toes. Good for these kids for dreaming big and for being fortunate enough to be able to pursue those dreams.

The start-up system is a pretty dysfunctional way to handle innovation though. Someone with no experience in an industry is probably the least able to make the kinds of incremental improvements that actually move the industry forward. Most of the "dreaming big" on both the part of the investors and the entrepreneurs is in the form of waiting for a big payday for a small group of people rather than focusing on long term profitability. Meanwhile the industry itself has an incentive to spend less money on R&D themselves, because if gamblers are willing to put in the hard work and money required to try a lot of random new ideas, established companies can just wait for the successful ones to appear and buy them out for less than it would have cost to develop something similar themselves (you can see this most strikingly in the drug industry). Effectively big companies are outsourcing risk to people who have a lot of money and are willing to bet on a lot of mostly bad bets, in much the same way that the financial industry setup the system of pairing big institutional investors with sub-prime borrowers during the housing bubble. If the investors ever wise up and realize they are being had, that's when the bubble bursts (as it did with the first dotcom crash).
posted by burnmp3s at 9:09 AM on June 5, 2012 [4 favorites]

The difference was these were developed on a BUS!

I hear that "mobile" is the new thing: you can actually surf the web on your phone or other portable device!
posted by wenestvedt at 9:10 AM on June 5, 2012 [1 favorite]

fatbird: "The factory owners have figured out how to hand the hard work of actually designing the product to the minimum wage employees on the factory floor, besides making them build it. But they're still the ones sitting back in their office with all the cash."

Indeed.
posted by mkb at 9:12 AM on June 5, 2012

Does it make good products? Probably not. It does encourage people to try to succeed on their own, it does show people the true difficulty of shipping something, and it's kind of a neat concept.

In what way does being on a bus throwing something together to hopefully scam a rich person into shoving money at them "encourage people to try to succeed on their own"?

And you yourself said the most difficult part was being on a bus. That's not part of the "true difficulty" of shipping something.

As for neat concept, I actually agree. For a reality TV show. Congratulations, Startups on a Bus, for being near the top of the dungheap.
posted by DU at 9:12 AM on June 5, 2012

I've watched this play out a couple different ways in the last two years. One way it played out was watching three founders try to guarantee a bank loan with their own homes, to continue operating because "we've got so much traction", and the VCs were happy to provide all the encouragement to do so, to continually fill their ears with "I really like where you're going, and your commitment is awesome, and I think we're getting close to the point where we want to jump in."

The start-up system is a pretty dysfunctional way to handle innovation though. Someone with no experience in an industry is probably the least able to make the kinds of incremental improvements that actually move the industry forward.

Not to mention that startups are full of people who don't know how to run businesses generally. They're high-risk environments because they're high-mistake environments.

I specifically chose "coliseum" as the word to describe start up atmosphere. Tech startups are extremely darwinian, and this is consciously the environment VCs and angels create.

Do you know what other type of groups like to isolate their recruits to create a pervasive atmosphere in which contrary thinking is difficult? Cults. They just use camps instead of buses to cut down on gas costs.
posted by fatbird at 9:13 AM on June 5, 2012 [1 favorite]

You're all missing the big tie-in here: they are going to reboot the movie "Speed" with a high-tech angle as an allegory on the current economy.

If the combined burn rate of the startups on the bus exceed $50M per month, the bus -- and the American economy -- explodes.
posted by wenestvedt at 9:14 AM on June 5, 2012 [2 favorites]

I'm a member of the small team (Adventeur) that was filmed for this piece. It was like an accelerated summer camp - we made some great friends, didn't take ourselves too seriously and had a fun time all the way through the the end.

Wasn't expecting this to hit Metafilter at all, and after reading this thread, wish it hadn't.

Given that, if you have a dream or an idea that you're excited about - go for it!
posted by erisfree at 9:23 AM on June 5, 2012 [5 favorites]

37Signals on VC.
posted by mkb at 9:24 AM on June 5, 2012 [1 favorite]

The logo is not exactly my point, which is that the VCs wave wads of cash at a bunch of kids and say "work really hard to come up with an idea and then execute it, in an environment we create where we laud you endlessly as a godlike entrepeneur, but really you just provide the sweat."

Eh, I think the VCs are more the ones who seem to be getting taken for a ride, funding ridiculous ideas and so-on. The developers do actually get paid right away once they get funded, and they still end up getting a lot of money if the project is a success.

If you look at this, it does seem to be the case that most VCs don't actually make all that much money.
posted by delmoi at 9:33 AM on June 5, 2012

(And actually, it isn't even the VCs who are getting taken, but their customers. The VCs actually do have too much money to burn, and not enough "good" startups to burn it with)

But the really interesting thing about the Kauffman paper is that it doesn’t blame the VCs for this underperformance. Instead, it pins the blame squarely on the LPs — the investors who irrationally invest money with VCs.

The first thing they do is have a “VC bucket”, which then turns them into “bucket fillers”. VCs love bucket fillers, because an LP with a bucket is an LP with no ability to invest in something better instead, like the Russell 2000.

_{GPs we interviewed are very aware of “bucket filling” behavior, and said LPs with VC mandates act like the money is “burning a hole in their pockets.” They just need to spend it. Institutional investors governed by mandates presumably attempt to get into the ten to twenty top-tier VC funds; but if they can’t, they’re left to choose from second- and third-tier funds—a strategy that nearly guarantees returns unlikely to exceed a low-cost, liquid, small cap public index.}

If you look at the performance of VC funds during the golden years of 1986-1999, it turns out that once you strip out the top-performing 29 funds, the rest — more than 500 — collectively invested $160 billion, and managed to return $85 billion to investors. If you can’t get into one of the best funds — and everybody knows which funds those are — then there’s really no point investing in venture capital at all. But what happens is that some investment board looks at VC returns inclusive of the best funds’ returns, and then mandate a certain investment in VC which assumes they’ll have some kind of access to those top-tier funds. And that’s an extremely dangerous assumption to make, because most of the time it won’t be true.

posted by delmoi at 9:38 AM on June 5, 2012 [3 favorites]

I think the VCs are more the ones who seem to be getting taken for a ride, funding ridiculous ideas and so-on.

They're not getting taken for a ride. They're perfectly clear, amongst themselves, that it's gambling. High stakes gambling, perhaps smart gambling because like a good poker player they can calculate odds, but gambling nonetheless.

The developers do actually get paid right away once they get funded

After working how long without pay? After working how long without pay after operating funds run out but they're really close to a deal with a major fund that secure everything?

and they still end up getting a lot of money if the project is a success.

Sometimes people do win the lottery, yes.
posted by fatbird at 9:40 AM on June 5, 2012

So it's like playing the lottery, except each ticket costs 72 hours of your time, spent on a bus with people you're going to have to split the jackpot with. Nah, I'd rather rub my dog's belly.
posted by Mooski at 9:40 AM on June 5, 2012 [1 favorite]

brain_drain: "I don't understand all the hate. A bunch of kids are getting together to develop new business ideas and maybe even raise some money to bring those ideas to fruition. Yes, most of the ideas are probably crap and will go nowhere. Yes, this enterprise sounds self-counsciously hipsterish. But new products and services have to be born somewhere. And when hungry, ambitious youth start small new businesses, it helps keep bigger, older businesses on their toes. Good for these kids for dreaming big and for being fortunate enough to be able to pursue those dreams."

A bunch of kids are on a bus coming up with wacky ideas to sooth the fevered brows of febrile investors ridding the foamy cresting tip of a tidal wave of money sloshing around a functionally broken late-stage capitalist system. If actual businesses with actual customers, revenue, employees and expenditure beyond a few Macbooks and some server time (i.e. functioning corporate members of a functioning economy) come out of this (or indeed any of the other VC hothouses) I'll eat my hat.

VC culture is a symptom of the systematic gutting of nation states by giant balls of money rolling around the landscape. Fifty years ago, people this smart were building national infrastructure and putting footprints in moondust. Now the seething morass of finance is stripping the best and brightest from every country in the world either to come up with the fever dreams or package them and sell them to everyone else.
posted by Happy Dave at 9:40 AM on June 5, 2012 [19 favorites]

Dang, fatbird, stay off my comment bus, y0.
posted by Mooski at 9:41 AM on June 5, 2012 [1 favorite]

each ticket costs 72 hours of your time, man and I thought the doubling of the cost of Powerball tickets was silly
posted by edgeways at 9:42 AM on June 5, 2012

The Metafilter background should be green to represent perpetual seething, shameless jealousy.
posted by esprit de l'escalier at 9:42 AM on June 5, 2012 [3 favorites]

I sound terribly bitter about this, and to some degree I am, but the result of my experience isn't to shun startups, it's to believe that bootstrapping is always preferable to angel funding, and VC money should only be taken if you don't need it. And all competitions like this are worthless. If you're in a good position to take VC funding, you don't need to compete in the Hunger Games for it. VCs do actually take meetings and referrals and such.

Mooski, rubbing your dog's belly would make both of you happier.
posted by fatbird at 9:43 AM on June 5, 2012 [3 favorites]

Looking forward to the next flaming bra.
posted by edgeways at 9:44 AM on June 5, 2012

From Stranger to Startup in 72 Hours

(to the tune of "Strangers In The Night")

startups in the night
exchanging pitches
startups in the night
avoiding ditches
riding on the bus
chasing the dollar bill

startups on the bus
we need an app, quick
startups on the bus
i think i'm carsick
nonetheless i'll try
to keep on trying til...

we can conjure up
some tech-y idea like
a site that sells a cup
for morning coffee that is also interfaced
or somehow product-placed
with some advertiser's spot
for underwear or some such rot, and...

if we get it right
we'll make a million
gotta hawk it like
a vaudevillian
hope investors bite
our startups in the night
posted by flapjax at midnite at 9:49 AM on June 5, 2012 [5 favorites]

After working how long without pay? After working how long without pay after operating funds run out but they're really close to a deal with a major fund that secure everything?

No one is forcing anyone to do it. Actually, looking more at this article by Felix Salmon, there is an explanation for the odd behavior:

Our own casual review of institutional private equity investors reveals median job tenure of around three years. There is much turnover at the LP investor level, which creates little incentive for any one investor to fight hard on behalf of their institution for better economic terms, especially if they are not getting paid for that outcome and views such behavior as harmful to industry ‘relationships,’ which the investor likely will find beneficial in landing their next job.

What this says to me is that the VC industry, as a whole, is being incredibly successful at extracting rents from dumb institutional investors. These investors wouldn’t dream of investing in a public company where there was no transparency as to basic questions like how much money the principals were being paid, but they happily invest in venture capital funds where the founders cream off so much of the income that younger top performers end up leaving the firm.

So the system makes a lot of sense. It's not so much they're buying lottery tickets and don't care about the quality, it's more like they have fill a box with "lottery tickets" and they don't really care about finding the best, most likely to win tickets but instead just want to fill the box with as much paper as they need. And the person who gave them the box doesn't really care either way.

So you end up with dumb 'startup culture' that rewards, well all the stupid shit you see, because there aren't enough actual lottery tickets so instead you see people coming up with "lottery tickets" on a bus in 72 hours.
posted by delmoi at 9:55 AM on June 5, 2012

They're not getting taken for a ride. They're perfectly clear, amongst themselves, that it's gambling. High stakes gambling, perhaps smart gambling because like a good poker player they can calculate odds, but gambling nonetheless.

Who exactly is clear that it's gambling and is making smart bets? For example, here's a plausible simplified trail of how money gets from various stakeholders:

Normal employee with a pension -> Company pension fund -> Financial institution managing the pension -> Venture capital GPs who raise money for start-ups -> Start-up

The employee with the pension has pretty much zero choice in what happens with their money. The company with the pension fund wants high returns but doesn't have the time or inclination to actually do any of the legwork to evaluate actual investment details. The financial institution manager wants to report big gains now and doesn't really care if the pension fund loses money in 10 years. The people raising money for the VC fund only cares about raising money, throwing it at whatever they can find quickly, and reporting enough immediate returns to raise more money. And the start-up wants to convince everyone that it's worth much more money than it actually is so that they can be bought out or go public and everyone can walk away rich.

The big chain of stakeholders in between the people who have a stake in whether the investment pays off and the people making actual investment decisions is a great way to end up with really terrible investments. And substituting risky start-ups for risky mortgages, it's the exact same chain of stakeholders that created the bubble that resulted in the housing crash.
posted by burnmp3s at 10:03 AM on June 5, 2012 [2 favorites]

startups in the night
exchanging pitches

/rises to feet, starts the ovation.
posted by jquinby at 10:03 AM on June 5, 2012

They're perfectly clear, amongst themselves, that it's gambling.

There's a reason "professional poker" took off right after the dot-com implosion. Smart people with a gambling addiction needed a new fix.

I understand there's a new Limp Bizkit album out, too.

Maybe there needs to be less gambling with seat-of-the-pants "innovators" and more investment in real R&D performed by real professional scientists and statisticians and engineers, addressing real business needs. That's if you're into the whole "not repeating the same mistakes" thing, which is totes o&b.
posted by Slap*Happy at 10:17 AM on June 5, 2012 [2 favorites]

Timeline: 1942. The U.S. government rushes to be the first to develop an atomic weapon to be used in World War II. Teams of scientists board busses in New York, Chicago, Los Angeles, and other major American cities. They each have 72 hours to develop a working prototype before arriving in Oak Ridge, Tennessee. The Greyhound Project was a top-secret program that secured America's future as a superpower.
posted by perhapses at 10:23 AM on June 5, 2012 [7 favorites]

Normal employee with a pension -> Company pension fund -> Financial institution managing the pension -> Venture capital GPs who raise money for start-ups -> Start-up

Not really how a pension fund gets managed. There is not financial institution managing the pension - there is a board made up of stakeholders who hire a third party consultant to help them determine what they want, but inevitably the third party consultant is just trying to figure out what pension board wants to be told.

Inevitably the consultant tells the manager "put x% in bucket y, z% in bucket w, etc, etc" then once you've determined how big the "VC bucket" is you engage a consultant (maybe the same one you used to do asset allocation, maybe a specialist) who will give you a huge list of "approved managers" and help you set up meetings with them. The board eventually settles on one and the consultant says "great choice guys"

So in theory as an employee you should have some role in choosing who is on the board (but you don't really) and all of those consultants have a fiduciary responsibility and don't get paid on anything other than total fund assets (usually an extremely small %). So its not as crooked as it sounds (in theory). The real problem is that VC funds are really expensive, illiquid, have a high opportunity cost for undrawn funds and have a terrible performance track record even in the good times.
posted by JPD at 10:25 AM on June 5, 2012 [1 favorite]

Of also don't forget the plan sponsor if its a DB plan maintains a pretty massive financial interest in the plan returns, and if its an endowment of some sort obviously the interests of the sponsor are very closely aligned with the underlying performance of the portfolio.

And substituting risky start-ups for risky mortgages, it's the exact same chain of stakeholders that created the bubble that resulted in the housing crash.

Not really - the pool of investors for the two assets are different. And for the 99th time - it wasn't risky mortgages it was mortgages that were thought to be risk less that ended up being very slightly risky that were the problem.
posted by JPD at 10:29 AM on June 5, 2012

Let's assume VC's in aggregate have no ability to select winning lottery tickets - this is generally a very fair assumption for any sort of investment endeavor. That alone isn't enough to explain why VC returns are so low. Its also gotta be the price they pay for their lottery tickets. Why does the market structurally overvalue VC lottery tickets?

Go read Kahneman - its exactly the sort of risk we're wired as human beings to want to take.
posted by JPD at 10:34 AM on June 5, 2012

There are going to be so many stupid ideas shopped in earnest out of this.

People, I predict really, really stupid ideas.
posted by clvrmnky at 10:34 AM on June 5, 2012

Four weeks after moving to NYC Jono has a full-time job as a user interface designer at Unpakt, a site that helps people find professional movers

Because apparently that's a super-hard problem for people? And they need a dedicated website to do it?

Have you seen all the questions on ask.me looking for reliable movers to go from, say, NYC to Portland? Or Chicago to Austin? Some friends of mine hired a very well-respected local moving company a couple of years ago, who unloaded all their belongings onto their new house's front porch and walked away. I've heard a ton of horror stories, on ask.me and in the real world, from people who've been scammed by movers, who've had their possessions held for ransom by movers, who've found their furniture smashed apart by careless movers. Furthermore, Unpakt seems to be aiming specifically at long-distance movers, where actually finding a company can be a lot harder.

So, in short: Yes, it is apparently a super-hard problem for (some) people. And a dedicated website to do it is not a bad idea.
posted by Tomorrowful at 10:43 AM on June 5, 2012 [1 favorite]

You guys just don't get it. With RoR,Coffeescript,Backbone.js,Bootstrap.js and RabbitMQ anyone can hack together an MVP in a few hours. With github,heroku,twillio and a few other services I built a massively scalable SaaS this morning. I've got a few meetings with some great VC later today and have started hiring OCaml devs as I am planning a ground up rewrite for tomorrow.

Once you leave the Java world with the AbstractFactoryFactoryAbstractImpl enterprise garbage programming becomes fun again. I just crank up TextMate and go. I am really psyched for Lightbox though, it is going to make me super productive.
posted by Ad hominem at 10:59 AM on June 5, 2012 [15 favorites]

You're going to totes monetize the shit out of that, yo.
posted by Slap*Happy at 11:05 AM on June 5, 2012 [2 favorites]

I've decided to pivot to the NFC space. I'm looking for rockstar ninja Haskell devs and designers who love beautiful typography to jumpstart a hyper-local micro transaction framework. We are going to be working out of a house in Hawaii I have lined up. I've already got initial funding from some Groupon alums.
posted by Ad hominem at 11:14 AM on June 5, 2012 [11 favorites]

I'll bet none of them are there to make any friends. In fact. they will say it out loud -- "I'm not here to make friends."
posted by KevinSkomsvold at 11:17 AM on June 5, 2012

I hope that they enjoy their bus ride but the whole concept just makes me uncomfortable.
posted by andendau at 11:33 AM on June 5, 2012

Normal employee with a pension -> Company pension fund -> Financial institution managing the pension -> Venture capital GPs who raise money for start-ups -> Start-up

Let's not forget the recently signed JOBS Act which is going to allow middle class people do invest directly in start-ups. Although, to be fair they are probably going to pay a lot more attention to what's going on, since their money will actually be on the line.

Also, aren't most pensions actually fixed payout? Doesn't the employee end up with the same money back regardless of how well it does, unless it goes bankrupt in which case they'll get a federal bailout at some lower rate? So does the employee have a reason to care in this example?

Have you seen all the questions on ask.me looking for reliable movers to go from, say, NYC to Portland? Or Chicago to Austin? Some friends of mine hired a very well-respected local moving company a couple of years ago, who unloaded all their belongings onto their new house's front porch and walked away.

Can't they look at reviews on yelp or angies list or something?

Not really - the pool of investors for the two assets are different. And for the 99th time - it wasn't risky mortgages it was mortgages that were thought to be risk less that ended up being very slightly risky that were the problem.

To get super-technical, it was mortgages of varying risk packaged into tranches and other complex instruments and then purchased with leverage that gave them a non-linear response to changes in the default rate.

So for example, if you buy 100 mortgages and you expect 5 to default you would expect to get 95% of your money back, plus interest. But if you buy bottom 'tranch' of the worst 20 mortgages, you'd expect to get 75% of your money back, plus interest.

however if the default rate doubles from 5% to 10%, then you end up losing 10% instead of 5% in the first example, but in the second example you lose 50% of your money, rather then 25% of your money.

Now, lets say you want to do a pure, coin toss gamble on these mortgages. You could get a 4:1 leverage, and if the default rate was slightly less then 5%, you'd make money, and slightly more then 5% you'd lose money. But if they default rate doubled to 10%, you've now lost 3x your initial investment. So a 5% default rate gets amplified to 300% loss. I guess technically that's still a linear equation but you also have to figure that more defaults mean lower house prices overall, which makes people walk away increasing the default rate and so on.

I'll bet none of them are there to make any friends. In fact. they will say it out loud -- "I'm not here to make friends."

Well, the thing is you actually do want to make friends, that's probably more important then the actual project. Because those friends are going to get jobs at other startups and then they can hook you up.
posted by delmoi at 11:54 AM on June 5, 2012 [1 favorite]

I just Ad Vominemed in my mouth a little. Kudos, sir.
posted by en forme de poire at 11:55 AM on June 5, 2012 [1 favorite]

I'm glad I'm not the only one that didn't find a single thing here to not hate.

It's unhealthy to be addicted to negative emotions like that.
posted by anigbrowl at 11:58 AM on June 5, 2012 [1 favorite]

Can't they look at reviews on yelp or angies list or something?

Services which were once trivial startups themselves. It doesn't matter if an idea was conceived on a bus or wherever. I've had great ideas in the shower. Nor does it matter if the idea is simple; Twitter is a staggeringly simple concept, developed from an internal utility tool at a struggling startup whose main product was not going anywhere.
posted by anigbrowl at 12:03 PM on June 5, 2012 [3 favorites]

In all honesty I think it is kinda cool. None of these kids are blowing grandma's pension on aeron chairs and launch parties. With app stores and cloud hosting the barrier to just putting up a functional app and calling it a startup is really low. The ones that make something cool will get acquhired by some company with money, the product will be buried and they will be set to work on making G+ cool or something. Some of them are really not bad, like taxcast. I am tempted to write a knockoff for Windows Phone.

Maybe my startup will be knocking off Startup Bus winners. I will follow them with a van full of Indian WPF devs writing me-too ware for WP 7.5.
posted by Ad hominem at 12:20 PM on June 5, 2012 [2 favorites]

So, in short: Yes, it is apparently a super-hard problem for (some) people. And a dedicated website to do it is not a bad idea.

I guess they never heard of movingscam.com.
posted by Sir Cholmondeley at 12:21 PM on June 5, 2012

Also, aren't most pensions actually fixed payout? Doesn't the employee end up with the same money back regardless of how well it does, unless it goes bankrupt in which case they'll get a federal bailout at some lower rate? So does the employee have a reason to care in this example?

Sorta - there are ERISA requirements and some degree of protection. The Sponsor also has a requirement to keep the fund within certain limits of funding driven by a set of actuarial assumptions. The end result of this is that the higher RoR they can generate on existing plan assets the less money they have to set aside. Also don't forget in a DB plan there isn't some ring fenced "employee's contribution" - the assets are set aside by the plan sponsor in lieu of compensation.
posted by JPD at 12:36 PM on June 5, 2012

It doesn't matter if an idea was conceived on a bus or wherever. I've had great ideas in the shower. Nor does it matter if the idea is simple; Twitter is a staggeringly simple concept, developed from an internal utility tool at a struggling startup whose main product was not going anywhere.

So it sounds like all this bus shenanigans is a big old waste of time and money and gasoline to accomplish something that all the complexity might actually be getting in the way of. If it doesn't matter where the idea is conceived then why all the rigmarole? Is this like when baseball players don't wash their jock-straps because actually they have no control over what is happening and turn to superstition and talismans?
posted by fuq at 12:39 PM on June 5, 2012

I've had great ideas in the shower.

In the shower. From stranger to startup in 72 wet, slippery hours.

Now that would be interesting. They could draw their diagrams on the steamy shower doors.
posted by perhapses at 12:45 PM on June 5, 2012 [2 favorites]

There's a tech bubble, perhaps, but I dunno if it's going to pop like the last one did. More likely we see a gradual failure of these companies to make as much money as VCs want, followed by a migration from this "web 2.0" craze to ideas that have more of an impact on the real, nondigital world. There're already a few of those finding success, and they'll be the ones the next wave of lovable youngsters latches onto.

I don't think the silliness is excessively unhealthy. We've yet to understand the nature of a more digital society, even some of the basic fundamental rules of it. The silliness is how those rules get stumbled upon and ultimately discovered. We're talking about a deep-level shift in how the world works, and nobody's quite sure what that shift entails; it makes sense, then, that the forays come first from young doofuses and rich gamblers. They won't be where this ends up, they're just a phase that occurs in every media/technological development. There will be some brilliant ideas that shine through and a lot of self-evidently dumb ideas that will be seen later for the gimmicks they are.

I'm part of that doofus wave, though I find a lot of it so irritating that I can't participate in that community in good faith. My long-standing Hacker News account, which used to be one of the most active on the site, was inexplicably hellbanned last week, but I don't think I'll mind the loss so much. There's a lot of trendiness in that community, some disgustingly cynical idiocy, some people who're painfully earnest but lack perspective. Amidst these are open-minded folks, chill people, and generally some people mixed in whose interest and ambition is less shallow and more likely to result in something meaningful (I'm hoping that's me). The good thing about those people is they're not as incestuously absorbed in community politics and drama, so I find I stumble into them even if I'm not paying close attention to the latest unfoldings.

In short, this is like any community of people – often young or shallow or manipulative, but the exceptions will ultimately be all anybody remembers anyway. Most of the irritating sorts will grow out of it. Don't begrudge them too much.
posted by Rory Marinich at 12:52 PM on June 5, 2012 [1 favorite]

Once you get on the startup bus you can't get off.
posted by RobotHero at 1:11 PM on June 5, 2012

Somebody has been reading their Cory Doctrow.
posted by djrock3k at 1:15 PM on June 5, 2012

This is actually an experiment to determine the critical mass of startup douchebags. They will gradually drive the convoy vehicles closer together until they achieve no-cluer fission.
posted by w0mbat at 1:44 PM on June 5, 2012 [1 favorite]

This is actually an experiment to determine the critical mass of startup douchebags.

Now that you mention it, I'm remembering another thing you can do with a bus...
posted by fatbird at 1:59 PM on June 5, 2012

OK. Now we're in a tech bubble.

Now? I think this is the third or fourth year this has happened.

Is there no tech startup reality tv show yet?
posted by jeffburdges at 7:51 AM on June 5 [+] [!]

Google "startup idol" (they're looking for a network to air season two).
posted by MikeKD at 3:29 PM on June 5, 2012

So it sounds like all this bus shenanigans is a big old waste of time and money and gasoline to accomplish something that all the complexity might actually be getting in the way of. If it doesn't matter where the idea is conceived then why all the rigmarole?

A change is as good as a rest. The unusual constraints of being in a friendly competitive situation on a moving vehicle (where you have only limited opportunities for departure, and must therefore put some more effort into getting on with other people than you might otherwise) are novel enough that they may stimulate a variety of original ideas. Then again, they may not, but it's more fun than sitting on a greyhound bus with nobody else who shares your interests. See Hakim Bey on temporary autonomous zones, or any number of literary works about friendships and/or romances struck up in the course of long journeys.

This startup bus thing doesn't strike me as an especially brilliant idea, but it's no worse than things like 48 hour film competitions or other pressure-cooker type scenarios. The outpouring of hatred from some people here is petty to the point of being childish. If this is not your (collective you) sort of thing, that's fine; but if hating on it is the best you can do, maybe you should get a fucking life instead of queueing up to take a shit on other peoples'.
posted by anigbrowl at 3:47 PM on June 5, 2012 [2 favorites]

Services which were once trivial startups themselves.

Not necessarily that trivial. Plus what makes you think every website was once a "startup" chasing VC dollars or whatever.

We're talking about a deep-level shift in how the world works, and nobody's quite sure what that shift entails; it makes sense, then, that the forays come first from young doofuses and rich gamblers. They won't be where this ends up, they're just a phase that occurs in every media/technological development.

I'd say the shift is mostly over. The changes these days seem driven more by fashion then real technological progress, beyond slightly better screens and battery energy efficiency allowing you to get the kind of computing power in a handheld that you could get on a desktop a few years ago. Compared to the changes in the 1990s though it's pretty boring, really. (Seriously the changes from 2002 to 2012 are more subtle then the changes between 1996 and 1998)

Fashion still changes every year, but there's no progress it apparel doesn't move forward in any sense, as far as I know. The computer industry is becoming like that, in a lot of ways.
posted by delmoi at 12:49 AM on June 6, 2012

Not necessarily that trivial. Plus what makes you think every website was once a "startup" chasing VC dollars or whatever.

I didn't say that they were; but Yelp came out of an incubator and Angie's list was a collaboration between a VC and one of his assistance. I was working for internet startups as far back as the early 90s and know a lot of Silicon Valley startup people from both the first dotcom boom and the web 2.0 wave, as well as in the current startup culture. Most internet-based companies do grow through financing rounds in the early years; the number that build on organic growth is small by comparison.

There's nothing magic about the internet startup scene, except insofar as the technical barriers to entry are almost negligibly low and there's a substantial pool of capital with a fairly high tolerance for risk, which is an unusually nice set of business conditions. Some people are in it because they're greedy, some are in it because they want to make better products, some are in it because whatever they do tends to have high utility and attract customers. It's like any other line of business. This hardly justifies the outpouring of bile in this thread, however.
posted by anigbrowl at 2:19 AM on June 6, 2012 [1 favorite]

Here a description from a Python developer & former Google Developers staffer who did the SF StartupBus trip in 2011. She paints a different picture than what a lot of posters here seem to be assuming.

The founder of StartupBus also has opened StartupHouse in SF, which offers office leasing, a sprawling coworking space, and even a hostel for visiting teams/developers. The hostel has maxed out its 50-person occupancy even while it's still under active construction. Seems like it's meeting a real need. The coworking space on the other hand appears to be under-subscribed so far.
posted by nakedcodemonkey at 2:55 AM on June 6, 2012