Dropbox and Uber are worth billions but are very fragile

In an interview with WIRED this past fall, Dropbox co-founder Drew Houston acknowledged that his company has almost no margin for error. If Dropbox accidentally destroyed just one person’s file, he said, it could erode the trust of all its users. “This is like the same sort of genre of problem as the code that you use to fly an airplane. Even if it’s a little bug, it’s a big problem.”

The risk for Dropbox is that at its core, it essentially does only one thing: It syncs your files across all your devices. On the one hand, this single-mindedness has brought Dropbox its tremendous success. Founded in 2007, the company concentrates on doing thing and doing it well. But that strength is also its greatest vulnerability — Dropbox is not diversified. Many other companies large and small now offer much the same service. If Dropbox loses your trust by messing up the one thing you thought it did best, you could easily switch your allegiance to another company.

Uber, the ride-sharing startup, is facing its own moment of crisis. Over the past months, many people — and many news stories — have complained about the company’s “surge pricing,” where it raises fares during times when lots of people want a ride, such as during snowstorms and over holidays. Now, a different kind of anger has surfaced: Paris-based blog Rude Baguette reports that, in France, protestors are attacking Uber cars, throwing eggs, slashing tires, and breaking windows. Uber confirmed the attacks.

~ Marcus Wohlsen Wired.com

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Better think about expanding into other services or merge with one of the really BIG guys.

Ditch the Lean Startup methodology, instead be innovative and take risks!

Often I heard many startup founders talk about lean startup, product market fit, minimum viable product, and on and on… I have always preferred the let’s do it and see what happens approach. This is not to suggest that the lean startup methodology and others are not good, instead what I am suggesting is that the best ideas and businesses usually come up when you don’t follow any one procedure or methodology but instead a mix of all of them. I am all for testing, iterating, getting faster to market, etc… However, if you want to start a business and achieve success, you do need to roll-up your sleeves and start getting things done. Startups need to be seen and treated as experiments, it is about doing things differently to find out what works and what doesn’t. It is also important to know that there is not a silver bullet for success in business, and believing that you can achieve success just by following one business methodology is just silly.

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Should you spend money on office space for a software start-up?

Should you spend money on office space when you are just starting your business? I asked this question on answers.onstartups.com and got great responses. This post is basically a summary of the answers received.

The benefits of working from an office

When you are building a new business and you are bootstrapping it, it is hard to think about paying rent for an office and all the other costs associated with it. It is also hard to justify the expense of leasing office space when you are a software startup since all of the work can be done from your home or a coffee shop. However, office space is now more affordable than ever, especially when you look at the incubator-like offices because the cost is much less than a regular office and it also offers an environment full of other entrepreneurs which for the most part are always happy to help you in many ways. Sigue leyendo

Startups: 5 things that you need to be doing!

If you are in Austin and you are an entrepreneur you are probably aware of the event that took place earlier this week, Capital Factory’s Demo Day. One of the event speakers was Bob Metcalfe and some of the points that he shared motivated me to write this blog post.

These are the 5 things that a startup needs to do to increase its chances of succeeding according to Bob Metcalfe, these are stay healthy, writing, speaking, sell and having a plan. The description under each one of them is my opinion about it, I hope you find it useful. Sigue leyendo

Are incubators and Angel money more harmful than beneficial to software startups?

Many people including myself agree that the cash investment from incubators, angel investors and any other type of investment have its benefits. When you join an incubator and/or get angel investors on board, you could also get great resources in the manner of experienced advice, partnerships, networking, free services, etc… maybe.

However, the fact that you do get cash is probably more harmful than not, in my own humble opinion. Yes, at some point you might need cash to grow IF you start getting successful and you need to invest in resources such as people and hardware to keep up with demand for your product or service. Advice from experienced people and potential customers is what you need when you are in the idea phase or just starting to develop your product, you don’t really need money at this point; you see, money in very early stages can make people lazy and feel as if they have accomplished something… when they haven’t, at least nothing that matters such as getting paying customers or releasing a product. Sigue leyendo