Dave Austin argues successful startups need one of two models: enterprise (high price, few customers) or mass consumer (low price, millions of users). The middle ground produces what he calls "crap" businesses that lack scale. He learned this framework from his time at Apple.
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I want to talk about 2 different kinds of businesses. And this piece is a purely opinion piece. It kind of goes into product and everything. And maybe a lot of people will disagree or not. I learned this from my old boss at Apple. And I think it really is very wise that there are 2 kinds of businesses you should do, only 2. You should either create a business that people will give you a lot of money for, And you don't have to do very many. Or something that people— everybody's gonna use, and they'll give you a little bit of money. 2 poles. In the middle, it's crap. If you're in this middle space where, well, a few people will give you medium money, well, that's really great, and you'll get a great lifestyle business. If you really wanna blow it out, you need to do one of the two. And both are fine. This in many ways is sort of like the enterprise model, which is getting funded a lot right now. You're solving a really complex problem, people are going to give you a lot of money, it's a longer road, but they'll give you gazillions of dollars per year, ongoing, in perpetuity, and you don't have to sell a million or a billion, you can sell hundreds, tens, hundreds, thousands. If you get to a million with huge dollars, that's great. Yeah. That's real money. Or you do the mass consumer space. Both are hard. It's all hard. No matter what, doing a startup and doing a product is hard. Picking one of these 2 is really critical, I think. Some people will argue and disagree, but I think if you pick one of those 2, at least you're heading in a direction where there's possibility of having a business versus just a product that's, you know, will go for some time. You might get acquired or maybe not. It depends on what your goals are. That's how we thought— that's how my boss at Apple— that's how we thought about every product. So, what are some of the things that you think are important to do when you're starting a startup?
