A founder leaving doesn't necessarily kill a startup, though. Plenty of successful startups have had that happen. [11] Fortunately it's usually the least committed founder who leaves. If there are three founders and one who was lukewarm leaves, big deal. If you have two and one leaves, or a guy with critical technical skills leaves, that's more of a problem. But even that is survivable. Blogger got down to one person, and they bounced back.

Most of the disputes I've seen between founders could have been avoided if they'd been more careful about who they started a company with. Most disputes are not due to the situation but the people. Which means they're inevitable. And most founders who've been burned by such disputes probably had misgivings, which they suppressed, when they started the company. Don't suppress misgivings. It's much easier to fix problems before the company is started than after. So don't include your housemate in your startup because he'd feel left out otherwise. Don't start a company with someone you dislike because they have some skill you need and you worry you won't find anyone else. The people are the most important ingredient in a startup, so don't compromise there.

The failed startups you hear most about are the spectactular flameouts. Those are actually the elite of failures. The most common type is not the one that makes spectacular mistakes, but the one that doesn't do much of anything—the one we never even hear about, because it was some project a couple guys started on the side while working on their day jobs, but which never got anywhere and was gradually abandoned.

Statistically, if you want to avoid failure, it would seem like the most important thing is to quit your day job. Most founders of failed startups don't quit their day jobs, and most founders of successful ones do. If startup failure were a disease, the CDC would be issuing bulletins warning people to avoid day jobs.

Does that mean you should quit your day job? Not necessarily. I'm guessing here, but I'd guess that many of these would-be founders may not have the kind of determination it takes to start a company, and that in the back of their minds, they know it. The reason they don't invest more time in their startup is that they know it's a bad investment. [12]

I'd also guess there's some band of people who could have succeeded if they'd taken the leap and done it full-time, but didn't. I have no idea how wide this band is, but if the winner/borderline/hopeless progression has the sort of distribution you'd expect, the number of people who could have made it, if they'd quit their day job, is probably an order of magnitude larger than the number who do make it. [13]

If that's true, most startups that could succeed fail because the founders don't devote their whole efforts to them. That certainly accords with what I see out in the world. Most startups fail because they don't make something people want, and the reason most don't is that they don't try hard enough.

In other words, starting startups is just like everything else. The biggest mistake you can make is not to try hard enough. To the extent there's a secret to success, it's not to be in denial about that.

[1] This is not a complete list of the causes of failure, just those you can control. There are also several you can't, notably ineptitude and bad luck.

[2] Ironically, one variant of the Facebook that might work is a facebook exclusively for college students.

[3] Steve Jobs tried to motivate people by saying "Real artists ship." This is a fine sentence, but unfortunately not true. Many famous works of art are unfinished. It's true in fields that have hard deadlines, like architecture and filmmaking, but even there people tend to be tweaking stuff till it's yanked out of their hands.

[4] There's probably also a second factor: startup founders tend to be at the leading edge of technology, so problems they face are probably especially valuable.

[5] You should take more than you think you'll need, maybe 50% to 100% more, because software takes longer to write and deals longer to close than you expect.

[6] Since people sometimes call us VCs, I should add that we're not. VCs invest large amounts of other people's money. We invest small amounts of our own, like angel investors.

[7] Not linearly of course, or it would take forever to raise five million dollars. In practice it just feels like it takes forever.

Though if you include the cases where VCs don't invest, it would literally take forever in the median case. And maybe we should, because the danger of chasing large investments is not just that they take a long time. That's the best case. The real danger is that you'll expend a lot of time and get nothing.

[8] Some VCs will offer you an artificially low valuation to see if you have the balls to ask for more. It's lame that VCs play such games, but some do. If you're dealing with one of those you should push back on the valuation a bit.

[9] Suppose YouTube's founders had gone to Google in 2005 and told them "Google Video is badly designed. Give us $10 million and we'll tell you all the mistakes you made." They would have gotten the royal raspberry. Eighteen months later Google paid $1.6 billion for the same lesson, partly because they could then tell themselves that they were buying a phenomenon, or a community, or some vague thing like that.

I don't mean to be hard on Google. They did better than their competitors, who may have now missed the video boat entirely.

[10] Yes, actually: dealing with the government. But phone companies are up there.

[11] Many more than most people realize, because companies don't advertise this. Did you know Apple originally had three founders?

[12] I'm not dissing these people. I don't have the determination myself. I've twice come close to starting startups since Viaweb, and both times I bailed because I realized that without the spur of poverty I just wasn't willing to endure the stress of a startup.

[13] So how do you know whether you're in the category of people who should quit their day job, or the presumably larger one who shouldn't? I got to the point of saying that this was hard to judge for yourself and that you should seek outside advice, before realizing that that's what we do. We think of ourselves as investors, but viewed from the other direction Y Combinator is a service for advising people whether or not to quit their day job. We could be mistaken, and no doubt often are, but we do at least bet money on our conclusions.

Thanks to Sam Altman, Jessica Livingston, Greg McAdoo, and Robert Morris for reading drafts of this.

When people care enough about something to do it well, those who do it best tend to be far better than everyone else. There's a huge gap between Leonardo and second-rate contemporaries like Borgognone. You see the same gap between Raymond Chandler and the average writer of detective novels. A top-ranked professional chess player could play ten thousand games against an ordinary club player without losing once.

Like chess or painting or writing novels, making money is a very specialized skill. But for some reason we treat this skill differently. No one complains when a few people surpass all the rest at playing chess or writing novels, but when a few people make more money than the rest, we get editorials saying this is wrong.

Why? The pattern of variation seems no different than for any other skill. What causes people to react so strongly when the skill is making money?

I think there are three reasons we treat making money as different: the misleading model of wealth we learn as children; the disreputable way in which, till recently, most fortunes were accumulated; and the worry that great variations in income are somehow bad for society. As far as I can tell, the first is mistaken, the second outdated, and the third empirically false. Could it be that, in a modern democracy, variation in income is actually a sign of health?