The problem isn't just that "we got 140 characters." The problem is that Peter Thiel asked for it by investing in and therefore promulgating Mark Zuckerberg's vision of ubiquitous irrelevance. I think he's right that VC is destroying itself by investing in what I have often referred to as trivial nonsense, but he and his firm are part of the problem, not the solution. Just look at the portfolio companies: Winster? Quid? Slide? Path? GoWalla? And of course, Facebook? None of these companies improve my life or the lives of anyone I care about. Founders Fund has 22 consumer internet companies in its portfolio and one or two in the other categories listed on the web site.

Furthermore Thiel has stated that he wouldn't bother doing PayPal again if he knew what he knows about the payments industry today. This is of course the space that I'm working in. Bold words, Peter. If only there were more VCs willing to run and hide.

Frankly I'm sick of venture capital firms writing self-serving slogans, or in this case, entire essays. Actions speak louder than words. I'm doing serious work and my company has been rejected by sixty (that's six-zero) VC firms in the past five years. It's going to take more than a manifesto to convince me that any investor is serious about the future.

I just want to burn some HN points here to tell you that you're not alone, and that there are a lot of other people out there that are terribly frustrated by this.

Investors are primarily in it to make money. They're optimizing for returns. When you have a choice between a company that will spend relatively little capital and has a chance to make a lot of money, $5 at a time, from millions of people, in a short period of time, and then get sold to some other megacorporation at a valuation that's detached from reality, versus a company with higher capital needs and a 20-year roadmap to becoming an industry heavyweight ... well, you choose the first one.

The horde of "business consultants" (coaches, advisors, what-have-you) aren't much better. I went through a period of intense naivete that involved trying those people out. I would try anything that might have a chance at accelerating my business. I have never before been charged so much to receive so little truly useful advice, from so many people so hell-bent on violating the very first rule of problem solving ("understand the problem"), and so inclined to insult me or my goals. They're all just doing the same thing as the VCs, but at smaller, pitiable scales: they're focusing first-and-foremost on making a buck.

Sometimes the situation leaves me feeling bitter. As a hopeless idealist and an obsessive problem-solver, I can't help but to habitually look at the world around me and see in its place the potential for the future that so many people with resources claim to be interested in while being interested first and foremost in making a quick profit.

The consumer internet startups FF funded were often intended to become something more than they turned into. Slide was supposed to be about cross-site predictive analytics on a massive scale. Silly widgets were just the data capture vector. Frogmetrics (my FF-funded YC startup) had similar ambitions for the real world. Both companies fell way short of our secret ambitions, but not for lack of effort.

Also, many of FF's most interesting investments aren't on the site for secrecy reasons.

One more anecdote:

Last year, when I told some VC friends that I was working on strong AI as a startup, they laughed. When I told Luke and Brian at Founders Fund, they said they wanted to invest. It's obviously too early to say whether we'll meet the same fate as past AI companies, but we're off to a good start (http://vicariousinc.com/), and that's thanks to Founders Fund taking the kinds of risks they discuss in the article.

It's like partying instead of studying for a test, and complaining you didn't pass. Of course you didn't; you chose "fun" over "boring".

Dude, you're just getting warmed up to pitching if you've only been rejected by 60 VC firms.

Google got rejected by 55. Pandora by close to 300. Adam Rifkin's first startup was doing AJAX in 2000, and he got rejected by 176 before raising $8M from Kleiner Perkins.

HR's job is to screen through job applicants and throw away resumes so they only show a precious few to hiring managers. A VC's job is to say "no" and to come forward with 2 or 3 proposals to their partners. Only rarely do they say, "Yes".

But, remember there's roughly 400 VC firms in Silicon Valley. There's still a ton more for you to pitch. You're just getting started.

Raising money is the process of pitching your idea to 150 investors, maybe 10 of them will say, "yes".

And, I agree you are doing serious work with FaceCash. I'm a fan. I like the product, and I think it has legs. Selling VC's on the idea is going to be the first of many hard sells that you're going to have going forward. Hang in there, Dude. You'll make it.

That doesn't make it impossible, but for a number of reasons, it shouldn't take that long. Aside from the given entrepreneur, it harms industry and ultimately the country when it does.

I totally hear you. It _shouldn't_, but it does.

I know we've talked about this before, Aaron, but I think you have to work like hell for the next 6 months to get people using _some part of your system. You've had uptake in libraries... try to get your system in as many libraries as possible. Get some press for that uptake and traction. You do this really well. Then, pitch 100 VC's in 3 months: 3 a day for 93 days, and raise money on that basis. If you can't raise money then, build traction like hell for another 6 months, mail monthly updates to those 100 VCs and then talk to the most interested 30 VCs again.

Your pitch: take on credit cards and beat them is _huge. I genuinely believe that you can do it. But, to do it all at once would probably take $100M up front as a series A round, and then a couple of follow rounds of $500M in series B and C.

Most VC's aren't going to believe that you'll be able to do it, and certainly won't give you $100M in a series A.

I suspect you need to show them that you can perform really well on one, small aspect of your system, and they'll probably be willing to give you money to expand.

I have no doubt you'll be able to do this. You've been doggedly working at this for 5 years. You have a very cool working product. At some point, I have no doubt you'll raise the money that you need. And, you can have your revenge in 10 years when you IPO. :)

The stories of people having money thrown at them by VC's for a business plan make for great TechCrunch reading, and it hits the main stream press, "The Bubble is popping! The Bubble is inflating! The Bubble is about to pop!". But, I talk with around a hundreds early entrepreneurs every month at Hackers & Founders, and _no _one is having money thrown at them. For every Color, or AirBnB, there are 3000 founders that pitch 60 times before they're able to raise.

http://www.facecash.com/legal/ca.html

Frankly, your subjective, continuous attacks on Mark Zuckerberg and Facebook makes it hard to see the objective side of your argument.

If you have 500 friends, each with a feed with 50 posts, you are talking about 25000 possible emails. Those emails would never be sent, because they are usually individually way below the importance threshold for an email.

So, by this calculation at least, it's at least a 1-2 order of magnitude reduction in the work required to maintain contact with old friends. That's valuable.

When G+ came out I dropped my Facebook account.

Due to the low activity on G+, I resorted to... doing stuff with other people in real life, such as volunteering and going to meetups.com meetups. And my real friends not near me kept in touch via e-mail and IM.

I went to high school in one city, college in one 1,000 miles away. Have since worked in cities all over the world. I don't know how I would manage to keep even a tenuous grasp on all the connections I have with people in these different places without Facebook. Admittedly, these are not and never will be deep social bonds I am maintaing, but that is hardly the point. There is value in maintaining a large web of shallow social connections. Facebook helps me do this.

Moreover, whether or not Facebook has improved the life of me or anyone I care about is irrelevant to an objective evaluation of the site's value. I could make the same case for anti-malaria drugs.

That is, the connections may be shallow while we're far away, but when locations change again, its nice to be able to re-develop those shallow connections into meaningful ones.

If you think there's no value in maintaining shallow social connections, then I think you too need to put some energy into adding meaning to your social connections.

Finally, we get it, the government sucks when it comes to making laws like those that make starting up a money transmitter company harder. But other entrepreneurs seem to have addressed it. There are a variety of ways to approach it. For one, use a partner for the transmission part and focus on what you think your added-value is. It would be quite easy to layer a face/barcode scheme on top of PayPal, for example. If you can prove it out, then you're in a better position to handle the money transmission yourself. And might be able to interest investors.

Pro tip: lose the fixation on legal matters and radically simplify your setup processes (10 clicks to approve the TOS!!??)(that's my background talking).

  So, we will continue to invest in very talented entrepreneurs 
  who are pursuing ambitious, challenging tasks. We will treat them
  with respect and hope for the best.

> SpaceX ( http://www.youtube.com/watch?v=WTFlFFrfEB0&feature=youtu... )

> Halcyon Molecular ( http://www.genomeweb.com/sequencing/halcyon-molecular-develo... )

> Palantir

> Pathway Genomics ( http://www.crunchbase.com/company/pathway-genomics )

> Gene Security Network ( http://www.crunchbase.com/company/gene-security-network )

> CDD ( http://www.crunchbase.com/company/collaborative-drug-discove... )

> ImmunePath ( www.immunepath.com/ )

> RoboTex ( http://www.robotex.us/ )

> SmartDrive ( http://www.crunchbase.com/company/smartdrive-systems )

> Navia ( http://www.crunchbase.com/company/navia-systems )

That doesn't sound like a social-mobile-local marketing companies portfolio to me, and yes I've seen their investments in companies such as Yammer, RapLeaf, but clearly they aren't their entire portfolio and they have taken a series of really impressive long term bets.

The entire essay is bullshit.

For some reason this just feels like the fundamental error of attribution to me. Yes, I accept that I might be wrong, but it still does. http://www.paulgraham.com/randomness.html

That's very cute, but the fact is most people don't say or do Important Things in their lives. And socialness on the Internet is a reflection of that.

And that cavalier dismissive attitude is what I would expect from Suits, not here.

Enjoyably read article.

Disabling CSS dumps the unstructured page. You can also pay it a visit in a console-mode browser.

I'm (sadly) finding this to be increasingly necessary to view web pages (as an aggressive user of NoScript).

When you're traveling at 260km/hr and going faster, it's horrifying. You think of how you can hold on.

If you go to Disneyland's Tomorrowland you'll see that we ended dreaming about the future in the 60's and 70's. It was polished metal; a stone's throw from what we had, but within dreaming limits.

Now we don't know where we're going, but we know we've never been there before. It makes no sense to dream about "today plus twenty years". It won't be that and we're aware now that it won't. The innovation will happen with or without us as individuals. And it will keep going, hurtling faster into an oblivion which we can only guess at.

"20 minutes into the future ..."

http://www.youtube.com/watch?v=rM9BOkcG9M0&feature=playe...

Yes, Pong was simply a clever design making use of existing technology that made shirtloads of money for a bunch of people and spawned entire industries. Whereas Concorde - a "real technological development" - was a giant money pit fed from government slush funds for decades, punctuated only by occasional lethal consequences for its passengers and bystanders. (Not to mention that it was a technological cul-de-sac.)

Remind me, which one was it they want to be investing in? Because it sure sounds like they're saying Concorde. Am I misinterpreting?

But looks like the Air France Concorde crash was due to debris on the runway rather than the plane itself. Or were you thinking of something else?

https://secure.wikimedia.org/wikipedia/en/wiki/Air_France_Fl...

A Continental Airlines DC-10 departing for Newark, New Jersey, lost a titanium alloy strip, 435 millimetres (17.1 in) long and about 29 millimetres (1.1 in) to 34 millimetres (1.3 in) wide, during takeoff from the same runway.

During the Concorde's subsequent take-off run, this piece of debris, still lying on the runway, cut a tyre causing rupture and tyre debris to be hurled by centrifugal force. A large chunk of this debris (4.5 kilograms or 9.9 pounds) struck the underside of the aircraft's wing structure at an estimated speed of 500 kilometres per hour (310 mph). Although it did not directly puncture any of the fuel tanks, it sent out a pressure shockwave that eventually ruptured the number five fuel tank at the weakest point, just above the landing gear.

I know nothing about the Concorde, etc. but that the crash was triggered by debris does not really refute that it was a poorly designed or dangerous aircraft, as that should be a design consideration of any aircraft (I assume).

Nah, man, you're not a romantic, and nobody would name a Moon crater after you... well, except of course the case when you make a sh!tload of money off the Pong and buy the honor.

For many of them the research would have to be so speculative that it would be hard to imagine them occurring outside of an academic research lab. For a startup to tackle one of these, the bones of the technology would have to already be there.

Here is some concrete feedback:

- WebKit lets you make custom scrollbars if that's important to you: http://www.webkit.org/blog/363/styling-scrollbars/ . Using a real scrollbar means that shortcuts I'm familiar with (e.g. shift-space to page up -- wow, I had no idea how frequently I used this until this page broke it) won't break.

- Whitespace is nice, but the double-spaced-feeling line-height combined with the "back to founders fund" heading at the top combine to make it feel uncomfortably cramped vertically -- not enough information density per page.

- Similarly, the lines are so wide they are uncomfortable to read. (I actually use a user stylesheet that limits lines to 50em, which makes many sites including HN more readable.)

I'm sorry I don't have any feedback on the content, I was too distracted to start reading it yet.

I have a 3d printer in my basement.

Poor little VC, go play with your social networks. The grownups a busy making the future.

    over the past thirty years, there have been
    no radical advances in transportation technology

It's evolved and become dominant with standardization of container sizes and fittings (by 1970) and with the deregulation of the US shipping industry and introduction of double-stack rail transports (both in 1984).

I suspect more significant recent advancements have been in inventory and logistics management (though bar-coding of rail cars was already happening in the 1980s) and overnight air and other rapid freight. Not quite as visible as containers, but vital to keeping the boats, trains, and trucks moving, and with JIT delivery probably accounts for much of the success of big box stores, and now Internet-based retail and shipping.

- Support normal scroll behaviour (swiping my trackpad scrolls but only very slowly; I can't press spacebar to page down; clicking underneath the scroller should advance a single page, not jump ahead to another part of the document)

- Show diagrams by default (no reason to require a click)

- Add a place for comments

- Narrower line length

The primitive steam based engine was discovered by ancient Greeks and technologically they could improve upon it further. Their slave based society wasn't ready for it.

Like Greeks and steam power, today we have the primitive access to space - and surprise!, instead of actively working upon improving it, pouring all our resources into it, we're still discussing whether it has economical reasons, and like in case of Greeks, we can't find much of such economical reasons for it.

http://www.terrafugia.com/

Kiva Systems has gone from strength to strength and is now used by Zappos, Wallgreens and others (http://en.wikipedia.org/wiki/Kiva_Systems)

Their manifesto makes me question if my current project is thinking big enough (I think it is).

I think the problem entrepreneurs who would apply to Founders Fund might have is how to present their idea as being big and bold. Often the big and bold are not understood in common terms, so we dumb them down to something that is achievable in the short term, and seems realistic, while having a long-term goal which only makes sense if the shorter term goals can be accomplished.

Facebook would be a perfect example here. They couldn't be discussed as 'world changing' in the early days as they were just another social network. Nothing seemed insurmountable, nothing seemed challenging, even the idea of this 'social graph' probably wouldn't have made much sense until tens of millions of people were using it.

140 characters may not have great technology but can be attributed to bring social revolution in so many places.

Ultimately, need is mother of most of innovations. Need leads to demand, which leads to building new solutions.

http://www.terrafugia.com/

Unrelated, except to the sub-title. I also posted deeper in the comments, but I think it's a pretty cool project and thought it's worth trying to repost in a more visible spot. The price tag is a few 100k and you only need the lowest level pilot's license to fly it.

I should add ...can be changed after much deliberation.

This essay calls for a return to hard problems. The "problem" with hard problems isn't that they're hard. That's actually exactly what we need about them. It the unyielding character of hard problems which makes them worth dedicating ourselves to. The greatest difficulty is not solving the problem (which isn't even strictly necessary to benefit from the investigation), but rather, in giving ourselves to the problem in the first place. How can we choose a problem when there are so many possibilities and we have so little foresight?

If we lived in a vacuum, the choice would be impossible or arbitrary. Luckily, our lives are not vacuums. The "real problems" (the things that matter to us, which come into our lives whether we like it or not, and generate actual experiences of significance) provide a point of departure. Real problems aren't technological in nature, but that doesn't mean they don't lead the way towards challenging technical projects. The space race didn't start as an engineering problem. It was the result of the longing of a people, of their hope and anxiety for the future. But as a result of that longing, of that fear and excitement, a lot of smart people dedicated themselves to hard technical problems and produced a huge array of breakthroughs. The trick, then, is to remain attentive to the problems around us, rather than giving into the temptation to ignore or adapt to them.

In order to refocus ourselves on the hard problems, it helps to acknowledge that they are what we want -- that we aren't really satisfied with a day's salary and that we want to push forward towards a life's work. Wouldn't everyone prefer to work on something substantial, on a 'hard problem' for the sake of a 'real problem'? I think so, but we often don't know where to start.

Can technology help us get started? I don't think "a Facebook" or "a Wikipedia" for hard problems is the answer, although either might help. In order to maintain the kind of excitement and reciprocal encouragement necessary to sustain a culture of hard-problem-solving, you need to put smart people who respect each other into the same physical space. You need to make hard- and real-problem-solving a lifestyle in order to overcome the creeping inertia of the trivial. This is why universities retain their relevance. They're a concentrated mix of intelligence, experience, and youthful idealism. They contain lots of people who think about "hard problems" (science, engineering) and "real problems" (philosophy, history, social thought). Universities have their own issues, of course. They suffer from institutional pressures that have more in common with the banalities of commerce and politics than with any dedicated enthusiasm. Historically they have been very successful, but it may be that the next wave of innovation will come from a less traditional source, perhaps from the real-life communities that sprout up around virtual groups like this one.

FOUNDERS FUND

WHAT HAPPENED TO THE FUTURE?

A.INTRODUCTION

We invest in smart people solving difficult problems, often difficult scientific or engineering problems. Here’s why:

The Problem

We have two primary and related interests:

1. Finding ways to support technological development (technology is the fundamental driver of growth in the industrialized world).

2. Earning outstanding returns for our investors.

From the 1960s through the 1990s, venture capital was an excellent way to pursue these twin interests. From 1999 through the present, the industry has posted negative mean and median returns, with only a handful of funds having done very well. What happened?

VC’s Long Nightmare

To understand why VC has done so poorly, it helps to approach the future through the lens of VC portfolios during the industry’s heyday, comparing past portfolios to portfolios as they exist today. In the 1960s, venture closely associated with the emerging semiconductor industry (Intel, e.g., was one of the first – and is still one of the greatest – VC investments). In the 1970s, computer hardware and software companies received funding; the 1980s brought the first waves of biotech, mobility, and networking companies; and the 1990s added the Internet in its various guises. Although success now makes these investments seem blandly sensible, even obvious, the industries and companies backed by venture were actually extraordinarily ambitious for their eras. Although all seemed at least possible, there was no guarantee that any of these technologies could be developed successfully or turned into highly profitable businesses. When H-P developed the pocket calculator in 1967, even H-P itself had serious doubts about the product’s commercial viability and only intervention by the founders saved the calculator. Later, when the heads of major computing corporations (IBM, DEC) openly questioned whether any individual would ever want or need a computer – or even that computers themselves would be smaller than a VW – investment in companies like Microsoft and Apple in the mid-1970s seemed fairly bold. In 1976, when Genentech launched, the field of recombinant DNA technology was less than five years old and no established player expected that insulin or human growth hormone could be cloned or commercially manufactured, much less by a start-up. But VCs backed all these enterprises, in the hope of profiting from a wildly more advanced future. And in exchange for that hope of profit, VC took genuine risks on technological development.

In the late 1990s, venture portfolios began to reflect a different sort of future. Some firms still supported transformational technologies (e.g., search, mobility), but venture investing shifted away from funding transformational companies and toward companies that solved incremental problems or even fake problems (e.g., having Kozmo.com messenger Kit-Kats to the office). This model worked for a brief period, thanks to an enormous stock market bubble. Indeed, it was even economically rational for VCs to fund these ultimately worthless companies because they produced extraordinary returns – in fact, the best returns in the industry’s history. And there have been subsequent bubbles – acquisition bubbles, the secondary market, etc. – which have continued to generate excellent returns for VCs lucky enough to tap into them. But these bubbles are narrower and the general market more demanding, so VCs who continue the practices of the late 1990s (a surprising number) tend to produce very weak returns. Along the way, VC has ceased to be the funder of the future, and instead has become a funder of features, widgets, irrelevances. In large part, it also ceased making money, as the bottom half of venture produced flat to negative return for the past decade. [2]

We believe that the shift away from backing transformational technologies and toward more cynical, incrementalist investments broke venture capital. Excusing venture’s nightmare decade as a product of adverse economic conditions ignores the industry’s long history of strong, acyclical returns for its first forty years, as well as the consistently strong performance of the top 20% of the industry. What venture backed changed and that is why returns changed as well.

Not Everything With A Plug Is Technology

... et cetera

A world lead by visionless, spineless leaders, employed by multinationals to kill anything that threatens their existence

A world that is feminized, where men are taught to grovel for a women's affection, and to earn their attention with gucci and prada, paid by their mcjob

A world ruled by bankers, where the mindless middle class are the sharecroppers. Bankers don't dream about flying cars. They dream about the rent paid next month.

A world brainwashed by advertising, training its citizens to love sequels and brands. Transformers 15. Call of duty 14. Starbucks everyday.

A world that no longer needs you, the passionate, explorative, imaginative, thinking you.

That's the first paragraph of the article. That is to say... What are you talking about?

"A world that no longer needs you, the passionate, explorative, imaginative, thinking you." AS IF any passionate, imaginative, thinking blob ever cared about how much "the world" (wth is that supposed to mean) needs her/him or not...

> A world that is feminized, where men are taught to grovel for a women's affection, and to earn their attention with gucci and prada, paid by their mcjob

Any man fitting that description has only himself to blame. Women don't want metros, they want real men (real man == doesn't care what others think, lives by his own rules.)

Anyway, great post, possibly the greatest post.

But then I remember that it doesn't matter what the world says or does, that our leaders are not only visionless and spineless but also ineffective playboys with a weak ego. That the multinationals have repeatably refused to change, even when we were screaming the necessity of that choice to them for a decade.

I remember that the bankers are a joke, that the middle class doesn't matter (make the product cool enough then they will buy it anyway); I remember that the dream that matters isn't theirs, but mine.

I remember that no matter how many sequels are made, how many WWII shooters are created, how many man years are given to graphics that is almost better than the real world, the creator of Minecraft is a millionaire.

I remember that the world needs the passionate, explorative, imaginative and the thinking more than it ever has, even if it does everything it possible can to deny it.

I remember that the critics, the negatives, the deniers and the naysayers don't matter as long as the men of action don't listen to them.