Wow, this is like a knight in a white horse for Hunch.. I seriously doubt they were making any profit... This sounds like a talent acquisition. I mean this is ridiculous... but it goes to show you.. you gotta show up for the game (the startup game, I mean) to win it... $80 m for a site that doesn't even get 1 million uniques (per Compete) a month is a STEAL. I mean.. seriously, everyone who has a CS background should just start something on the side if a deal like this is possible.
> everyone who has a CS background should just start something on the side if a deal like this is possible
Chris Dixon is a veteran investor and entrepreneur, with enormous visibility in the tech world. Contacts with potential acquirers are a non-issue for him.
A poor CS fellow could have created a version of Hunch that was 100x better and they still would have 1,000x less of an exit opportunity as compared to any startup Dixon founded.
Technically he should be a software developer with a $120-200k salary working at Google, saving money with compound interest and getting company stock. Thats the easiest way as a CS grad to become wealthy - if thats your goal.
That's when you don't factor in 'skills'. If you're 'any' CS grad, you're right. Be if your skills are above average (CS and business sense), this skews the return of investment of the startup.
C'est la vie. It's not the startup scene - it's a basic principle of society, unfortunately. Who you know is just as important as what you know or can do. The best thing to do is find people to know by showing them what you can do.
Agreed, this is completely absurd. Say what you will about Chris Dixon (zomg he doesn't code, wtf!!!!!111), but the engineering team at Hunch is second-to-none.
Grandparent makes it sound like Dixon pulled this off in his spare time. He assembled a team of A-level engineers, then secured millions in funding so they could develop an awesome recommendation engine with almost no clear revenue stream. I challenge anyone to find a CS grad who can match that in his or her spare time.
I think we need to move away from all the nonsense of "A-level engineers" or superstar developers and so and so and so.
Carl Henderson of Flickr fame looked like an A-level engineer back then (especially with his O'reilly book) yet some of the Flickr engineers baffled when they saw the Flickr codebase.
A few years ago I met a 'superstar' type developer who was considered hot shit amongst the usual crowd. I met him with a view of hiring him (or, trying to) mostly because of his reputation.
I think i must have been the first person who really drilled into his knowledge, because he was more interested in talking about who he knew, projects he had been associated with etc.
I got a funny feeling about him, and asked that he do a simple code project. A week overdue later, he asks for our FTP credentials to upload it. I say that we don't run ftp anywhere, and that he needs to scp to the box. He said he had no idea that ssh can 'copy files'. urgh. He later worked out that his GUI FTP client supported SSH and got so excited about it that he messaged me to tell me about it.
I have never judged the capabilities of a developer based on reputation since.
It's kind of hard to judge this superstar developer you mentioned based on his knowledge of some of those UNIX tools.
Josh Bloch admitted himself that he's kind of not really "up"-ing his knowledge/skill when it comes to tools (git, eclipse, intellij, etc) but he writes damn good code with just Emacs.
He knows his Math & Stats to debunk benchmark and stuff like that and he knows the pitfalls of complexity.
ye but the mistake I made was to take his reputation and have a pre-conception about his abilities to the point where I almost didn't test him on anything.
he also fell apart in the code test, which was pretty simple (using a library I had written, which he made a copy of and edited). I have no idea how this guy got his reputation, but it seemed to be more amongst non-tech tech people, if you know what I mean (who are easier to bullshit, I guess)
when I started my career I worked with a bunch of old IBM mainframe guys who had no idea about modern web stuff but were some of the best programmers I have ever met. I could take a problem to them in a language they didn't know (so for eg. VB.NET) and they would talk me through it.
Flickr was a bonafide cultural phenomenon before Yahoo let it die on the vine. That doesn't happen with crappy engineering. Less-than-optimal engineering, yes. That's the tradeoff between getting a product out the door and never delivering.
agreed. ooh.. a recommendation engine backed by semantic cloud-based peer to peer infrastructure... for all we know, it could just be aggregating data from twitter and seeing whether the word "good" or bad appeared more often to decide whether to aggregate it.
Actually yes, I have written a recommender system.But if there's 1 thing I've learned over the years is that you don't go overestimating the complexity/intelligence of any system unless you take a peak underneath. For all you know, Hutch could be just hiring curators with good taste rather than write some complex system that would need to be constantly changed and updated. But people have all the incentive in the world to "over fluff" and overcomplicate their work to make it sound valuable. It's smart, but you gotta be skeptical.
> you gotta show up for the game (the startup game, I mean) to win it...
This type of thinking is why the valley is so full of zombie companies pumped up with capital, but with no real traction or any way of ever being profitable
PG and many speakers at startup school repeatedly said that its easy to spot the ones who are just doing it because they want to be "that guy" like Zuckerberg - the ones who want to play the game. Instead of starting a company to figure out what customers want.
What motivates you to start a company is really important. Especially during the downswings that kills most startups (google "trough of sorrows").
I would agree, and it's a damn good talent acquisition. Hunch's team is made almost exclusively of engineers who (a) went to some of the best CS programs in the world (CMU, MIT, Stanford), and (b) really really really know their shit (just have a 5-minute convo with one of them).
Here in NY, Hunch had a reputation for opportunistic hiring. They had lots of funding and an incredible core team, so they'd only hire engineers that astounded them. That's a great way to set yourself up for a talent acquisition.
There's really almost no such thing as talent acquisition , IMHO:
1. No dev is worth $1m. Their skills may generate as much and more, but only in a specific context. Being great at catching a football is worth $50m in context of the NFL, $0 without it.
2. You can't really buy talent. At best, you can keep it, working at 1/2 of its ability, until fully vested and moves on. Alternately, eBay could create an environment as challenging and attractive as Hunch - but (a) by definition, it's almost impossible and (b) if you could pull it off, you could hire the similar talent for much less than $80m.
You think Ebay can't just, you know, hire this kind of talent?
I'd think walking through the halls of those CS programs offering $250k a year in salary would get a a bunch of A-Level talent at a much lower price then they paid for Hunch.
I dunno, their recommendation engine was scary good -- the technology Ebay's acquiring isn't anything to sniff at. They reportedly have a defensive portfolio of pending patents: http://www.formspring.me/hunch/q/169651283274266480
Ebay's been on a spending spree this past year and I'd say this is one of the better deals they've made, depending on how long they've locked in Hunch's team.
+1 on the talent acquisition, although much like Slide, About.me, this shows that once you're lucky, twice you know who to speak to if you've gotten to a sizeable exit before.
Also helps that eBay is looking for its second act to avoid the fate of a crumbling Yahoo!
Comments
Wow, this is like a knight in a white horse for Hunch.. I seriously doubt they were making any profit... This sounds like a talent acquisition. I mean this is ridiculous... but it goes to show you.. you gotta show up for the game (the startup game, I mean) to win it... $80 m for a site that doesn't even get 1 million uniques (per Compete) a month is a STEAL. I mean.. seriously, everyone who has a CS background should just start something on the side if a deal like this is possible.
> everyone who has a CS background should just start something on the side if a deal like this is possible
Chris Dixon is a veteran investor and entrepreneur, with enormous visibility in the tech world. Contacts with potential acquirers are a non-issue for him.
A poor CS fellow could have created a version of Hunch that was 100x better and they still would have 1,000x less of an exit opportunity as compared to any startup Dixon founded.
Get real.
If this really is true then it's a sad indictment of the state of the startup scene.
Perhaps your hypothetical fellow should focus on building a "lifestyle business" instead of trying to get big and then get acquired...
Technically he should be a software developer with a $120-200k salary working at Google, saving money with compound interest and getting company stock. Thats the easiest way as a CS grad to become wealthy - if thats your goal.
That's when you don't factor in 'skills'. If you're 'any' CS grad, you're right. Be if your skills are above average (CS and business sense), this skews the return of investment of the startup.
Well, not any developer can get $200k at Google. So skill is important in both respects.
C'est la vie. It's not the startup scene - it's a basic principle of society, unfortunately. Who you know is just as important as what you know or can do. The best thing to do is find people to know by showing them what you can do.
Agreed, this is completely absurd. Say what you will about Chris Dixon (zomg he doesn't code, wtf!!!!!111), but the engineering team at Hunch is second-to-none.
Grandparent makes it sound like Dixon pulled this off in his spare time. He assembled a team of A-level engineers, then secured millions in funding so they could develop an awesome recommendation engine with almost no clear revenue stream. I challenge anyone to find a CS grad who can match that in his or her spare time.
EDIT: restructured on second read.
I think we need to move away from all the nonsense of "A-level engineers" or superstar developers and so and so and so.
Carl Henderson of Flickr fame looked like an A-level engineer back then (especially with his O'reilly book) yet some of the Flickr engineers baffled when they saw the Flickr codebase.
Sometime it's all smoke and marketing hype.
A few years ago I met a 'superstar' type developer who was considered hot shit amongst the usual crowd. I met him with a view of hiring him (or, trying to) mostly because of his reputation.
I think i must have been the first person who really drilled into his knowledge, because he was more interested in talking about who he knew, projects he had been associated with etc.
I got a funny feeling about him, and asked that he do a simple code project. A week overdue later, he asks for our FTP credentials to upload it. I say that we don't run ftp anywhere, and that he needs to scp to the box. He said he had no idea that ssh can 'copy files'. urgh. He later worked out that his GUI FTP client supported SSH and got so excited about it that he messaged me to tell me about it.
I have never judged the capabilities of a developer based on reputation since.
It's kind of hard to judge this superstar developer you mentioned based on his knowledge of some of those UNIX tools.
Josh Bloch admitted himself that he's kind of not really "up"-ing his knowledge/skill when it comes to tools (git, eclipse, intellij, etc) but he writes damn good code with just Emacs.
He knows his Math & Stats to debunk benchmark and stuff like that and he knows the pitfalls of complexity.
ye but the mistake I made was to take his reputation and have a pre-conception about his abilities to the point where I almost didn't test him on anything.
he also fell apart in the code test, which was pretty simple (using a library I had written, which he made a copy of and edited). I have no idea how this guy got his reputation, but it seemed to be more amongst non-tech tech people, if you know what I mean (who are easier to bullshit, I guess)
when I started my career I worked with a bunch of old IBM mainframe guys who had no idea about modern web stuff but were some of the best programmers I have ever met. I could take a problem to them in a language they didn't know (so for eg. VB.NET) and they would talk me through it.
Flickr was a bonafide cultural phenomenon before Yahoo let it die on the vine. That doesn't happen with crappy engineering. Less-than-optimal engineering, yes. That's the tradeoff between getting a product out the door and never delivering.
Netscape's code was pretty crappy too.
I never refer to a perfect utopia where the code is superbly indented, nicely commented, looks great, etc.
But hacks will always be hacks regardless the discussion of "getting product out of the door" vs "never delivering".
agreed. ooh.. a recommendation engine backed by semantic cloud-based peer to peer infrastructure... for all we know, it could just be aggregating data from twitter and seeing whether the word "good" or bad appeared more often to decide whether to aggregate it.
Have you used Hunch? Have you ever written a recommender system? Have you even read the source of one??
This isn't some naive Bayes spam filter from 1992. Hunch is really, really accurate.
Actually yes, I have written a recommender system.But if there's 1 thing I've learned over the years is that you don't go overestimating the complexity/intelligence of any system unless you take a peak underneath. For all you know, Hutch could be just hiring curators with good taste rather than write some complex system that would need to be constantly changed and updated. But people have all the incentive in the world to "over fluff" and overcomplicate their work to make it sound valuable. It's smart, but you gotta be skeptical.
In what universe is starting a company with no clear revenue stream a good thing?
100x "better" in what sense? Traffic? If so, I suspect suitors would line up.
While Dixon's reputation is a great asset, I wouldn't say it's a multiple-orders-of-magnitude difference.
> you gotta show up for the game (the startup game, I mean) to win it...
This type of thinking is why the valley is so full of zombie companies pumped up with capital, but with no real traction or any way of ever being profitable
PG and many speakers at startup school repeatedly said that its easy to spot the ones who are just doing it because they want to be "that guy" like Zuckerberg - the ones who want to play the game. Instead of starting a company to figure out what customers want.
What motivates you to start a company is really important. Especially during the downswings that kills most startups (google "trough of sorrows").
This sounds like a talent acquisition.
I would agree, and it's a damn good talent acquisition. Hunch's team is made almost exclusively of engineers who (a) went to some of the best CS programs in the world (CMU, MIT, Stanford), and (b) really really really know their shit (just have a 5-minute convo with one of them).
Here in NY, Hunch had a reputation for opportunistic hiring. They had lots of funding and an incredible core team, so they'd only hire engineers that astounded them. That's a great way to set yourself up for a talent acquisition.
There's really almost no such thing as talent acquisition , IMHO:
1. No dev is worth $1m. Their skills may generate as much and more, but only in a specific context. Being great at catching a football is worth $50m in context of the NFL, $0 without it.
2. You can't really buy talent. At best, you can keep it, working at 1/2 of its ability, until fully vested and moves on. Alternately, eBay could create an environment as challenging and attractive as Hunch - but (a) by definition, it's almost impossible and (b) if you could pull it off, you could hire the similar talent for much less than $80m.
You think Ebay can't just, you know, hire this kind of talent?
I'd think walking through the halls of those CS programs offering $250k a year in salary would get a a bunch of A-Level talent at a much lower price then they paid for Hunch.
Would anyone happen to know how much 'exit bonus' these MIT/Stanford CS Grads get once a company is sold?
40% of them will start their own companies once their non-competes expire.
I dunno, their recommendation engine was scary good -- the technology Ebay's acquiring isn't anything to sniff at. They reportedly have a defensive portfolio of pending patents: http://www.formspring.me/hunch/q/169651283274266480
Ebay's been on a spending spree this past year and I'd say this is one of the better deals they've made, depending on how long they've locked in Hunch's team.
I wonder if Google was in on the action for Hunch.
Apparently Google bid $60million for Hunch - http://www.businessinsider.com/not-for-sale-hunch-has-turned...
+1 on the talent acquisition, although much like Slide, About.me, this shows that once you're lucky, twice you know who to speak to if you've gotten to a sizeable exit before. Also helps that eBay is looking for its second act to avoid the fate of a crumbling Yahoo!