Interesting comment discussion between me and iamronen this morning. It started with me making the assertion that most founders start companies with the goal of building a "financially successful business."
iamronen then pointed me to a Jeff Atwood post from earlier this month where Jeff says:
Yes, Stack Overflow Internet Services Incorporated©®™ is technically a
business, even a
venture capital backed business now — but I didn't co-found it
because I wanted to make money. I co-founded it because I wanted to
build something cool that made the internet better. Yes, selfishly
for myself, of course, but also in conjunction with all of my fellow
programmers, because I know none
of us is as dumb as all of us.
For those that don't know, Jeff is a founder of our portfolio company Stack Overflow.
So then iamronen asked me if we would be happy if Stack didn't make profits but did make enough money to sustain itself (a non-profit?).
And I answered with this:
if hundreds of millions of people all around the world are learning and improving
their lives with stack powered knowledge exchanges, i will be thrilled
And I will be thrilled. But my answer doesn't really mean that we would be happy if Stack became a non-profit. We are financial investors and we do want to see our portfolio companies become valuable.
My answer to iamronen suggests something else. At USV we do focus on financial metrics, but our number one goal for our companies is to build very large networks of engaged users. We believe if they do that, they will build value for themselves and us.
So that is how we measure success first and foremost. We believe very large networks of engaged users will ultimately create significant financial value for everyone involved.
