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Front cover of Startup

It’s been a while since my last post. I was in USA at the time. Now I’m Brazil again. A lot of things have changed, but I will (hopefully) write about it on another entry.

Right now I want to write about a book that was on my reading queue for a while: Startup by Jessica Livingston. I got this book last weekend and, truth to be told, I am a little bit frustrated with it.

Before I bought it I expected to see great insights about starting a new company, making it develop and grow. But this wasn’t what I got. The book follows the format of a series of interviews made with founders and co-founders of big and important companies of our time where they explain a little bit about how they started, but without any deep thoughts. Companies like Apple, Hotmail, Yahoo!, Firefox and other.

So, after some moments of frustration I changed my mindset and could actually enjoy the reading. I stopped thinking about getting good insights from it and started to read it to understand how American startups worked, subject that I had a vague idea about. Now I have a little bit more information about it and it goes like this:

Most American startup companies are created in college/university. Great and brilliant students get together and talk about a really nice idea. You can almost think that they can predict the future because they changed the way we use computers today, but they don’t. They actually make the future happen the way they wanted. Almost always, after discussing and prototyping a bit they come up with a business plan and with this very important piece of paper in hands they go after investors. Venture capital investors. People who want to risk their money in things that might work in exchange of a piece of the company. Making a long story short, after a lot of work and effort they sell (or not) their companies for billions, pay back the investors and sometimes keep working for the company as an ordinary employee.

Getting back to the book and startups formation, the first thing you will notice is the fact that opening a startup company has nothing to do with Brazilian reality. It won’t work here the same way it does in USA. Not even close. It’s all about culture and infrastructure.

In USA you can find good universities (they are expensive, but also good) that teaches you a lot of new things and the basics about everything you need to know to work with computers (or whatever subject that you are studying). But we also have good universities, right? Yes we do, but the problem is that only a minor portion of our students have their studies paid by their parents, like they do. In Brazil we have to work our way through college/university and think about bringing money to our home and families. We have to worry about making a living. In my opinion this is the big difference: investment in education. We could use some of that here.

While in college, American students don’t have to worry about anything else other than studying. The structure offered by the government and their families makes students prosper. They have the knowledge in their hands, the supplies and tools needed to transform the knowledge into something tangible and in the end a culture of investment that makes it possible to raise large amounts of money needed to start a company and keep it breathing. We have all this guts too, but unfortunately we don’t have the culture and the investments necessary to make it work.

Of course we cannot take away all the quality and merit that they deserve. They have great ideas and guide our IT world. But, I would say that this only happens because they have a more fertile environment (government quality, economics, security, etc) than we do.

It doesn’t mean that we can’t do something like that. It only means that is harder here. Thanks to our interest rates, taxes and politics. We can see that this is true by counting the number of startups in Brazil and how many companies survives after five years that they are open. I don’t think I can fill my hand’s fingers couting it. Can you?

Although it’s not a must read book I would say that is a good reading that can help you understand a little bit more about the foundations of the companies that currently rule our world when it comes to IT.

Hope you enjoy!

ps: Even though I was in USA for three months and studied a lot of English it still needs improvement and because of that you will find some errors in the text. If you want to help, please leave a comment when you find one. Thanks!