Rabbit Starvation at your Startup
Nov 29 2006, 21:37 EST [updated Dec 19 2006, 14:30 EST]
Rabbit Starvation is a wilderness survival term. Rabbits aren't too hard to catch and provide a good source of food even in winter. Rabbit starvation happens when you eat only rabbit. The food is so lean that you can be filled to bursting and still die of malnutrition. Even worse you will die faster by expending the fat reserves you do have by chasing the rabbits that won't replace it[1].

This is an easy trap for startups to fall into and an almost enviable one - hey, people are paying us $X to do something so let's do more of it! The danger is that you can never do enough to grow (merely living isn't the point of a startup, if you want that just get a job). You have to consider opporunity costs in your startup even for break-even or marginally profitable product lines. You have to put your most profitable product lines first or they will wilt while your are off chasing rabbits. This is a hard thing to do - keeping the pipeline full of marignal business may make your next month but the tradeoff is displacing better business down the road. If you aren't banking on the bigger payoff then maybe you don't have a startup. Either way, you still have to worry about rabbit starvation.

All lessons go double for software where the fat is divided between the first and the best, and where best is short lived.

[1] This isn't true but tradition requires we over learn the lessons of our fathers because we will partially disregard them anyway.

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