Max Klein

For young smart programmers who study a bit about the basic principles of making money, it’s pretty easy to get a steady income from the internet. It’s almost trivially easy, particularly at this point in time where there are many consumers of internet-based products and few producers.

But many people who try to make money on the internet are failing – and one of the main reason they fail is because of angels. Dark angels, flying about and preying on fresh minds.

You see, the angel investors, however benign the name may sound, are not investing money to help businesses get off the ground. They are not investing money so that others will get as rich as they themselves are. They are not doing a nice and social service – they are investing money because they want even more money back. That’s all they are – they are hawks looking to see where they can prey.

And one of their main bait methods is in their writing. Angel investors and others in their eco-system are writing on the internet about how to make money on the internet. These articles are what young programmers read, and the methods that these people write about is what the programmers end up using. Not knowing that they have fallen into a deadly trap that will maximize the potential profits of the angels, while rendering them nothing but statistical nothings, to be discarded at any time.

Angel investors are not interested in companies that create value and that can hire one or two people, while making a steady profit. The investors are interested in blow-out companies – companies that either grow huge, or that will be bought by other companies. Those are the only types of companies interesting for the angels.

And these are exactly the hardest types of companies to build, and the ones most likely to fail. But the angels will write and convince the programmers, and build this system where it seems like this is the right kind of company to build. Yes, it is, but only for THEM!

For you, young programmer, the right kind of company is not that insanely difficult, high risk company! It’s a simple product company that has a large market and that will pay your bills quickly. That’s EASY to build with the talents you have, and it WILL satisfy your needs.

The angels don’t want you to do this. It’s exactly what they don’t want, because those types of companies are taking away from their potential pool of candidates. They will write and talk as if those types of companies don’t even exist. Don’t let them sucker you into wasting the best years of your life trying to build something ambitiously dumb.

They will tell you to change the world, because you’re young and you still think you can. What they really mean is that you should join the ranks of their small investments, reducing their risk slightly, while increasing slightly the probability that they will make another 5 million. You’re just a statistic to them.

There is an easier path to the money you want. Good stand-alone product, big market. Execute well, the money will come. It starts slow, but it gets faster a couple of years down the line.

Don’t see venture capital as your aim. Don’t see seed investments as your aim. Don’t build only things that google may acquire. Don’t start unrealistically ambitious companies.

Don’t let those venture capital and angel blogs sucker you into doing stuff that is rather unlikely to work. Just make a good product for a big market, and ignore the vultures. When they smell the meat, they will come flying around anyways.