But as the industry matures, it's becoming apparent that that model doesn't hold up quite as well. 1 success is rapidly copied by every other major website and YC type startups, there's major marketing spend to stay on the front of techcrunch, techmeme, digg, etc. Software requires more maintenance, hardware becomes a bigger cost, employees extract more from their employers or leave just when they're most productive, etc. So where it might have been 1 success will make up for 10 failures, it's rapidly becoming the case that 1 success will make only make up for 5 (or 1) failures.
Plenty of empirical evidence out there in the decline in shrinked wrap software, the disappearance of successful IPOs, and the inability of the vast majority of websites to charge for any service whatsoever.
