Slashdot Mirror
Bootstrapping Start-ups
An anonymous reader writes "How many of us wanted to follow
our dream and start our own start-up? How many of us thought that it can't be done due to costs, the need of big bucks and convincing some snotty VC? Well it didn't stop these guys. The most current success story is
social networking software Huminity which
has been on /.
before. The recipe for their success was: open source, clustering $100/mo
servers, using the web to find native translators instead of using over priced
local ones and hiring GUI designers from popular skins download sites."
Argh my eyes! They're still blinking!
I have several ideas that could make great money but they ultimately require money to make money. Does anyone have a good suggestion for raising capital without forfeiting the rights to one's intellectual property?
Life is the leading cause of death in America.
... their bandwidth costs have forced them to close down.
and i am the only employee/CEO of the company....browse pr0n all day. haven't figured out how to get somebody to pay me for it though
There are no more angels willing to invest hundreds of thousands of dollars.
Sure, if by angels you mean idiots.
What is their business model? Selling people t-shirts while they use the software for free?
I'm one guy. I also sell t-shirts and give away software. I'm a startup too!
If you're a start up, like me, do not, repeat, *do not* make the government your first contract. They will bleed you dry with all the waiting due to red tape and politics.
I now understand the $700 toilet seat:
* $5.95 for materials
* $694.05 for overhead
Completely justified IMHO
Sometime you don't need money to make money, just the will to rummage in the trash.
There's always the story of Wallflower, a company that makes digital picture frames. They got their start by buying ancient laptops (considered scrap) and re-shaping them.
Sometimes, you can start a business with nothing but a little cleverness, and an order from the scrapyard.
On the negative side... In a country such a Canada where you can claim R&D tax credits, you can only claim these credits on real expenses - so if you pay yourself (next to) nothing, you won't be able to claim any of that as a tax credit...
Platform independent bug tracking software
This is a brand new account reposting a highly moderated comment from the previous slashdot story.
While the comment remains true, I hope the mods will send him right back down to -1. It looks like a troll charging up karma to me.
There are no trails. There are no trees out here.
Your main goal is to immediately quit your current job. If your goal really is to start something new, then in many cases (but not all)your dedication and discipline will weigh more heavily than your financing.
There's always the hours after your 9-to-5 (assuming it's a 9-to-5), and they are yours to spend as you wish. If you want to risk your time (and maybe a few of your buddies' time) on a venture that may or may not generate any income, the risk/benefit is pretty well in your favor.
Yes, it is hard to be disciplined enough to find the time when you go home, or to treat it like a real project rather than a hobby, but these are matters of self control, and usually within a person's own determination.
The moment you ask someone else to fund your venture, you are turning over some part of what determines success or failure to someone else.
Need a simple, easy to use data tier generator? http://www.gryphinsoftware.com/
Remember, Hewett Packard and Apple were started out of a borrowed garage.
I am currently running a web developement firm and an ISP from my basement. It's not enough to quit my day job, but it does help line the pockets around the holidays. My market is small non-profits and family run businesses who are sick of dealing with large ISP's, and getting raped by web designers. My product is reliable service for a good price, and the ability to tweak the system to make it do what THEY want it to do.
"Learning is not compulsory... neither is survival."
--Dr.W.Edwards Deming
- Sketch out a business plan that gives you some clue of how much money you really need. Hint, you do not need a million dollars.
- Pretend you're optimizing code and shrink the hell out of it. You don't need to pay for a hosting service above and beyond your cable modem in the basement. You don't need brand new machines when you can buy from ebay. You don't need an office, or business cards, or a travel budget. You don't need to hire person X if you can convince them to do it for free for version 1. Repeat ad nauseam.
- Go out and get the stupid money. Ask relatives. Rack up credit card debt. Tell them you're making an independent film or something. Move back in with your parents if you have to.
- Get customers. You may even find yourself a sugar daddy that likes your idea so much that they will pay up front, enabling you to do more sooner. This is how many startups get started, when a big company says "I am willing to be your only customer for awhile, even though I know you have no product, and I will pay you to build it, on the promise that I will get lots of profit once you really do have product."
It's been done plenty of times before. It's not inconceivable once you have a better handle on how much you need. Everybody thinks they need a million dollars to start, but in reality you can probably get started for a few hundred or a few thousand. And if your idea has any legs, then raising a few thousand bucks should not be out of the realm of possibility.www.HearMySoulSpeak.com
My partner and I have an online service that we have launched with basically no money. We are entering our third month, and we are breaking even already. Actually made a peep of a profit last month.
Since we have no money to play with, we find advertising to be the most difficult aspect of starting a business. We do the cheapest things imaginable, and quite often simply ask for established sites to support us, flat out. Google adwords helps also, especially since our keywords are cheap. For payment processing, we use paypal because we cannot afford the setup and gateway fees of a proper service.
The site design and hosting was actually the cheapest part, as he is a graphic designer and I sling code and already have adequate hosting for our service. Hehe, I would post a link but no way can I survive a slashdotting, even a mild one. We have just enough to get by on.
Anyway, we are not making a lot of money, but we started with almost nothing and are ( however pathetic ) profitable and growing rapidly. You just have to be creative, have a service people want, and be willing to beg for eyeballs sometimes. Good luck to anyone who is trying it. With a bit more money than we have to work with, you might do quite well. You will certainly get there faster than we are.
Where have we heard that before. Are we now advocating shipping jobs offshore as long as it saves a lot of money and does not affect quality? Or is it that these jobs were not IT positions, so no one cares.
Anyway, the whole post sounds like an advertisement. Hope /. got comensated.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
"Learning is not compulsory... neither is survival."
--Dr.W.Edwards Deming
How many of us thought that it can't be done due to costs, the need of big bucks and convincing some snotty VC? Well it didn't stop these guys.
Those with short attention spans are doomed to repeat recent history.
Unless your startup needs a factory, gobs of employees, or other extensive capital, you don't need megabucks, only kilobucks. No need for snotty VCs, selling off rights to future IP, etc. It's still hard, but 95% of existing businesses have done it.
You just have to start small. One of the worst legacies the dot.boom left us was the general perception that businesses have to be large to be successful. Nothing could be further from the truth. I don't have the current statistics, but last I heard them a few years ago, 80% of businesses in the US had 20 or fewer employees. In other words, small business is king.
I've worked closely with many individuals who have started businesses from scratch. It's not cheap, but it doesn't require millions from venture capitalists. Your credit cards, retirement savings, relatives and a trip to the local bank are often all that's needed to start out small. And small is all that you need. You'll be working your butt off eighteen hours a day, but you can do it.
If this is software, you've got a headstart over most other businesses, since you don't need to carry inventory, rent warehouses, or run factories. All you need are salesmen and developers. The developers may be expensive, but your salesmen will be cheap, since they'll be bringing in their own paychecks. As a bonus, your product is infinitely reproducible at no cost. Heck, you can even contract out development to bring in cash flow while your main product is getting ready.
Your hardware isn't going to be that expensive, if you stop thinking like a gamer. You can get away with old i386 or Sparc5 boxes for your servers. If the software is ultimately an end-user product, you'll need a variety of current hardware to test on, but otherwise it's a luxury you can't afford.
Don't blame me, I didn't vote for either of them!
Most mid-level pot/coke dealers aren't nearly as tough as they seem, they aren't going to go more than 500 miles out of their way to recoup under $5,000.
I can't help but think that there's really only one way to learn this sort of thing...
Alito: A vote for Alito is a punch in the eye to put that bitch back in her place!
Heh. "Snotty VC" in the blurb reminded me of 1999, when I was employee #4 at a software startup. The company makes software for a specific type of business. Through tests we had done, we could prove that we were capable of increasing profits for companies in the target market by 25%-100%. /. terms, many of these companies did indeed leave out step 4 before claiming that step 5 would be "Profit!"
Unfortunately, as I said, it was 1999. Smart VCs like John Doerr had seen good business opportunities in companies like Yahoo!, Amazon, AOL, and others, and made huge wads of $$$ for their firms through shrewd investments. The clueless wannabe VCs apparently missed the point that-- internet or not-- the success of investors like Doerr was based on careful evaluation of business plans and business models. The Doerr wannabes apparently said to themselves "John Doerr made a lot investing in internet companies, so we have to do the same." I figure that's how multiple internet pet shops and ridiculous internet businesses got funded, with many even going to IPO without having anything resembling profit in the foreseeable future or even a decent roadmap to achieving profitability. In
Getting back to how this was relevant to my personal experience, the founders of the company (employees #1 and #2) would make their presentation to some VC, again, showing that the company's software could produce billions of dollars of value for companies in the target market, and the response was almost always the same: "OK, but what's your internet story?"
Most of them were really snotty, saying that "these days," anything that isn't internet-based doesn't have a chance, or something equally short-sighted and clueless. But they said it with such authority and such snottiness that it would make even the strong of stomach want to vomit.
At the time, I said "Let's just change the name of the company to 'e-(Real Name of Company)-dot-com' and we'll be swimming in money!
After that, I became a big fan of F**kedCompany, which now seems to include non-dot-coms a lot more than it used to. Back in the day, it was more focused on reporting disasters in dot-coms that probably never should have been funded. Every time I saw another online business with no clear sustainable revenue stream (the $$$ from idiot VCs desperate to pour money into anything dot-com doesn't count-- it has been proven not to have been sustainable) go down the toilet, with an amusing report on F**kedCompany, I would snicker and say to myself "Yeah, I've got your internet story RIGHT HERE!"
--Mark
"It is nice to know that the computer understands the problem. But I would like to understand it too." --Eugene Wigner
Yes, you may have to run up credit cards and eat bread & water for months, but here's what's really important: Customers
Every single work day, dedicate 9:30 - 11:30 AM to nothing but cold calls [ok, I hear your moaning...] Or have your S.O. do it -- if s/he has a less threatening voice.
Google "cold calling" and learn the best techniques, on-line -- they do work. Do calls every day! Fill out a spreadsheet with who you're going to call the next day and, just like successful aerobics, get up in the morning and do it without thinking about it. Use a similar spreadsheet to track who you've called and call again the next month. And the month after that.
Eventually, you'll turn those calls into appointments, you'll turn the appointments into sales, and you'll turn the sales into (life-long?) clients. Eventually you'll be paying all your bills, on time. Eventually you'll be paying down your debt and even saving a little for retirement. Eventually, you'll be eating out in style, again. Eventually, you will not need to do any cold calling!
We do about 20 calls a day, and a day doesn't go by that I don't get at least one appointment. Sometimes it's someone who's rather friendly or curious. So I go the next day and introduce myself in person and ask a slew of questions about their business. I don't tell them anything about mine unless they ask -- then I keep it to just one sentence worth of info. and get back to them.
After about 4-6 "appointments", I make a sale. If I do a great job the first time, the first sale can lead to many, many more. A client tends to return to the one person s/he knows. They rarely let another geek into their sphere, unless there's a good reason.
I also think it's good to "spread the wealth". So for other geeks I trust with my clients, I throw work their way as much as possible. Clients like to know there's a "hit-by-truck" backup for your services.
Remember how hard your first real job was in IT? Took you a while to get to real "success", right? This is no difference, except you're having to sell to several "bosses" instead of just one [cheap, lying, no-good, rotten, four-flushing, low-life, snake-licking, dirt-eating, inbred, overstuffed, ignorant, blood-sucking, dog-kissing, brainless, dickless, hopeless, heartless, fat-assed, bug-eyed, stiff-legged, spineless, worm-headed sack of monkey shit] Holy shit! Where's the Tylenol...