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Eric Sink on Starting Your Own Software Company
prostoalex writes "The topic of starting your own software company was recently brought up on Ask Slashdot as a way to fight current employment trends. Eric Sink from SourceGear, who shared his software company-building experience before has written a new article published on MSDN. Getting started with your own software company suggests several simple steps to evaluate your abilities, count your estimated expenses and then start the software company, if the idea still seems feasible."
...on starting a company is right here.
Lots of similar ideas there, including a few rants against VCs and incubators.
The Army reading list
Advice on starting a software company from the MicroSoft Developer's Network? I have to say I'm just a tad leery of this generosity.
Enough about Erik Sink's efforts. What about the companies started by Jon Fail and Trevor Bankrupt?
Ahhh, finally step 2...
1) Start small software company with flagship product
2) Get bought out my Microsoft
3) Profit!
I know tht;s a bit flippant .... but if you use a PO Box for your company's registration and correspondance and no one ever is going to come to your house you're not going to piss anyone off .... and they probably wont care
Anti-slash: In sacred jihad against slashdot
The advice seems very balanced and well-thought out. I RTFA and enjoyed it a lot. I want to encorporate these ideas as I start to look for a new job as I recently burned out at my support job and quit for sanity's sake. This is good stuff.
"What we do in life echoes in eternity." Maximus Decimus Meridius
One way to increase your self-awareness is to take a standard personality test. There are several such tests, but my favorite is the Myers-Briggs Type Indicator (MBTI).
Determine your personality here: http://www.humanmetrics.com/cgi-win/JTypes2.asp
I'm an ENTJ (coincidentally, the same as the author of the article).
How could I say to men: "Speak louder, shout! For I am deaf!"? -Ludwig van Beethoven
The Association of Shareware Professionals has some great resources for writing, marketing, and selling software for the author on a tight (read almost no) budget. While some companies probably get VC help, I think this a great start for research if you are interested in trying out some capitalism with your software. There is a lot of competition due to the low barrier of entry, but a motivated individual with talent could end up quitting their day job. WinZip is a good example of a success.
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just past the 1 year marker, having started my own business. he forgot the one thing that i think is the most important. make contacts before you take the leap. sadly, who you know is more important that what you know. if it weren't for the contacts i've made in advance of starting my business, i wouldn't have lasted two months.
TODO: come up with a clever sig
- Ideas are worthless
- Know Yourself
- Understand the business
- Seed capital
A startup can be rewarding, but risky, difficult, and challenging. If you're going this route, be prepared for the difficulties and determined to make it succeed.It's all about execution. The idea by itself is worth nothing.
Are you really prepared to do what it takes to force this company to succeed?
You may not need a business plan, but you need to understand your product, competitors, and where your cash will be going during the first several quarters.
Initial financing is difficult to acquire for a risky new startup and, even if you do find it, you'll end up working with little or no salary for the first several months.
Starting your own software company is easy, but you'll probably go under. The key is coming up with something that people really like so much that they're willing to pay for it. Obviously you have to conciously avoid geek tendencies to go Linux-only or to use Emacs for a GUI and so on. But that aside, it is still tough to come up with a real niche where you have _the_ product that people want to buy. You can't just jump into an existing niche with a text editor or password manager or anything else there are fifty of already. You also can't compete with high-end applications like Maya and Photoshop. Finding the right niche, and filling it correctly, is most of the battle.
The right answer for 99% of programmers is to become a contractor. People have been becoming contractors since time began yet for whatever reason this is now a big deal. In 1999, most of the programmers out there were contractors.
As a contractor you're satisfying all the reasons the authors give for starting their own "businesses" and it's a lot less of an initial risk.
I disagree with his statement about a business plan, he concentrates on the one thing most people write then for, getting venture capital or a bank loan. While it is true that a VC or a bank would require this there is a very good reason to write one. It is focus yourself on what your are trying to accomplish.
What is your product, who are your customers, how do you do business, what are your expectations. Do decide to write customized software for dentist offices or are you just desperately doing anything for cash? How are your customers going to know who you are and what you do if you are not willing to define what you do to yourself!
Also starting your own business does require alot of focus, you have alot of things to do and you have to be timely about accomplishing them. Paying employees, the bills, contacting customers, while you are very scattered in what you working on, you cannot hop from one to the other just because you cannot focus one thing. The IRS will have your butt in a sling you don't do payroll properly, your customers will have your butt in a sling if you don't deliver what you promise, the list goes on and on.
The other thing about small business is he ignores that you don't have to do everything yourself. There are alot of companies that cater to small business to do the time consuming but boring things that have to get done, like payroll. Always look around for help in this area because for $50/month(or whatever) is cheaper than you spending 8 or 10 hours a month trying to figure all the forms and making sure that they all get done in time.
http://www-swiss.ai.mit.edu/~bob/clarisworks.php
It's a bit out of date (we started in '89), but even so, we were told it was too late to get into the software startup game. We had no business plan. Yet we managed to beat our Microsoft competition (MS Works), with no venture capital, in fact without even incorporating... of course, getting bought by Claris helped. But I think keeping everything ultra-low overhead was essential - *all* of our time was spent designing and developing, and none on coming up with a business plan, a "failure plan", etc., as described on the MSDN article. YMMV...
There are still plenty of great ideas out there, waiting to see the light of day.
You mean you're extremely slow to make decisions, but once you've decided, you're unstoppable?
Borrow from friends and family.
Have a working spouse.
Borrow from your credit cards."
Obtain money from a potentially major customer
This one is often overlooked. If a company has a problem they need solving and is willing to fund some of your development effort to solve it, this is a golden opportunity. Depending upon what problem you are solving, the company may not be interested either in owning any of the IP you create or supporting the product if/when it takes off.
This is how the company I'm with now started and their sales are $500MUSD per year. It all started from a $500K investment from a major industry leader, who remains the company's biggest and most valued customer.
I posted this a little late when this was discussed a couple of days ago, so here it is again so that it can hopefully help out some people.
:)
;) My research led me to these guys who created a corporation for us in Delaware for about $100. We also bought a corporate kit from them (for ~$50) which included a corporate seal and all the necessary legal documents. On a side note, a lot of the informati
You can't just throw clever programming at the problem and get money out the other end. For one, it takes a hell of a lot of marketing knowhow, something that most geeks should have known they were crappy at when the prettiest girls went to the fast-talking football players. There is much more to making a company than clever tech. Tech ability is becoming a cheap commodity.
Amen. This gets right to the heart of what most people here don't seem to realize, much less mention. Starting a software company requires great coding AND marketing skills, not to mention a good sense of what would even be a good product to make. I'm speaking from experience here; I've succeeded in my own startup.
Most geeks either don't have what it takes or aren't willing to put forth the effort required to make a software company succesful. Aside from the coding, there's the packaging and the selling. After the packaging and the selling, there's the support and maintenance. And by maintenance, I don't just mean maintenance regarding your product...but your company. Because once you get to the point where you've got a nicely packaged product that needs to be supported and maintained (assuming you've done it right), you've also got a nice little beast on your hands called a corporation.
Now I imagine that most of this stuff would be a breeze for the average slashdotter, except for the part about packaging and selling (i.e. marketing). This is the most difficult area for geeks to master. The head of the evil empire is where he is today because of his mastery in this area. But Bill Gates isn't the only geeks with those skills, so if you want to succeed, find yourself a partner with (very important) BOTH marketing AND technical skills. Let him do all the talking. Let him handle user iterface, software packaging (installers, icons, etc...) and you can concentrate completely on coding while he puts a pretty face on it and handles the customers.
Of course, this is all easier said than done. So I'll tell you what I've done and how I've succeeded. Hopefully this information will help you succeed as well
A couple of years ago I was running out of contract work and I didn't want to go get a "regular" job because I don't like being a cog in the man's machine. So I decided to start looking for opportunities.
Step 1: Look for an opportunity
I figured it would be easier to start in a niche market with little competition. I also knew that small businesses are a ripe market for IT services. It just so happened that one of the companies I was doing part time consulting for was a small business in a niche market. The owner of this business had excellent contacts in his industry as well; I don't mention the industry because I don't want to invite competition
I knew I possessed the marketing and people skills necessary, but I didn't quite have some of the coding skills to pull it all off. So I talked to a friend who is a top notch coder working for a large web hosting company who was interested in starting a business. I told him about my contact in this small, nich market and about the need for certain types of software. We both had similar outlooks on life and our personalities were a good match for a business partnership, so we agreed to start a company.
Step 2: Incorporate
I then did a little bit of research to learn how to actually create a company. Whichever of you is the smartest one should handle this. I just happen to have a 156 IQ, so it was a breeze.