Startups Can a sole founder build a profitable business? |
- Can a sole founder build a profitable business?
- self registering LLC vs. "professionally" registering LLC, which one is better?
- Business contracts and equity
- So You're Bored Of Your Startup: A Point Form Guide To Successfully Pivoting.
- Need Advice: CTO is bottleneck for the company
- I just got my first price quotation request for my saas mvp and am not sure how to prepare one.
- Write and Share Interactive Stories Product Video
- The don'ts of running a funded startup by billionaire entrepreneur Bhavin Turakhia. Thoughts?
- Assessing Market Size
- Feeling lost
- Fair payment to a consultant?
- (re) building a company culture?
- Looking for advice: PayPal micro-transactions vs. BrainTree for payment solution for my new app
- Advice on equity for joining early stage startup?
- How can I add more value to the company as a contractor? Going full-time is not an option here.
- Prelaunch beta marketing
- How critical is a technical founder? Looking for some tips & advice on my start-up.
- Have you ever gotten an email from a potential competitor?
- Is it good if I crowdfund before the product is released?@
| Can a sole founder build a profitable business? Posted: 28 Mar 2019 01:35 AM PDT In recent times, when people have looked at fresh founded startups, they would see that the majority of them have more than one founder. Indeed, it seems incredibly common for two or more individuals to put their talents and minds together to create the next big thing which will take their respective industry by storm. How Common are Sole Founder Businesses? There are many reasons why an entrepreneur may decide to set up a business on their own, without adding another co-founder into the mix. Below are the figures for sole-founded startups in a number of countries across Europe, North America, South America, and the Middle East and Africa North America
Europe
South America
The Middle East and Africa
These numbers make it clear that sole founders are not that common in startups worldwide, however, there is some disparity between different regions. The Middle East, Africa and South America all had the highest average rates of solo-entrepreneurship, with North America not too far behind. Interestingly, sole founders are incredibly uncommon in Europe, with a large number of the listed countries coming in under 10% (Global Entrepreneurship Monitor Adult Population Survey, 2018, p.31). There could be a number of reasons for this, such as a difference in working culture amongst certain countries', a lack or surplus of skilled individuals to partner with, or the availability of certain technologies that may eliminate the requirement for a co-founder and so on. So, in answering the question, just how common are solely founded businesses? We can use the figures from GEM's report. From the 49 countries listed, we can understand that the worldwide rate of solo entrepreneurship sits at around 12.73%. The working is as follows — Percentage of All 49 Countries Added Together ÷ 49. How Successful are Sole Founder Businesses? This is another commonly asked question, although it is normally phrased as "Do I need a co-founder to be successful?", or "Can solely founded businesses succeed?". To answer this question, we are going to analyze some of the data that has been collected by Techcrunch, which itself has been curated from Crunchbase. To measure success as a metric, the companies' used were filtered down to startups that had raised over $10 Million in outside funding and businesses that managed to exit, either through an Initial Public Offering (IPO) or a Merger and Acquisition (M&A). The sample size for the research examined 7,348 different companies' on Crunchbase that had reached $10 Million in funding and 6,191 companies' that exited through an IPO or M&A. With the businesses that reached over $10 Million in funding, the results shown were incredibly interesting. In total, slightly less than half of the businesses managed to reach this level of success with only one founder at 45.9%. The number of startups that managed to reach this level of success actually decreased for each additional founder that was thrown into the mix, with two founders yielding 31.9%, three yielding 15%, four yielding 5.3% and five or more only managing to yield a measly 1.9%. Within that sample group, the average number of founders per startup sat at 1.85. Interestingly, in the sample group relating to company exits, the results showed even more favor towards solely founded companies'. Of the 6,191 companies that achieved an exit, over half of them only had one founder at 52.3%, with two founders the number sat at 30.1%, three yielded 12.5%, four yielded 3.7% and five or more only managed to yield 1.4%. Within this group, the average number of founders was slightly lower at 1.72 per startup. This research generates some interesting results. It suggests that despite all of the claims by a large number of media outlets that you "need a co-founder to be successful" may actually be massively incorrect and over-exaggerated. Now, that's not to say that having a co-founder is a bad thing, it can be incredibly helpful to have another person come in who can help take a lot of the pressure from you. What we would say is, whilst it is recommended that you try and get a co-founder so that you can get more done through a division of labor, working alone on your startup isn't going to necessarily stop you from receiving funding from investors or making an exit through an IPO or M&A. What are the Affects of Sole Founding a Business with No Employees There are numerous ways in which solely founding a business can affect the operations of the startup, these can be either positive or negative. Firstly, if an entrepreneur decides to start a business without any intention of employing anyone or having a co-founder, the owner of that business will not have to worry about financing additional overheads. For example, the founder has to utilize a team of five people, paying each of them $2000 per month, that is an additional $10,000 that the business will have to generate each month to ensure that every member of the team is paid. Without having this financial burden, the founder of the startup can operate without the stress of having to pay their team and they can operate at their own pace, only having to worry about generating enough revenue to pay the bills and their salary. Secondly, if the founder hasn't employed anyone and doesn't have a co-founder, they will not need to worry about office politics. What is meant by this, is that if a co-founder is involved in the operation, the founders may not always be able to come to an agreement on massive decisions that will affect the direction of the business. This can be avoided by working alone and it can help the sole-founder to keep the startup operating on their playbook, without worrying about any confrontations which could impact the operational efficiency of the startup. Alternatively, without a team or a co-founder to divide company responsibilities with, the founder will have to handle every aspect of the business on their own. This can be incredibly difficult for some people to manage, as the neverending list of tasks around every business aspect can cause people to burn out. Then, if the founder wants to avoid the failure of the company due to their stress, they will have to create a team who can help take away some of the tasks of the business. Even if they manage to do this, it can sometimes be too late for a badly affected startup. Without the support of a team, it can be quite hard for a sole-founder to effectively scale their business and continue to increase their profit margins. This is simply for the reason that one person can only do so much work, because of this the amount of revenue that the business will be able to do will be limited, leading to an inability to scale further than the capabilities of that individual. It's really about preference and your personality. Strong aggressive people usually will prefer to work alone, because their singularity of vision and control issues can make them into, well, a-holes. In those cases those folks probably should have just hired talented people--not had partners. [link] [comments]  |
| self registering LLC vs. "professionally" registering LLC, which one is better? Posted: 27 Mar 2019 07:03 PM PDT A friend is working on a game and he wants to release it on Steam or whathaveyou at one point. So far, it is obviously just more of a hobby but who knows. When he did some research, Steam requires a business entity to use their dev services. We reside in CA. So first step, registering an LLC! (or Corporation?) It seems that we could just do research and register as an LLC ourselves and have one of us designated as a registered agent.......or use professional services like LegalZoom. Has any of you done it one way or the other and wished that you had done it differently? Any input is much appreciated. [link] [comments]  |
| Posted: 28 Mar 2019 12:12 AM PDT Hello, does anyone have any advice on what to do when it comes to creating a business contract with developers and how much equity to give? Any suggested templates? Thanks so much Background (and also fulfilling 500 character limit) hhhhhhhhhhhhhajfloanflafn, just kidding. So I recently started this business, I've had a background running a small clothing company, etc and have found something I'm really passionate about within music. I just hired two employees for equity pay and have no clue how or what to give them, thanks guys! Appreciate all the help! Would love to hear about some of your businesses and connect! [link] [comments]  |
| So You're Bored Of Your Startup: A Point Form Guide To Successfully Pivoting. Posted: 27 Mar 2019 10:07 AM PDT Every founder has been there. Once, sometime ago, you had an idea for a startup that was going to make you rich and/or change the world and/or be better than your current job. Maybe you found some co-founders. Maybe you read some startup books or online resources (like this subreddit). You made a pitch deck. You told your friends and family. You put some time in. And now you're bored, or you've hit a wall. The opportunity you were pursuing isn't as easy to achieve as you thought. You underestimated the resources required to reach positive cash flow, or to obtain investment, or to get a functioning prototype or sufficient customer traction. Everyone is tired of eating cup-a-noodle and working 20 hours a day. But you've put so much time in to this point, and you don't want it all to be a waste. Maybe, you think, it's time to pivot. There's nothing wrong with pivoting. Many successful startups do so, and sometimes it takes numerous pivots to get there. A startup is a dynamic enterprise, and it's hard to predict exactly the way a business will develop no matter how hard you try. However people throw the term Pivot around a lot and just assume it means "do something different". They read an article on Medium, and decide that their messaging startup needs an AI component or a chat bot or should be run on a blockchain, or that their widget needs to be targeted towards the green energy sector. It's easy to get caught up in the newest and most exciting business trends, but you didn't launch your startup on a whim. You did your research and considered the risks. Your pivot needs to be at least as disciplined, and there's a few general steps to a successful PIVOT:
If you get stuck on the above steps, ask yourself why. If you're having trouble identifying value, or opportunities to apply existing value to, it's likely that a pivot isn't going to make your situation better and you should consider folding the current startup and trying something different. If you're having a hard time developing a transition plan or find yourself unmotivated to go through the steps, perhaps the pivot is less about the business and more about your excitement or lack thereof. If that's the case, all I can say is push through the slog because all businesses stop being exciting at some point, generally long before they start being profitable. However if you make it through the above steps and are still enthusiastic about the pivot, you'll have a clear framework to more forward with, and will have something you can use to explain to/instill confidence in your investors, staff and stakeholders that your business is making the correct strategic decision. [link] [comments]  |
| Need Advice: CTO is bottleneck for the company Posted: 27 Mar 2019 02:21 PM PDT Hey all, I'd like some advice on a situation with our current CTO. A few years ago, me and a partner created our startup a few and split the company 51/49. He is the CTO building the core product and 90% of the backend while I built the front end. Over the last few months, he has been less committed to working on the project and his time commitment has reduced. Additionally, we have 3 contractors helping us build the product. Since the new developers joined the project, 2 things have become apparent, the current code base has "too many errors", "not scalable", "too complex" and the other devs have a hard time working with the backend. They have to reach out to him to get answers, but because his time is limited he has become the bottleneck which is slowing down development, and releases are being rolled back because of missed bugs. We've worked together at a previous job and have been friends for almost 5+ years. I feel sad that i have this feeling that he may have lost his passion, or also he may not be the one who can scale as we move into the next phase. Also, I don't have a backup CTO as we are still bootstrap with limited funds for development, so I feel stuck. What have you guys experienced, what advice can you give me? [link] [comments]  |
| I just got my first price quotation request for my saas mvp and am not sure how to prepare one. Posted: 28 Mar 2019 03:09 AM PDT I have been working on a book-sharing related service for some time. The site currently says the service is free for groups of up to 10 people and I don't mention any pricing tiers at all. However, I just received a request for a price quotation from someone who wants to use the product in their company for around 130 people. After reading a number of saas-pricing related articles, I am still not sure what exactly I should include in such a document. Can anyone with experience in preparing price quotations point me in the right direction regarding how its done and what to include in such a document? I would also be grateful for a template or a link to any useful resources. [link] [comments]  |
| Write and Share Interactive Stories Product Video Posted: 28 Mar 2019 03:08 AM PDT Hi everyone, I'm the co-founder of Elementari and we just produced our first video and looking for feedback. https://youtu.be/FUKOvFBTJ3U It's about 1 min and a half. Here are the points we are trying to make.
Let me know what you think and what other videos we should look into producing :) Thanks! [link] [comments]  |
| The don'ts of running a funded startup by billionaire entrepreneur Bhavin Turakhia. Thoughts? Posted: 28 Mar 2019 02:27 AM PDT https://blog.flock.com/bhavin/4-mistakes-that-kill-funded-startups Article's pretty basic but the video goes more into detail. The part about defocusing piqued my interest. I've been seeing more and more companies try to branch out into new things aggressively even before they've built a strong customer base for their core product. Here in India, every other app is trying to get into the payments market no matter how unrelated their app is to it. Reminds me of when Confucius said, "The man who chases two rabbits catches neither." [link] [comments]  |
| Posted: 28 Mar 2019 01:45 AM PDT Hey all, I'v been working on a venture in the world of Customer Success and better experience of on-boarding complex product into companies. I'v experience hard time finding out the market size of B2B SaaS companies with products that require high-touch integration process (not self-served), and I'm thinking if there is really potential in this business. Do you have any advice how to assess the market size of these segment of customers? I want to make sure that there is potential in what I've been working on. [link] [comments]  |
| Posted: 27 Mar 2019 09:13 PM PDT Hello guys, I'm a 25 years old from Mexico, I've tried several times to build a startup since I was 18, I've learned a lot along the way, though all my startups attempts have failed, each one of them. Right now I'm in a weird position, I don't know what to do anymore, currently I'm working with my partner in a marketing agency but I'm feeling that things are moving so slow, the reason is because I believe there are basics necessities like Facebook campaigns, Adwords campaigns an so on. I do want to build a tech startup, that always have been my dream, I'm a developer and also a designer and I can build things my own. Though I'm in Mexico I feel that the ecosystem here is kinda difficult because people doesn't have the mentality for technology as in other places like SV. The reason, I believe I feel lost is because I want to build something but also I have the fear to waste more time on something that wouldn't be enough. I'm thinking about working for a big technology company in US but I don't have the necessary money to move over there, neither I believe the enough skills to be accepted. Right now I feel my mind is in a void, don't want to do either of those (keep working on the marketing agency, I'm doing boring cheap WordPress sites because you can't sell them with the right price here) or look for a boring job while I invest on my tech skills with the hope I can get enough money to move to other place. I like to build things but right now I don't have the motivation to work on something because I feel it would fail again and working on something for other markets would be difficult for me to compete because the tech gap of what I can do between other people can do in other countries. [link] [comments]  |
| Posted: 27 Mar 2019 04:19 PM PDT At some point in your startup growing process, you might realise that you need some external help with your business. That could be anything starting from a marketing strategy to product development. How do you think, which payment method is more fair when it comes to a consultant's help.
If you vote for the 3d option, please specify how would you determine that amount in your business? [link] [comments]  |
| (re) building a company culture? Posted: 27 Mar 2019 07:41 PM PDT When I started the company was 5 or 6 years old. Things were fun then, but poorly managed. Eventually the poor management got ahead of the fun and now everyone is just....tired. Drained. Especially the old guard - the employees who have been around for 3 or more years. More than 25 people have either left or been fired in our 9 year history. Our team is only about a dozen people with a core 6 at HQ and the rest scattered around the US. At least things are getting better from a business standpoint. We're profitable, we actually have KPIs that we work towards and improve on regularly. But people don't really talk to each other than if they need something. Some team members, especially the sales team, are toxic. Flippantly asking "why am I doing this" if it's not specifically related to their job for example. I want to rebuild the culture. I'm sure we can both look forward to going to work while also taking it seriously. I'm not in the C Suite but I've been around for a while so I have some swing with the team. The problem is, is that I'll be working remote soon so I can't have as much direct influence. I want to leave a small legacy though before I go remote. What advice do you have on making a culture? Short of just drinking yourselves silly every day at happy hour? Retreats? Meetings? Bring in home made cake? I really have no idea. [link] [comments]  |
| Looking for advice: PayPal micro-transactions vs. BrainTree for payment solution for my new app Posted: 27 Mar 2019 03:31 PM PDT Hi all. I'm trying to make a payment processing decision for my app, and I'm looking for feedback to see which one I should go with. My app allows people to sell things for prices ranging from $1 to $20, and I'll be using PayPal or BrainTree to process the transactions. Option 1: I use PayPal micro-transactions. The pro here is that the fees are lower for transactions below $10. The con is that it uses the clunky PayPal Express checkout where every time the user pays for something they have to log into paypal or enter all of their credit card info. Option 2: I use BrainTree. The pro here is that it has a very nice user flow and user experience (eg: like Lyft and Uber have). The con is that it uses the standard processing fees, which is really high for a $1 transaction. For reference, on a $1 purchase, the fees will be 10 cents if I go with option 1, or 33 cents if I go with option 2. eg: 10% versus 33%. So my question for you all is this: Do you think the nice and easy user experience with the BrainTree option is more important than the lower transaction fees with the micro-transactions option? eg: do you think users will not want to use my app if they have to log into paypal every time they pay? or do you think sellers will like the idea of saving 20% on payment processing fees for smaller transactions? ps: I've talked with PayPal and BrainTree and, unfortunately, BrainTree does not support micro-transactions. [link] [comments]  |
| Advice on equity for joining early stage startup? Posted: 27 Mar 2019 10:10 AM PDT I'm a college senior electrical engineer looking for full-time employment. I'm interviewing with a startup I'm very interested in and I think it's going well. They recently got their seed round and currently have 3 or 4 employees depending on how you count them. None of them are EEs or really have much of any electrical engineering experience. The company's products have a big electrical component. My knowledge base is basically dead-on for what they're doing. I've done research, internships, and hobby projects that gave me a huge amount of extremely relevant experience, so I think I could be a great asset. They absolutely need an electrical engineer and I'm a prime candidate. With all that in mind, if I get an offer, how much equity should I be shooting for? Is there any chance I could get it up front rather than the typical 4 year vest, 1 year cliff plan? [link] [comments]  |
| How can I add more value to the company as a contractor? Going full-time is not an option here. Posted: 27 Mar 2019 12:53 PM PDT I'm currently one of three developers in a very small, bootstrap funded startup. We are all contractors and we all work remote, with the most experienced guy somewhere in Eastern Europe, the least experienced a part-time dev in Mexico and then there's me somewhere in between, working in the US. The founder and company are also US based and also has some technical expertise. The product is a B2B software product that has a somewhat significant Enterprise Resource Planning component and it's all custom made by the most senior developer. I was hired to help push the product's development along. Now, here's where I've run into wondering what I should do next. Been going along mostly fine for six months (the contract has no expiry date), and the founder is happy with my performance. But lately the founder's been considering replacing the ERP portion of the product with a tried and true third party ERP tool that will serve as a suitable replacement. This doesn't sound good for the future of my job because I have been assigned work mostly in the ERP portion of the product. However I enjoy working with the founder and want to help his business grow. As a contractor I am more on the sidelines, technically not being part of the company, and getting no equity or benefits. And the founder is not interested in doing a contract-to-hire to convert any of the devs to full-time. If going full-time is not an option, what are some ways I can help contribute more value to the company? How can I keep myself from getting replaced or fired in the case that they don't need me anymore? This ERP tool they're considering is vast and looks like too much to quickly pick up. I was hired because of my expertise in a certain framework, which their custom ERP is built on. If they go with the third party option, they effectively killed hundreds of hours of work and starting a new, making all I've done obsolete. That's why I'm asking what I could do to shift positions, as a contractor, and still be of use to the company. [link] [comments]  |
| Posted: 27 Mar 2019 05:48 AM PDT Hi everyone! I am currently building my startup and will probably be launching the beta version in early May. It's aimed at businesses looking for content marketing outlets and content creators on Youtube/Twitch. Both sides need to be using the platform for it to work. What I have right now is a beta mailing list and I am accepting beta signups. Marketing goals: I'd like to get both businesses and creators on the list so there will be users from day 1. Steps I have taken so far:
I haven't gone further until I fix up my landing page, currently it looks very bland. Hence why I am here, I'd like to know if any of you guys have strategies for doing prelaunch marketing and getting beta signups. I am a solo technical founder and a college student so I cannot undertake any massive/expensive marketing campaigns on my own. A big pro of the product is that I am not directly "selling" anything, the platform is a service and anyone can sign up. Thanks for your advice and time :) [link] [comments]  |
| How critical is a technical founder? Looking for some tips & advice on my start-up. Posted: 27 Mar 2019 05:27 AM PDT Hey guys, Overview: I am currently at a stage in my start-up where the next step demands technical development/programming. The start-up itself is software intensive &, for a general description, is an online platform in the lodging space. Personal & Start-up Background: I am 20 y/o but have a bit of business experience. Before my start-up I was operating a packaging company for about a year and a half, & was doing well for myself. Although profitable and certainly scaling, the packaging co. didn't (in lack of a better term) 'feel right'. That feeling was almost entirely due to an idea I had about a potential start-up years ago. When I first conceptualized this idea (at 17), I knew I had already begun to bite more than I could chew. I told myself to take the next few years to acquire a skill-set and some experience to be 'eligible' to make my start-up possible. I used the next 3 years to learn graphic design, business development (in terms of structure, legality, taxes, etc.), proficiency in Excel, Adobe Illustrator/Photoshop; then to further the experience side of things I started the formerly mentioned packaging company. The duration of operating the packaging company allowed me to learn the in's and out's of marketing (campaigns, customer acquisition, etc.), supply chain management and much more. It was a great learning experience running my own company, but the idea of the start-up I had before kept itching and finally I made the decision to end operations, liquidate my inventory, and go all in on my idea. It seems ridiculous to leave everything I built but I am convicted in the enormous potential of my start-up, and my ability to take it on. Current Stage of Start-Up: Business plan, TOS, UI of every screen (both mobile and web), prototype for mobile (not MVP), some marketing campaign content, & legal structures have all been established while an MVP and any form of raw code has not. Problem & Potential Solutions (where I need advice): While a technical co-founder would solve the majority of my current issues, I have no prior tech-oriented work background and no university to recruit from as I dropped out after my freshman year for business. The only solution I can think of is either take the next several months to learn to code and build an MVP, or to raise a 'Pre-Seed'/Seed round mainly for a CTO & development crew (& yes I am aware of the risks involved with pursuing VC funding this early on--but take into consideration the opportunity costs of the former). I am not completely empty in terms of the tech development side as I have a pretty extensive 'blueprint' that describes the functions the code (front-end) needs to execute and accommodating animations to give a visible representation, it isn't much but it's an effort to give the developer(s) a slightly easier job & understanding. -side note: The start-up is in an industry where a seed round is inevitable going forward. If any of you have any advice or tips, please don't hesitate, thanks! TL/DR I am a business-oriented founder of a tech-dependent startup, and have taken the company as far as I can without needing technical development. Not sure where to go next. [link] [comments]  |
| Have you ever gotten an email from a potential competitor? Posted: 27 Mar 2019 10:51 AM PDT If a C level executive from a product that appears to be a competitor sends you a message what should you expect? I'm interested in deciphering their intent, and perhaps building a mental playbook for handling the situation appropriately. My thoughts: I suppose the best course of action is to only reveal any information that is currently publicly available? Part of me thinks that's too paranoid and that perhaps there is some benefit/collaboration that could occur. I'm trying to think of best and worst case scenarios. Does anyone have first hand experience with a situation like this? What was the good, the bad, the ugly? [link] [comments]  |
| Is it good if I crowdfund before the product is released?@ Posted: 27 Mar 2019 08:56 AM PDT I've an idea which is taking place little by little but the product is not totally ready till now. Is it ok to have a crowdfunding campaign before the product is launched or made? If it is then Should I have a target of taking all the fund at a single time or should I go phase by phase? The idea also brings around physically challenged people so the target audience is little bit smaller than usual, thus I felt little bit awkward bringing it to investors. What should I do? This will be my first startup and I am just 18 years old. Internet told me that you can also be too late to produce a product. Help me guys. [link] [comments]  |
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