Startups My personal journey as a co-founder of a tech startup |
- My personal journey as a co-founder of a tech startup
- Looking for help on picking the right development firm / individual
- How to find a good mentor? I have some success but no clue what I'm doing
- How much does it cost to make a deck? I own the company but bringing in a CFO. he wants 45%. More details below. Thanks. My app is fully live already and the 4th largest school in US wants to integrate it to their school.
- How do I patent and protect my idea? I have secured a tourism app project for a local council. It’s my idea and they are backing with a grant.
- Hiring brother for the summer - how to hire?
- How to navigate operating as FP&A, IT, and Analytics?
- Early on, on the way to kickstarter I need startup capital. A buddy would invest 10000 for 30% investment. Should I take it?
- Startup finances
- How to write into Operating Agreement for Operating Partner vs. Investor where goal is to grow business AND pay back $1m+ debt
- Finding a job (I'm out of money, but I believe the startup can work)
- Should I leave a startup as a co-founder?
- How to get involved with large companies?
- Sweat Equity - Is This A Fair Value?
| My personal journey as a co-founder of a tech startup Posted: 09 May 2021 09:22 AM PDT Hey, just want to talk about my experience working on a tech startup for many years, and see if you guys can learn from it or have similar experiences. So, the startup began casually between two friends (me and let's say "Jack"). Jack and I became very close in our first year of college and wanted to create a business together. We both had a love for cannabis and technology and so we decided to build a fully automated cannabis grow box with a companion smartphone app. This was back in 2013 when there wasn't much at all if any companies in the automated grow box space (Grobo has since emerged as the front runner here). We secured space to work out of our freshman year and began creating prototypes. Jack was more on the physical design, woodcutting, machining. I was more on the technical side, the app, the electronics. We made a prototype and continued iterating on it and attempting to improve it, as it started out quite raw. We should have probably done market research, but hey, we were young and for me, it was a lot of discovery and creativity at that point. It was fun. Now the first red flag, we had both said we were going to drop out and pursue this (young and reckless, I know), and I did, I literally dropped out of a top-tier university to focus on it, while Jack, mysteriously did not. He transferred to another top-tier university, breaking our agreement we'd had and leaving me to struggle on my own. However, this did not stop me from pursuing the vision, and we continued working on it together. After about a year, seeing that he was not going to leave college, I decided to go back to a new university too. We would meet on the weekends to work together on the project and continue during the weeks on our own on other tasks. During summers, we would live together and devote ourselves to it full time. We got our first sale after about three years, and it was a complete disaster. The product simply did not work consistently without us having to constantly come and do maintenance on it (30 minutes drive each way, too). Granted, it was our first customer, but also it was a massive headache. Part of it was early growing pains, but part of it was in our lack of testing and validating that this product really worked. From here on, Jack and I started to diverge on our vision. I realized we had a good start with the customer, and wanted to figure out how to improve based on him. I also realized we desperately needed some investor money (all out of pocket up to this point, 10k each), otherwise, it was too much to balance in addition to our lives. I also felt we should start looking into scaling because we needed to create more of these efficiently to start turning any profit. Jack disagreed with all of this. He instead wanted to create more idealistic prototypes based on his own ideas (not from customer feedback), avoid all investors because he always seemed to get suspicious of them, and not really focus on any form of scaling because we didn't have the money. Basically, I wanted to step it up a notch and try and grow the business, while Jack wanted to keep crafting grow boxes on our own meticulously one at a time with no outside help. Things got tenser and tenser. At this point, I had graduated and moved in with Jack and some other people, as he was still finishing his degree. As mentioned, Jack really just wanted to continue to create more "idealistic" prototypes, spend more cash, and had no feasible plan to get us in profit or any investor to support us. As he was more on "the business" side, and I was more on "the tech" side, I deferred to him on these things, partly because he was very very stubborn. We got into a big argument when Jack wanted to create a brand new app, for multiple grow boxes per user. I thought it was a waste of time because we weren't even fully working with a single user. It seemed idealistic to me. A cool idea, but not something to spend our money or time on right now, when no one had requested it, and the single grow box app still had numerous issues. I think Jack thought that our customer would love it, and want to buy lots more units. We got heated over it, and he basically said "We are designing this app, it's what we are doing because I decided it". Lo and behold, we designed the app, showed it to our single customer, and guess what he said: "I don't really care about that feature, and I've had so many problems with this box that I wouldn't want to get another one anyways" Months of work for that. It became apparent after that episode that I simply had to leave. I was wasting my time working for someone else's convoluted vision that would never go anywhere. The excitement had just worn off and I was tired of dealing with my cofounder and his stubbornness. So I left, giving him all my shares (we were half-half) because frankly, I saw no way it would succeed especially without a level-headed founder. And guess what, it's now been about 2 years and where has it gone since? One more "idealistic" prototype, no sales, and a website that is currently down. I don't speak with him anymore, but to me, it seems that Jack is still cutting grow boxes in the community maker space and thinking of cool new ideas. Nothing about getting investors, market research, figuring out the viability of this product, scaling. Just same old. I joined a much bigger company, but still a late-stage startup. I was able to move to where I wanted to live and pursue things I'd always wanted to do outside work. I haven't regretted leaving the startup for one day. In the future, I'd like to make another startup after generating some more savings and working in a successful startup for a few years. And definitely not with Jack! lol [link] [comments]  |
| Looking for help on picking the right development firm / individual Posted: 09 May 2021 11:06 AM PDT Hello everyone, I was looking to create my own app. However, I can't code and I'd rather just pay someone to make it and provide maintenance for a set amount of time. I have submitted a request on upwork to find someone or some firm they could develop the app. The US based developers have quoted me for about what I thought it would cost ($15k). There have been some really really cheap offers for around 6-8k all from India or South America. Does anyone have any experience out sourcing to firms outside of their own country? What was that experience like? Any advice on choosing a developer? Thanks for all the help! [link] [comments]  |
| How to find a good mentor? I have some success but no clue what I'm doing Posted: 09 May 2021 05:47 PM PDT I'm a technically skilled person who invented a product and I've been quite successful by myself so far. So far I've made about $50,000 over the course of a few months and am projected to make around $100,000 more by the end of the year. I moved in with a few friends and I'm getting their help with building the business, doing stuff like customer service, shipping, and assembly of my invention. Currently the business is structured as a single member LLC. Right now I'm paying them each $2000/month under the table with no official contract. One of my workers/friends/roommates wants equity at some point cause he sees a huge potential in what I'm doing to grow. I told him I would be willing to give some equity after a year based on how much he contributes. I'm not sure what's standard in terms of equity in startups and how to quantify his contribution. He doesn't have extensive knowledge in business or any specialized skills, but he's a good worker and I'd be willing to give up a small percentage of equity if he's committed and helps build the company/product. I honestly have no clue what I'm doing on the business side (equity, business structure, accounting, etc) and it might be good at some point to find a mentor or possibly another team member to help fill that gap. As a technical person I'd rather spend my time focusing on improving the existing product and making new ones, and would like if someone else could handle most of the other stuff, but I also have to make good business decisions since I'm the one that owns the company. Any advice? [link] [comments]  |
| Posted: 09 May 2021 05:45 PM PDT I am the founder and I own 100 percent of my startup. I am adding a partner and he wants 45% of the company. I know him well and I know he has started and running successful businesses. He is also putting money into the company on top of being the CFO. So is this reasonable 45/55? [link] [comments]  |
| Posted: 09 May 2021 03:21 PM PDT The tech is pretty standard and lots of mobile platforms could replicate. The use case is unique and the idea could be replicated globally. I don't have the resources to scale quickly and someone else could run with it and leave me for dust. Is there a way to protect my use case and idea so I can gather resources to scale? [link] [comments]  |
| Hiring brother for the summer - how to hire? Posted: 09 May 2021 02:17 PM PDT My LLC is planning to hire my little brother for the summer. Its mostly for education, but he will definitely be contributing to building the software/our product as well. We will be paying a hourly rate that he has agreed to, for 20 hours a week commitment. My question/concern - whats the best way to hire him/which extra forms past the contract does he need to sign? 3 options I see:
This is the LLC's first 'hire' and I just want us and him to be covered on any tax front. Past the summer there is a high likelihood that he remains on in a part time role (during the college semester), but we can figure that out then, for now we are only ready to commit to a role for the next few months. (Also please don't comment on the risks of hiring friends/family, I am fully aware on that front. I just wanted to add that info as there is a fair amount of trust which I feel changes the dynamic a little compared to hiring a stranger) [link] [comments]  |
| How to navigate operating as FP&A, IT, and Analytics? Posted: 09 May 2021 01:59 PM PDT So I am the head of Fp&A, IT, and Analytics at a company just now leaving the startup phase (Im employee number 42, now we are 250). I don't know which of the three to choose or focus on as time goes on, and worry about my identity when I leave this company. Anyone have any guidance? [link] [comments]  |
| Posted: 09 May 2021 01:07 PM PDT So with this money and all the time and money I've invested, I would be able to make it on to kickstarter. The issue I'm running into is a 30% investment at this stage values the company at roughly 30,000. Is that to steep? I'm just afraid I'll be shooting myself in the foot for future investors, but he would be able to sell his shares later on to another investor right? Am I worrying to much. [link] [comments]  |
| Posted: 09 May 2021 08:13 AM PDT Hello everyone, We recently have started working on our startup idea, and building MVP at the moment. To get things going I was trying to find a tool for finance tracking. Specifically to be able to track Bank balance, expenses and income. Having this information I'd like to setup couple of metrics: - Burn - Runway - Growth rate. I can do all this in excel spreadsheet, but maybe there's tools to show those numbers dynamically? [link] [comments]  |
| Posted: 09 May 2021 11:08 AM PDT I'm in a scenario where an investor is providing over $1m for startup investment capital for initial inventory, working capital, and real estate for a business. I think it is worth noting that this will actually be one of multiple locations and we know that we will have customers and significant revenue right away. The investor and I agree that my equity should accrue based on the amount of the initial investment that has been paid back by the business. However, the investor and I also agree that my goal as operating partner is to grow the business to $x amount of inventory. Thus, I could grow the inventory but not necessarily pay down debt and therefore not accrue any equity. How do you think I can incorporate that into the operating agreement, i.e. write the operating agreement so that it factors in growing the inventory and somehow getting rewarded in equity for that as well? [link] [comments]  |
| Finding a job (I'm out of money, but I believe the startup can work) Posted: 09 May 2021 02:57 AM PDT Hello all, TLDR: what can I put in my CV and what can I say to recruiter about my startup, given that I'm looking for a job, but not giving up on the startup. So, I'm building a SaaS for businesses. I started right after finishing my studies, and I actually found something worth being developed (Users we talked to really really want what we are building, and customers are interested in seeing the MVP) I already have a few offers for pilots, however I'm not finished coding the MVP (We should finish coding it in a month or two roughly). Problem is: my landlord need her flat back (she lost her job), and unless I have a real income, I will not find another flat. To add to the problem, after a year working on the startup, I spent almost all my savings. I participated to some challenges, but since I made some bad decisions (like doing legal matters before coding, or changing my tech stack in the middle of development, market research that is very very specific and seen as incomplete), I managed to get into the finals, but always got the "good enough" reward, which is not enough to pay myself. My parents are pushing me to find a job, ideally part time, and told me to not talk about the startup and simply put "personal project". Problem is, I don't know what to put in my CV, or what to say to recruiters because I'm still convinced the startup can work, it's just that I can't go on without money. ps: I'm French, living in Scotland, and I'm both software and AI engineer [link] [comments]  |
| Should I leave a startup as a co-founder? Posted: 08 May 2021 10:49 PM PDT This is a long post, if you don't want all the details you can read the TLDR. A little bit of a backstory, I'm a Computer Science student who has built a product before (mobile app) and sold it. About 8 months ago, while I was mostly in the ideation phase of a product I was working on with someone else, I was approached by someone, call him Tom for this scenario. Tom had an idea that sounded interesting, it's one of those startup ideas that sounds "cool", while the other idea I was working on didn't sound as exciting but was solving a problem I had personally faced and that I was looking forward to building a solution for. I made a huge rookie mistake and decided to join Tom as well and work on his idea concurrently as a CTO. I regret this decision as It has been very busy and stressful since then, as you may imagine juggling 2 tech startups, and later starting the school term at the same time. I definitely have learned how bad of an idea it is to work on 2 startups, and while it may be manageable early on, it will eventually lead to the abandonment of one, unless you are Elon Musk and have significant experience, funding, and resources. Tom's idea was in a niche I had absolutely no experience in and I think the novelty of the idea (to me) attracted me to it. In retrospect, I regret not doing my due diligence and thoroughly researching the product, the tech, the market and a range of other things. Since Tom was not very technical and this wasn't his niche as well, it became apparent over time that his understanding of the tech and the product was not detailed enough either. Basically, the initial requirements I was told would need to be implemented were not entirely accurate and we soon realized there was a significant barrier of entry to try and build an MVP that was synonymous with our expected value proposition. However, I had spent around 3-4 months, before coming to a lot of these realisations, building the initial architecture from scratch and building the base auxiliary functionality of our product. We had then hit a roadblock, so I spent less time coding and significantly more time on product development. In the meantime, I also continued working on the other startup. Keep in mind, both founders from the 2 startups knew I was working on something else, and yet they were okay with it. They are both pretty new to startups, this is their first startup. However, it was my own fault to join another startup, I should have known better. Fast forward to this point, and we still haven't launched an MVP for either startup, which is bad. The first startup had some issues because something we had spent a lot of time building turned out we wouldn't be able to use, so we ended up just working on the other core functionality and we will launch a private beta soon (like in the next week) from the mailing list we built up. The other startup is significantly more complex with so many other companies and parties we need to consider. As I had mentioned, the barrier of entry was quite steep and due to our lack of experience in this niche, it took us a long time to figure out things we should've known before. Therefore, we haven't even built the core functionality yet, we've built the general required architecture for an application and placeholders for when we are able to get what we need to build out the rest. However, we do have a plan to launch a crowdfunding campaign in the next 2 months (which would need to succeed for us to meet a minimum order requirement) and then continue to build and also fulfill the orders in the following 2 months (I think it will take longer). It's also important to note the entire team is doing school. I am seriously considering leaving the startup with Tom for many reasons. The first being the conflict we have on a daily basis. I like Tom and he would make a great friend but it is extremely difficult for us to work together at times. We argue so much and spend hours going back and forth for things I feel are very obvious (and he likely feels his side is very obvious). While I am a co-founder, I am also a CTO, yet I spend most of my time in these product development calls and arguing with him about everything. It is getting exhausting and I think it is because our personality types clash. I am quite analytical, which helps me be a good technical person as well as develop a good product sense. He is on the other hand, more of a driver, which is someone who usually wants to get things done and may overlook a lot of the details. Add to this the fact that he is not technically well versed yet, which notoriously leads to more oversimplification and failure to consider details. Again, I am not trying to bash Tom, I like Tom, but it is becoming very very hard to continue working with him, which I am not blaming on him as I realize we have significantly different personalities and experiences. Tom has been a part of this startup for quite some time, (probably a year and a half at least?) and I also worry that he has developed "startup goggle" or tunnel vision about the idea and its success. The second reason is that I have realized I don't care too much about the problem we are solving. I have not personally experienced it and so a lot of what we consider are assumptions. In fact, both of us aren't (and never really were) our target customers, which is pretty bad. I am not heavily invested in finding a solution to the problem, mostly because I do not have an emotional connection to the problem, and as I have had to learn more about the niche and dive deep into the tech, product, and market, I have felt that our solution does not offer much more value than what's already there on the market. Basically, at the start I seemed to be attracted to the novelty of the idea and that it sounded "interesting", however as I progressed and had to learn more and decipher all the obstacles and the realities of the situation, it became more apparent that we were out of our depth in this niche, and that there was significantly more to it than expected and what Tom had told me at the start. I think the idea still has potential (an accelerator contact said so as well, although it was over a very casual chat), quite a few people had expressed that it was interesting although I don't take that as seriously since that doesn't necessarily mean they will convert to customers especially since again the idea is one of those ideas that sounds "exciting" or "interesting" to the average person. However, I feel as though the barrier of entry to get to the product is not really worth it, due to my lack of passion in this niche and problem, as well as the different added value it may bring customers. To build this out successfully I would have to learn a significant amount more in this niche to keep up and fulfill my role, however I don't think I have an interest to spend the next couple of years doing that. The other startup does not require such a thing since its niche doesn't really require much specific knowledge whereas this does as the niche is huge and complex. Another thing is that the product itself has two major components. Each one alone can be a product by itself, and there are actually products like each one on the market. We are essentially joining the two into one cohesive platform. Another major player of one of the components has also announced that they will add the second component by partnering with another major player of the second component. We plan to have an advantage over them but they also have advantages over us. They are also in another country, so there is a gap in the current country's market which is an advantage. However, I feel the barrier of entry is still significant, and they have also been in the market for almost a decade. We are also partnering with another company to use their first component instead of building it ourselves since it is very expensive or requires a lot of expertise to replicate what they have. However, this is not very good since this component is the most important and the one that the second component relies on. The main worry I have is we now have to basically excel at building two separate components, where we have to compete with all the first component players as well as all the second component players since although we are partnering with the company that will integrate their services into ours, we will still heavily spend some time on the first component with added features and making it better. So I feel as if we are building 2 products at the same time, which is a recipe for disaster. I have also expressed this to Tom, and he is quite adamant on eventually building out a full-fledged solution for the second component as well. I apologize if this was too generic, but I hope you get a general idea. So I guess the main thing I am wondering when considering leaving is being okay with this decision. Am I okay with the situation where the company succeeds and does great shortly after, and I did not get any palpable results of my hard work? I think I am since I have learned a lot from this experience, from the business and product side of things, to the tech, and the newfound knowledge in this niche. I feel it isn't the best idea to stay on hoping for this project to succeed while not really enjoying it and having very high stress due to founder conflict and other product things, as well as my other startup, and school or my full time internship which I'm starting soon at Amazon. What is the point of working on something, especially solving a problem I do not personally relate to, that is just making me unhappy when I have the capability to work on other things and I've been blessed with other opportunities? Moreover, due to the current stage of the product, the core functionality hasn't even been built yet (although according to the company we hope it integrate with, this can likely be done in the next few months), but a significant amount of dev work and product development has been done. However, If I were to leave, now would be the time before the core functionality is built and we potentially start getting funding or customers, making it harder for me to leave and where the stakes are even higher. I also would not be leaving Tom in the dust since we have another engineer who is extremely intelligent and who I know can easily step into my role if he wants to. I think the key takeaway is even if the product is very successful and I miss out on a lot of money, do I want to stay on while stressed and frustrated just in case this does happen? I think life is too short for that, and just because an idea may be interesting or even has potential does not mean I have to work on it especially if I am unhappy with my relationship with my co-founder and I am not personally invested or passionate about building a great solution for this problem. If you've read up to this point, that's crazy but I appreciate you and would love to hear your thoughts. TLDR: I made a rookie mistake and joined a second startup as a CTO and I am now a part of 2 startups and doing school/work and I am not very happy working on the second startup due to founder conflict, lack of experience and passion for the niche and the problem being solved, the high barrier of entry to build the product, and the stress from doing too many things at the same time. It's been 8 months working on the second startup, we have not launched yet but we are supposedly going to in the next few months although the core functionality has not been really built yet although there is a plan for that. I am seriously considering leaving, I will likely have a talk with my co-founder very soon. I am wondering if any of you have been in a similar situation or have any helpful thoughts. My main takeaway is even if the product is very successful and I miss out on a lot of money, do I want to stay on while stressed and frustrated just in case this does happen? I think life is too short for that, and just because an idea may be interesting or even has potential does not mean I have to work on it especially if I am unhappy with my relationship with my co-founder and I am not personally invested or passionate about building a good solution for this problem. [link] [comments]  |
| How to get involved with large companies? Posted: 08 May 2021 09:35 PM PDT I am currently working for a small engineering service and consulting firm (specializing in medical device/bio-tech, but not limited to it). Has anyone been in a similar position where they are trying to get in contact with larger companies to get contracts or projects? If so, can you provide some guidance? Is it a "you need to know someone" situation or do you need to pitch to a specific person? Thank you in advance! [link] [comments]  |
| Sweat Equity - Is This A Fair Value? Posted: 08 May 2021 04:57 PM PDT I've been a co-founder at a startup for 2 years. There are 2 other co-founders. I was responsible for developing part of the technology over those 2 years and get to an MVP which I have done. We bootstrapped those 2 years and didn't require external investment so we never had to figure out equity splits. However, since our MVP is done, we're now fundraising and equity is coming into the picture. While determining our pre-investment/pre-revenue cap table, the CEO decided that for the prior 2 years of sweat equity I would receive 1% of the company immediately. In the future, I'd receive 14% of the company (4 year vest, 1 year cliff) for a grand total of 15%. The future would involve launching the MVP, scaling, hiring, etc. My question to you all is, if I left the startup now to pursue something else, does 1% seem reasonable for the 2 years of sweat equity? Trying to figure out if I should negotiate that number or not. [link] [comments]  |
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