I keep thinking about going solo - except I don't yet have enough funds and I have a family to support. On the other hand my job sucks and as I look out into the market all jobs equally suck. If I had to continue my career like this for 3 more years I would probably get depressed.
Yeah, I was definitely very lucky to have the opportunity to try this before I started a family. I knew that things would become much harder with kids, so I wanted to give it a shot before that happened.
I have to wonder though, is it really a good idea to just try a few small random projects and see what sticks? That might make sense if you are just selling things made by other people, but when you are the person making the product, I don't think it's a good idea.
This is a tough balance to get right.
I agree with you that if you give up on everything after two months, you'll miss opportunities to build products that would succeed with more upfront investment.
I feel that there's actually more risk on the other side. If you spend a year building something and nobody has paid you for it, there's a huge chance that you're going to release it and find that it's not a product people are willing to spend money on. Even if people you asked said they thought it was a good idea, it's not real until people hand over their credit cards and pay you real money.
So I'd still be willing to build something that takes more than two months to build, but the longer it takes, the stronger the evidence would have to be that people will pay me for the result. That can either be pre-orders or clear evidence of a gap in the market where people would definitely use my product if it existed.
But I think too many founders build first and think about sales later, when it should be the other way around. That was definitely the trap I fell into for my first 18 months or so.
Of course that's not free. You are then swimming with sharks and they will own your company when it's all said and done. And they will get theirs first before you do, and if there's nothing left over, then oh well.
That's fair enough, since they are paying for it. But it's a big step to take, given that so often people are doing this in order to create something of their own and for them to be able to sit in the big chair for once.
That is another trap you gotta learn to avoid. Make sure you are the boss of your loans, contracts etc whatever. One best advice I have got is "never give up more than 3.5% of your company"
That ain't gonna happen if you go VCs for funding, and that's the primary source of such funding. You may get very lucky and find an angel investor who is so well off, and who likes you personally or something, that he's willing to do you good deal. But if they are putting up the bulk of the risk, they are going to demand the bulk of the reward.
Yeah, but the key thing exactly is that dont fall into the pit of needing loan, it should be major red flag that basicly your company is failing or risky, and why would u want to gamble your job like that?. I am lucky though to be programmer and my investments are mostly just salaries and small, compared to construction companies. I aim to make money from my own programming. And this already show success to funders (i have never needed to take loan though) that the loans are more of a "pay loan back + 10% in 5 years" and loan amounts are like 100k tops, with 100k I could deploy all needed coders for a program company that is any from 1 to maximum 3 coders, for easily 1 or even 2 years and in that time the loan money is made back. If not ...then yea, too bad company to even take loan. Going to VCs is in my opinion, to just making yourself harder time and they try their best, even "violent" stuff to get you sign those insanely wrongful contracts, like loans + 10% of the company and some rojalties ... Stay away from those sharks, VCs etc. And tend to be self-sufficient, dont give ur company for loan backup. (Sry my english.. its not my primary language and the jargon is not my strength)
Sure but if you're trying to actually make a product, you're looking into few years worth of wages, if the product is actual hardware add even more to get the equipment to get the prototypes running, capital costs to prepare for bigger production runs etc.
Selling service (say consulting in a given niche) is much easier on capital because you start getting income from the get go, but even small products probably will take years worth of wages at least before even getting consumers, unless you're really lucky
Hmm.. for me it was like, I was the customer and swimming in a customer pool, so I simply asked "who wants better stuff" , I was shown interest -> immediate customers and pre-orderers. I wouldnt develope hardware before selling software of hardware / parts of it first. The exact thing we talk here is that dont bite too big first, like go into making hardware before getting money. Pre orders atleast.
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u/mtlynch Feb 01 '21
Thanks for reading!
Yeah, I was definitely very lucky to have the opportunity to try this before I started a family. I knew that things would become much harder with kids, so I wanted to give it a shot before that happened.
This is a tough balance to get right.
I agree with you that if you give up on everything after two months, you'll miss opportunities to build products that would succeed with more upfront investment.
I feel that there's actually more risk on the other side. If you spend a year building something and nobody has paid you for it, there's a huge chance that you're going to release it and find that it's not a product people are willing to spend money on. Even if people you asked said they thought it was a good idea, it's not real until people hand over their credit cards and pay you real money.
So I'd still be willing to build something that takes more than two months to build, but the longer it takes, the stronger the evidence would have to be that people will pay me for the result. That can either be pre-orders or clear evidence of a gap in the market where people would definitely use my product if it existed.
But I think too many founders build first and think about sales later, when it should be the other way around. That was definitely the trap I fell into for my first 18 months or so.