So I decided to Start My Own Thing. Kind of. I feel like I have good intuition here, maybe not, but much of that was within confines of existing entities and more importantly structures. So, started my own thing. Under my name pitched something under software and got a $100k contract, very easily, based on my personal capability alone.
I do not care about $100k, and it is almost not noteworthy. Except I feel like based on my industry knowledge I can turn this small contract into goodwill that can snowball into lots and lots of “small” B2B contracts of similar sizes and maybe be a real thing. I have a lot of talented SWEs in my rolodex I could call. But, assuming maybe I’m right, and I can turn this small thing into a big thing, I really don’t know what to do here. I am used to fast growing things. I am thinking come up with a company name and start a Delaware c corp, and then the for contract #2 and then maybe start pinging outside contacts at various SV firms for some seed capital to expand to similar deals 3-10? I really don’t know.
Overall: I feel like I have the skills, have some market fit (?), have the personal history, and could theoretically build a well-heeled team. But I have never actually started a startup myself and am totally lost. Can someone suggest a roadmap to the practical aspects of Starting a Startup?
My advice would be to scale fast. Hire subcontractors and productize your offering as quickly as you can. Never do hourly work, retainers only. Come up with a subscription product you can offer. Hire a tax accountant immediately and press them on ways you can lower your taxable income. Have a plan for when your income greatly exceeds what you ever thought it would be.
You’re on track to true independence. You never have to work for somebody ever again. You got this.
1) You have industry connections which can be very valuable in the right scenario. Your best bet is to be a business cofounder. But, I wouldn’t give 50% for a business cofounder until they can demonstrate their value in $$ terms by signing contracts with customer.
The bad things:
1) You don’t know what you want to build
2) Doing grunt work is a very different reality from executive leadership. You might be in for a real wake up if to decide to do this.
3) Product market fit doesn’t care about how much money your startup has. Getting there is the hard part. Everything else is useless until you get there.
4) You don’t have a product or idea, why register a company? To seem legit or raise money?
5) Will SWE join your startup in this hot market? It’s going to be a tough sell. Money talks at the end of the day.
You are not a product or engineering guy. You are a business guy. That might not be enough. Just my 2 cents.
Definitely go the c-corp route. You'll have an easier time closing deals since your customers don't have to issue 1099s and can just pay your invoices. And if you ever do find someone willing to invest, the stock issuance is so much easier than dealing with LLC operating agreements.
Everything is smooth and easy for you but you are lost too?
Here is my road map:
- Hire people
- Give them work
- Get paid and pay
- Change whatever you see is not working well
Good luck and I wish you luck.
Otherwise IMO the biggest challenges for Startups is raising awareness, getting sales and creating USPs that customers are willing to pay for, which is where I'd recommend the primary focus of Startups should be in their preliminary years. After you're able to establish a pattern of increasing revenue is a good place for the next step whether it's seeking funding or hiring to accelerate product development & sales.
consulting could be a way to explore the space and start to get ideas for a product or repeatable offering.
maybe also of interest:
Do some business for a year. There is nothing like learning by doing, none of us have any idea what your skillset is and how you're making money to give you advice.
Why do you think you need investors at this stage if you're already profitable?
Presumably you left to do your own thing for a reason. They could snowball, but is pursuing those contracts what you want to do?
Pick something you want to build and build it. I've learned that you don't need to be an engineer, but you do need to really want to build it, otherwise someone who actually wants to will come and build it better.
Either way, incorporation can be done using services such as Stripe Atlas.
The rest is of course, history.