My co-founder and I have been working on a startup since the last 12-13 months or so.
It's a social media that caters to a niche and we think it will work.
We've built the MVP, and we have a certain amount of signups with minimal marketing costs. We think there is a market fit here.
To scale up, we've been thinking of starting to approach funds for a seed round.
At the same time, we're thinking of the future -- if/when we get funding, we will have to quit our jobs.
We're 24 right now.
We were discussing all of the possible outcomes that might occur. A couple of scenarios:
Scenario 1: Our product really flies to millions as we are expecting it to, and we make a decent amount of money through Series B, Series C rounds etc.
Scenario 2: Our product shows decent promise during seed stages etc, we raise money through two rounds but then the startup dies for some reason.
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For the second scenario, we'll be 28.
We will probably have made no savings through the four years, and will be behind our peers in terms of professional growth and monetary savings.
28 also happens to be the age when most people get married. It seems like not a great idea to not have a good financial cushion at this age.
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Both of us are decently smart I think, and if things end with scenario 2, it simply won't be great. We'll be so behind people our age in terms of money saved etc.
This post does focus on the monetary aspect of the process, even though building something of your own will be super fun. How would you approach this predicament?
Generally, founders would be better off (even in founding another company) getting the right logos and degrees on your CV. Consider very carefully if you are trading industry recognition on a moonshot. If the moonshot doesn’t pan out to at least an acquisition (which a new report found happens 0.5% of the time for funded startups), you’ve lost years and will find it tough to compete against your peers. It sucks and the options available to you are to join other struggling startups.
The one reason to do it is - it’s super fun. If you can learn & prove something simply by building it (whether it succeeds or not), that can be a solid reason to go for 12-18months at it.
My main advice would be to set milestones of risk and achievement, then schedule meetings as co-founders to review your decision. The thing that drives co-founders a part is often divergent perception of risk. It’s important to synthesize regularly and assess against where you could be.
Taking risks is worth demonstrating. Just don’t confuse it with demonstrating success.
Basically don’t be stupid and don’t be a dick. Nobody gets in trouble for their company failing bc the model wasn’t right or PMF wasn’t found. If it fails, then you’re an entrepreneur.
You’ll still be in your 20s, so kick back and smoke weed or do whatever it is you enjoy doing for fun
Aim to fail fast, if it doesn't fail at all... great. If it fails, fail fast so you can waste less time getting started on something new.
Don't fail ;)