throw9987432

Well lets say he sold for 40 million (for IP), and also not accounted for has 50 million in debt, but 100 million in boxes of watches.

One could argue that the debt + more can still be paid off by selling the existing inventory. It may be a bit hard to get full retail for an "old" product though from a "dead" company, so who knows.

I mean, I understand what he is saying... but if you join a startup (even as an employee), you should be aware that your risk of your job going away is higher.

If you want a really safe job for 20 years you would join the government or a fortune 100 type company. Does the 2nd and 3rd employee ever think his job is as secure as working for a fortune 100?

This sounds very good in theory, but if I got to the point I have 3 months runway at current staffing level with no funding in site, or 6-12 months at staffing level N - X, I would lay people off to improve the success of launching the company. My job is to get the company to take off. I think it would be absurd to say "Whelp guys that depend on me for a job.. I don't want to lay off 2 people to save the rest of your jobs because you are employees and not founders, so we are gonna likely go under in 2 months"

This is totally a valid thing you should bring up in an interview though. I would pass over you, but I can totally see many others agreeing with you.

Growth is in the OP. 3 months, but have a good sales pipeline (i.e. Dec will be month 4 and no slowing down, if anything it is speeding up).

The funding example I gave was for a non-incubated startup. But it is my n=1, so not totally sure that is out there.

100% agree on the hire and funding treadmill. I would only take funding if it is reasonably sustainable. If I would end up hiring 2 people and in 6 months we have had less than projected growth, I would lay them off to keep the company alive. Sucks for the hires, but part of the risk of startups I think. I would not hire 14 people that I need funding to employ.

Thanks for the support! I don't think I need 50k to quit my day job, depending on how much staff I have I should be able to quit closer to 10-15k MRR. If I can get people to prepay yearly as others have suggested, would be even sooner.

Has been an interesting journey for sure. Have not really planned it to happen, just did my best at each phase, and it has always been "enough". We will see how long this baby goes...

Well what kind of seed rounds have you seen for companies that are small but have some traction? I have been involved in a few ( not as owner though), and for example a company with 0 market fit or customers or tech got 250k convertible debt for about 10% of the company (obviously depending how the next funding round went). Using that as my mark with a fairly conservative growth rate, 250k should fund me + 1 full time dev (+ current support staff) until we get to profitability.

You guys are great, wish I didn't have to write in stealth mode so I could blog.

Awesome thanks. Let me look one by one.

> Increase your price. This may reduce the number of customers but increase the profit margin, thereby cutting back on the hours required of you and making the transition from job to business owner more manageable.

For sure, I am not entirely sure what the right pricing move is. I could likely do a 25-50% bump and end up better for it.

> Find ways to somehow free up time. This does not necessarily need to be in the form of business automation, though finding some ways to automate pieces of the business to lighten your load would be good. You could also look at your overall life and either do things like hire a person to mow your lawn or just simplify things in some way.

For sure. Today we just figured out "order groceries from the internet". Going to be a process,but every extra hour helps a BUNCH right now

> Take better care of yourself. Eat better. Improve sleep hygiene. Join a gym or fit more walking into your life. If you have more to give physically, this pace becomes more sustainable.

My running has gone from 30 MPW to 5 MPW. Thanks for the reminder, I shall go for a run in a bit.

> You seem to feel a bit trapped, like the business has a life of its own and you cannot corral it. Try to reframe the problem as one of you needing to get this dog on a leash and teach it some discipline. That approach has the potential to give you the breathing room you need to grow it on your own terms.

This is genius

I am not a sales guy, but I guess I say the right stuff? Not sure.. I am not having to force people to use my product, they are generally beating down the door to find ME. One guy last week found me on page 17 of google. I didn't know google had 17 pages....

I actually have a yearly discount advertised but not have not spent the 10 minutes to code it. Stupid of me, I bet I could get several people to commit to paying a year for 2 months free.

These are good questions. Let me hit them up in order.

> Are these customers who have already committed money/signed contracts? Or, would these be considered more like warm prospects?

Say a customer I have talked to on the phone or otherwise convinced to sell. Need to do a little discussion and a little work, and get them set up. I vetted them as a real customer, and they vetted me as sounding interesting. Historically at least a 75% chance to pay at this time.

> How long are they having to wait between decision and implementation? Do customers in this backlog know what kind of wait time they are facing under your current solo part-time commitment? Are they willing to wait? Or, are you losing customers to other competitors or internal solutions because of the wait time?

1-3 week range. I don't think I am losing a ton.

> What is the dollar value of your current backlog? If for example it was another $2000 in monthly revenue that is committed but at risk if you don't deliver fast - I would encourage you toward greater commitment try for a small business loan or take on your more personal sources of investment that you mention in option 3. On the other hand if the backlog is something more like $500 in monthly revenue I might suggest that you continue with #1 because your growth curve might already be slowing down.

Closer to $500 in backlog. Here is the part of the story that perhaps I did not express fully.

1) I am spending like $20 a month on google adwords. I have some very hot words. I could up it to $20 a day, and probably get 2-3x the new customer flow I do now. I do not, because my backlog would go insane. Perhaps I should do it anyway though :)

2) I have some complex customers I am turning away. They would be good for pretty good money (perhaps $500 MRR each), but I cannot yet deal with them. I know part of a young business is turning away things that are too much work, but if I scaled up and had money - I totally know I could deal with them.

So I think more than the raw backlog leaving money on the table, is #1 and #2 above leaving money on the table.

Any more tips on why you feel so strongly 1, or strongly against 2-3?

I do have a part time support person I am paying with "profits" (I am profitable as long as I keep working for free). So yes this is 100% where I am putting my money for a while, not for development.

Sadly that is partially my competitive edge. I am making it BETTER with code changes when I can find the time, but I never want to be a "sign up and never talk to a human" app ala Google Docs or something. I have 10 or 15 products in my space that already do that. Many of my current customers quit those products to come to me.