Ask HN: how to start a startup when you need a proper salary
Most startup stories describe how the founders at some point were not getting any salary, sharing rooms, sleeping in a couch, and barely sleeping. Is that the only way to be successful in a startup? What if you have two kids, a wife and a mortgage, should you just trash all your startup ideas and forget about starting one? What's your opinion and can you share any relevant story?
24 comments
I come at this with experience of both successful and failed startups while being married and raising kids. My question is do you want a "lifestyle" business where you can make life changing money for you & your family plus leave something for your kids or are you wanting to be a unicorn and/or change the world?
Many times people in the tech startup world favor the unicorn idea, but the reality of it is you can make a lot of money and personally be very successful, plus make others successful all while not working yourself to death. This requires a lot of focus on making a product/service and being profitable from as early on as possible. In fairness I never worked on a problem that could change the world until what I am doing now, but I am currently in a funded startup where that is our focus.
Personally, in my past, I have done what many in the tech industry wouldn't think is cool or a rocketship, but it changed people's lives, was profitable very early on and we had a hell of a lot of fun, but we would never have been considered on the unicorn track. This is for the businesses I created, I have been part of funded and rocketship startups prior.
But if you could put a business together that would be say, $5-$15M a year in revenue over 5-7 years and profitable at 30-40% where you control the majority stake and it just keeps generating revenue year after year would you be happy?
Honestly you can start this type of business while working a full time job, it requires a bit of time management but you can do it. When I did this as a FTE I would work during the day, come home have dinner, spend time with the kids and wife and than start working on the project at like 9-10pm when kids went to bed, some nights I'd take off for time with the wife too. Then I'd pick one day a weekend and work all day, but stop around 4 or so and spend time with the family. This let me have some balance, but TBH it is still hard, but once things start picking up it gets easier. I will say that if you go this route you have to expect you'll have lean times where it is a struggle, and flush times when things feel amazing, it is a bit of a roller coaster, so you need to have balance and a supportive wife. And you need to make sure you prioritize family times so you don't become the MIA parent.
You are welcome to send me an email (check my profile) if you want to chat about it, having done it I get it is not easy.
Many times people in the tech startup world favor the unicorn idea, but the reality of it is you can make a lot of money and personally be very successful, plus make others successful all while not working yourself to death. This requires a lot of focus on making a product/service and being profitable from as early on as possible. In fairness I never worked on a problem that could change the world until what I am doing now, but I am currently in a funded startup where that is our focus.
Personally, in my past, I have done what many in the tech industry wouldn't think is cool or a rocketship, but it changed people's lives, was profitable very early on and we had a hell of a lot of fun, but we would never have been considered on the unicorn track. This is for the businesses I created, I have been part of funded and rocketship startups prior.
But if you could put a business together that would be say, $5-$15M a year in revenue over 5-7 years and profitable at 30-40% where you control the majority stake and it just keeps generating revenue year after year would you be happy?
Honestly you can start this type of business while working a full time job, it requires a bit of time management but you can do it. When I did this as a FTE I would work during the day, come home have dinner, spend time with the kids and wife and than start working on the project at like 9-10pm when kids went to bed, some nights I'd take off for time with the wife too. Then I'd pick one day a weekend and work all day, but stop around 4 or so and spend time with the family. This let me have some balance, but TBH it is still hard, but once things start picking up it gets easier. I will say that if you go this route you have to expect you'll have lean times where it is a struggle, and flush times when things feel amazing, it is a bit of a roller coaster, so you need to have balance and a supportive wife. And you need to make sure you prioritize family times so you don't become the MIA parent.
You are welcome to send me an email (check my profile) if you want to chat about it, having done it I get it is not easy.
Great advice. I don't see it as "change the world ideas" vs. something that is not. Pinterest isn't a changing world idea, so is Atrium or something else.
The difference is do you want to work on a business of your own and as with any business it has to be profitable (I don't why it's called lifestyle business - it's just business). The other option is to try and get someone to gamble millions of dollars on your idea without being profitable for years. Getting someone to gamble like this just requires a lot more time. That's all.
I agree, I don't like the term "lifestyle business", it is just a business, but in the tech industry I have seen that term used in a derogatory way when frankly I love that type of business.
Raising money can be done outside of the traditional tech VC world as well. High net worth individuals who themselves own businesses many times are willing to invest on pretty decent terms. But your point is super accurate, raising money takes time focused on raising money and not building the business or product, which is why incubators/VCs favor multi-founder startups. The incubators all know essentially one founder will spend the majority of their time raising capital, meeting new investors and finding warm intros to investors etc. It is a full time job.
Raising money can be done outside of the traditional tech VC world as well. High net worth individuals who themselves own businesses many times are willing to invest on pretty decent terms. But your point is super accurate, raising money takes time focused on raising money and not building the business or product, which is why incubators/VCs favor multi-founder startups. The incubators all know essentially one founder will spend the majority of their time raising capital, meeting new investors and finding warm intros to investors etc. It is a full time job.
This kind of thing sounds great, any suggestions for area of businesses that you would look at starting? Part of the challenge is that the range of things that you could do is massive.
That's it, once you stop thinking about the typical tech ideas as your central focus and start thinking about things you can do quickly and make money at the world has millions of waiting clients and ideas.
I have brought this up before on HN, if you look around in any town you will find plumbers, electricians and other "trades" people (or mom & pop shops) who started their business and have some basic business sense. Many are sitting on businesses that have high margins and can easily become multi-million dollar businesses (or already are) and make their founders quite wealthy. A lot of time people get so focused in their narrow area they forget to look outside of the industry or type of work they do. I am not suggesting you become a plumber, just that if you look at those businesses there are always needs to fulfill for people. And technology as a whole seriously ignores traditional businesses like these, a mistake I do not make.
To find these ideas, talk to everyone. I even found clients from talking to fellow parents at my kids sporting events. We'd talk about work they'd open up where they worked and I'd chat them up about what the opportunities and issues were. 90% of communication is listening and asking calculated (not in the evil sense) questions.
I always follow the rule that every issue, complaint or failure is an opportunity to provide value, even if it was my own.
I have brought this up before on HN, if you look around in any town you will find plumbers, electricians and other "trades" people (or mom & pop shops) who started their business and have some basic business sense. Many are sitting on businesses that have high margins and can easily become multi-million dollar businesses (or already are) and make their founders quite wealthy. A lot of time people get so focused in their narrow area they forget to look outside of the industry or type of work they do. I am not suggesting you become a plumber, just that if you look at those businesses there are always needs to fulfill for people. And technology as a whole seriously ignores traditional businesses like these, a mistake I do not make.
To find these ideas, talk to everyone. I even found clients from talking to fellow parents at my kids sporting events. We'd talk about work they'd open up where they worked and I'd chat them up about what the opportunities and issues were. 90% of communication is listening and asking calculated (not in the evil sense) questions.
I always follow the rule that every issue, complaint or failure is an opportunity to provide value, even if it was my own.
Amazing advice. Good to know someone with a family has made it work.
Just save up enough money to be comfortable not taking any salary for the next 15 months or so. Some ways to save include but are not limited to: buying in bulk, skipping everything considered a perk, holidays, cooking 100% of the time (I recommend meal prep)...
The problem with that is, more often than not great startups have a 12-16month window to launch. Depending on your particular instance, you might miss yours while you're saving up. A way to kinda mitigate that risk(or just an alternative way on its own) is to work all the free time on it + get some cofounders + raise a friends&family round.
The problem with that is, more often than not great startups have a 12-16month window to launch. Depending on your particular instance, you might miss yours while you're saving up. A way to kinda mitigate that risk(or just an alternative way on its own) is to work all the free time on it + get some cofounders + raise a friends&family round.
Fortunately, you don't need to quit your day job nor live a crazy lifestyle in order to launch a startup. All you have to do is commit to working on it 5 minutes per day and it will happen.
This is what I followed when I built CloudBuddy (https://cloudbuddy.cloud). For any side project it starts off being exciting and looking like a climbable mountain. Then when you start to get into it, it seems daunting. Each day I would tell myself that I am going to put one foot in front of the other and walk up the mountain. No matter how slow it seems, I will make it to the top. Some days I was so burned out; those were the days that I only worked 5 minutes on it and called it a day. Other days, I was into it and naturally blew beyond the 5 minutes.
It took me 2 years and 3 months to launch CloudBuddy (which has paying users). There isn't anything special about me or my circumstances - I'm married, have a child and have a day job.
If your having difficulty starting or working consistently on your side project and it would help to have someone to talk to, email or drop me a line. My contact info is in my profile.
This is what I followed when I built CloudBuddy (https://cloudbuddy.cloud). For any side project it starts off being exciting and looking like a climbable mountain. Then when you start to get into it, it seems daunting. Each day I would tell myself that I am going to put one foot in front of the other and walk up the mountain. No matter how slow it seems, I will make it to the top. Some days I was so burned out; those were the days that I only worked 5 minutes on it and called it a day. Other days, I was into it and naturally blew beyond the 5 minutes.
It took me 2 years and 3 months to launch CloudBuddy (which has paying users). There isn't anything special about me or my circumstances - I'm married, have a child and have a day job.
If your having difficulty starting or working consistently on your side project and it would help to have someone to talk to, email or drop me a line. My contact info is in my profile.
Really cool that you've built this simple service. How did you reach out to your initial customers initially?
Also, assuming it's just a storage service at the moment? :) I'm in need of storing docker containers on behalf of customers.
Also, assuming it's just a storage service at the moment? :) I'm in need of storing docker containers on behalf of customers.
To date I haven't specifically tried to reach out directly to potential users. I've just been posting on Hacker News!
CloudBuddy doesn't currently support storing Docker containers.
Here is a write up on 3 that do: https://www.nirmata.com/2017/03/14/comparing-container-image...
With pricing on those 3 here: - DockerHub (https://hub.docker.com/billing-plans/) - Amazon Elastic Container Registry (https://aws.amazon.com/ecr/pricing/) - JFrog (https://jfrog.com/pricing/#on-prem)
If you need something more custom, let me know and I can brainstorm with you (my contact info is in my profile).
CloudBuddy doesn't currently support storing Docker containers.
Here is a write up on 3 that do: https://www.nirmata.com/2017/03/14/comparing-container-image...
With pricing on those 3 here: - DockerHub (https://hub.docker.com/billing-plans/) - Amazon Elastic Container Registry (https://aws.amazon.com/ecr/pricing/) - JFrog (https://jfrog.com/pricing/#on-prem)
If you need something more custom, let me know and I can brainstorm with you (my contact info is in my profile).
How is this different than just using s3?
With CloudBuddy, it costs $1 per 10GB per month and setup takes less than 1 minute.
s3 is both more expensive and much more involved to setup. With s3, it takes longer than 1 minute just to be able to figure out the pricing! LOL
Here is a link to s3 if your curious https://aws.amazon.com/marketplace/pp/B0764CYKPB (I found this by googling SFTP Gateway to Amazon S3)
s3 is both more expensive and much more involved to setup. With s3, it takes longer than 1 minute just to be able to figure out the pricing! LOL
Here is a link to s3 if your curious https://aws.amazon.com/marketplace/pp/B0764CYKPB (I found this by googling SFTP Gateway to Amazon S3)
http://www.startupsfortherestofus.com/archives
Listen to the archives, you can follow along with Rob as he stair steps up from job boards to a SaaS with an exit. Lots of great advice on creating a startup with kids, job, mortgage.
@DHH Startup School Talk (Inspiration) https://www.youtube.com/watch?v=0CDXJ6bMkMY
Listen to the archives, you can follow along with Rob as he stair steps up from job boards to a SaaS with an exit. Lots of great advice on creating a startup with kids, job, mortgage.
@DHH Startup School Talk (Inspiration) https://www.youtube.com/watch?v=0CDXJ6bMkMY
You work like crazy in two jobs. I did exactly this putting in 100+ hour weeks for around four years until mark II of my startup was profitable enough to support me and my family.
That’s amazing. May I ask a few follow up questions? Have you written more about this anywhere? Did you do 100+ hours every week or maybe alternative week etc.? Did it negatively impact your health? Did you manage to have any family time?
Most important of all - what did you do about sleep? If you didn’t get much sleep, how did you sustain that for 4+ years? May I see a sample of your daily schedule?
I’m sorry if that was too much and too many questions - I’m deeply interested in this subject.
Most important of all - what did you do about sleep? If you didn’t get much sleep, how did you sustain that for 4+ years? May I see a sample of your daily schedule?
I’m sorry if that was too much and too many questions - I’m deeply interested in this subject.
I haven't written up about my 100+ hour weeks specifically, but from 2008 to 2012 I did literally nothing but work and sleep every day (7 days a week). Even eating I did while answering emails, etc.
Sleep I didn't skimp on (7 hours average a night, but that is my norm even now).
My day would start at 6.30am (sometimes earlier if I needed to call a customer in a bad time zone), eat breakfast while dealing with emails, etc, go to work around 8.30am (I luckily had a short commute), work until lunch, work on my business over lunch, work more and come home around 6 pm, eat dinner and work, then round out the day with some more work, and finally go to bed around 11.30pm (sometime later if I need to call customers, etc). Weekends were much the same except no commute.
No I didn't get sick and physically I could have sustained it for as long as I needed, the biggest side effect was my judgement started to become detached from reality. It was a very slow and steady drift, but in hindsight I can see my decisions were not always the best. Nothing catastrophic, but not the best by any means.
This was the cost of building a business when you have a family to support. I now get to spend a lot of time with my family, and while it wasn't easy, I still think it was the right decision. Four years of very, very hard work has avoided 30 years of hard work.
Sleep I didn't skimp on (7 hours average a night, but that is my norm even now).
My day would start at 6.30am (sometimes earlier if I needed to call a customer in a bad time zone), eat breakfast while dealing with emails, etc, go to work around 8.30am (I luckily had a short commute), work until lunch, work on my business over lunch, work more and come home around 6 pm, eat dinner and work, then round out the day with some more work, and finally go to bed around 11.30pm (sometime later if I need to call customers, etc). Weekends were much the same except no commute.
No I didn't get sick and physically I could have sustained it for as long as I needed, the biggest side effect was my judgement started to become detached from reality. It was a very slow and steady drift, but in hindsight I can see my decisions were not always the best. Nothing catastrophic, but not the best by any means.
This was the cost of building a business when you have a family to support. I now get to spend a lot of time with my family, and while it wasn't easy, I still think it was the right decision. Four years of very, very hard work has avoided 30 years of hard work.
Thank you for being so open about this. The information helps me a lot. Thanks again.
Just because you have a family doesn't mean that you should thrash your startup ideas. It takes more planning, a deeper commitment to focus on core business building activities and a more selective criteria on what you will work on.
I see it as a plus to have a family to take away the stresses of building a business. It's kept me motivated to hone it on what things I should and should not be doing. I have found that I have done more than I could ever have done had I been single.
We're now in a position to start beta testing with customers with a potential to raising initial funding to identify the right business model.
I see it as a plus to have a family to take away the stresses of building a business. It's kept me motivated to hone it on what things I should and should not be doing. I have found that I have done more than I could ever have done had I been single.
We're now in a position to start beta testing with customers with a potential to raising initial funding to identify the right business model.
A lot of advice here is about finding time to work on your product on nights and weekends. You also need allocate some time during the day for marketing and communicating with your target customers
Ideas worth nothing. Talk to potential customers, try to learn they problem, see if they like your idea of solving their problem. Use "paper and scissors" to build quick and dirty prototype — this is possible while having full time job.
If you idea is too grandiose that is not possible to launch while working full time — find another, smaller idea. Bootstrap, sell - make money, then you will have funds for your big idea.
If you idea is too grandiose that is not possible to launch while working full time — find another, smaller idea. Bootstrap, sell - make money, then you will have funds for your big idea.
You could save up enough money to the point which you're comfortable not accruing more wealth for the time you think it takes to prove the startup out prior to funding. Finding partners who can do the same can accelerate the time to an MVP. Also, it's possible to start something on the side while keeping your day job.
Pick an idea you can work on in the evenings and weekends. This may limit what idea you choose - but if it is your first attempt at this it would be better to choose a small well defined problem anyway to get experience of all the fun of building, marketing and selling something.
You can still take a salary with VC funding. That's really the whole point of seed funding. But there's a balance there. If you're taking much more salary than your cofounders, you also take much less equity.
1: You can work and use your salary to fund your startup
2: You can buy a startup and extend
3: Save money and move somewhere cheap