{Copyright (C) 2008-2009 Startup Professionals, Inc. All Rights Reserved}
Startup Professionals, Inc.
Where do you find co-founders?
Most successful startups have more than one founder, and usually the founders seem to have been friends
for at least a year before starting the company. The best way to meet co-founders is to go to school with them, so recent grads have
a big advantage there. You can also meet co-founders at work, but be careful not to violate whatever non-compete you signed. In the
old days, co-founders often met through user groups, but this seems less common now.
How can someone start a startup if they have a
family to support?
The most common advice is to maintain your “day job”, with a stable income, until your startup is funded or produces
a reliable revenue stream. If the startup requires too much time for this option to be viable, you must rely for funding on
personal savings, friends, and family. Professional investors will not often provide funding for startups in the Idea Stage.
I
have multiple startup ideas. How do I decide which to work on?
Work on the one that will cause the most immediate concrete improvement
in users' lives, and has the largest opportunity. Don't worry too much at first about how users will find out about it, or how to
make money instantly. But don't work on something that's going to take ten years, either. (In technology, ten years rounds up to never.)
Are
some locations better than others?
Yes. Remember the old real estate adage of “location, location, location.” Time and effort
devoted to selecting where to locate your business can mean the difference between success and failure. The kind of business you are
in, the potential market, availability of employees, and the number of competitive establishments, all determine where you should
put your business.
Can I operate a business from my home?
Yes. In fact, experts estimate that as many as 20 percent of new small
business enterprises are operated out of the owner's home. Local SBA offices and government tax documents can provide pertinent information
on how to manage a home-based business legally and successfully.
How can I find qualified employees?
Choose your employees carefully.
Decide before-hand what you want them to do. Be specific. You may need flexible employees who can shift from task to task as required.
Interview, screen applicants, and check references diligently.
Remember, good questions lead to good answers - the more you
learn about each applicant's experience and skills, the better prepared you are to make your decision. Most investors recommend
that you avoid hiring family members, unless they have strong domain knowledge in areas relevant to your new business.
Where do you find co-founders?
Most successful startups have more than one founder, and usually the founders seem to have been friends
for at least a year before starting the company. The best way to meet co-founders is to go to school with them, so recent grads have
a big advantage there. You can also meet co-founders at work, but be careful not to violate whatever non-compete you signed. In the
old days, co-founders often met through user groups, but this seems less common now.
How can someone start a startup if they have a
family to support?
The most common advice is to maintain your “day job”, with a stable income, until your startup is funded or produces
a reliable revenue stream. If the startup requires too much time for this option to be viable, you must rely for funding on
personal savings, friends, and family. Professional investors will not often provide funding for startups in the Idea Stage.
I
have multiple startup ideas. How do I decide which to work on?
Work on the one that will cause the most immediate concrete improvement
in users' lives, and has the largest opportunity. Don't worry too much at first about how users will find out about it, or how to
make money instantly. But don't work on something that's going to take ten years, either. (In technology, ten years rounds up to never.)
Are
some locations better than others?
Yes. Remember the old real estate adage of “location, location, location.” Time and effort
devoted to selecting where to locate your business can mean the difference between success and failure. The kind of business you are
in, the potential market, availability of employees, and the number of competitive establishments, all determine where you should
put your business.
Can I operate a business from my home?
Yes. In fact, experts estimate that as many as 20 percent of new small
business enterprises are operated out of the owner's home. Local SBA offices and government tax documents can provide pertinent information
on how to manage a home-based business legally and successfully.
How can I find qualified employees?
Choose your employees carefully.
Decide before-hand what you want them to do. Be specific. You may need flexible employees who can shift from task to task as required.
Interview, screen applicants, and check references diligently.
Remember, good questions lead to good answers - the more you
learn about each applicant's experience and skills, the better prepared you are to make your decision. Most investors recommend
that you avoid hiring family members, unless they have strong domain knowledge in areas relevant to your new business.
I
have multiple startup ideas. How do I decide which to work on?
Work on the one that will cause the most immediate concrete improvement
in users' lives, and has the largest opportunity. Don't worry too much at first about how users will find out about it, or how to
make money instantly. But don't work on something that's going to take ten years, either. (In technology, ten years rounds up to never.)
Are
some locations better than others?
Yes. Remember the old real estate adage of “location, location, location.” Time and effort
devoted to selecting where to locate your business can mean the difference between success and failure. The kind of business you are
in, the potential market, availability of employees, and the number of competitive establishments, all determine where you should
put your business.
Can I operate a business from my home?
Yes. In fact, experts estimate that as many as 20 percent of new small
business enterprises are operated out of the owner's home. Local SBA offices and government tax documents can provide pertinent information
on how to manage a home-based business legally and successfully.
How can I find qualified employees?
Choose your employees carefully.
Decide before-hand what you want them to do. Be specific. You may need flexible employees who can shift from task to task as required.
Interview, screen applicants, and check references diligently.
Remember, good questions lead to good answers - the more you
learn about each applicant's experience and skills, the better prepared you are to make your decision. Most investors recommend
that you avoid hiring family members, unless they have strong domain knowledge in areas relevant to your new business.
Can I operate a business from my home?
Yes. In fact, experts estimate that as many as 20 percent of new small business enterprises are operated out of the owner's home. Local SBA offices and government tax documents can provide pertinent information on how to manage a home-based business legally and successfully.
How can I find qualified employees?
Choose your employees carefully. Decide before-hand what you want them to do. Be specific. You may need flexible employees who can shift from task to task as required. Interview, screen applicants, and check references diligently.
Remember, good questions lead to good answers - the more you learn about each applicant's experience and skills, the better prepared you are to make your decision. Most investors recommend that you avoid hiring family members, unless they have strong domain knowledge in areas relevant to your new business.
How do I set wage levels?
Wage levels are calculated using position importance and skill required as criteria. Consult your
trade association and accountant to learn the most current practices, cost ratios and profit margins in your business field. While
there is a minimum wage set by federal law for most jobs, the actual wage paid is entirely between you and your prospective employee.
What
does marketing involve?
Marketing is your most important organizing tool. There are four basic aspects of marketing, often called
the "four P's":
· Product: the item or service you sell
· Price: the amount you charge for your product or service
· Promote: the ways you inform
your market as to who, what and where you are
· Provide: the channels you use to take
the product to the customer.
As you can see, marketing encompasses much more than just advertising or selling. For example,
a major part of marketing involves researching your customers: What do they want? What can they afford? What do they think? Your understanding
and application of the answers to such questions play a major role in the success or failure of your business.
How do I set price
levels?
To have a successful business and make money, the price of a service or item should be based on three basic production and
delivery costs: direct materials, labor and overhead. After these costs are determined, a price is then selected that will be both
profitable and competitive.
But the practical reality is that we live in a laissez-faire society, and pricing must be a function
of ‘what the market will bear.’ That means good market analysis is the key to setting the right price, considering factors
such as opportunity, competition, marketing, and sales channels.
Do I need special insurance for my business?
It is wise for
any business to possess a general business insurance policy, which includes liability and other standard coverage. Your place of business,
if you own it, should be insured; and if you rent, you still should possess your own coverage. Don't rely on the landlord's insurance.
If
you have one or more employees, you are required to have worker's compensation insurance. Depending on your industry -- for example,
food service requires product liability insurance -- you may need additional types of insurance. If you already have insurance coverage,
begin investigating coverage options and requirements with your present agent. Obtaining quotes from several agencies is also recommended,
being sure to compare both coverage recommendations and price.
How do I set wage levels?
Wage levels are calculated using position importance and skill required as criteria. Consult your
trade association and accountant to learn the most current practices, cost ratios and profit margins in your business field. While
there is a minimum wage set by federal law for most jobs, the actual wage paid is entirely between you and your prospective employee.
What
does marketing involve?
Marketing is your most important organizing tool. There are four basic aspects of marketing, often called
the "four P's":
· Product: the item or service you sell
· Price: the amount you charge for your product or service
· Promote: the ways you inform
your market as to who, what and where you are
· Provide: the channels you use to take the product to the customer.
As you can see, marketing encompasses much more than just advertising or selling. For example,
a major part of marketing involves researching your customers: What do they want? What can they afford? What do they think? Your understanding
and application of the answers to such questions play a major role in the success or failure of your business.
How do I set price
levels?
To have a successful business and make money, the price of a service or item should be based on three basic production and delivery costs: direct materials, labor and overhead. After these costs are determined, a price is then selected that will be both profitable and competitive.
But the practical reality is that we live in a laissez-faire society, and pricing must be a function
of ‘what the market will bear.’ That means good market analysis is the key to setting the right price, considering factors
such as opportunity, competition, marketing, and sales channels.
Do I need special insurance for my business?
It is wise for any business to possess a general business insurance policy, which includes liability and other standard coverage. Your place of business, if you own it, should be insured; and if you rent, you still should possess your own coverage. Don't rely on the landlord's insurance.
If
you have one or more employees, you are required to have worker's compensation insurance. Depending on your industry -- for example,
food service requires product liability insurance -- you may need additional types of insurance. If you already have insurance coverage,
begin investigating coverage options and requirements with your present agent. Obtaining quotes from several agencies is also recommended,
being sure to compare both coverage recommendations and price.
Frequently Asked Questions (Operational)
Below is our list of questions with some generic answers which we believe will
guide you in most situations. Obviously, many of these questions have many individual complex legal and financial implications,
so an attorney or accountant should be consulted to give you a definitive answer for your situation. Also feel free to contact us
as well for additional discussion.
