http://swombat.com/2013/3/15/taking-the-leap
A very good post from Daniel Tenner on his successful startup blog, swombat.com, where he gives some advices to those who want to go to “taking the leap” (quit your job and start your own company). Here is the list, with my personal comments from my experience of co-founding a company and primarily from my mistakes
- “Cut (personal) costs to the minimum” - In the begining it is absolutely essential to cut the personal costs, since there is no income (worst case scenario, but a realistic one). There are some expenses that can’t be cut. Most of the trouble here is caused by decisions made in the past: big house, big car, etc. If you are married it is better to inform your wife about the potential changes of this movement: go out to dinner less often, postpone some house improvements, etc. And it is also absolutely crucial to answer to the question “how many months can you handle without any income and what is your stop loss limit?”. if you have a partner, do not skip this question and have an answer from your partner as well. It does not make sense that you accept to handle no income during 12 months and your partner just can handle 2 months.
- “Do not take funding” - I believe that there are some kind of businesses where it is needed to take some funding. Although, I think it is always preferable to be self-funding. First, if you take money from some VC or if you sell part of the company, you maybe loose the operational control, and some frictions arise as consequence. If you follow the self-funding path, as Daniel refers, you will be pressured to make sales and get some revenue. This pressure will force you to be very pragmatic and force you to validate your idea as soon as possible. You will be forced to launch early, which in my opinion it is a good thing. Even if the product does not gain any traction, you didn't waste all your time and money. If we have to fail, then we should fail early, allowing us to have more second chances.
- “Connect with mentors and peers and listen to them” - Absolutely right. I think I should have listened more people in the field, who already took the leap. In 2004, when I decided to found my company, there was too much wishful thinking around my head. But that's it: "wishful thinking", with some distance from the reality. Listening experiences from other people, and knowing in advance how hard it is to take the leap it is crucial to handle hard times.
- Don't tie yourself to one idea - It is very difficult to know if our idea it will be or not a successful idea . I think the execution is more important than the idea, however picking the wrong idea, even with a good execution, can be something that it's not profitable. The Lean Startup approach popularized from Eric Ries (credits here also to Steven Blank with the Customer Development techniques popularized in the book the "4 Steps to the Epiphany"), can help us to rapidly validate our idea. If the feedback of this validation it's not what we are really expecting, we have to be prepared to pivot or jump to another idea. But the lack of focus on an idea can be bad to the execution. Derek Sivers, from CDBaby tell us that the Ideas are just multipliers of Executions. My observations on this field tell me that a possible recipe, with apparently some kind of success, consists in building something to an audience that you know well, and the audience recognizes you as an authority and trusts you. The hard part is to grab the audience. But there are a lot of guys that follow this recipe with some success: start a blog which gains buzz, write a book, record screencasts, develop workshops, etc. Then finally build a product to this audience. However, this evidence of success doesn't tell us nothing about the efficacy of this recipe, since it is not possible to know how many people have tried this recipe and have failed.
- "Don’t make plans or set deadlines" - Well, I don't agree with this statement. I think the statement should be "Don't make a detailed plan or set rigid deadlines". I think that we should have a plan an write it on piece of paper, primarily if you are co-founding with a partner. But the plan should be no longer than a page. "The shorter your plan the better", very well said in this post . But Daniel gives an excellent advice: if you for some reason have to rollback, then get a daily-job in a startup instead of a large company. By that time, you should be known in the startup scene, and maybe you go-back for a job without the need to be interviewed. Very good advice.