> Lesson learned: get investors; share the wealth, share the risk.
Or go to a 3rd word country and live happily with $0 of debt like me ;)
Beware self-funded Startups: failure can haunt you for a long time
41–50 of 55 posts
Re: Beware self-funded Startups: failure can haunt you for a long time
#42Been there. Destroyed my credit right out of the gate when I tried to run a web development firm in 1997 on student credit cards. Was threatened with eviction twice, and eventually was forced to move. Was fired and subsequently sued for $millions from/by a dot com in 1999 at a time when I literally had a negative account balance. I had dropped out of school to pursue my ambitions, so I had no degree to fall back on i…
Sorry, I never answered your actual question.
First, learn from your mistakes. It sounds to me like you negotiated your current deal poorly. Next time around, if you are committing or risking more to a given project than your other partners, you ought to demand more in return.
Second, monetize. If you have the userbase you say you do, $150k can probably be whittled away very easily.
Third, if your userbase is somehow unmonetizable, there is always the option of selling into a bubble. To be blunt: find a sucker and sell. Just be aware that the ONLY time anyone should ever do this is if they have lost faith in their business model. If you are still passionate about your idea, DO NOT DO THIS.
Re: Beware self-funded Startups: failure can haunt you for a long time
#43How do you define millions of users? Daily visits, daily hits, monthly hits, hits ever, db user entries, active sessions....
If you have millions of active users, and can share some information about how active they actually are, the users here may have some good ideas on how to monetize better.
If OTOH you have had millions of visits over some very long period (and not repeat users), perhaps a chapter 13 makes sense.
~ $15k/yr income is not enough to justify maintaining any but the most minimal of web applications; how much do you pay yourself?
Re: Beware self-funded Startups: failure can haunt you for a long time
#44Been there. Destroyed my credit right out of the gate when I tried to run a web development firm in 1997 on student credit cards. Was threatened with eviction twice, and eventually was forced to move. Was fired and subsequently sued for $millions from/by a dot com in 1999 at a time when I literally had a negative account balance. I had dropped out of school to pursue my ambitions, so I had no degree to fall back on i…
It is because of my 800 credit score that the cards in my name were upped automatically. Too much of a good thing! It is now 590.
Thanks for the inspiration! Just knowing recovery is possible is half of the mental battle. I look forward to making such encouraging words myself at some point in the future.
Re: Beware self-funded Startups: failure can haunt you for a long time
#45How do you define millions of users? Daily visits, daily hits, monthly hits, hits ever, db user entries, active sessions.... If you have millions of active users, and can share some information about how active they actually are, the users here may have some good ideas on how to monetize better. If OTOH you have had millions of visits over some very long period (and not repeat users), perhaps a chapter 13 makes sense…
Millions of visitors a month, and millions of registered users (not the same set, only a fraction of the visitors in a given month are registered). Freemium model. I'll post another question next Sunday on how to monetize, as now I see that perhaps that should have been the first question. Not that we haven't worked over the issue a million times, but we haven't had fresh perspectives at all.
Getting paid? Hahaha. Not now.
Re: Beware self-funded Startups: failure can haunt you for a long time
#46How did your credit line get expanded without you knowing it? A key detail I was not aware of is 'business cards get switched to personal cards when not pain on time'. That's a bit one that we should all be aware of (though I don't have a business card yet, good to know).
This is not how it works. When you open your business credit card, make sure it's not a personal credit card in disguise. The credit card needs to really be linked to the business. Then, iy cannot be switched to personal, ever. The trick is that many credit card companies will be happy to extend credit to you personally (your SSN), and agree to print a fancy "company name" on the card, so it makes you feel important.…
Yes, good to know. They kept things under the EIN until it went unpaid, then they switched to my SSN. That got my attention, of course, and I've learned a lot since then.
Re: Beware self-funded Startups: failure can haunt you for a long time
#47Thanks to everyone commenting on this, even though it is a few pages back on "new" and not on the home page. You all rock!
Re: Beware self-funded Startups: failure can haunt you for a long time
#48You need to share more info. What do you think about the business in general? How your co-founders feel about it. Are you all at a point of wanting to call it quit because you don't believe in it anymore, or is it simply the debt that makes is all seem like a bad movie. You need to be honest about the business. Selling a business when all founders want to get out is HARD if not impossible. If however, at least some o…
One of the three would go with it if he wanted, or it were possible. But with two bailing for sure...
Re: Beware self-funded Startups: failure can haunt you for a long time
#49If you have some money, you can negotiate your credit cards down to almost nothing (eg $30k = $4k payoff). Call the credit card company, tell them you have $X (X being about 10-15% of your balance) and you are calling all of your creditors to see who will take it as payment in full. $X is all you have...and if they will accept it, you will send it to them...otherwise you are sending it to the next card on the list.
It will be a little scary making that first call and making such a low-ball offer, but it is where you want to start and you will be amazed at the results...I guarantee it. Be sure to get the accepted deal in writing before sending any money.
This is a tough thing to go through. As an entrepreneur, you have to be able to compartmentalize these types of problems. Put these problems in a box, put the box on a shelf, and continue to build things and solve problems. Don't forget about the box, but set it aside and refocus on kicking ass. This is just a wall. You will run into a lot of walls on your journey. Walls are not there to keep us out, they are there to keep those who do not want it bad enough out.
tl;dr It's not over until you quit. Never quit.
Re: Beware self-funded Startups: failure can haunt you for a long time
#50Earlier quoted context omitted.
Don't take on debt secured by you personally. Your business should take on the debt. I know it's easier said than done, because no one will loan anything to a business with no revenue. By agreeing to personal debt, you pledged personal money that you didn't have. I guess different people have varying levels of risk, but I don't invest money I don't have.
Another lesson: you may think it is a business card (it is), but surprise! They can convert to personal (read the fine print).
Use debit cards. It will only allow you to spend money you have.