1) In general, the database is always the bottleneck. It's easy to throw up more webservers- can't do that with db's. 2) Throw up an ad or two, with the goal of having the ad revenue pay your server costs. This will allow you to not worry about the financial situation while you're fighting fires, so you can defer thinking about investment etc until later. (now after you have the servers tamed...) 3) Make sure you are…
Not so sure about incorporating, but that's because I spent my day writing up notes on Camz's talk on incorporation. He gave the three reasons to incorporate: 1. You have significant profits or net income. 2. You have high liability. 3. You're getting funding. I doubt this meets any of those criteria, unless someone offered to fund him. Here are the relevant links if you want to see what I'm talking about: HN Story -…
For example, how much would I save by incorporating if I make 1k versus 10k versus 100k a year?