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I lost $209k of my own money trying to start a business

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Re: I lost $209k of my own money trying to start a business

#141

Post by maeil »

matrix wrote: post #45
andsoitis wrote: post #10

The first heading reads “marketplace for last-minute tours and activities”, followed by a paragraph that says “industry where 80% of bookings were still done using pen and paper, months ahead of time” How is something done both “months ahead of time” and “last-minute”?

The answer is: he didn't understand the business. There tens if not hundreds of competitors, and yet the tour operators still taking bookings over the phone. That tells you a lot. The market is ruthlessly efficient. If something has a low barrier to entry, like his idea, then it's absolutely 100% guaranteed that someone else has tried it. Would-be founders need to do a brutally honest assessment of why they are going…

> If something has a low barrier to entry, like his idea, then it's absolutely 100% guaranteed that someone else has tried it

Most founders of succesful businesses Ive met - especially ones who weren't absolutely outstanding talents in their fields - created businesses with very low barriers to entry yet that no one had tried. But all of them were three-dimensional ones. I get that this is HN so the assumption is tech, but in the offline world or at least the combination of tech with a big dose of offline (bigger than the one in this article) a low entry barrier says just about nothing about potential.

Re: I lost $209k of my own money trying to start a business

#142

Post by ChrisMarshallNY »

moomoo11 wrote: post #138
TuringNYC wrote: post #28

Earlier quoted context omitted.

+10 on point 3. Even as a highly technical CTO, it is shocking what outsourced dev agencies will try to do. I've seen dev agencies try to conclude engagements with a "successfully working app" but havent delivered any source code, or when source code is delivered it cannot actually be compiled into the successfully working app. As a technical CTO I can smell this a mile away and work it into SoWs, but I wonder how ma…

It makes me shudder to think people actually hire dev agencies to build their early stage product. Having worked with some in the past in a different life I absolutely despised those people for being both terrible engineers and people (my experience working with big outsourcing companies). Why hire people who don’t care that much to build something the founders definitely care a lot about? Are there any examples of t…

One of the reasons that I am working on the project that I'm on now (for the last couple of years), is because a friend of mine had set up a 501(c)(3), and was looking to develop an app, out of his own pockets, and through solicited donations.

The main problem was, he didn't really know what he wanted (non-technical).

He asked me to sit in on a couple of his enquiries to developer agencies.

It was a shitshow.

I had respect for the one chap that basically said "Get back to me, when you know exactly what you want."

I had absolutely zero respect for the agency that said they would deliver a full MVP, in three months.

After that, I just said "Screw this. You'll just get ripped off. I was looking for something to work on, so it might as well be this."

It's been a long process, but we are now in the home stretch. I don't even want to think about how badly he would have been screwed, and I'm quite un-thrilled with the ethics of the folks that claimed they could deliver the app in three months (fairly large-scale backend, and high-quality frontends for mobile clients).

Re: I lost $209k of my own money trying to start a business

#143

Post by TuringNYC »

moomoo11 wrote: post #138
TuringNYC wrote: post #28

Earlier quoted context omitted.

+10 on point 3. Even as a highly technical CTO, it is shocking what outsourced dev agencies will try to do. I've seen dev agencies try to conclude engagements with a "successfully working app" but havent delivered any source code, or when source code is delivered it cannot actually be compiled into the successfully working app. As a technical CTO I can smell this a mile away and work it into SoWs, but I wonder how ma…

It makes me shudder to think people actually hire dev agencies to build their early stage product. Having worked with some in the past in a different life I absolutely despised those people for being both terrible engineers and people (my experience working with big outsourcing companies). Why hire people who don’t care that much to build something the founders definitely care a lot about? Are there any examples of t…

>> Why hire people who don’t care that much to build something the founders definitely care a lot about?

Because people dismiss engineers as low-value, until they painfully realize otherwise. It is the same reason Google/Facebook/Stripe did so well compared to other companies -- because Google/Facebook/Stripe realized the strategic value of engineers and compensated them well and aligned with long-term interests. Other companies cut Engineers and constantly squeezed them until they realized (too late) that they had no strategic power left. The stock market over the past two decades is a fantastic A/B test on people strategy and success.

To be realistic, there is one good reason to outsource dev -- it is to very quickly get a demo-able MVP so you can get funding. You have to recognize that the demo-able MVP is most likely throw-away and you have to be ready to re-build from scratch once you get funding for your own team.

Re: I lost $209k of my own money trying to start a business

#144

Post by gowld »

blagie wrote: post #9

I have a very high level of scepticism towards non-technical founders without deep pockets: 1. There's an agility to being able to change things yourself, at 2am if necessary. That's very important to startups. 2. There's a discipline to not accruing unreasonable technical debt of the type that will sink you two years in that you can't expect from someone who doesn't deeply care. 3. Managing devs generally requires u…

#2 is highly suspect. Technical people create all tech debt.

Re: I lost $209k of my own money trying to start a business

#145

Post by moomoo11 »

ChrisMarshallNY wrote: post #142
moomoo11 wrote: post #138

Earlier quoted context omitted.

It makes me shudder to think people actually hire dev agencies to build their early stage product. Having worked with some in the past in a different life I absolutely despised those people for being both terrible engineers and people (my experience working with big outsourcing companies). Why hire people who don’t care that much to build something the founders definitely care a lot about? Are there any examples of t…

One of the reasons that I am working on the project that I'm on now (for the last couple of years), is because a friend of mine had set up a 501(c)(3), and was looking to develop an app, out of his own pockets, and through solicited donations. The main problem was, he didn't really know what he wanted (non-technical). He asked me to sit in on a couple of his enquiries to developer agencies. It was a shitshow. I had r…

Nice good luck to u and ur friend

Re: I lost $209k of my own money trying to start a business

#146

Post by m-ee »

twelve40 wrote: post #27
andsoitis wrote: post #10

The first heading reads “marketplace for last-minute tours and activities”, followed by a paragraph that says “industry where 80% of bookings were still done using pen and paper, months ahead of time” How is something done both “months ahead of time” and “last-minute”?

i guess something like Airbnb Experiences?

Also viator and tripadvisor. I've made last minute bookings through all three. Market feels fairly crowded.

Re: I lost $209k of my own money trying to start a business

#147

Post by acdha »

twawaaay wrote: post #134
acdha wrote: post #92

Earlier quoted context omitted.

Someone needs to be technical or they’ll get hit by a number of problems which are almost always fatal: consulting companies (especially the large ones) will take them for a ride, burning budget and likely failing to deliver something viable; they are likely to make bad hires because it’s hard to tell people who can’t deliver or, more commonly, who aren’t capable of building what the business needs right now; and the…

Which is to say there are upsides to being expert in the field. The question is whether every company requires technical people to run the company just because they need an app to sell their services. One theory is that in future every company will be a technical company -- because merciless competition will favour companies driven by technical, scientific mindset. But I don't think we are there yet.

I think this really comes back to the question of how custom your technology needs are. My local coffee shop has a website and apps but the owner doesn't need to be a programmer because they have the _exact_ same needs as everyone else, and something like ToastTab can be licensed and used without modification. The same is true of a lot of online stores where their business is conceptually very similar to many others.

If your business is less like that, however, I do think it's critical to find someone you have a high degree of trust will make reasonable calls. Once you start needing things like custom development you're saying that technology is core to your business. That doesn't mean the CEO needs to be a techie any more than the CEO of a restaurant chain needs to be a chef but they definitely need someone whose judgement the CEO respects.

Re: I lost $209k of my own money trying to start a business

#148

Post by georgeecollins »

blagie wrote: post #9

I have a very high level of scepticism towards non-technical founders without deep pockets: 1. There's an agility to being able to change things yourself, at 2am if necessary. That's very important to startups. 2. There's a discipline to not accruing unreasonable technical debt of the type that will sink you two years in that you can't expect from someone who doesn't deeply care. 3. Managing devs generally requires u…

>> high level of skepticism towards non-technical founders

For web app / software businesses for sure. It's worth noting that most entrepreneurs don't sell software. I'm talking by # of businesses, not market cap.

Re: I lost $209k of my own money trying to start a business

#149

Post by swamp40 »

danielvaughn wrote: post #21
bluedino wrote: post #14

> I'll never depend on a 3rd party dev as the main means of production again. He spent over half of his money on it as well. I've had more than one person come to me with their business idea, and they have a terrible website (or app) that they have spent 100, 200, or even 300k on. And it doesn't even work. If you aren't staring out WITH customers, you either have to code it your damn self, or have a technical co-foun…

Seriously, sign me up for that contract. Give me 100k-300k for a single website? That website is gonna be a thing of beauty.

It probably looks like this:

Use real-time APIs to find the best price from: Travelocity, Hotels.com, Expedia One, Scott’s Cheap Flights, Priceline, Hotwire, Google Flights, Hertz, Kayak.

Sync up flights with hotels and rental cars.

Add 15% to everything, book and resell automatically, making it look like it all came from your app.

That 300K is all gone into the backend in a flash.

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