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From idea to replacing full-time salary in 4 months

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Re: From idea to replacing full-time salary in 4 months

#131

Post by gnaritas »

Androsynth wrote: post #118
ricardobeat wrote: post #7

It's a nice personal achievement, but I can't help myself cringing at business models of this kind. It's plain old extraction of surplus-value, adding very little to the economy as a whole. The workers would be better off operating as a cooperative, I wish they had the education to know that from the outset, and the means to implement it.

It's plain old extraction of surplus-value, adding very little to the economy as a whole. This guy took the risk of starting his own company and has literally created 8 jobs that did not previously exist in our economy. The 8 people that work for him are better off than they were before (otherwise they wouldn't be working for him). However it sounds like the IRS will eventually come in and destroy those 8 jobs, all i…

> and has literally created 8 jobs that did not previously exist in our economy.

No he didn't, he's hired maids who would otherwise be maids for someone else.

> The 8 people that work for him are better off than they were before

Because he's not doing his taxes right and paying them more, he'll get caught and eventually have to pay them less.

> However it sounds like the IRS will eventually come in and destroy those 8 jobs, all in the name of 'protecting the workers'.

As they should. What's he's doing is unfair to other maids who work for legit companies and are paying taxes correctly. It's also unfair to his competition who plays by the rules he's ignoring. 1099'ing them is cheating, they are employees.

Re: From idea to replacing full-time salary in 4 months

#132

Post by sparknlaunch12 »

This is a really impressive story. Sure there are some obstacles and challenges - but this is the fun of very real life business.

The guy has taken a traditional business and applied all the buzz of the web (social media, lean, etc etc) to establish a profitable business in 4 months.

I would love to hear from others willing to share similar experiences of turning an idea into one business (cleaning), then repeating the process again (lawn services).

This kind of sharing is what makes these communities priceless.

Re: From idea to replacing full-time salary in 4 months

#133

Post by Androsynth »

gnaritas wrote: post #131
Androsynth wrote: post #118

Earlier quoted context omitted.

It's plain old extraction of surplus-value, adding very little to the economy as a whole. This guy took the risk of starting his own company and has literally created 8 jobs that did not previously exist in our economy. The 8 people that work for him are better off than they were before (otherwise they wouldn't be working for him). However it sounds like the IRS will eventually come in and destroy those 8 jobs, all i…

> and has literally created 8 jobs that did not previously exist in our economy. No he didn't, he's hired maids who would otherwise be maids for someone else. > The 8 people that work for him are better off than they were before Because he's not doing his taxes right and paying them more, he'll get caught and eventually have to pay them less. > However it sounds like the IRS will eventually come in and destroy those…

No he didn't, he's hired maids who would otherwise be maids for someone else.

But now the company they came from has to hire 8 new maids. If his business model is superior, he may eventually drive the old company out of business and employ at least as many maids as they did. Even if he only employed the same amount as the old company, he is providing more value to his customers, either through increased efficiency or lower costs. So even in the case of there being no new jobs created, creative destruction has again moved our economy forward.

Judging by how fast his first maid came to his company, I doubt he pays them less (I didn't see him mention this).

Re: From idea to replacing full-time salary in 4 months

#134

Post by paulhauggis »

ricardobeat wrote: post #24
toyg wrote: post #21

Earlier quoted context omitted.

He's not playing golf all day: he did design and commission the scheduling system he now operates, and provides ongoing advertisement and management. From what he says, it looks like he gets $40 to $60 per job, whereas cleaners get $15 to $30 per job -- they work in team, so it's $30 to $60 in total (it's all pre-tax, from what I understand). Not a terrible arrangement, to be honest, especially in the Land Of The Fre…

I know, and I don't mean to put down his effort (as I said below, there is some value added). But they are just being exploited by a smaller company - it's the same. edit: what is with downvotes lately? This is not a contest, feel free to join the discussion.

By this logic, all employers are exploiting their workers. Most employers make much more money on the work that their employees are completing.

However, they are going to this company by choice. They can choose to leave. They also agree to the wage. In addition to all of this, it's not easy being an independent worker. If anything, the small company is preventing them from getting exploited (they don't have to worry about chasing down a paycheck from each individual client, marketing, etc).

Finding clients is just as time consuming as the actual work itself. I know, I've done it myself as a freelancer.

Re: From idea to replacing full-time salary in 4 months

#135

Post by paulhauggis »

ricardobeat wrote: post #83
courtewing wrote: post #69

Earlier quoted context omitted.

This is a sentiment that I see frequently on HN, and I'm not exactly sure why. I was a "questionably" contracted employee for awhile, and I never once felt exploited by the company, and I'm confident that they never felt that they were exploiting me. Sure, being contractors might not be ideal for them at the moment, but they are the first 8 employees at the company. There are additional benefits to being in that situ…

I think you fell on the wrong comment tree. The "exploitation" in discussion has nothing to do with the employment laws discussed above.

right. You're one of those left-wing, the government should force "equality" people.

Re: From idea to replacing full-time salary in 4 months

#136

Post by paulhauggis »

mseebach wrote: post #54
ricardobeat wrote: post #50

Earlier quoted context omitted.

The main difference between a standard business and a cooperative would be the sharing of profits - there's still the need for management/marketing/etc, which can either be done by one of the cooperatives or subcontracted, it doesn't disappear. That the maids don't have the skill set or the means to acquire it is exactly what I commented on originally. That is the gap. The extraction of surplus-value comes from havin…

Yes, I understand the principle. But deciding to form a coop, hiring a manager/marketer and being a partner in a company are all skills, and while valuable, they're just just as arbitrary to decide to teach in schools as knowing how to build a vacuum cleaner. Also, where is the evidence of exploitation? Does this guy make more money than he would if there was profit-sharing? Paying a salary is profit sharing.

His point is that the owner shouldn't be getting any more than the workers. IE, they are all "equal".

This sounds strangely familiar...

Re: From idea to replacing full-time salary in 4 months

#137

Post by frogpelt »

edw519 wrote: post #53

This time next year on reddit: "From working my ass off 90 hours per week running a business that wouldn't scale to nice salary/benefits for 40 hours. I'm taking home the same net and I feel like I'm on vacation." I don't want to sound too snarky and I really admire OP's initiative and ability to make things happen, but this just doesn't smell right. It's easy to get excited by nice revenue in the beginning (as he sh…

I hate to rain on your cold shower but...

- doesn't scale well

Who said he wanted it to "scale"? If he has already replaced his income he may not need much "scaling". Nice buzzword though.

- is the first thing customers eliminate when times get tough

Times are tough now and he is growing his business (or "scaling" if you prefer buzzwords).

I'm interested to know what kind of business you're running and how well it is performing.

Re: From idea to replacing full-time salary in 4 months

#138

Post by gnaritas »

Androsynth wrote: post #133
gnaritas wrote: post #131

Earlier quoted context omitted.

> and has literally created 8 jobs that did not previously exist in our economy. No he didn't, he's hired maids who would otherwise be maids for someone else. > The 8 people that work for him are better off than they were before Because he's not doing his taxes right and paying them more, he'll get caught and eventually have to pay them less. > However it sounds like the IRS will eventually come in and destroy those…

No he didn't, he's hired maids who would otherwise be maids for someone else. But now the company they came from has to hire 8 new maids. If his business model is superior, he may eventually drive the old company out of business and employ at least as many maids as they did. Even if he only employed the same amount as the old company, he is providing more value to his customers, either through increased efficiency or…

Of course he doesn't pay them less, he's cheating on taxes to pay them more by 1099'ing them wrongly, they are employees and he'll have to pay them less once he starts doing it right thus losing his current advantage in the market.

Re: From idea to replacing full-time salary in 4 months

#139

Post by localcasestudy »

Hi folks, OP from the reddit thread here. I'll answer questions. disclaimer: This is my first time posting here.

Disclaimer #2: I'm no expert.

Disclaimer #3: See Disclaimer #2 again. I just tried something and it took off. Will it work long term I have no idea. Where I am now is just the reality of where I am now. Have I made mistakes, you bet your life on that! Okay, I'll scroll through and try to respond to anything I can.

Re: From idea to replacing full-time salary in 4 months

#140

Post by localcasestudy »

edw519 wrote: post #53

This time next year on reddit: "From working my ass off 90 hours per week running a business that wouldn't scale to nice salary/benefits for 40 hours. I'm taking home the same net and I feel like I'm on vacation." I don't want to sound too snarky and I really admire OP's initiative and ability to make things happen, but this just doesn't smell right. It's easy to get excited by nice revenue in the beginning (as he sh…

you could be right my man. I'm not looking at this through rose colored glasses at all. I'm a realistic ^ 2. Thanks.
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