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We're Shutting Down and I'm Scared

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Re: We're Shutting Down and I'm Scared

#51

Post by panther2k »

I'm there right now (minus the high-profile accelerator and funded part so I had even less success). It sucks. I'm exhausted. But I'm broke so I need a job. I can hack stuff together but I'm more of a junior level dev so not sure how attractive I am to a Silicon Valley startup.

I thought I knew what it took to be successful, so I quit my wall street job and drove out to San Francisco to JFDI. I even lived in my car for nine months to save money. It would be worth it once the business took off. It never did. So I started another one, which failed too. When you work non-stop, every waking hour for almost two years and fail at everything, you realize you don't have it all figured out. At all.

The scary part of failing is asking yourself, what the heck do I do now? And you don't know the answer.

Probably should have made this a throwaway. Oh well.

Re: We're Shutting Down and I'm Scared

#52

Post by laureny »

> But, I can’t imagine working for somebody else. I wish my wife understood that.

She's understood it long enough to let you pursue the dream of your life at great costs for her, maybe now it's time for you to do some sacrifice for her and go work for someone?

You're not the first one to have to do that and, you know, survive.

Seriously.

Re: We're Shutting Down and I'm Scared

#54

Post by poulsbohemian »

JoshTriplett wrote: post #31
tptacek wrote: post #27

Earlier quoted context omitted.

S Corps are limited liability corporations. Lots of LLCs turn themselves into S Corps, because (a) there's an old sketchy tax dodge about self-employment/FICA tax you can do as an S, and (b) it's easier to grant employees equity in an S than an LLC. (You're not an idiot.)

> Lots of LLCs turn themselves into S Corps, because (a) there's an old sketchy tax dodge about self-employment/FICA tax you can do as an S Interesting. Got a pointer to details on that?

Josh - I see you are based in Portland (hello "neighbor!" - I'm about a 4 hour drive east from you). You'd probably be just as well off moving over the river to shed the Oregon state income tax (sorry Oregon, I love you but...). Setting up an LLC in either Oregon or Washington is trivial. Setting up an S or C corp in Washington (I've never done it in OR) is also really easy, but does involve more paperwork. Especially in the early days of a business, there are so many advantages to setting up an LLC that I'd be surprised if an accountant advised otherwise. Have a deep-pocketed investor ready to go? That's the only case where I can imagine that setting up a C corp from the beginning makes sense.

Re: We're Shutting Down and I'm Scared

#55

Post by godgod »

The world needs ditch diggers too. You took a risk, lost. Pick yourself back up, be a man, and get a real job. You have a wife who is counting on you regardless of the fact that you don't want to work for someone. Suck it up or check out. What other options do you have in life?

Re: We're Shutting Down and I'm Scared

#56

Post by danthewireman »

A big first professional failure is like breaking up with your first girl/boyfriend - it feels like the entire world is ending. After you find out that it didn't, it can be wildly liberating because you won't really be scared of failure any more. I recommend a few massive fuckups in any career.

Re: We're Shutting Down and I'm Scared

#57

Post by godgod »

Is this what HN has become? People posting stories for a pity party. No one cares how scared you are. We all have real world problems too. You didn't have a backup plan which is your fault. Go apply at 7-11 and quit being such a nancy. Real men don't complain like this.

Re: We're Shutting Down and I'm Scared

#58

Post by tunesmith »

JoshTriplett wrote: post #31
tptacek wrote: post #27

Earlier quoted context omitted.

S Corps are limited liability corporations. Lots of LLCs turn themselves into S Corps, because (a) there's an old sketchy tax dodge about self-employment/FICA tax you can do as an S, and (b) it's easier to grant employees equity in an S than an LLC. (You're not an idiot.)

> Lots of LLCs turn themselves into S Corps, because (a) there's an old sketchy tax dodge about self-employment/FICA tax you can do as an S Interesting. Got a pointer to details on that?

It's not as sketchy as it used to be, due to some rules changes in the last few years.

As a one-person S-Corp, you run payroll and you are your own employee. You can set your salary, and you can also pay yourself in distributions. Salary is subject to FICA, distributions are not. Both are subject to income tax.

When you pay yourself salary, your "personal" side pays its half of the FICA, and your "business" side pays the other. This is the same way a regular employer/employee relationship works (and why it "feels" like you are paying double FICA when you're self-employed; it's because you are both the employee and the employer).

It used to be that you could severely limit your salary, and pay yourself the bulk of your income through distributions, and lower your tax bill by having lower FICA costs.

These days, it is your responsibility to pay yourself a "reasonable salary", as in something you could reasonably defend during an audit. Once you have paid yourself a reasonable salary (which is subject to FICA), you can give yourself more money (revenue permitting :) ) in distributions.

Also, if your self-employment is part-time, you can pro-rate your salary to reflect that part-time employment.

It's also worth noting that as your business gets successful and long-term, you may want to increase your salary and pay into FICA so you can get a better social security payment when you retire. But still, if you analyze it in a spreadsheet, you'll see that social security, as an annuity, is a "bad deal" when you're paying both sides. (It's a very good deal as a W-2 employee with someone else paying the employer half, though.)

Re: We're Shutting Down and I'm Scared

#59

Post by theli0nheart »

tptacek wrote: post #27
ye wrote: post #26

Earlier quoted context omitted.

[deleted, i'm an idiot]

S Corps are limited liability corporations. Lots of LLCs turn themselves into S Corps, because (a) there's an old sketchy tax dodge about self-employment/FICA tax you can do as an S, and (b) it's easier to grant employees equity in an S than an LLC. (You're not an idiot.)

S Corps aren't necessarily LLCs. A C Corp can elect to be taxed as an S Corp as well.

Re: We're Shutting Down and I'm Scared

#60

Post by opendomain »

tptacek wrote: post #18

Been there. * If your payables and debts are all in the company's name, nobody is coming for your house. The likelihood that your business was going to die before you could pay all your debts was priced into your contracts. If you have employees, pay them and get them off your books first; employee wages are, depending on the state you're in, the one likely exception to that rule. * If they were in your name, well, t…

THANK YOU! I came in here to write something similar, but you said it much clearer. I was lucky - when my first Startup Free.TV died, the company did not go bankrupt, but it did kill my credit. I was also worried about what I would tell my wife - the great news is is was VERY hard, but she stood by me and we are still married ten years later. I have eventually gotten the courage to start another startup, but now is that I now know how the system works and will not sell equity for peanuts anymore. This does hold me back - I would not say I am scared, just more careful. There IS life afterwards. If you want to talk, email me HACKER at Free dot TV
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