Tell HN: My startup is making money and I don't know what to do • Hacker News Board

Re: Tell HN: My startup is making money and I don't know what to do

#111

Post by ghiculescu » Sat, Jun 28, 2014, 12:41 AM UTC

swalkergibson wrote: post #110

ghiculescu wrote: post #109

Earlier quoted context omitted.

Why on earth would you say that? They're just about the cheapest form of loan you can get, and are perfect for OP's needs.

> They're just about the cheapest form of loan you can get In what sense? Unsecured credit has the absolute highest interest rates, especially for college students. They are no doubt the most convenient, but cheapest is a bit of a stretch.

Compared to paths 2 and 3 (incubator or seed round).

I'd say that at this stage of the game, paying some interest is probably much cheaper than giving up a stake of the business. Not least because paying interest is really annoying and will teach you to make better decisions for cash flow, which will better equip you as the business grows and you do consider paths 2 or 3.

Disclaimer: I'm im Australia, it does seem like credit cards don't hate students as much here. We were all approved for decent credit while studying and it's the main reason our startup is going strong on path 1.

Re: Tell HN: My startup is making money and I don't know what to do

#112

Post by swalkergibson » Sat, Jun 28, 2014, 12:51 AM UTC

ghiculescu wrote: post #111

swalkergibson wrote: post #110

Earlier quoted context omitted.

> They're just about the cheapest form of loan you can get In what sense? Unsecured credit has the absolute highest interest rates, especially for college students. They are no doubt the most convenient, but cheapest is a bit of a stretch.

Compared to paths 2 and 3 (incubator or seed round). I'd say that at this stage of the game, paying some interest is probably much cheaper than giving up a stake of the business. Not least because paying interest is really annoying and will teach you to make better decisions for cash flow, which will better equip you as the business grows and you do consider paths 2 or 3. Disclaimer: I'm im Australia, it does seem li…

This is assuming that someone will buy their stake in the business. It seems to me that there are some holes in the business model, and the traction might be overblown. For instance, the website suggests that the most expensive advertising package is $1,200/year and there are about 75 properties listed on the site. While it is a gorgeous product, it seems to me that they are going to have trouble raising funding in such a competitive industry without much higher numbers.

Re: Tell HN: My startup is making money and I don't know what to do

#113

Post by peterlada » Sat, Jun 28, 2014, 1:04 AM UTC

Incubators are a good idea at this stage. They will groom you, get your ownership in order, teach you not to say stupid stuff and curate the VC space for you. You will raise if growth keeps up. YC, 500, TS on west coast or TC, DreamIt, ERA on the east. Go for it.

Re: Tell HN: My startup is making money and I don't know what to do

#114

Post by sthielen » Sat, Jun 28, 2014, 1:25 AM UTC

swalkergibson wrote: post #108

sthielen wrote: post #100

Earlier quoted context omitted.

Hi Patrick, Thanks for the advice! I'm an avid reader of your blog, so it's cool to get feedback from someone I admire in this industry. A lot of the comments here are bringing up the question of if and _why_ we need to raise funding, which has been something we've asked ourselves (and are asking ourselves even more in light of these comments). Essentially it's a combination of necessity and validation. We're college…

> And a lot of people are critiquing our business plan/strategies--which I am grateful for and do actually appreciate--but I didn't really intend for this to be an elaboration of our business and I didn't really write my OP in order to explain how everything works and what all our financials/projections are, rather I wanted advice about moving forward from here. In order to properly provide advice about the next step…

Yeah, I understand what you mean and I tried carefully to phrase that in a way that avoided sounding dismissive of what has been good and insightful critique--we've all been reading everything posting on here and following up with a lot of commenters off-site, which has been really cool and helpful.

Re: Tell HN: My startup is making money and I don't know what to do

#115

Post by Firegarden » Sat, Jun 28, 2014, 1:26 AM UTC

sthielen wrote: post #100

patio11 wrote: post #67

Choose your own adventure: 1) You currently have approximately $500 to $2k in revenue. That's great, because it is $500 to $2k in revenue more than the vast majority of people will ever achieve. You need to work the numbers on whether the founding team can solo-close $100k in revenue in the next twelve months. If that appears achievable, you tighten your belts, perhaps run up larger balances on your credit cards than…

Hi Patrick, Thanks for the advice! I'm an avid reader of your blog, so it's cool to get feedback from someone I admire in this industry. A lot of the comments here are bringing up the question of if and _why_ we need to raise funding, which has been something we've asked ourselves (and are asking ourselves even more in light of these comments). Essentially it's a combination of necessity and validation. We're college…

If you guys are actually paying to learn from a college that is the first thing to change. A business owner used to say to me "Kid you have to take the bull by the horns" and I never really got that until later in life. It's true man. I a self taught programmer and I had the option of going to school or working at a start up. Aside from the personal pleasure of school - it just fucks you up. For real. 1)Quit wasting your time in college. 2) Quit waiting for somebody to walk up to you and write you a check and say I believe in you - it's an illusionary permission slip. 3) Work on this more.

Think about it - whats the worst that can happen you have to go back to school? You can't get a job? Bullshit this is your resume and your education - trust yourself and go for it.

Re: Tell HN: My startup is making money and I don't know what to do

#116

Post by ghiculescu » Sat, Jun 28, 2014, 1:37 AM UTC

swalkergibson wrote: post #112

ghiculescu wrote: post #111

Earlier quoted context omitted.

Compared to paths 2 and 3 (incubator or seed round). I'd say that at this stage of the game, paying some interest is probably much cheaper than giving up a stake of the business. Not least because paying interest is really annoying and will teach you to make better decisions for cash flow, which will better equip you as the business grows and you do consider paths 2 or 3. Disclaimer: I'm im Australia, it does seem li…

This is assuming that someone will buy their stake in the business. It seems to me that there are some holes in the business model, and the traction might be overblown. For instance, the website suggests that the most expensive advertising package is $1,200/year and there are about 75 properties listed on the site. While it is a gorgeous product, it seems to me that they are going to have trouble raising funding in s…

Yep. Agreed on that. Without a decent model, no amount of credit (however well managed) will do the job.

Re: Tell HN: My startup is making money and I don't know what to do

#117

Post by sthielen » Sat, Jun 28, 2014, 1:44 AM UTC

swalkergibson wrote: post #112

ghiculescu wrote: post #111

Earlier quoted context omitted.

Compared to paths 2 and 3 (incubator or seed round). I'd say that at this stage of the game, paying some interest is probably much cheaper than giving up a stake of the business. Not least because paying interest is really annoying and will teach you to make better decisions for cash flow, which will better equip you as the business grows and you do consider paths 2 or 3. Disclaimer: I'm im Australia, it does seem li…

This is assuming that someone will buy their stake in the business. It seems to me that there are some holes in the business model, and the traction might be overblown. For instance, the website suggests that the most expensive advertising package is $1,200/year and there are about 75 properties listed on the site. While it is a gorgeous product, it seems to me that they are going to have trouble raising funding in s…

The rental housing market moves incredibly fast, and properties go on and off the market daily. The most desirable houses we list sometimes only stay on the site for a few days before they go off-market, and some of the less desirable ones will stay on for weeks. Of course, this is not a metric we can, in any way, attribute to our success--most of these properties are posted all around the web and there's no way for us to know if it was rented by someone using our service--however we've had local property management firms reach out and tell us they've had a lot of good leads come from our service.

Our database is the sum of all properties currently on the market that are willing to rent to college students, and that number is small. It is a very competitive, fast-paced market, and that's the reason there is a problem in this space in the first place.

From our experience cold-calling properties, 3 out of 5 rental properties are completely unwilling to rent to college students. Many will just hang up the phone. From the already small number of desirable (i.e. close to campus, not absurdly expensive, etc.) rental properties on the market at any given time, only about 40% are willing to rent to students. But we add new properties to the site daily, so our inventory is constantly cycling.

With regard to our pricing, it's something we came up with last week, and we fully expect it to be increased if our current successes in sales justify it. We have additional monetization strategies in development as well--a $1000 ad is not the be-all end-all of our revenue stream. But hell, at this point we're just excited that someone is willing to pay for this thing we've invested our lives into over the past few months.

Re: Tell HN: My startup is making money and I don't know what to do

#118

Post by [deleted] » Sat, Jun 28, 2014, 1:44 AM UTC

swalkergibson wrote: post #112

ghiculescu wrote: post #111

Earlier quoted context omitted.

Compared to paths 2 and 3 (incubator or seed round). I'd say that at this stage of the game, paying some interest is probably much cheaper than giving up a stake of the business. Not least because paying interest is really annoying and will teach you to make better decisions for cash flow, which will better equip you as the business grows and you do consider paths 2 or 3. Disclaimer: I'm im Australia, it does seem li…

This is assuming that someone will buy their stake in the business. It seems to me that there are some holes in the business model, and the traction might be overblown. For instance, the website suggests that the most expensive advertising package is $1,200/year and there are about 75 properties listed on the site. While it is a gorgeous product, it seems to me that they are going to have trouble raising funding in s…

[deleted]

Re: Tell HN: My startup is making money and I don't know what to do

#119

Post by ericd » Sat, Jun 28, 2014, 2:00 AM UTC

Firegarden wrote: post #115

sthielen wrote: post #100

Earlier quoted context omitted.

Hi Patrick, Thanks for the advice! I'm an avid reader of your blog, so it's cool to get feedback from someone I admire in this industry. A lot of the comments here are bringing up the question of if and _why_ we need to raise funding, which has been something we've asked ourselves (and are asking ourselves even more in light of these comments). Essentially it's a combination of necessity and validation. We're college…

If you guys are actually paying to learn from a college that is the first thing to change. A business owner used to say to me "Kid you have to take the bull by the horns" and I never really got that until later in life. It's true man. I a self taught programmer and I had the option of going to school or working at a start up. Aside from the personal pleasure of school - it just fucks you up. For real. 1)Quit wasting…

As a counterpoint, I really think my formal education was valuable for me, and I'm glad I didn't quit to go work on something for one or two extra years. Also, whether or not it's justified, my impression is that there is some stigma about not having graduated from college among many hiring managers.

Basically, don't drop out of college just because someone on the internet tells you to, think it through.

If you get into YC and it looks possible to raise a big round, then it might be time to start thinking about dropping out more seriously.

Re: Tell HN: My startup is making money and I don't know what to do

#120

Post by randomthoughts » Sat, Jun 28, 2014, 2:12 AM UTC

I really like the interface. I think if you have enough properties listed you can't fail. If it was me doing this the next step would be employing local people responsible for taking care of schools in their region. The only expense here could be legal fees for drafting a contract template making sure those people are self employed "suppliers" paid a percentage of profit their activity generates. This way you wouldn't need to worry about all other costs associated with employing people.

Also, why not talk to few large property listing websites like (UK examples)rightmove.co.uk or zoopla.co.uk to partner with them? Those guys get fees when properties they list are filled. It is in their interest for them to be advertised as widely as possible.

Or alternatively create another type of a user. An estate agency. You could have hundreds of estate agents sign up and list properties on your website paying extra to make them come up first etc.