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Stop Looking for a Cofounder

dontscale.com

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Re: Stop Looking for a Cofounder

#111

Post by [deleted] »

danieltillett wrote: post #102
beambot wrote: post #100

Earlier quoted context omitted.

$5M gross is kinda low for 50(ish) employees. That works out to $100k apiece fully-loaded (healthcare, taxes, etc). He would need to be paying them each substantially less than $60k a year.... and that's ignoring all his other costs: materials (it's a physical good), inventory, taxes (property, sales, income), and service fees (attorney, accountant, etc). Only then do you get to his net income. It's likely not very g…

People on wages near or just above minimum wage don’t make anywhere near $100,000 a year. There is a reason that manufacturing jobs are coming back from China.

[deleted]

Re: Stop Looking for a Cofounder

#112

Post by PopeOfNope »

beambot wrote: post #100
PopeOfNope wrote: post #93

Earlier quoted context omitted.

tl;dr: owning a business does funny things to people. Make sure you're one of the ones who can handle it in a healthy manner. Reality is having a couple million a year business can really lead to a fantastic lifestyle if done properly. Emphasis on the "if done properly." I know a man who own his own american manufacturing company (yes, they still exist). They specialize in electric motors. They do good business despi…

$5M gross is kinda low for 50(ish) employees. That works out to $100k apiece fully-loaded (healthcare, taxes, etc). He would need to be paying them each substantially less than $60k a year.... and that's ignoring all his other costs: materials (it's a physical good), inventory, taxes (property, sales, income), and service fees (attorney, accountant, etc). Only then do you get to his net income. It's likely not very g…

I said less than 50 employees. This is also in a place where cost of living is low and employee turnover is high. To say they make substantially less than $60k a year is accurate, but they still make enough to live on (unlike double that amount in SF). You're also assuming all 50 of those employees are salaried and/or full time. Not all of them are.

He's making a healthy profit. That has nothing to do with the stress. Some people just don't deal well with the risk and unknowns that come with owning a business. These are only two of many stories I know of people doing very odd things under the stress of business ownership. I'm sure people here can provide more.

Re: Stop Looking for a Cofounder

#113

Post by hughguiney »

dontscale wrote: post #84
hughguiney wrote: post #76

As someone who has been stressing over “needing a cofounder” lately, this is an encouraging and timely post. However, I dislike the phrasing here: > a 100% owner requires half the earning power of 50/50 partners–that gives him a huge advantage. …which assumes the founder is going to be a man.

Thank you Hugh. I thought about pronoun choice when I wrote that. I was deliberating between 'her' or 'him or her'. The problem I had with the former is I always notice when male writers do it--I can tell it's deliberate. The problem with the latter is it breaks rhythm a little, I think. In my mind, the sexes are equal so him == her. It's something I feel strongly about too especially having a daughter. But nonethele…

While I appreciate your viewpoint, it is not obvious to the reader. I think it is more important to not alienate women any more than already happens in this industry, than it is to form a sentence that has a certain rhythm. I would also examine why male pronouns “sound right” while non-male ones “don’t”.

And I agree with @sidawson that gender-neutral pronouns maintain the same rhythm besides.

Edit: And thank you for the upvote. I am glad that you are open to constructive criticism even if the crabby status-quo-loving anonymous users aren’t.

Re: Stop Looking for a Cofounder

#114

Post by nulltype »

timr wrote: post #110
brightball wrote: post #41

He's not wrong, but a lot of what he says is very dependent on self-discipline. Having a partner, in addition to all of the other perks, also gives you a point of accountability the forces prioritization and a real plan. It is entirely possible to start a business by yourself. People do it successfully every single day but there are a whole lot of complicated factors from financial, legal, technical and psychological…

The thing is, a co-founder won't save you if you don't have self-discipline. It's probably one of the top sources of co-founder conflict, actually: one founder slacks off or loses focus, and the other(s) get upset, and the whole thing falls apart. Self-discipline is a highly underrated quality. In my experience, most people can't work productively for an extended period of time on an open-ended project.

I think it's super important, but maybe should be considered a skill rather than a quality. It's definitely something that people don't get much practice on in school or most jobs. If you get some practice, you can improve self-discipline dramatically.

Re: Stop Looking for a Cofounder

#116

Post by CPLX »

beambot wrote: post #104
danieltillett wrote: post #102

Earlier quoted context omitted.

People on wages near or just above minimum wage don’t make anywhere near $100,000 a year. There is a reason that manufacturing jobs are coming back from China.

$10/hr workers cost ~$30k fully-loaded per year. That's $1.5M for 50 employees. If we assume 30% margins, then materials costs are $3.3M and "profit" is $1.6M. Subtract off employee salaries, and he's netting $100k/hr. And that's not even accounting for taxes or other fixed costs (eg. realestate). Given the strong competition in the electric motor market... he's living on a razor's edge. If he can eek out higher marg…

Making a million dollars a year on average is, in fact, great, by nearly any non-delusional standard.

Re: Stop Looking for a Cofounder

#117

Post by adventured »

larrys wrote: post #98
xiaoma wrote: post #94

Earlier quoted context omitted.

And it's not like being bootstrapped ensures a business won't be a home run. Microsoft, Oracle, Ebay and Github were all bootstrapped.

Microsoft may have been bootstrapped (I will go with what you are saying without verifying) however it also had the backing and full faith and credit of a somewhat wealthy and connected family.

Microsoft did not have the "full faith and credit" of the Gates family. His family figured it would burn out and he'd return to college, per what Bill has said on the matter. They were less than thrilled with him dropping out. He received $0 funding or help from them in regards to Microsoft getting started.

It was a million dollar business, completely independent of the Gates family or its connections, while it was operating in New Mexico. Bill and Paul had sales almost from day one.

Re: Stop Looking for a Cofounder

#118

Post by adventured »

danieltillett wrote: post #90

I am going on a rant, but can we stop using the term lifestyle business for non-VC startups? Almost anything would be better - I came up with the term founder focused as an alternative [1], but almost anything would be better than the term lifestyle. A serious business is a serious business no matter the funding source. 1. http://www.tillett.info/2014/11/24/lets-kill-the-term-lifest...

There has been a term for this type of business for a very, very long time.

A small business.

It's also nearly universally understood in regards to what it means. A layperson will get it immediately.

Re: Stop Looking for a Cofounder

#119

Post by vezzy-fnord »

adventured wrote: post #117
larrys wrote: post #98

Earlier quoted context omitted.

Microsoft may have been bootstrapped (I will go with what you are saying without verifying) however it also had the backing and full faith and credit of a somewhat wealthy and connected family.

Microsoft did not have the "full faith and credit" of the Gates family. His family figured it would burn out and he'd return to college, per what Bill has said on the matter. They were less than thrilled with him dropping out. He received $0 funding or help from them in regards to Microsoft getting started. It was a million dollar business, completely independent of the Gates family or its connections, while it was o…

I think this was in reference to Mary Maxwell Gates, who ended up bringing (if not directly) the then nascent Micro-soft to IBM's attention.

Re: Stop Looking for a Cofounder

#120

Post by danieltillett »

adventured wrote: post #118
danieltillett wrote: post #90

I am going on a rant, but can we stop using the term lifestyle business for non-VC startups? Almost anything would be better - I came up with the term founder focused as an alternative [1], but almost anything would be better than the term lifestyle. A serious business is a serious business no matter the funding source. 1. http://www.tillett.info/2014/11/24/lets-kill-the-term-lifest...

There has been a term for this type of business for a very, very long time. A small business. It's also nearly universally understood in regards to what it means. A layperson will get it immediately.

Small businesses are not the same as what is called a lifestyle business. What we don’t have a good term for technology businesses that aim to be large businesses, but don’t want or need VC money. The closest we have is bootstrapped businesses, but this has a connotation of very early stage start-ups.
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