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A startup doesn't need to be a unicorn

mattgiustwilliamson.substack.com

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Re: A startup doesn't need to be a unicorn

#91

Post by x2rj »

zwnow wrote: post #78
summarity wrote: post #34

Earlier quoted context omitted.

No that's for a full GmbH. You can start with an "UG", which realistically needs maybe 1500 EUR to get registered and up and running. Then, a certain percentage of the profit is contributed towards the 25k (of which in turn only 12.5k have to be deposited in cash) each financial year. If the threshold is met, you can convert from UG to GmbH.

Always go for GmbH. UG will make you account for everything with your private money. If something goes wrong in your business you'll be dirt poor.

You are confusing UG with something like GbR. UG is basically a baby GmbH with constraints of the name of the company and how much money the associates can extract from it (until the company got 25k€ captial and can become a normal GmbH).

Re: A startup doesn't need to be a unicorn

#92

Post by nottorp »

Propelloni wrote: post #72
tiluha wrote: post #37

Earlier quoted context omitted.

You need 25k€ to register a GmbH, but you can nowadays register a UG which only requires 1€ and can later be converted to a GmbH

First, it is sufficient to only pay 50 % of the stock capital at registration of the GMbH, ie. 12500 EUR. Obviously you also have less operating capital then. Second, the money is not gone. It is right there in the company's account. You use it to pay company bills. The only thing annoying about German GmbH is that it can take 6-8 weeks until you get your tax id and registration numbers. You can, of course, already d…

> Second, the money is not gone. It is right there in the company's account. You use it to pay company bills.

That's fine if you start a restaurant or small workshop and need money for salaries, materials etc, of course.

It's a barrier to entry when you can start something digital only with just a person or three putting in sweat equity and zero to very little actual cash.

Re: A startup doesn't need to be a unicorn

#93

Post by aleph_minus_one »

cardanome wrote: post #75
fastball wrote: post #19

Earlier quoted context omitted.

And yet Germany still doesn't seem to have much more startup / entrepreneurial success than any other European country. What gives?

Bureaucracy is crazy in Germany. Forget about doing anything online, paper and in person only. Founding any form of limited company is expensive and complicated. Want to put a website online? Have fun putting your full name and address in the imprint. Want to offer some courses that teach X? Yeah, no, you need a license for that, mate! Also being self-employed you lose most social benefits. You need to get private he…

While I completely agree with many of the points that you made, I disagree with some:

> Bureaucracy is crazy in Germany. Forget about doing anything online, paper and in person only.

The latter point has nothing to do with bureaucracy.

> Germany is also one of the least friendly countries for expats. And I say that as a native Germain. Officials will refuse to speak English to you. Yes, refuse.

For example in the USA, they will refuse to speak German with you. So what?

In my opinion there actually exist good reasons for this:

1. A lot of legal, bureaucratic German terms have no direct analogue in English (and their word forming sometimes depends on subtle grammatical features of the German leanguage).

2. For official purposes, it does not suffice if the clerk can somewhat speak English; he/she rather has to be fluent in a way that is "negotiation-safe" ("verhandlungssicher"; I know that this German term is usually translated with "confident in business discussions", "business fluent", "language proficient", but all of these translations don't catch the subtlety of the German term).

> people [are] not open to making new friends.

The German word "Freund" (commonly translated with "friend") has a different meaning than the English "friend" - the relationship goes much deeper. I don't think that Germans are not open to making new "Freunde", but if you want to have shallow, superficial relationships, Germany is not the ideal country. Vice versa, if you want to have deep relationships, you will likely be annoyed by the USA.

Re: A startup doesn't need to be a unicorn

#94

Post by CalRobert »

summarity wrote: post #25
fastball wrote: post #19

Earlier quoted context omitted.

And yet Germany still doesn't seem to have much more startup / entrepreneurial success than any other European country. What gives?

What are you looking for in particular? The model is geared towards slow, sustainable growth. And that growth might also not need to exceed a certain level. So you're unlikely to hear about many of them. Not all are in tech or software, many are focused on German-only (or DACH region) research, industrial development, etc. I think that's fine.

Is slow growth sustainable?

Re: A startup doesn't need to be a unicorn

#95

Post by marcinzm »

javierluraschi wrote: post #85
marcinzm wrote: post #82

Earlier quoted context omitted.

Startups aim to grow quickly. Every single definition highlights that difference versus traditional small businesses. Trying to re-brand small businesses into "startups" for the cool name factor just seems silly to me. If you're making a sustainable small business then call it that. Don't call it a startup. You'll get more customers that way as well and more relevant business contacts. People care about startups beca…

From your point of view, when does a startup is no longer a startup? Seed, Series A, B, C, pre-IPO? Can you be a startup after IPO?

That's another reason I find the re-naming of small business to startup so silly. Putting a billion dollar company and a family small business on the same label is silly just because were started recently. Some startups are worth billions the second they are created. Personally I think startups generally stop being called startups when they get old enough or go public. Then they get other labels such as a private company or a public company.

The point of labels is to quickly give a lot of relevant information about some entity. This helps customers, investors, clients, future employees and so on understand the entity quickly.

Re: A startup doesn't need to be a unicorn

#96

Post by tlogan »

I think the post is off.

How exactly is a VC—or any investor, really—supposed to make money from a startup that’s aiming for a “middle of the road” outcome? That just doesn’t add up. In that case, wouldn’t it make more sense to invest in something safer or more traditional?

From what I understand, the very definition of a startup is tied to ambition. Founders need to be aiming for the moon—or at least something close to it. If you’re not taking big risks with the potential for big rewards, can you even call it a startup?

Re: A startup doesn't need to be a unicorn

#97

Post by dividuum »

zwnow wrote: post #78
summarity wrote: post #34

Earlier quoted context omitted.

No that's for a full GmbH. You can start with an "UG", which realistically needs maybe 1500 EUR to get registered and up and running. Then, a certain percentage of the profit is contributed towards the 25k (of which in turn only 12.5k have to be deposited in cash) each financial year. If the threshold is met, you can convert from UG to GmbH.

Always go for GmbH. UG will make you account for everything with your private money. If something goes wrong in your business you'll be dirt poor.

That doesn't sound correct. UG is identical to the GmbH in that regard. Do you mean a GbR?

Re: A startup doesn't need to be a unicorn

#98

Post by esafak »

Cthulhu_ wrote: post #63
Etheryte wrote: post #8

Well yes, that's called a regular company. Not sure if I'm missing something here?

At least some years ago, browsing HN's comment section felt like it was a different world, separated from reality. I think some people need this kind of grounding reminders every once in a while.

Russ (VC): Why would you go after revenue?

Richard (CEO): Because... to make money?

Russ: No. If you show revenue, people will ask how much, and it will never be enough. The company that was the hundred x-er, the thousand x-er, becomes the two x dog. But if you have no revenue, you can say you're pre-revenue... you're a potential pure play. It's not about how much you earn, it's about what you're worth, and who's worth the most? Companies that lose money. Pinterest, SnapChat, no revenue. Amazon has lost money every fucking quarter for the last twenty fucking years and that Bezos motherfucker is the king. There's no revenue. No one wants to see revenue. Go!

Richard: Oh, um, I just thought that mainly the goal of companies is to make money.

Russ: Yeah, no no no, that's not how it works. I don't want to make a little bit of money every day, I want to make a fuckton of money all at once. ROI. ROI!

— Silicon Valley, "Bad Money" (2015). https://www.youtube.com/watch?v=BzAdXyPYKQo

Re: A startup doesn't need to be a unicorn

#99

Post by zwnow »

dividuum wrote: post #97
zwnow wrote: post #78

Earlier quoted context omitted.

Always go for GmbH. UG will make you account for everything with your private money. If something goes wrong in your business you'll be dirt poor.

That doesn't sound correct. UG is identical to the GmbH in that regard. Do you mean a GbR?

Ahh might have confused it with one of the other forms then... It's been a while since I had to learn all that stuff.

Re: A startup doesn't need to be a unicorn

#100

Post by whizzter »

marcinzm wrote: post #82
flir wrote: post #73

Earlier quoted context omitted.

You said this below, too. What's the difference? In my mind a startup is just a newly established business, but you seem to have a different vision?

Startups aim to grow quickly. Every single definition highlights that difference versus traditional small businesses. Trying to re-brand small businesses into "startups" for the cool name factor just seems silly to me. If you're making a sustainable small business then call it that. Don't call it a startup. You'll get more customers that way as well and more relevant business contacts. People care about startups beca…

Replying here because nesting,

Regardless of if the startup intends to hit it big or remain smallish, a startup is really something that's appropriate until it's operating for profits rather than growth and/or growth in it's market niche naturally slows down due to saturation.

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