For the past months, my Eat ‘n Meet team members and I have been working hard – most of the time pondering on one question.
“Of course!” you might say, “You were figuring out a way to make your SNS-service as perfect, attractive, unique, customer-friendly and what-have-you as possible!”
Sadly, dear readers and/or Eat ‘n Meet-prospects, the answer to this bold statement has got to be “no.” The truth is that, as time went by, we somewhat lost track of our core-concept in favor of another sword of Damocles which was dangling over our heads.
“But how is this possible!” you then (justly!) exclaim in horror. Well, I have to say that we were musing (and panicking) over the thing that all too many entrepreneurs tend to muse (and panic) about – that is to say:
HOW ON EARTH ARE WE GOING TO MAKE MONEY?[1]
A hard nut to crack, indeed.
Programmer, venture capitalist and essayist Paul Graham agrees, when he says[2]:
“Raising money is the second hardest part of starting a startup. The hardest part is making something people want[3]: most startups that die, die because they didn’t do that. But the second biggest cause of death is probably the difficulty of raising money. Fundraising is brutal.”
The whole set-up of the MTB SNS-project is just that: come up with a great business plan for a startup, so that you can convince investors to pump oodles of money into it.
But.
Why?
Why would we need oodles? Think about it – you really don’t need that much to get a startup going. If you succeed in figuring out a way how to get your company ramen profitable[4] right from the beginning, a firm basis to back you up during your business’ childhood years is all you need. Heaps of investors’ money will make you hire too much people, give things out of your hands and they will change your initial entrepreneurial ethos. That’s a nono.
And why on earth would you beg perfect strangers to provide you with their money? Why can’t you just do what you’ve been doing on a daily basis since the day you said your first word: ask mummy and daddy. And gran and gramps. And friends. Whoever you know and trust and who trusts you back.
Do that, live your life as lean and mean as you possibly can and, if your idea is great enough, after a few years, you will make it. Without venture capital.
(R)amen.
[1] To be translated as: “how on earth are we going to make enough money to refund our investors plus an ROI of at least 20%, whilst feeding ourselves and our loved ones,
and not going to prison for being, well, totally and utterly bankrupt.”
[2] http://www.paulgraham.com/fundraising.html
[3] Obviously, this is a problem which Eat ’n Meet is not at all facing.
[4] http://www.paulgraham.com/ramenprofitable.html