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MenuWhat is the best way for a social media startup to get new users, aside from friends and family?
I built an app for sharing useful advice/tips/perspective (like a cross between wikihow and instagram), now I need to beef up the content and user base. Is it easy/possible to piggyback off current users' email contact lists or Facebook friends, etc?
Can I rely on networking and word-of-mouth, or will I need to raise money for a marketing budget?
Answers
Always look for the free avenues first before putting down any dollars as you are running lean as it is. Look to on-line forums, groups in your target market that are discussing the subject area and begin engaging and sharing insights to show credibility for your offering. As you move forward, begin to request advice in developing the basic product offering. You can then start providing incentives like entries into a draw to this focused target market, as opposed to general contact lists that get very little conversions (unless it is a targeted e-mail list). This should get you started.
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It's really ill-advised to solicit your vision from anyone. In my 20 years of building, investing and supporting tech companies, I don't know of a single success story that has it's origins in someone with your approach. Running a tech startup is incredibly hard. It demands sacrifices few are truly able to make and come with it tremendous risks that most people are unwilling to take. It sounds to me as if you want the startup life because you have an impression of what it's about but haven't yet experienced it first-hand. I'd encourage you to first join an early-stage startup. Developers are incredibly in-demand. Find an entrepreneur who has some experience, funding and a compelling vision that you believe in and get to know what the journey is really like.TW
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Should I charge for a pilot project?
Generally speaking, Yes. I say this for a couple primary reasons. 1) If you do not place value in your product, why should the customer? And if you are not charging for it you are not placing value on it. 2) the customer will be more "invested" in the success of something that has cost them something. If it was free and it fails, "who cares"? if it cost them resources they may be more interested in making it work. There could be overriding factors, but this is where I start with a question of this nature.MF
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What's an alternative to equity based compensation that recruits, motivates and retains employees?
Before we dive into the equity,salary and such. Motivation and retention begins with the CEO. Ask yourself what is the culture of the company? If you don't know anything about culture then start with the basics: 1. Do you value employee opinions? Do you ask for others opinions? 2. Do you encourage people to listen to employee problems? Do you listen to what other people have to say? 3. Do you encourage others to come up with ideas and suggestion? 4. Can you sell your dream? 5. Can you build consensus? 6. Hire people for their strengths and fix their weaknesses 7. Don't assume shit, always ask 8. Treat your interns like employees and mentor them 9. Have a clear vision and be able to articulate it 10. Can you admit when you are wrong? VERY IMPORTANT So if you have a strong company culture this will help with new hires, motivate, and retain talent. The frosting on the cake is free food/snacks, happy hours, company paid healthcare benefits, etc.TP
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What legal precautions can I take to make sure nobody steals my startup idea?
I've discussed ideas with hundreds of startups, I've been involved in about a dozen startups, my business is at $1M+ revenue. The bad news is, there is no good way to protect ideas. The good news is, in the vast majority of cases you don't really need to. If you're talking to people about your idea, you could ask them to sign an NDA ("Non Disclosure Agreement"), but NDAs are notoriously hard to enforce, and a lot of experienced startup people wouldn't sign them. For example, if you asked me to sign an NDA before we discussed your Idea, I'd tell you "thanks, but no thanks". This is probably the right place though to give the FriendDA an honorable mention: http://friendda.org/. Generally, I'd like to encourage you to share your Ideas freely. Even though telling people an idea is not completely without risk, generally the rewards from open discussions greatly outweigh the risks. Most startups fail because they build something nobody wants. Talking to people early, especially people who are the intended users/customers for your idea can be a great way to protect yourself from that risk, which is considerably higher than the risk of someone taking off with your idea. Another general note, is that while ideas matter, I would generally advise you to get into startup for which you can generate a lot of value beyond the idea. One indicator for a good match between a founder and a startup is the answer to the question: "why is that founder uniquely positioned to execute the idea well". The best way to protect yourself from competition is to build a product that other people would have a hard time building, even if they had 'the idea'. These are usually startups which contain lots of hard challenges on the way from the idea to the business, and if you can convincingly explain why you can probably solve those challenges while others would have a hard time, you're on the right path. If you have any further questions, I'd be happy to set up a call. Good luck.DK
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Business partner I want to bring on will invest more money than me, but will be less involved in operations, how do I split the company?
Cash money should be treated separately than sweat equity. There are practical reasons for this namely that sweat equity should always be granted in conjunction with a vesting agreement (standard in tech is 4 year but in other sectors, 3 is often the standard) but that cash money should not be subjected to vesting. Typically, if you're at the idea stage, the valuation of the actual cash going in (again for software) is anywhere between $300,000 and $1m (pre-money). If you're operating in any other type of industry, valuations would be much lower at the earliest stage. The best way to calculate sweat equity (in my experience) is to use this calculator as a guide: http://foundrs.com/. If you message me privately (via Clarity) with some more info on what the business is, I can tell you whether I would be helpful to you in a call.TW
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