At what point in your life is it best to start a business?
I'm interning in asset management this summer and plan to work in the field for at least two-three years post internship. My idea is that I start off my career in AM and in a group I know I'll find fulfilling to work in if I need something to fall back on (in the event that my business fails and I need to bridge the gap between working and trying my hand at entreprenuership again for some time). I have a concrete idea for a startup that I've been planning for the last couple of years now, and would like to get started as soon as possible. I plan to speak with people in VC this summer while I'm in San Francisco to get some insight as to the process.
I would like to try to work with y-combinator as my idea gets closer to being able to be implemented and try for an upfront investment. I have no startup capital at this point in my life, and figure I'll save as much as I can after working for a few years to have something to begin with. I think I can scale up from starting with lower production and fewer products, but I imagine that I would be able to make progress exponentially quicker with venture capital and sizeable loans.
I want to be able to start this venture as soon as possible, and I know my 20s is the best time to take risks. What do you guys think about this plan? Would it be advantageous to spend more time building my career and gaining experience, or should I educate myself on entrepreneurship as much as possible and jump into the fire as soon as I can? TIA
Don’t have much to add but following.
Curious what industry your idea is in
Healthy personal care products (think native) and hopefully if successful an expansion into food products and other consumer staples
Nice. Crowded space, what’s your differentiator?
Longevity is a bunch of BS. That being said, very crowded space with a retard like RFK running the HHS.
I went off on my own after 5 years of experience. First thing you notice is that you wear a lot of hats. I also learned quickly I'm bad at creating a sales pipeline.
Have you tried at it again? I think in a previous comment on one of my other posts you might have mentioned other businesses. Nothing good happens overnight. This picture comes to mind
I'm starting my MBA this summer. I just want to be another cog in the wheel at this point. I want low risk highly dependable corporate paychecks.
Paul Graham has a lot of essays on the topic, I would definitely look into those
Thank you for the rec, whatever workable advice and knowledge I can get I'm very grateful for
That’s great you are thinking ahead and seeing how it can work. This forum tends to attract risk-averse people with structured career paths, so the advice may be skewed.
But the best thing you can do is just get started. You don’t need $500k to find a customer, find someone to buy your product, create a waitlist to prove demand exists. Until you have customers, it’s only a hypothesis and as a start up founder, your goal is to either prove or disprove that hypothesis as quick as possible. If it works, great, you should triple down on the idea because someone else will be chasing you. If it doesn’t work, consider how you can pivot with those new understandings about why the previous product didn’t work (maybe they weren’t interested in a deodorant but they would use a shampoo version, etc)
As I’m sure you know, YC is extremely competitive and focused on tech-related companies. They tend to shy away from anything consumer / manufacturing focused (although in recent years they have ventured more into industrial-type start ups). YC is not the only option, they are just the most well known. Before every new cohort, YC posts a summary of ideas they are interested in funding. Look to see if what you are working on aligns with their next cohort focus. Also, you should work on finding accelerators or incubators focused on consumer products / your specific industry. The advice will be more tailored to your needs and they will have industry experts able to help guide you (the advice from a CS major who build an AI app will not be relevant or helpful to you).
Taking VC money comes with certain demands and requirements. First, at the earliest stage (pre-seed), they are not investing in a product, they are investing in a team. You need to prove why you are the right person with the right expertise to create an innovative product in a highly competitive market (spoiler, the best way to prove your worth is by sales or waitlists since you won’t have advanced degrees in chemical engineering or product experience at a leading consumer staples company). Second, a VC will want to understand how this is a $1bn company in 7 years. If you are not thinking in those terms, VCs will not participate. The level of execution speed they demand is nothing shy of impossible. Third, you need to sell a vision. Sell a vision of the product to a customer, sell a vision to investors about how you will change the world, sell a vision to prospective employees about why they should work with you. Focus on the pitch, find quantitative facts to back up what you are saying (i.e. did you do a focus group with 100 participants to understand their current product purchases and their willingness to try your product? How likely are they to try it and what are they willing to spend?). If you can’t or don’t want to sell this vision, VC is not the right option. That doesn’t mean you can’t still build this company, it just means you need to be realistic about the type of company you want to build.
You need passion to do a start up, it’s so damn hard and is an emotional roller coaster full of high highs and low lows. You don’t need to be an expert to start a company, but do you need to be willing to become an expert in every part of your company. The best thing you can do is get started and don’t worry about perfection in the beginning - focus on getting a product ready as quickly and cheaply as possible and iterate from that point on. Start ups are about taking understandings from failures and pivoting. If it takes pitching 100 investors to get an initial investment (which is a very realistic scenario), it didn’t actually take 100 meetings doing the same thing, it took 99 changes to figure out what works.
It is a privilege to run a company, have a creative vision, and find others to believe in your mission. Respect the process & you will be a great founder :).
Focus on getting the return offer and spend your senior year building this company. Don’t wait 2-3 years. Find someone in your school that has some of the skills you need, recruit them, and go pitch investors. My best advice is to not get stuck trying to build something that doesn’t work. It could just mean the market isn’t ready to accept your product, or the demand truly isn’t there. Understand. Pivot. Repeat. Customer feedback is the lifeblood of an early stage company.
Thank you so much for the earnest words of encouragement. I know it won't be easy, and I appreciate you being honest and straight up to help me level my expectations. The emphasis on not waiting is the sentiment I had in mind, this summer my plan outside of work is to spend as much time as possible developing my idea and to work towards product development, at least one that I can get to the production stage. The comment on VC is also very useful, not being privy on it I knew it was a very stringent process but I wasn't aware of the entire chain of funding (pre-seed etc) so thanks for the insight there.
I'm committed and truly believe that if I give it my maximum effort I can at least get my feet off of the ground. If I fail and have to change direction, I'm willing to take that risk. My grandfather was a first generation immigrant from Italy who founded a multi million dollar business in construction, and I want to continue the family legacy of self-starting and industriousness. I think it's my best path to fulfillment and peace of mind---despite the crazy time commitment and emotional rollercoaster you mentioned--- knowing I'll be providing something positive to people's lives if I do succeed. Cheers my friend.
---accidentally posted same comment twice dk why---
Thanks for senior baboon fellas
I just had a mentorship meeting with a student yesterday and a similar question from him came up. Here’s my answer:
To recap today's call regarding steps to start a business:
1) gain experience and expertise for a few years; gain credibility
2) identify a field that is emerging and interesting to you, so that when you are ready it will be growing and new enough that you can become an expert in at a young age
3) Skillset leverage, seek opportunities to work with others where they value your experience/skills/relationships, more than you normally would (my example of being an accounting/finance professional working with farmers), and that your partners bring skills/expertise that you are weak in.
4) develop overlapping skillsets to become world class in your niche (I'm a top 5% creative CFO with a CPA and experience investing and developing real estate, along with experience starting and exiting senior living/health care companies and being a consumer as well)
If I were to add another bullet point in regards to your question about timing, I would say this: now. Start building things now. Doesn’t have to be a business. As a student, get out of your head that you are just a student, be an activist about something. Do something beyond you, for others if you see the need. Start a student club. My mentee yesterday said he organized a golf fundraiser last year for scholarships for his old high school. He combined his love of golf and a good cause. He asked me if he should have put that on his resume, and I said absolutely he should have and been proud. Enter a school business plan competition with a team (doesn’t matter if you win or not). Just start doing things and get out of your comfort zone. Get comfortable being uncomfortable. As an entrepreneur, you’re the guy/gal on the dance floor first, dancing by yourself.
My answer to when in life is it best being an entrepreneur, to me depends on your opportunity cost.
- if you are an immigrant to the US and your prior education or experience is not recognized or appreciated, your English isn’t good, you might start a restaurant or dry cleaning business, sooner rather than later. Your opportunity costs are lower compared to a US college educated person with at least a foreseeable career track for the next 5 years.
- my thought is if the industry you want to start the business in is mature (ie real estate investment firm or private equity firm), than generally in your 30’s is a good time to start after you’ve gain credibility the traditional way.
- if the industry is emerging (didn’t exist 5 years ago) and within 3 years of intense focus, you can be an expert because it is so new, then being in your 20’s might be ok, along with older ages.
- the opportunity costs of not starting gets higher especially as you get older (40’s and above) where you’ve always wanted to start a business but took the safe route of a W2 your whole career. At some point, you think you are going to regret not trying something and don’t care about the lost wages. Your opportunity cost of lost time and remaining time, energy creeps in.
Any time is a good time to start and build companies. Don’t think so big, start small (acquire five paying customers), and then iterate.
Thank you for the helpful response, after some thought I've decided on focusing on one single product which I'm currently researching and hope to bring to market as soon as I can.
Sooner rather than later.
Apply to YC for their next cohort (probably winter at this point). If you get in, you would be foolish not to go if this is your goal. If you don’t, evaluate your idea. While you’re doing this be a sponge at work, and not just at your role. What does your company do well? What could they do better? Is there an idea to improve that business that could be interesting?
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