Hey guys,
Would you skip your internship/terminate your internship with say GS/MS for persueing the concrete idea of starting your own internet startup?
Let's say the idea is very good, you just need time to put on it and to discuss with business angels/ vcs..
You assume that the market potential might be above 10 mio rev. per year.
What would you do? Wait 10 weeks until the internship is finished or skip it and start right away?
Don't quit anything until you have funding.
You might think your idea is awesome, you might think people will be jumping to get behind it. You are wrong. Its an uphill battle in getting funding.
1-VCs get something like 10,000 business proposals a month, so chances of getting in through mail is slim. You most likely will never even get a meeting, unless you know someone who can bring you in to the VC. And no I'm not talking about your daddy or mommy, I'm talking about someone the likes of a CEO of another start up, that the company funded, who'll come in and say "hey check this out dude111's idea is awesome, give him a meeting", and even then you'll have to convince them to pony up the dough. 2-Very few VCs will fund someone without a stellar management team. And no, a 20 year old kid is not someone who they'll want sitting on their millions(if you even get that much) 3-Very few VCs will fund an internet start up, which doesn't have a finished product. That means you gotta get your thing developed and designed before they'll even talk to you. 4-You might think your idea is brand new, and noone ever did it before, you are wrong. Chances are the thing you came up with is already created by someone else. This shouldn't be a deterrent, since competition is good, just be realistic.
And to tell the truth you don't even want a VC or angel investor to back you. The main reason, is that the money will come in with huge strings attached, essentially it will no longer be your company, it will be VC's company, and your job will be to manage it.
If you know the right people boot strapping is the best thing to do. It will take you longer to find people who'll work for equity. It will take you even longer to come out with a finished product because people will start quitting on you. But when everything is done, you'll be your own boss, with your own vision for the company, and in the end will profit even more.
But if you don't know any people, you can get your site developed for about 250-450K(these were the estimates when I was looking around) and then when done, you can start hosting for about $2500 a month(for a couple of good servers).
So don't do anything until you either have the funding from VC/Angels(don't hold your breath), or until you have enough cash/contacts, to create the project, and then operate it for 6-12 months without a penny of profit
I recommend you do some reading before you even think about it. Pick up the following books:
Startup Nation by the sloan brothers and The Art of Start by Guy Kawasaki.
The first book is more generic for all business steps, and Guy's book talks more about the getting money stage.
Hahaha, Guy Kawasaki sucks. Look at his track record:
http://valleywag.com/tech/venture-capital/the-curse-of-guy-kawasaki-230…
http://www.nowpublic.com/don_t_be_a_dude_yamaha_a_gripping_story_of_lif…
I wouldn't take this guy's "business savvy" with anything other than a hearty laugh.
But to answer your question, take the BB experience. The long post is spot on.
Yes his business savvy may suck, but the the part of the book of how to pitch during the meeting, is pretty decent. Gives a few insights, and since he runs his own VC,it doesn't hurt to read what VCs want to hear.
Start right away if you're confident.
He runs a small VC fund, like him or dislike him he has some useful knowledge.
As far as dropping IB experience for your own start-up, look at your audience. You are not going to get a balanced view here.
As far as your business venture is concerned unless you have some form of product or prototype you're wasting your time. Idea's are useless.
If you truely believe your product will work and that you can get it up and running within 10 weeks then go for it. But makes sures a good idea and test the waters with other. More importantly, make sures its unique and you're not just jumping on the bandwaggon of some new trend / fad (Social websites and internet video spring to mind here)
also a thing you need to keep in mind, is that your internship is only 2 months long. There is no way, you'll be able to get anything done during that time, and it never hurts to have that on your resume, so that when you find out 5 months from now that Joe Schmoe from Kentucky has had your site idea running for the last 4 years, you'd have something to fall back on.
Better leave that whole design stage for when you are in school, and have a lot of free time on your hands. Because there are a lot of tasks to do when starting your company. Choosing a business structure, writing the business plan, writing the articles of __inc or org, writing contracts etc etc.
And then you'll have to come up with a design and write the Requirement document for your coders. You can't just tell them "the idea, is to make an online book store, for every college in the country, where students can sell their books!", no your RD has to be a lot more complete than that. You need to factor every single detail from the moment the user enters the site to the moment he leaves. All the front end and back end processes that are implemented as they navigate the site. And you have to be very specific, and cover all the tiny details...i.e. you can't just say "there is a login screen where users enter their info", no you'll have to mention the layout, how many letters in each field, how this interacts with the database, what fields in the database are checked, etc etc.
And I fully agree with runforthehills, your ideas are USELESS, until you implement them into a design, and see how everything works out.
I am actually looking to have a business idea designed and coded as well. Where did you go to find coders when you were starting your business?
Thanks.
totally agree, take the internship, 10 weeks great exp. then when youre back at school, do all the legwork yourself and youll have a much better idea of where you are going with your site, and how it will work when you are trying to woo the investors
For coders etc, you can try craigslist, lots of people there. Or some people from campus. But remember, you get what you pay for.
I went through 3 coders, before I ended up with the team I have now. People are easily excited about ideas of making 'millions', but when push comes to shove, and they need to get down to work, they quickly give up.
As far as getting idea designed and coded, your best bet is to take control of the design portion yourself. It will help you run through the design stage, and you'll get a few ideas for your business along the way.
look at outsourcing companies in India. There are companies that specialize in this type of stuff. My friends are currently building their site with an outsourcing company for 50k (only a portion of that up front)
1-communication: you never get what you were asking for 2-maintenance: once your site is finished, you need to maintain it, you need to upgrade it, you need to scale it. etc, which is why its a good idea to have someone who is going to be permanent. 3-if they decide to screw you over, there is really nothing you can do
I meant barrier compared to United States. i.e. if you have coding done in India, you better double check the grammar when everything is done.
This is another good reason to make the full design for them to follow
Guy Kawasaki is an idiot.
dude111, I come from a different background from most people in banking (was an engineering major and had never done finance before this job). I've worked at large companies, startups, and tried to start my own one summer and my advice is to take the internship.
1) It sounds like you're not sure of what you want to do, the internship is perfect to find out whether you really want to do banking or not... and if you don't, the experience still looks good and lets you do other stuff e.g. consulting. And if you do want to stick with banking, it's much easier to do so after a BB internship.
2) It helps a lot to be out in the real world first to see what's out there, what problems people actually have, etc. so that if you do launch a startup at some point, you're much better prepared.
3) To do something on your own you need resources/contacts and a great team. At this point your team can probably only consist of some friends from school, which means you'll need to bootstrap because very few VCs will fund anyone without experience.. may have better luck with angels but you need connections to find them.
You hear a lot about college kids with no experience creating The Next Big Thing (Michael Dell, Bill Gates, etc.) but those few cases are true anomalies rather than the norm. And a lot of "hot" internet startups these days were founded by people WITH experience (YouTube - both founders had worked at PayPal, Facebook - Mark Zuckerberg had Sean Parker of Napster fame as an advisor). In tech banking we work with startups all day and it's simply not true that only young people can do it... most of the founders I've met were in their 30's and I can't think of a single one who built a substantial company with no prior experience.
Really, the only disadvantage to doing the internship (and no one has mentioned this yet... and it's a big one) is that it may make you less inclined to do a startup later on. Yes, the hours in banking are long and there's a lot of work, but ultimately it's completely risk-free work and you have someone telling you what to do all the time so it is just not that difficult.
I know after a year of banking I feel less inclined to do a startup, even though I wanted to originally. But who knows, after only an internship you may feel differently.
Sorry if this was long-winded, I was trying to be as thorough as possible. PM me if you have any questions.
I agree with the previous post, and so does everyone else on this thread but one guy. You have your answer.
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