Do you need money for your side project?
Hello you hackers –
Sometimes I see those articles, where founders raised millions of $$$ and started a company by building fancy offices, hiring top talent and going on expensive team retreats. Product will be in the development for years (maybe) and you really don't know when and if at all money starts to come from clients. It seems that they start to think about next funding round very soon after the first one.
I don't know, maybe it's just me thinking and I don't see the whole picture here.
On the other hand, yes – if we're talking about purely software business, founders need some money to eat things, wear things and pay their rent. Not millions of dollars of course, but some thousands per month.
But... it could be difficult to reach, let's say, $5k/mo with your bootstrapped product when you have your day job, maybe friends and kids – it could be really hard to find the energy in the evening to work on your sideproject.
Could it be useful to get some money that helps you to quit your day job and work on your sideproject full time? Yes, that would mean you should give away a small % of your project and there will be some legal paperwork etc. It also means that project can fail and money runs out and you go back to work.
I'm not sure I like that idea very much, but what are the alternatives?
a) keep working on your day job and continue building sideprojects
b) crowdfund?
Would be nice to hear how easy it is for you to build projects and work full-time on a day job? Do you have enough energy?
I was under the impression there were milestones you needed in order to get a seed round.
https://bettereveryday.vc/how-much-traction-do-you-really-need-to-raise-a-seed-or-series-a-round-5fb0cf532201
Great find. Just proves, have to put in the work.
Another thought with VC funding is that it's probably quite hard to shut down the project. It could happen that you really don't believe in your product anymore. If there's no funding involved, you can just stop working on it.
This comment was deleted 6 years ago
Yeah, true – when you're a solo, it's much easier to shut down the project when you don't believe in it anymore. On the other hand, it's sometimes maybe too easy – not feeling like working on the product anymore and you take another one, and then another one, ... when you have cofounder buddies, they can still convince you to stay (which may be a good thing, or a bad thing).
My personal view on this – if you don't believe in a product anymore, stop working on it. Don't make a decision too quickly – give it a bit time, sleep on it. If it's still the same feeling, stop working on it.
It doesn't really matter if there's a lot of work put in if you don't see future for the product – you just keep putting more and more work in.
This is an interesting perspective. I am not sure I agree with some of that advice without context. Just because you are ‘solo’ doesn’t mean you can just drop something when you don’t believe in it anymore, if you have paying customers. Let me explain.
As an IH community, we harm the industry if we just abandon our customers and leave them in the lurch. That’s not to say your advice is incorrect in that if something isn’t working you may decide not to invest more into it, but there has to be an exit transition period to ensure we leave our customers in a good place. Not doing so gives people a bad taste in their mouth for betting on IH businesses.
Chances are if the business is struggling and the founder has lost passion for something there isn’t a lot of customers anyways. But those same customers MIGHT be prospects in the future; let’s not burn bridges if we don’t have to.
To the original post’s question, if you can stick with your day job until you can get to ‘ramen profitability’ (I love that term... learned it here on IH) before quitting you may be better off. Or... make sure you have at least 6 months of ‘ramen style living’ in the bank and the balls to go all in and fight to get to ramen profitability in 3 to 6 months. Before you do that though, make sure you have vetted the idea, done “Mom Test” (momtestbook.com) with at least 10 prospects, and have a plan.
Above all... enjoy the journey. If this isn’t something you are interested in, why do it?
Haha yes, I was not really clear on this – I was thinking it's easy to shut down project when you don't have any clients yet – you are trying to build something and believe in it and then one day you don't believe in it anymore.