Insufficient funds.

[Unknown]

A 24% Apr is a joke for any reason. P2P loans can be had for 6-10%. If you're willing to take a 24% loan for any reason ever then you're doing something wrong.

 

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[biophase]

Most businesses need capital to start, unless your in services or information.

Yes they do. But they don't need alot of money. And they usually don't need as much as you think. I started my first ecommerce store with less than $500, and the bulk of that money was setting up the LLC, the SSL certificate and getting a credit card processor.

 

[LightHouse]

15k.... this is the biggest action fake ever.

If you actually needed that, which I wouldn't really on some quote from a buddy, you could generate it a million ways to 1. We aren't talking about 500k here, but 15k.

It doesn't sound like you really want to be in business to be honest. If I saw an opportunity like you describe, I wouldn't be on a forum waiting for answers, I'd be out getting them, or working on making that money any way possible.

 

[Deon]

Yes they do. But they don't need alot of money. And they usually don't need as much as you think. I started my first ecommerce store with less than $500, and the bulk of that money was setting up the LLC, the SSL certificate and getting a credit card processor.

Hey Bio, thanks for your contribution always on the forums.

Do you ming breaking down how you started the business with only $183? Meaning, how are you going to do the marketing and get the word out there? And are you a one man band on this business, so not paying anyone?

Thanks

 

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[biophase]

Hey Bio, thanks for your contribution always on the forums.

Do you mind breaking down how you started the business with only $183? Meaning, how are you going to do the marketing and get the word out there? And are you a one man band on this business, so not paying anyone?

Thanks

Sure, I'm going to go the same route as the soap biz. If you are an INSIDERS you can read my thread in there.

But basically:
Got an idea: $0
Researched competition: $0
Hired a guy to do design: $65
Called manufacturers and got samples made: $58 (some sent me samples for free)
Made an Amazon Pro account: $40 (listed product on Amazon, not for sale yet though)
Bought a domain: $10
Logo design: $10

What I have not done yet:
Haven't decided on how many to make intially
First production run of 50 units: $850
First production run of 100 units: $1400
Create FB page, market on FB (without ads at the start)
Create my webpage
Create a separate LLC

Marketing
Ask friends and people to buy
Use FB, Instagram and Pinterest

 

[Unknown]

@biophase why the pro account out of curiosity? I downgraded my account until I'm selling more than 40 items a month. I'm sure I'm missing some other reason though, or you already know you'll sell more than 40 a month.

 

[parkerscott]

Something's not right here. I don't know what kind of ideas you keep getting, but you talk about startup money like it's just something everyone needs. To put it in perspective I have started 5 businesses and have spent under $500 in starting each one. It seems like you get an idea and then just think that start up money is the key when it is actually a very small part of whether or not you are successful.

My current start up is about to go live (in 2 days) and I've spent under $500 ($183 to be exact) and I'm shooting for $200k/yr within 2 years. I don't even know what I would do with $6k to spend on a start up, let alone $15k or $100k.

Maybe you should step back and think of how to accomplish your ideas without large amounts of money.

That much is true. I could start a landscaping business for a few hat tricks, or start up an eccomerce store on wordpress for next to nothing and sell mosquito patches. My previous venture which is on hold for the moment costs so much because I was developing a product. I know autocad but my knowledge wasnt enough for my needs so I hired someone. I then needed a prototype to make sure that the drawings would work for molds and that cost money. The next piece of the puzzle is the molds, and those are not cheap.

If I wanted to spend a few hundred bucks on this next project, I would need a few years to learn how to code. It will take my buddy about 3 months to develop the project, and his quote is actually quite low.

 

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[parkerscott]

15k.... this is the biggest action fake ever.

If you actually needed that, which I wouldn't really on some quote from a buddy, you could generate it a million ways to 1. We aren't talking about 500k here, but 15k.

It doesn't sound like you really want to be in business to be honest. If I saw an opportunity like you describe, I wouldn't be on a forum waiting for answers, I'd be out getting them, or working on making that money any way possible.

I am working on getting the money. Read the op. Im on this forum because most people on here have experience. For instance people have told me I can get a loan for 6% APR. If I went out and asked my friends they would tell me to get a personal loan at 22%. I value personal experience answers better than something I find on about.com and with that being said thank you everyone.

Also this isnt an action fake, this is seeking wise council. I can have a thread going while I do a myriad of other things or go to work. Im not sitting around hitting refresh every five seconds. Plus if I jumped straight in and dumped the cash and failed I would have been told to do more due diligence or split testing etc. There is no pleasing everyone on here.

 

[JDM]

If the opportunity is as you describe, the only thing stopping it happening is you taking action. Capital will not be an issue.

This time six months ago I was in your exact situation, however the capital required to go to market was closer to $500k.

I went in search of a product that I assumed existed and realised it didn't. I did some further research and had found my opportunity. At this stage, I was in debt with no cash flow to fund the idea. I downgraded my car to generate seed capital and moved to a cheaper unit to reduce overheads. With my seed capital ($30k or so) sorted, I engaged an industrial designer to bring my product to life.

Long story short, that $30k has been spent, along with another $10k won in a start up competition. Although the money dried up again, I was now in a position where my product had received international media coverage and I am currently gearing up for a crowdfunding campaign to keep the product development moving.

I am in talks with the two largest companies in my market for my country (one being the largest in the world for this product area) to explore an early stage buyout or licensing agreement and also talking with a few angel investors.

Every opportunity I have had has been a result of me taking action. I did what I had to do because I believed in my product and the opportunity. I did what I had to do to get the idea off the ground, I called the people that could take my idea forward (companies and investors), I flew interstate to meet with people and pitch my idea, I emailed nearly 500 journalists to get internaitonal coverage...all while working as a lawyer by day.

Moral of the story - If your idea is truly as you believe and you want to make it happen, take action and the money will come.

 

[LightHouse]

I am working on getting the money. Read the op. Im on this forum because most people on here have experience. For instance people have told me I can get a loan for 6% APR. If I went out and asked my friends they would tell me to get a personal loan at 22%. I value personal experience answers better than something I find on about.com and with that being said thank you everyone.

Also this isnt an action fake, this is seeking wise council. I can have a thread going while I do a myriad of other things or go to work. Im not sitting around hitting refresh every five seconds. Plus if I jumped straight in and dumped the cash and failed I would have been told to do more due diligence or split testing etc. There is no pleasing everyone on here.

I am not trying to be mean but you can tell yourself whatever you want to believe. You should know getting a loan at 6% is better then 22%... that is basic math. Same with saying answers here are better then about.com, you are waiting or searching for someone else to give you easy and obvious answers. That is exactly what an action fake is.

Everyone's first reaction is usually getting defensive, I want you to know I am not trying to offend you, only make you realize something. As entrepreneurs we have to find the procrastination and laziness itch everyday.

You need 15k, go make 15k. There is a world of commerce out there waiting to be pursued, bought, sold, and traded. It is right outside your doorstep. If you don't get it, the next guy will. Then you can read his story in the magazines in a few years and get angry about that too.

 

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[parkerscott]

If the opportunity is as you describe, the only thing stopping it happening is you taking action. Capital will not be an issue.

This time six months ago I was in your exact situation, however the capital required to go to market was closer to $500k.

I went in search of a product that I assumed existed and realised it didn't. I did some further research and had found my opportunity. At this stage, I was in debt with no cash flow to fund the idea. I downgraded my car to generate seed capital and moved to a cheaper unit to reduce overheads. With my seed capital ($30k or so) sorted, I engaged an industrial designer to bring my product to life.

Long story short, that $30k has been spent, along with another $10k won in a start up competition. Although the money dried up again, I was now in a position where my product had received international media coverage and I am currently gearing up for a crowdfunding campaign to keep the product development moving.

I am in talks with the two largest companies in my market for my country (one being the largest in the world for this product area) to explore an early stage buyout or licensing agreement and also talking with a few angel investors.

Every opportunity I have had has been a result of me taking action. I did what I had to do because I believed in my product and the opportunity. I did what I had to do to get the idea off the ground, I called the people that could take my idea forward (companies and investors), I flew interstate to meet with people and pitch my idea, I emailed nearly 500 journalists to get internaitonal coverage...all while working as a lawyer by day.

Moral of the story - If your idea is truly as you believe and you want to make it happen, take action and the money will come.

Ive been in your shoes as well sort of. Yes im a little more skeptical of taking action this time, because the last time hasnt worked out like I had hoped. It still has legs, but its still somewhat of a burden. I had prototypes built, and had companies requesting pricing for 50k units etc but those requests havent come to fruition yet.

This idea has way more potential than the previous idea, and I dont have to serve a certain niche either. I am taking action, but just not at the same speed I did last time. Im playing this a lot more safely to try and mitigate some of the risks. Im running a survey right now to see what questions people have, and if the idea is something that interests them. 15k isnt a whole lot for the potential that this idea may yield. An idea is nothing without execution though, so im trying to find out what angle to kill this from.

 

[Gale4rc]

You realize there are people who only invest in people like you right?

I've always got actual angel investors (not friends or family) pretty easily.... I would never consider taking a loan :/

Research investors local to you in that industry and contact them relentlessly.

 

[parkerscott]

I am not trying to be mean but you can tell yourself whatever you want to believe. You should know getting a loan at 6% is better then 22%... that is basic math. Same with saying answers here are better then about.com, you are waiting or searching for someone else to give you easy and obvious answers. That is exactly what an action fake is.

Everyone's first reaction is usually getting defensive, I want you to know I am not trying to offend you, only make you realize something. As entrepreneurs we have to find the procrastination and laziness itch everyday.

You need 15k, go make 15k. There is a world of commerce out there waiting to be pursued, bought, sold, and traded. It is right outside your doorstep. If you don't get it, the next guy will. Then you can read his story in the magazines in a few years and get angry about that too.

Im not looking for the answers to just be given to me because im lazy. Im seeking answers because there are so many of them. This isnt my first rodeo and i dont need my hand held. I have contributed to this forum, and I have held peoples hands. I just dont understand why nobody gets on anybody elses case when they ask questions, but when I ask an innocent question I get chastised? And yes i know that a loan at 6% is better than 22%

 

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[parkerscott]

You realize there are people who only investor in people like you right?

I've always got actual angel investors (not friends or family) pretty easily.... I would never consider taking a loan :/

Research investors local to you in that industry and contact them relentlessly.

Yeah I have looked at angelist.co I believe it is. Most of the investment is in tech. They are usually looking for a minimum viable product and a track record as well. Im still looking for investors, and cold calling them, and signing up for incubators etc but no bites yet. Im possibly attacking from the wrong angle though.

 

[BeingChewsie]

So let's just assume you are right about everything. Your buddy who is going to develop your product isn't getting $15,000 upfront. Let's run it out 4 months instead of 3 months...that is only $3,750 a month. That isn't a lot to generate. You could flip stuff of CL or ebay and make that. You could do gigs on off of CL and make that. I said 4 months because you should always plan for delays in business. I'd plan for cost over-runs too. I'd be highly curious what you are building for $15k. We had a learning management system, testing software, data analytics, e-courses and e-books developed in 2009 and our initial investment was less than $15,000. I'd shop that around myself.

 

[JDM]

Yeah I have looked at angelist.co I believe it is. Most of the investment is in tech. They are usually looking for a minimum viable product and a track record as well. Im still looking for investors, and cold calling them, and signing up for incubators etc but no bites yet. Im possibly attacking from the wrong angle though.

It's hard to comment without knowing the idea you're pursuing, however reaching out and cold calling investors is never the wrong angle. Although they might not be willing to invest until your idea gains more traction, these are great contacts to have.

Is there a way that you can progress your idea and do a proof of concept without spending the $15k?

 

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[Gale4rc]

Yeah I have looked at angelist.co I believe it is. Most of the investment is in tech. They are usually looking for a minimum viable product and a track record as well. Im still looking for investors, and cold calling them, and signing up for incubators etc but no bites yet. Im possibly attacking from the wrong angle though.

I'm a unsuccessful fool with no educational background with funding on 2 separate products right now and 2 separate (small) teams..... Had 0 MVP on both.

My main developer on one of them, I literally stalked online - found his Skype - got him to quit working at his current job and start working on my startup for equity full-time.

What's your excuse again?

Not trying to hate... Just show that it's possible.

 

[parkerscott]

I'm a unsuccessful fool with no educational background with funding on 2 separate products right now and 2 separate (small) teams..... Had 0 MVP on both.

My main developer on one of them, I literally stalked online - found his Skype - got him to quit working at his current job and start working on my startup for equity full-time.

What's your excuse again?

Not trying to hate... Just show that it's possible.

I cant get them to pick up the phone lol, thats my excuse and its a terrible one. I guess I should start stalking them, or send them a huge teddy bear to get their attention.

 

[DennisD]

The only downfall I see is that everybody's personal experiences will lead them to different outcomes and different solutions.

If I was trying to be the "funniest man in the world" and I asked a youtuber how to make it happen, they'd tell me to make funny videos. If I asked a stand-up comedian they'd tell me to hop on stage, and a humorist would tell me the most efficient way is to syndicate columns to newspapers.

Similar with business. @biophase will give advice based on his experiences filling product based needs on the cheap, @D. Maxwell will tell you the best way is to build a SaaS by outsourcing funding to your intended customers, and I'll tell you the best way is to gain popularity through Content Creation and videos and then jump onto crowdfunding.

Your particular expertise, experience, and knowlege determine what works best for you

 

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[LightHouse]

Im not looking for the answers to just be given to me because im lazy. Im seeking answers because there are so many of them. This isnt my first rodeo and i dont need my hand held. I have contributed to this forum, and I have held peoples hands. I just dont understand why nobody gets on anybody elses case when they ask questions, but when I ask an innocent question I get chastised? And yes i know that a loan at 6% is better than 22%

Come on, don't play victim, i tear everyone up, and in turn i get torn up all the time. The thing is, it sounds mean here on the forum, but if we were chatting over a beer it would sink in a bit. You just have to go get it.

How much have you made today that puts you closer to that 15k?

 

[JDM]

I cant get them to pick up the phone lol, thats my excuse and its a terrible one. I guess I should start stalking them, or send them a huge teddy bear to get their attention.

I had the same issue and found adding them on LinkedIn was a good start and make the approach somewhat less cold. I had success with messages on LinkedIn or calling after I had added them. Another approach is to add them to LinkedIn and then do targeted ads on Facebook so that they are aware of your product/idea before you call. This will obviously not work in all situations though.

 

[parkerscott]

Come on, don't play victim, i tear everyone up, and in turn i get torn up all the time. The thing is, it sounds mean here on the forum, but if we were chatting over a beer it would sink in a bit. You just have to go get it.

How much have you made today that puts you closer to that 15k?

only 85 today. I bought some bicycle parts on craigslist that im flipping too.

 

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[Joe Cassandra]

Get on Quora, find topics/questions on your niche/product...look for good answers and look for people who may have connections and/or success (read bio and look through some of their answers). If their bio says serial entrepreneur/sold company etc. Ding Ding!

Reach out to them on quora message asking their advice and SPECIFIC questions. No pitch. Go back and forth, jump on a call and then pitch.

Ive met tons of great connections this way or people who have the connections ...one said "Joe this idea is too competitve, but let me know your other ideas, I know some VCs in Boston," ( that was 2 weeks ago)

This works because they are going on Quora in their free time providing value meaning if they can directly see where they are providing value I.e. answering your private questions, its a win for them.

Everyone wont be a hit but youll get a 70-75% response rate.

 

[biophase]

Parker, the only reason I was/am on your case on this thread is because of statements like these, "market is worth hundreds of billions a year, theres very little competition. I also meet a need that hasnt been met. Its easy to scale, and doesnt take much of my time."

People that make statements like these are a huge red flag to me. It shows way too much emotion and not enough research. If you watch Shark Tank, you notice that they hate it when people say stuff like "this is a 3 billion dollar market", because it doesn't really mean much. You can say that clothing is hundreds of billions of dollars a year, but you aren't making all the clothes in the world. Maybe you just make socks, what's its market like? Maybe it's just athletic socks, what's its market worth? That's why saying "hundreds of billions a year" to me just sounds wrong and inexperienced.

I don't know what the market is of much of the stuff I get into. But what I do know is that most markets are large enough that if you capture any percentage in it, you will be making at least six figures. I concentrate on them because the markets are small and easier to compete. I only need 5-6 six figure companies to make me happy.

 

[parkerscott]

Parker, the only reason I was/am on your case on this thread is because of statements like these, "market is worth hundreds of billions a year, theres very little competition. I also meet a need that hasnt been met. Its easy to scale, and doesnt take much of my time."

People that make statements like these are a huge red flag to me. It shows way too much emotion and not enough research. If you watch Shark Tank, you notice that they hate it when people say stuff like "this is a 3 billion dollar market", because it doesn't really mean much. You can say that clothing is hundreds of billions of dollars a year, but you aren't making all the clothes in the world. Maybe you just make socks, what's its market like? Maybe it's just athletic socks, what's its market worth? That's why saying "hundreds of billions a year" to me just sounds wrong and inexperienced.

I don't know what the market is of much of the stuff I get into. But what I do know is that most markets are large enough that if you capture any percentage in it, you will be making at least six figures. I concentrate on them because the markets are small and easier to compete. I only need 5-6 six figure companies to make me happy.

I know exactly what you are saying. I know it seems far fetched, but thats because it is. The few people that I have shared this with have even asked me how its even possible lol. I hope to share what it is soon, after I get some things in motion.

 

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[Kyle Tully]

I know exactly what you are saying. I know it seems far fetched, but thats because it is. The few people that I have shared this with have even asked me how its even possible lol. I hope to share what it is soon, after I get some things in motion.

Have you run the idea past an experienced business owner or one of the senior forum members? What do they think?

 

[parkerscott]

Have you run the idea past an experienced business owner or one of the senior forum members? What do they think?

Not yet. Good suggestion though. I kind of know runnum.

 

[tafy]

I was in the same boat as you Parker, but I needed 25k to make it happen. Chances of an investor backing you without a successful path is next to zero, you could get your friend to be a technical co-founder but you still need to pay him wages while he builds it.

Do you want to give up 50% equity for a saving of maybe 10k?

Crowdfunding software on an idea without a great background will nearly be impossible, but if you built the MVP and gained some traction with it then the options are totally different.

Oh and take your time on a project like this unless speed to market is crucial, go slowly and research like a crazy mofo because you will have a better product in 2 months time than you can think of right now. You can pick up a lot of ideas and features by researching and looking at other web apps.

 

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[parkerscott]

I was in the same boat as you Parker, but I needed 25k to make it happen. Chances of an investor backing you without a successful path is next to zero, you could get your friend to be a technical co-founder but you still need to pay him wages while he builds it.

Do you want to give up 50% equity for a saving of maybe 10k?

Crowdfunding software on an idea without a great background will nearly be impossible, but if you built the MVP and gained some traction with it then the options are totally different.

Oh and take your time on a project like this unless speed to market is crucial, go slowly and research like a crazy mofo because you will have a better product in 2 months time than you can think of right now. You can pick up a lot of ideas and features by researching and looking at other web apps.

Thanks for your input, and yes I have noticed that. Most of the guys getting crowdfunding for their software are Harvard students or google employees. Im going at a much slower pace for this project. I learned more today than I knew yesterday, and I keep running into new marketing avenues.

 

[biophase]

@biophase why the pro account out of curiosity? I downgraded my account until I'm selling more than 40 items a month. I'm sure I'm missing some other reason though, or you already know you'll sell more than 40 a month.

I don't believe that you can get the Buy box without a pro account. So that's why I always go pro right away.