Startup SWAG

[dknise]

WARNING: The following is a bit of a rant about some older guys (early 30's) I met with at a meetup yesterday... Please enjoy, take what you can, tell me I'm wrong, or join in on the fun haha.

A lot of startups talk about how "lean" they are and throw out the term "lean startup." I rarely use these terms, but I find it interesting how fat "lean" startups actually are sometimes.

I take a lot of flack for the desk I chose for my 3 monitor computer setup. I searched for days trying to find a table that had no cabinets, was sturdy, and cost-effective. I finally found it covered in dust at my dad's warehouse... a twenty year old wood folding table in near perfect condition for $free.99. My favorite price.

To me, it's a desk. It serves it's function. The value I have to generate comes from the chair to keyboard interface for me, not from the price tag on my desk, or the type of wood it was made from.

None-the-less, the "lean" startup guys always talk about how I need a better desk. I call it... dun dun dun... startup swag. There seems to be a consensus that by looking professional and looking like you make a lot of money, you attract success. I don't deal with customer's in person, so I'm not trying to show off to anyone. I just need something to function. If I walked into a business as a customer and noticed their $5,000 desk with diamond chandeliers hanging from the marble ceiling, I might end up questioning the price they're having me pay for their service. "Hey, I thought I was paying for your service! Not your big fancy mahogany desk!". o.0

As a one man team, I don't see a difference between my "home" and my "workplace." I pay for one area that has room to serve both functions and therefore don't see the need to pay for two areas. But! To a lot of the "lean" startup founders I've been meeting, it doesn't make any sense to have a one man workplace be at your home. They see spending $1200 a month for an office, in downtown Seattle, at $35/sqft an absolute necessity to success. No employees... no customer visits... no function.

Bottom line... I don't like spending money on things that don't in turn make me money.

What I do spend money on:

• my computer
• my monitors
• my keyboard
• coffee
• books on kindle to learn what I need to learn
• professional consulting advice

What I refuse to spend my money on:

• Anything that in turn doesn't make me money

So, how do you feel about startup SWAG? Do you spend money on it? Or are you a cheapskate like me? haha

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[wade1mil]

Quick question: How do all three monitors make you money?

I love the term Startup SWAG. That's got a ring to it. startupswag.com is taken, I just checked.

I think before you have a profitable business, it only makes sense to keep expenses as little as possible. If you never leave your home office, you could keep the $FREE.99 desk forever. If you have a profitable business with an office that clients visit, that $5,000 desk won't necessarily make you money, but it sure could lose you money by keeping the free one. If you're selling commercial insurance and I walk into your office sporting a 20 year old folding desk, I might think you're a fly-by-night company that is going to take my money and run.

 

[Dezzamondo]

Nice post dknise, too many people want to look successful before they've made the money to be successful!

I'm using a semi-broken desk to hold my PC at the moment in a spare room next to a wardobe and laundry basket! One day I might upgrade it to something sturdier, but it'll do for now!

 

[CTamme]

Nice post dknise, too many people want to look successful before they've made the money to be successful!

I'm using a semi-broken desk to hold my PC at the moment in a spare room next to a wardobe and laundry basket! One day I might upgrade it to something sturdier, but it'll do for now!

Fake it till you make it. Isn't that what happened in the dot com boom. Jim Cramer talks about the money burn during the start up of the thestreet.com in his book Confessions of a Street Addict. Cramer's hedge fund is in a crappy office with used furniture in a bad part of town while the business he is investing in has posh offices with $50k desks and art work hanging on the walls.

I am starting to believe that having little to no money when starting a business forces you to focus on the business rather then all the noise. Most people are driven by stuff though. I have a successful friend that said the excitement you get from buying an expensive car, watch, or whatever gizmo was great but the next day it was always gone no matter what he bought. Don't let stuff define you and you have a better chance of being successful.

 

[DeletedUser2]

This, (startup swag) is the bigglest killer of startups.

to much shit.
when you are making money, you upgrade.
having done several start-ups over the years, the leaner the better.

White board + total necessity for me, so 15 dollar 4x8 melamine shower board on a wall works great.
2-3 monitors. TOTALLY need. so there was a study a while back about computers and internet marketing. and they foudn that if you had a faster computer, that is on average 15% faster, and multi monitors, (add another 10-15% in time savings) for a total of around 25-30% in time savings, and you do 10 hrs a day at the computer, you can save HOURS per day, or almost 1-2 work days worth of hours per week. so its totally needed for computer based startups.

desk. 39 bucks, plastic folding table from wall mart. cheap.

a good cell phone and cell phone plan, (I recently decided my cell phone is my super power, considering how much it has made me over the years)

Fastest internet connection you can afford
1 10 dollar file cabinet

1 99 dollar chair that is comfortable enough to spend those 10 hrs in.

1 coffee pot from local thrift store.

your good to go.

 

[prime]

At the beginning, I only spent money on my computer. Especially if your trying to make money online, I like to have a reliable computer to get the job done. Once I started making some decent money, I invested a couple things:

- multiple screens, one screen is not enough.
- whiteboard
- sticky notes
- keyboard
- mouse
- aeron chair for $800.

To me the chair you sit in is the most important thing you can invest in. Think about it. Your sitting in this chair for long hours working on your business. I use to sit on a beat up leather chair, then a hard wooden chair, I can not tell you how much back pain I use to have after putting in 8-12 hours of work. So I bought a chair that will make me feel good/comfortable when I work.

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[PatrickP]

If it is my own money I only buy what is absolutely necessary which for me is a $350 laptop from Walmart.

If it is like the $500,00 I received from the federal govt to start an electric car battery company or the $500,000 for a windmill farm I buy the $40,000 brass sink fixtures : )

 

[Dezzamondo]

I am starting to believe that having little to no money when starting a business forces you to focus on the business rather then all the noise.

Amen to that!

 

[Kak]

If it is my own money I only buy what is absolutely necessary which for me is a $350 laptop from Walmart.

If it is like the $500,00 I received from the federal govt to start an electric car battery company or the $500,000 for a windmill farm I buy the $40,000 brass sink fixtures : )

HAHA My laptop is a $299 lenovo G575 deal from Fry's. It is amazing that people think they need a quad core i7 and 40GB of memory to run Outlook. I could probably do fine with a netbook.

My desktop is an off lease lenovo that I have upgraded over the years. It has a server processor and 8GB because it is always on and I don't want it to crash. I have maybe $500 in it.

My desk came from my parent's attic, it is nice oak. I spent 140 on my Brother printer/scanner/fax. I have twin 22 monitors that were from the attic too.

 

[Kak]

- aeron chair for $800.

What? Holy crap! I have an $80 black leather chair from officemax that is as comfy as can be.

 

[The-J]

I was thinking the same thing!

I run my business from a college dorm. Desk isn't mine, chair isn't mine, bed isn't mine. I live with 3 other people for god's sake.

If you are the only worker, you don't need office space, or desks made from mahogany, or anything.

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[PatrickP]

My couch is pretty darn comfy, as is my bed, the local McDonalds, sitting in my car outside the local hotel to steal their internet(just kidding they give it out for free) a table at Panara bread etc.

Just a laptop, no desk, no desk top, no printer.

Anyone have an Ipad? I was thinking maybe get one of those. I just broke down after HORRIBLE coverage with Sprint for 6 years and got AT&T and (yes I know punch me lol) an Apple 4S for .99 This thing is AMAZING to me so far. I don't understand why the internet on it is faster than my laptop? Any ideas, not complaining just thinking maybe an IPad would work well for me.

Thanks!

 

[theag]

My couch is pretty darn comfy, as is my bed, the local McDonalds, sitting in my car outside the local hotel to steal their internet(just kidding they give it out for free) a table at Panara bread etc.

Just a laptop, no desk, no desk top, no printer.

Anyone have an Ipad? I was thinking maybe get one of those. I just broke down after HORRIBLE coverage with Sprint for 6 years and got AT&T and (yes I know punch me lol) an Apple 4S for .99 This thing is AMAZING to me so far. I don't understand why the internet on it is faster than my laptop? Any ideas, not complaining just thinking maybe an IPad would work well for me.

Thanks!

I got an iPad a week ago when my laptop broke down because I dont have a backup laptop and wanted to get one anyway for client meetings, so I got it while waiting for my laptop to be repaired. Using it with a bluetooth keyboard and upstand, so it nearly feels like a laptop, without a mouse of course. Right now I use it for everything, but cant imagine that longterm, as I need the real version of excel and some other software to operate my business properly. But as I will be mainly on the phone for the next few weeks it will do the job as a interim main machine.

Its fantastic for reading, mails, simple document and spreadsheets and nearly everything inside a webbrowser, though. Will also use it to bring along on client meetings in the future.

Also nice to play a few minutes of a racing game to relax now and then.

So I can definitely recommend it.

 

[prime]

What? Holy crap! I have an $80 black leather chair from officemax that is as comfy as can be.

I did too for a while.

Anyone have an Ipad? I was thinking maybe get one of those. I just broke down after HORRIBLE coverage with Sprint for 6 years and got AT&T and (yes I know punch me lol) an Apple 4S for .99 This thing is AMAZING to me so far. I don't understand why the internet on it is faster than my laptop? Any ideas, not complaining just thinking maybe an IPad would work well for me.

I have one, but I don't use it much for business. I think the new ones have 4g LTE. I think there good for checking on things and just overall overseeing type tasks, but anything that requires intensive work, I would would rather do on a computer.

 

[PatrickP]

Thank you theag and prime for the good info.

I appreciate you taking the time to post your suggestions.

I think for now I will stick with a laptop.

 

[Kak]

Thank you theag and prime for the good info.

I appreciate you taking the time to post your suggestions.

I think for now I will stick with a laptop.

I had an android tab for a while and it definitely isn't something designed to replace a laptop. One of the best options out there would probably be one of the new windows 7/8 tablets. Basically a full computer in a handy tablet design. You can do your hardcore typing on a desktop. Desktops make great reliable computers and you can get a beast these days that will last you years for 500-700 bucks.

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[PatrickP]

Yes I think if I do a tablet I would need a desk top.

Thing is I haven't had a desk top in 10+ years. I haven't even had a desk in 10+ years lol

Laptop it is for now I think.

 

[Kak]

I use windows live mesh so everything I do on my laptop is backed up on to the desktop and vice versa. They are basically the same computer when I am working on one.

I could definitely replace my laptop with a windows tablet and that is the plan when the laptop gets screwy. I do about 20% of my work at my desk. Most emails I send are short and sweet can be sent from a tablet or smartphone anyway.

 

[Kak]

I am not going to lie. I think a highrise office in downtown Houston, mahogany desk, a humidor full of padron 64's, twin 27" monitors and a rockstar computer sounds appealing. But not for a startup.

 

[MJ DeMarco]

Vigilante and I were talking about this on the Startup Failures thread... never heard of it called as "Startup Swag" but I love it!

I built a company in the services industry. We literally boot strapped it from the ground up based on an awesome value proposition and filling a void in the market. We were a rough small ragtag group of misfits, with all of the start up capital coming directly from my relatively thin pocket. It was successful, and a blast, but ran on a shoe string. I took zero money from the operation of the company until we sold it.

A knockoff company started in my wake, in my home town. Same value proposition (copied), same game plan (copied)... just a different retailer as the anchor. The main difference between us and them was :
1. We had an 8 month head start as the first market mover and
2. They took over $4m in seed capital from a first round investment group, and an undisclosed amount from a second round investment group

As a side bar, I probably would have taken the money also if I knew how to raise it. Their business was raising money. My business was adding value. I never took the time to learn how to raise money, and conversely they never spent much time learning how to add value.

They had beautiful offices in downtown Minneapolis. We had shit hole offices in a "b" tier office building near my kids highschool, outfitted with cubicles I purchased on Craigslist. When I went to see the president of their company, I made an appointment through his personal receptionist/secretary. He was very busy about the business. Their offices were dressed to the 9's (although aside from their investors I was probably one of the few people that ever visited them.)

Three years later :

We outgrew our ability to glue it together with bubble gum, and sold out to someone capable of taking it to the next level. The business exists today using basically the same model we drew up on a napkin several years ago.

What happened to them? You can guess. They burned through several million dollars of shareholder money doing essentially the same thing we did with our little a skeleton crew with the lowest SG&A imaginable. Their executives are gone, their investors are out, and the company is on life support. Not sure about their offices, but the bottom line is there is zero percent chance the "investors" will ever be made whole.

The business model wasn't that great. It ONLY worked with a low SG&A. Add a huge expense structure, servicing of debt, and shareholder expectations to it and it was certain to implode. Shareholders bought into the "pitch" but once the "pitch" was revealed to be bullshit, the wheels came off of the wagon.

If you take people's money, you owe them something. Successes are minimalized because many hands are in the pot to grab the spoils. Failures are magnified as your "bosses" didn't buy your bullshit only to make a donation to your retirement fund.

People dream of using OPM financing (other people's money) thinking it mitigates their personal risk. I had a front row seat to watch a train derail, and can tell you from watching this abuse and collapse that presiding over a company who is squandering OPM is an difficult road.

At the time, I wanted to be sitting in his $4m chair. Several years later, I am still sitting in my fully paid for (figurative) folding chair, and his $4m chair has cobwebs on it.

Be careful what you wish for.

It reminds me of an investment prospectus I received a year ago -- the startup wanted several million and had no customers, no traffic, and a skeleton of an application. The CEO salary on the prospectus was $100K/year plus various incentives.

I responded with that the CEO salary was about $86K/year too much and that the CEO had to share the investor risk -- at that salary, the risk is entirely square on the investors. I passed.

The last I heard, that company was up for sale after burning through the initial rounds. (I'm sure the CEO got his nice cushy salary though).

Glad I passed.

The bottomline is that "startup swag" evolves from the "fake it until you make it" premise. Somehow a $2,000 mahogany desk and $1,500 leather chair signifies success. I always thought business success was reflected in the EBITDA.

 

[The-J]

Anyone have an Ipad? I was thinking maybe get one of those. I just broke down after HORRIBLE coverage with Sprint for 6 years and got AT&T and (yes I know punch me lol) an Apple 4S for .99 This thing is AMAZING to me so far. I don't understand why the internet on it is faster than my laptop? Any ideas, not complaining just thinking maybe an IPad would work well for me.

I personally use an ASUS Transformer (TF-300), but an iPad can work, too.

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[mayana]

I always thought business success was reflected in the EBITDA.

hahahaha that's true!

I wrote a brilliant list of things that I bought a long time ago in a long-lost business venture, but when I pressed post, it gave me a blank screen. That must be a sign that the response was too wordy

Anyhow, I 100% agree: If it doesn't make you money, don't buy it. Never, ever, even when your business is making bank. I plan on buying a murcielago someday, but that will be for me. After I've made a ton of money. But the business(es) that I am running at that point in time will still be run frugally. Sorry, no "team building" exercises in Aspen for my staff

 

[healthstatus]

multiple monitors will make you extra money, you become a lot more efficient. (as I gaze upon my 3 30" monitors)

As for furniture, watch the local auctions, businesses with no sense have bankruptcy sales quite often and you can get some nice, barely used furniture, cabinets, warehouse stuff, for nickels on the dollar.

There is no sin in having nice stuff, just don't pay full retail for it....

 

[dknise]

multiple monitors will make you extra money, you become a lot more efficient. (as I gaze upon my 3 30" monitors)

:smxD: <--- This is me, crying sheer tears of joy. That's just beautiful. I have three 24" Asus monitors and love it.

The monitors and super powered brute forcing computer are for development purposes and performance productivity. I've had to work on software projects on a 15" Lenovo laptop before... and it is so much less efficient then having everything accessible to you at all times!

never heard of it called as "Startup Swag" but I love it!

Haha I'm glad everyone liked the title! Ironically, I've never heard of the motto "fake it until you make it." That's exactly what I was talking about.

 

[DeletedUser2]

thinking maybe an IPad would work well for me.

borrow someones, then go type 10-15 emails with it.

if you can handle the change in typing, great get one. if you cant then spend $90 bucks on a blue tooth keyboard, and use that. I have totally ditched all my laptops, I either only use desktops (for major work) or the Ipad. LOVE LOVE LOVE the Ipad. i have been consistently impressed with it for moving more of my biz that direction.

PS. get taptap talk as a forum app. its great.

Z

 

[The-J]

I used to run a dual-monitor setup. It was brilliant. Course, I didn't have a business at the time but still, amazing.

I'll be doing it again. I miss it!

 

Dislike ads? Become a Fastlane member: Subscribe today and surround yourself with winners and millionaire mentors, not those broke friends who only want to drink beer and play video games. :-)

[Determined2012]

PatrickP,

I have an iPad... I only use it when I travel because its sooo light and convenient to haul around. I watch movies and read books on it. I would never try to do work from it, or type lengthy emails etc.

An iPad, as is (without a keyboard hook up or iPad case that turns into a stand) is nothing but an oversized iPhone.

 

[The-J]

My professor is talking about how businesses spend money. His examples suck.

Talking about furniture, business trips, office space, etc. before you even have a customer. Such awful ideas. Find the need, get the customer, then spend money to scale

 

[oddball]

So I should go return the $5,500 desk I just bought and $2,000 big leather chair? lol I have been tempted to get a new computer, but I am not making enough to do it yet. I missed my custom desktop I had with dual 22" LED monitors, now I have my 15" laptop with a 17" old LCD monitor. Not the best, but it's better than just my laptop. I do want an iPad, if you get it with the keyboard case they are amazing. I've had so many of them but always sell them, I should have kept a cheap iPad 1 though. The desk I use in my room is an old one my grandfather made a long time ago, I would love a new one but not atm. Once money starts coming in I may upgrade things.

 

[dknise]

My professor is talking about how businesses spend money. His examples suck.

Talking about furniture, business trips, office space, etc. before you even have a customer. Such awful ideas. Find the need, get the customer, then spend money to scale

Ask your professor how many businesses he's started. Then ask him how many successful businesses he's started.

Unless he's been there, done that, he probably shouldn't be teaching haha. I really only think about 5% of professors are worthy to pass on their experience and knowledge and get paid for.