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Ask HN: Should I give up?
66 points by sui_generis80 on June 26, 2009 | hide | past | favorite | 69 comments
(Posting this under a different account to my usual, for reasons which will become obvious)

So, I find myself in this situation: After developing my start-up over the last 2 years outside of work, I quit, and launched doing it full-time 3 months ago, and have been working at it since then.

Without going into too much detail, my start-up is in the B2B space, in a reasonably conservative industry. I have been doing everything myself, from development, to sys-admin stuff, to sales, marketing etc. I'd characterize the feedback I've got from people in the industry so far as "mildly positive" - they express some interest in the idea, but are not yet willing to commit to it.

At the moment, I have enough cash on hand in the business to last until November, at current boot-strapped burn rates, and I have enough cash on hand personally (since the business isn't paying me a wage) until the end of September. After that, I can sell some stocks (around $10K worth) which would give me enough personal income and business income to last until around January 2010. However, if I took that path, and the business didn't then succeed, I would be facing bankruptcy.

My feeling is that I have perhaps started a business which attempts to do too much for a single founder with no employees and limited capital, trying to do something in the business/enterprise space which has long lead times, big perceived risks (for my clients, not me) and in an industry which is very slow to change.

I don't want to give the impression that I've already decided to give up, because I haven't.

So that's why I'm asking HN: How should I decide whether to give up, and go back and get a job until I have another startup idea, or keep going with this one, knowing that there is perhaps only a slim chance of success (but if I do succeed, it will be well and truly worth it)?

Happy to provide any further information if you think it relevant.




An few arguments for giving up:

You aren't ready, financially, to see through even 1 year of unprofitability. Give up while your credit rating is intact and before you have to fire your friends who might go along with your idea/dream. The market is a disaster for unproven, new offerings that you describe as 'mildly postiive'. Hell for most companies, if you cut a sale -today- you wouldn't be paid until October or later. I'd say that if you give up now you'll have enough time to get a job worth going to work for and get paid in time for your November deadline.

If you shut down now, you can skip a bunch of calender year bs in 2010 and keep it all in 2009. You can stop paying/playing accountant, lawyer, marketer and pr person. You don't have to clean the toilet, do the corp taxes and reporting, ship an mail, vacuum the floor and maintain the copy machine. :-)

Sorry if I seem negative, but not every idea works out the way you might like. Don't send good money and time after bad. I've had two companies fail, both taking time and one taking big old hunks of cash with it. I don't regret it, but I don't regret shutting them down, either. Well, maybe a little....


One of the few times I can say, "I don't think I agree with you, but great post anyway."

Nice to have a sanity check amongst all the cheerleading.


The reaction can be "explosively positive", the kind of gushing reviews everyone dreams for, and you still won't close sales fast enough if you are that close to bankruptcy. I don't know if quitting is the right answer but you are going to need more cash than what you have. B2B moves slowly at times like these.


I'd so go back to those folks that have given you a lukewarm reception and change the question -- what are they looking for? What do they want? What are the problems they're trying to solve?

Take a really close look and make sure that you're not a hammer looking for a nail, but that you're solving a problem people actually have.

Three months is nothing in the B2B space. It usually takes longer than that to figure out the stuff above. I'm not saying to continuously beat a dead horse -- if you solved the wrong problem you need to find the right one, but that's a process not a crap-shoot.


>Three months is nothing in the B2B space.

This is very true.

You can measure whether consumer sites have any traction pretty quickly because you can make changes constantly and redeploy daily. With B2B you need to constantly reiterate on what problem your solving and that takes time.

B2B is something that needs to be built up like an old school business, measured in years not months. But the pay off is much higher the consumer sites.

The main reason why is that its difficult to get into companies and find out where the real problems are. Once you build those relationships and find out - then sales will become easier.

Then you have to deal with long sales cycles. So be prepared with a long runway.


i agree with this. sit down and figure out what you need to do in the next few months to succeed. if that means changing focus or direction, make it happen. if the path you're on now isn't going to work, you'll have to change or fail.


Yeah, I've had a lot more luck than I thought I would asking people who quit early why they are quitting. Not only do I occasionally get actionable information, but sometimes those people who leave me recommend me to other people for whom the service is more suitable.


I have 2 signs above my desk.

One says, "It doesn't matter". This is for when I get so stressed out, I have trouble doing anything. It helps keep things in perspective.

The other says, "Jabez Wolffe". His guide boat forced him to abandon his swim across the English Channel because they couldn't see through the darkness and fog, and it was too dangerous to continue. What they didn't realize was that they were only 100 yards from shore, but they had no way of knowing.

How far from shore are you?

I would suggest doing whatever you can to find out before making any decision.

[Aside: Please contact me off-line. I am in a similar situation and would like to talk.]


What's your monthly burn? If you downshift to building something that will bring in $2k/month you have an infinite burnrate.

With our startup we had a six month financial abyss timeframe, which was doable but risky. So, we spent the last two months pushing out a series of products- we shipped four different things in those two months, with the criteria being 'novel, simple, and potentially profitable in the short term'. Fortunately enough, one of them has taken off on the App Store enough that we're on track to make 2-3k/month with it

Now, 2-3k isn't a lot... except for the little detail that my co-founder and I are living in Budapest! I'm American and he's Hungarian so it was a no-brainer for us, but if you are working on your own, pick a place!

From my perspective, living in America is a waste of money if you have an internet based income- by moving to somewhere somewhere in South America or Eastern Europe your money will go three times as far, and you'll have a great time in the process.


This is a good idea, but I'm guessing from the OP's comments that he has a B2B model that likely requires personal a personal presence to get it sold.

Great idea for things that don't require that presence though.


Could simplification be helpful? I'm thinking that in a conservative B2B industry, offering too much too quickly from an unknown probably gets your target's risk radar bleeping.

I spent a lot of time consulting for, managing projects in and selling into the wholesale banking industry - pretty conservative, slow to change and hard to break into. I found that simplifying both my offering and my message to focus on one or two major points of functionality and pain helped pique interest enough that I could get a decent conversation going, during which I could gently introduce other features and benefits.

In terms of long lead times I would suggest, if it's at all possible for your product or service, offering risk-free trials for a month or two. Manage the install, the maintenance, the training yourself, so the prospect has little or no reason to say no. Once they become users, and assuming your product or service is good, it will be easier to upgrade them to paying status.

A major feature of selling into the B2B space is to know who your buyer is. It is rarely an IT manager. It is rarely an HR manager. It is not always the Operations manager. It is very often, however, the Finance guy. This is not always true, of course, and many people have more or less influence over a given purchasing decision, but you need to know who those people are, what they care about and how to communicate with them in terms they each understand and care about.

To answer your question about how you decide whether to give up, I would advise you to do the above until you are 3-months from zero net worth. At that point, find a paying gig (consultancy, full-time job, whatever you need to do to keep your head above water), then use those three months to go all in on your startup - phone clients and push them hard, phone/email/meet with as many prospects as possible, and push, push, push. If it's going to fail, there is little harm in being harder-nosed / cheekier about the sales process. I would also, in that last 3-month period, look for a buyer for your technology, to at least get some return back on your investment. If, however, you land a contract or two during those three months, you can cancel the paying gig and continue with the startup.

Really good luck, whatever happens! Please do post an update - I think your story will be of interest to pretty much the whole of HN!

If it helps, I spend a reasonable amount of time helping people formulate business and marketing strategy. Happy to offer a specific opinion and ideas (gratis, of course) if you want to email me.


Being down to 0 money left is quite different to bankruptcy, do you have large debts that are going to cause someone to file bankruptcy proceedings against you? Otherwise I would have thought worst case scenario was really just looking for a new job and you might know that you need to do that slightly before you fully run out of money.Lets imagine the lead time for getting any old job, starting and getting your first pay cheque is 6 weeks. So 6 weeks from running out of money I would start job hunting.

From your comments in reply to others I assume you are young(ish) with no dependents. That has to be the best situation to start a business in. You talk about perhaps doing this again in the future with another idea, but imagine in that future you are married, you have kids, you have a mortgage. I'm in that position and I can tell you it is a lot lot harder than it is when you have no body depending on you - I can go without for a while, but kids grow, they need new clothes etc. You also get more accustomed to a lifestyle as you get older - which is hard to give up (Thank God I built up a cellar over the last few years because I cannot afford to buy wine now!).

If you've lost faith in your idea or don't see it being a success then cut your losses now, but if you still think you can make it work my advice would be to go for it.

Good luck.

PS. Also you mention that you are doing everything from dev to sales and marketing. If you actually have contacts in the industry I would focus 100% on dev, then get them to look at the product properly. People you know don't need to see your sales and marketing to tell you if the product will be a success.


This is probably easier to do with someone in person... I'd find another entrepreneur that you respect and trust and get a second opinion on what you can do. You may find that there's actually a whole range of things you can do (and you'll hopefully get some pretty direct, no-bullshit evaluation of whether your business makes sense). Be open with that person, so that you get equally candid advice.

As a piece of generic advice: I think it is never, ever, ever a good idea to get in the situation where you will go bankrupt if your business fails. Be relentlessly resourceful, but also be relentless at managing your risks to ensure you don't lose everything if things don't work out. When it all comes crashing down, you need to be still able to pick yourself up and move on to the next thing (perhaps even another start-up).


On that last point, the fear of bankruptcy is as damaging as the thing itself. You will be so stressed out in the final months you won't be able to think clearly. Whatever your do on the marketing/sales side, your prospects will feel neediness and desperation which instantly overrides any benefits your product might bring.


While I respect your desire not to use YCombinator to shill your company, you've got something that apparently is facing some growth problems. Why not at least include a URL, or description of your product to help us gague whether it's got legs? It feels like you're still keeping your product in the stealth mode, but at the same time complaining that it's not getting any traction. It's not clear to me how you expect something to take off if the company's only employee refuses to also serve as your PR person.


Perhaps b/c if his potential customers google him and find that he was recently thinking about abandoning the business altogether, they'll be even less inclined to buy from him?


People here generally do not take offense at linking to companies/sites/products/stuff we've built. Why should we? It's only 'shilling' if it's pushing it where it's not appropriate. Otherwise, we like to link to the stuff we've done - we're proud of it, by and large. In any case I strongly agree that having something to look at would be useful.


I'd personally love to see more "shilling" here. That's why I come here: startup people talking about startups. Shake it if you got it.


I think the mix is about right where we have it. I don't want to see more submissions shilling products. If you find out something interesting in the course of building your product or growing your business, please tell us about it. If you put a link in your profile, those who are interested will follow.

In my view that's appropriate "shilling" on this site.


I'd love to know, too.

Unfortunately, I strongly suspect it wouldn't be in the company's best interest to associate it with a post about possibly "giving up". Business customers already perceive the product as a risk (or the OP said) and uncovering a topic about it on Google where they can see the founder in tough financial situations won't excite customers one bit.


When I started my B2B company, it took us forever to get sales. As in, about 2 years. We now have a healthy low-medium seven figure sales run rate. So anything in the B2B space -- particularly involving big clients -- will have long sales cycles and take some time to get traction.

However, companies have a lot of money, and typically they will not be that price sensitive, so there could be a sizable pot of gold once things start moving.

I know you won't want to talk about this company in any way that could be tracked down via Google, but if you'd like to get more advice by phone involving the specifics, I'd be happy to help--just shoot me an email. I've been where you are before.


Get a part-time job. If things move slowly in your industry and you aren't a consumer product with lots of customers, there's no reason you need to be available 24/7.


heck, you might even be able to work out a gig where you can interrupt your contract to be with your customers if you need to. if you have unusual skill (or are willing to work for below-market rates) you can usually find someone willing to be flexible.

that said, you obviously have a limit on the total time and effort you can put into a day so that might not work if you are already coding 8 hours a day on your product. but if your product is 'pretty good' and you are mostly marketing and waiting to be noticed, it might make a lot of sense to shave some hours off to sell to other people.

But then, most of my marketing is 'do something to try to get noticed' - i imagine if most of your marketing is cold calling or otherwise direct customer interaction, then it might not be so easy to take hours off.


Never give up and never surrender. The difference between failure and profitability can be as small as changing a few paragraphs on your sales page (it was in my case).

Reduce your costs, and experiment as much as possible.

The worst that can happen is you end up getting a day job.

Bob Parsons (found of GoDaddy) has some pretty good advice in this area: http://www.bobparsons.me/SuccesskeyNevergiveupbutbeveryquick...


I respect and admire your positive thinking, but the poster has already established that "the worst that can happen" for him is not getting a day job, but bankruptcy.


Real url: http://www.bobparsons.me/SuccesskeyNevergiveupbutbeveryquick...


In summary, you have a product you've been working on for two years. You have no sales and will run out of money to live in about six months.

You need a source of income! Unless just 1-3 sales will keep you paying your bills for months, you need to start making money outside the business. In the best assumption, your business will not be cashflow positive within six months: few product busineses are.

If you're committed to the idea, they by all means keep growing the business, but you simply can't rely on it as a source of income right now. Get a job, even a part time one, or do consulting.

I was in a similar situation in the late 90's except I was making sales -- just not enough to pay rent, etc. With about 3 months of runway left I got a job and it was the right decision. In hindsight, there's no way I could have built up the market in the limited time I had left and the "niche" was being commoditized.


Without knowing anything about your product or industry, is it possible to do some contracting for these potential clients that would allow you to earn some extra money as well as get your foot in the door for your product?


It may also let you see what the pain-points really are and what your competitors' vulnerabilities are.


Okay, worst case: It doesn't sound as though you would be facing bankruptcy. You would just have burned through 100% of your savings and be left with nothing. That's still not pleasant, but it's a big difference from being bankrupt.

I also started, bootstrapped, in a very competitive B2B space and it took years to get significant traction and comfortable profitability. However, the feedback I received from potential customers made it clear I was addressing an actual market and that, if I could build a product which suited the market I was targeting, I would receive more than enough profit to compensate for the effort I had expended to build the business. I was, I did and it has, but it wasn't easy.

So, my advice to you would be: Be realistic about your business. Examine your chosen market and identify if the customer base and the pricing you have planned would be sufficient to support you within the next six months. If it is, focus laser-sharp on that market and address it in the best way possible. If it isn't, put things on hold, start consulting for a bit or take on a job to build up your reservoir of cash. I can almost guarantee it's going to take a lot longer to build your business to profitability than you have planned, so just assume your savings are gone.

For myself, I had set aside an amount which I had thought more than sufficient to build a business and it took all of my savings (and a bit of debt) before things were positive. No matter how you look at it that's a hard game of 'chicken' to play, but it's what bootstrapping is all about.


Have you exhausted ALL your credit options?

- Angel investors?

- Discounted customers?

- Federal / State loan for small businesses (SBIR)?

- Loan from a Credit Union (lower rates)?

- Even 0% 12 month no interest Credit Cards (make sure you get a job to pay it off after 6 months)

- Micro-lending sites?

- Part-time job? Contracting / Consulting?


I've already taken out a substantial personal loan to supplement my savings when starting up the business. I've thought about looking for angels, but I'd like to have at least just one paying customer before that, so I don't have to completely give up the farm in terms of equity for whatever money they offer.


Two different takes:

1. If you absolutely love the idea you've built (like you were born to build this idea) take it to the very end. If you believe this is what your are meant to do then quitting will be a regret you'll never get over. And bankruptcy is bad but it is short lived (relatively).

2. If you are in the business because you saw an opportunity and are taking advantage of it... If you saw this as an opportunity, but don't love it for what it is, then get out before it causes too much debt, but not a minute earlier. In the meantime try like hell to get it to work but there will be other businesses to build.


I would recommend reading The Dip by Seth Godin. It is all about deciding when to quit and when to push through. My favorite line is "Quit or be exceptional. Average is for losers"


'My favorite line is "Quit or be exceptional. Average is for losers"'

Wow. That's inane. Yes, 'exceptional' is a fine goal, but there are many people doing pretty good by being pretty good.

Godin's books have struck me as little more than collections of pithy but ill-supported aphorisms, where the reader brings more to the book than is actually there. People find what they want to find, to "prove" what they want to believe.

(I'm sure there's some value in that, though by no means exceptional.)


I really wish I could convince someone to summarize that book for Squeezed Books. Without having actually picked up a copy, it looks like a book with some good points and lots of fluff.

I guess the fact that I can't, easily, is indicative of why that site isn't going anywhere, though:-/


I'd like to mention another problem in the B2B space: customers often feel uncomfortable buying from very small businesses. And in decision processes where Consultants are involved you can almost be sure that they usually do recommend bigger companies.

I'm a one man show myself and I've experienced the problems described above many times. Even in one case where I was the only bidder who could actually prove with a working prototype that I would be able to realize the rather complex solution, they chose one of the big players who could only provide prettier brochures (btw. they had to shut down the project after burning over 100K).

Furthermore, it is often not easy to enter conservative markets as a new player. Established companies are almost always preferred in such markets.

Therefore, my recommendation would be (it worked well for me): Look for companies that already are doing business in your target industry successfully, try to win them as resellers and become an OEM. This way you can profit from their reputation and you can reduce your marketing/sales efforts, too.

I don't know if this tip comes too late for you, but that would be the first thing I would try right now if I were in your position.


I know little of your market; I target SysAdmins. But I went 4 years (and one Ross Perot) before my company became profitable. I supported it and myself through part-time consulting.

The big thing is to present a decisive face to the world. My 'Ross Perot' cost me another two years or so, I think.

As for 'stay or quit,' well, when you are small, it doesn't take much to make a huge difference. That article about me on hn and reddit the other month? that took me from 'breaking even if my time is free' to the point where prgmr.com revenue is greater than my contracting revenue.

Me, I stayed in it for so long in spite of my losses because this is what I like doing, and what I'm good at. Perhaps more importantly, I believe I have a chance of holding my own against the competition.

Uh, but yeah, if you do decide to stick with it, you might want to think about a part-time contracting gig.


Also you can do some freelance jobs in your field. You can make some money and learn more about B2B.


One thing about marketing is that it will take time for people to get to know about a product and then decide to try it.

How much time did it take for you to adopt twitter/google/whatever? Even for trying out free products people take months (you have a product that solves a real problem, but people don't know yet that they have a problem!).

Give it enough time. Learn more about and be good at sales. Be at their face all the time. Be so good that they cannot ignore you.

Just try to keep the buzz around your product/service alive. It is difficult in the B2B market, but not impossible. Then again, B2B (like any other market) is about the people involved and nothing else. Get to know more people and persuade them to use your product.


Seth Godin has a book ("The Dip") about knowing when to quit and I should have read it much earlier, during my PhD.

Essentially, the absolute worst outcome is to stick with it and give up towards the end (which is what I did). Then you've got all the downsides of wasted time/investment and no upside. Quitting early isn't the worst possible outcome because at least you've saved yourself money & time.

My takeaway was that the earlier you commit to quitting or sticking, the better. Either commit to quitting now or decide to stick with it for the very long haul; even if that means going back into full-time employment, raising investment money, hiring staff, incrementally switching focus until the thing sells.


Two things strike me about this question.

1. The fact that you're asking others if you should give up lead me to advise that you probably should. In my own business, I'm too convinced that I have something that works and will continue to improve to listen to anyone telling me I should give up. This can be both a very good and a very bad trait to have. But if I do end up a financial failure, I neither ask nor give any apologies.

2. If it is a business worth risking your financial stability for, couldn't you find a co-founder to help share the burden of both cost and responsibility? This could provide you enough resources to continue on for a year before attaining profitability.


Pretty good advice from "wheels" but ask another question.

What have your potential customers got to do to get a benefit from your start-up? That could be adding to the inertia - mild interest will only turn into a sale when everyone else is doing it OR there are no barriers to entry. It may be that you can offer to solve your first customer's problems by doing the leg work, development work, managing process change (what have you) for them. For instance, most businesses plan IT development work 12 to 24 months ahead - with competition for resources.

A pain yes - but others will follow soon enough if they see someone else getting an advantage.


Do what you can until September, if you can't improve the business then cash in 50% of the stocks ($5k) to live on until you find another stable 9 - 5 job. Keep working on the start-up while looking for a stable job, things could improve. If you find a job before things get better then wind up the business and try something else after re-couping the money from the stocks.

That's the beuty of a small start-up, you've got room to experiment and if it doesn't go well you can cut and run without too much loss. Just don't pour everything into it unless you are in love with the idea and know your potential market loves it too.


(I had written a long reply but then wrote this last paragraph and found it summed it up better than an essay could).

It sounds like a challenge; run up and meet it head on. Im sure your project has pitched numerous technical challenges at you previously. Now this is a business one. Throw yourself at it the same way as you would with a coding problem and you might find it surprising what you can achieve :)

(also if business copy and "spin" is your problem I am happy to read over any material to critique it; I've found a modicum of skill in that area in the past, so if it's useful to you then drop me a mail [check my profile])


What about finding outside investors? Or partnering with a client? Your business idea may be impaired by your funding model...you didn't give yourself much of a runway. No matter what, don't cash out your savings just to stay alive through the holidays. It is too much personal risk-- it is better to dilute your equity with outside investment.

Also, pay close attention to your mental health. Working alone, under deadline pressure and financial stress can lead to poor decision-making.

You can always get another job but even that takes some time, especially in this market, so keep that in mind.

Good luck and keep us updated!!!


You say "feedback I've got from people". People will tell you what you want to hear and often don't really know. Most important ask customers or potential customers, listen to them.

And on the financial part lots of good ideas here and as usual minimize your expenses and find some income (part time, consulting) you can go a long way.

You need to believe in your cause and if you listen to the successful entrepreneurs they will tell you don't give up than you know what you need to do.

Set yourself specific limits now when it is time to stop (financially, emotionally), but when you agree to give up, give up fast and learn from it.


You don't say what size your client biz are. The larger the company the more likely that their decision cycle is long. From my experience large companies can be 6-9 mths to decide. If possible go for the real decision makers.

Your feedback if "mildly positive" ???? Allowing for the fact that people are usually polite and diplomatic, that is not a good sign. Why don't you find out what you would have to include / change to move them to passionate - hot to to trot ????

Agree with the posts about "The Dip" and persistence. It does take a long time and you don't want to give up 4 feet from the gold seam.


There is unfortunately a large gap between "mildly positive" feedback and getting paid. This is not a judgment on the quality of your offering or your ideas but a suggestion as to how far you still have to travel. Paradoxically, negative feedback can be more useful since it gives you an idea of what needs to be changed.

I would find part time or consulting work that allows you to continue to pursue your startup and focus on what businesses are actually willing to pay for. I would also see if you can find someone else to join you as a partner/co-founder.


Just pick up a day job again if you can or find some other revenue streams. You launched it full-time 3 months ago. If you maybe made that move prematurely then just go back into that for another 3,6,12 months. Don't quit your day job until you have enough to live on.

However if you are having the feeling of quitting, you need to decide if you want to throw away the last couple years as a try and try again another way. Sometimes ideas and failure make you better the next time. But also it always gets harder before it gets easier.


Why not just get a job and continue building your startup on the side, if the response is mildly positive, then figure out what other problems you could solve to make it overwhelmingly positive. The sales cycle is much longer for B2B products and if you don't have a ton of competition, then getting a job and building this on the side is an option worth pursuing. There's definitely an opportunity there, you just need to make sure you refine your product to hit it.


Get somebody to take a look at your service/idea who has some experience in the B2B market. Talk about it.

Maybe you're so in to it, you don't see what's missing.

I think it's especially hard because you're on your own. Try talking about it with friends or family. They'll mostly give some high level advice, but you'll see it will give you comfort to a certain degree.


September to January is 10K of expenses? That seems like a lot to me. Do you have a family to consider?


Yes - I'm single, with no kids, and living pretty much at the level I was when I was a student at uni. It's not a comfortable lifestyle, but it keeps me in food and shelter.


September up through January is 5 months. 2K a month doesn't sound like a "cheap" lifestyle to me... I would think that even in SF or NY you could squeeze more out of that kind of money; potentially by moving somewhere cheaper (the East Bay for instance).


> which would give me enough personal income and business income to last until around January 2010

First off, 2k a month could be considered frugal depending on area of the world they're living, etc, even for a single person (especially if not living at home or if it's difficult to find roommate situations where they live) when they may have debts, etc.

Also note that number includes further expenses for his business from November to January (at least). And depending on the business, there's no way you can "judge his frugality" on the numbers he's given.

Even if the costs can be $1k or $1.5k a month, I highly recommend he estimates this out with somewhat conservative estimates (for an emergency issue or two) when deciding how long a runway he has. If it turns out to be 9 months instead of an estimated 8, that's awesome, but you don't want to be in month 9 thinking you've got a month to spare and have your car being repossessed.


Well, no, I don't have much information to go on. It just seems like a lot if what he's doing is similar to what many others are doing here. You can get a room in SF for 6/700$, it looks like:

http://sfbay.craigslist.org/sfc/roo/

And there's probably no more expensive/better place to be for startups. There are places that are more expensive, but at that point, you should move to save money. And like I said, you can get by on less and still be in the bay area, if it's important to be there physically.

So I'm not judging his frugality, just saying that from what little we have to go on, it doesn't sound quite right.

Maybe we could even help him figure out how to save somewhere...


the effort to go from $2K/month to $1.5K/month is probably not worth it if you have the option of contracting yourself out; at bay area computer janitor contracting rates, (and I imagine good devs are more expensive than SysAdmins.) that's less than 8 hours of work. If you are good and have contacts, you can realistically expect twice as much; but if you are good, $500/day is reasonable to expect without expending too much marketing effort.

Being frugal is good too... but sometimes spending money makes sense, I think. Me, for example, I drive a $3,000 car, and pay $750 in rent. (I live in the south bay, my girlfriend and I split the rent on a $1500/month duplex) . Paying more isn't going to free up any time, so I don't. But I do hire someone to clean out my house once a week; It seems like a big win, as that saves me a lot of time, for a relatively small amount of money.


I would think that even in SF or NY you could squeeze more out of that kind of money

Good luck.

  studio apartment, best deal in the city: $1000
  1 burrito per day (or equivalent)         $150
  1 coffee per day                           $45
  2 beers per week                           $30
  health insurance                          $250
  muni pass                                  $45
  cell phone                                 $70
  cable modem                                $50
  stuff like soap toilet paper, laundry      $30
  github                                     $7
  hosted slice                               $40
  subtotal                                 $1717
Note that in SF or NY renting a room in an apartment is often more than $1000. Renting your own studio is usually at LEAST $1300. I have a special situation, I don't have to pay utilities. Everywhere else you will have to pay utilities on top of rent.

NYC will cost at least 30% more than this.

It's very easy to spend $2000 living a "cheap" lifestyle. I don't know what I'd cut out here. Aside from coffee and the beer, I don't really do anything a normal adult single male would do. That budget contains no dates, no movies, no restaurants, no books from the book store, etc. If I do any of those things a couple times a month I'm hitting $2K.

Moving to the east bay doesn't save much money unless you move far, far away. The nearby nice parts are not cheaper, the nearby bad parts are sketchy, and the far away parts require a car or else hours on the bus.


I know Hayward's pretty cheap although it's been awhile since I've lived there (mid/late nineties).


I would second the idea of looking for part-time or full-time work as you continue to develop the project. That way, when you do hit launch you can quit the job and have money on hand to see you through the marketing and launch phase till hopefully hitting profitability.


I cant say what you should do. But, have a look at the technologies (if, any) that you have built while trying to build your product. It may be quite possible that the kernel of your effort might be better applied somewhere else.


I think reading through Steve Blank's "four steps to the epiphany" or reading up about the customer development process might help you figure out how to turn those mild positives into real sales.


I'd go back to developing the startup outside of work. Go get some contract work that will pay the bills and give you more time to develop the business on the side.


I work in B2B. Do you have something of value for us at the right price point? Sell me.


How? You don't have an email, website or any other conact data in your profile.


Don't give up, tweak your idea. Also, get a job to support yourself.


Angel finance or friends and family round


In his book The Millionaire Course, Marc Allen writes that "Your business goes through the same three stages that all living things go through: infancy, adolescence, and maturity".

"When your business is in its infancy, have you to care for it constantly. You expect nothing from it, and have to support it completely. Care for your infant business as you would care for your infant child -- with loving attention, with no expectation of any reward... your infant grows at its own pace; sometimes slowly, sometimes instantly, in a quantum leap. As James Allen says, Be not impatient in delay, but wait as one who understands. Your infant business will soon grow to adolescence."

"The adolescent business can take care of itself, but it certainly can't take care of its owners. In fact, the owners may still need to come in with some additional support if the adolescent stumbles for some reason, maybe because it's trying something unproven or risky or new..."

"If you keep focusing on your dreams, and if you're patient and persistent, your company will grow into maturity and be able to support you and many others abundantly."

In the comments people are doing the math to calculate that you need 2K a month to live on. Whatever the amount is, it is then your job to provide yourself with that income to support yourself, separate from your business. You shouldn't expect or depend on your infant business to provide you with that 2K, because you don't know how long it will take for your business to grow up. That your infant business isn't yet supporting you isn't a reason to give up, it just means that your business hasn't grown up yet.

In http://www.paulgraham.com/relres.html Paul Graham writes: "A couple days ago I finally got being a good startup founder down to two words: relentlessly resourceful."

Being relentlessly resourceful means that you come up with the 2K a month. Get some investors. Do some contracting work. Work nights and weekends. Hold a yard sale. Deliver pizza. Do whatever it takes to make 2K a month, separate from your startup.

Your other question was should you sell your 10K of stocks to support yourself. Because you're in the B2B space, you're doing sales. Dave Ramsey notes that people don't buy from a desperate salesperson. Desperate salespeople smell bad. People buy from relaxed, confident salespeople. So, the answer is, in your particular situation, you should start making the 2K a month to support yourself before you need to sell the 10K of stock. Because, with the 10K in reserve, you won't be feeling desperate, you'll be feeling confident. And with that confidence you'll be able to make sales.

How to succeed in your business is fairly simple :-) do what your business needs you to do. If your business needs you to make 2K a month to support yourself, then go do that. If your business needs you to make sales, then do the things you need to do for yourself so that you can be a confident salesperson. And sooner or later, your business will grow up, and you'll reap the benefits.




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