

Ask HN: I think my startup is going to fail, what should I do? - startupguy73

Dear Hacker News:<p>About six months ago, me and two of my friends (we work at the same company) decided to go and start a startup. Since we didn't have funding, we figured we'd keep our day jobs, build the website, get a few users, and then quit and work on the company full time. The initial plan was for me to do the programming/technical stuff, one of my friends to handle getting funding and the other to handle marketing/getting users.<p>I've built a pretty decent site (in my humble opinion), but I think my friends want to abandon the project. They've floated the idea (several times) of just scrapping all my current code and starting over, they don't propose new features anymore, they haven't gotten around to getting the paperwork to form the company since they said they would (in June) and they say now they might never do it, etc., etc.<p>I only put a few months of full-time equivalent work into the company, so it's not the end of the world if it fails, but this sort of thing seems to keep happening to me. When I was in college, I did some research with a professor and he never got around to helping me with the write-up and publishing. I wrote a long article for a magazine last year, sent it in to the editor, they said it was very nice and then ignored it. I did part an earlier web application four years ago, but my co-workers never launched it. How can I avoid this sort of failure?
======
delld
1\. Stop the car and ask them to get out.(Maybe compensate them for the
journey so far.)

2\. Get in the drivers seat.

3\. Hit the accelerator as hard as you can.

4\. If the ride is good, you might get more passengers to ride along.

5\. Even if the ride is not good for sometime, you still might get the
adventurous sort going in the same direction.

6\. Whatever happens don't let go of the accelerator and keep moving ahead.

7\. Most importantly, always remember to enjoy the journey - make stops, meet
people, reflect on how far you have come. It is more important than your
destination.

------
seasoup
Ask them to sign over all rights for the company to you. Prepare to be busier
then you've ever been. Launch. The worst case scenario could be that you get
no users... if that happens, search out a new partner, it should be easier to
find one with a prototype already built.

If the other worst case scenario happens and you get a lot of users, good
problem to have! Find some more help at that time.

You are on the cusp of succeeding or failing. Nothing has been determined yet,
and don't let your partners decision to do nothing stop you. Oh, and it sounds
like they haven't done anything yet.

Next time make sure your partners are putting in as much effort as you are
along the way so that you aren't the only one with flesh in the game and they
along for the free-ride.

~~~
startupguy73
Thanks!

They definitely did put in a lot of work, which is why I'm surprised they're
giving up now. Eg., they made a whole bunch of fabulously slick presentations
for investors that must have taken dozens of hours each (none of them
invested, but hey, that's startup life).

~~~
jacquesm
I've seen this as well but in a much later stage of running a company, a
nearly done deal went south at the last possible moment and everybody got
demoralized to the point where they wanted to quit. I ended up selling my
house to buy everybody out, and it's been a pretty good company ever since.

Not everyone is made to be an entrepreneur you have to take your beatings and
keep going, that is the only road to any kind of success unless you are a very
lucky person.

I'd make a reasonable valuation of what you think the whole project is worth
at this time, try to figure out fairly what their contribution is worth and
then offer to buy them out if you can afford it, or, if you can't to take them
on as silent partners and give them non-voting stock. The latter is a (nearly)
surefire way to never get any investors on board though, you have to be aware
of that.

Then, after that you go and work like the devil to make it happen.

If you can't afford it and/or you don't want to have them on board as deadwood
I'd just walk away, and do something new.

About your 'black cloud' following you, this can happen simply as a series of
coincidences, or it might have to do with the company you keep & pick.

That's very hard to comment on without knowing a whole lot more about the
situations you were in, one thing is for sure though, if you want stuff to
happen and to succeed then you'll simply have to shift over to the drivers
seat, if you think you 'need others to succeed' you are not yet in the right
mindset, you are seeing yourself as a victim or at the mercy of others. That
needs to change for sure.

------
anigbrowl
Straighten out the situation with the rights, first. Establish who owns what,
so that if your buddies decide it's not right for whatever reason, you still
own the right to do things with it. If it's a joint contribution (eg you did
the coding, but you all3 came up with the idea and your buddies each suggested
things like site names and design elements), then work something out now.

Even if they are cool and 'nah, it's all your buddy' _get it in writing_.
Don't ask them to put it in writing, say 'cool, I'll just write that up then'.
(The only part you want them to actually write themselves is their signature
agreeing to the terms specified by...you. This is something I wish I had
realized earlier in life!).

Then launch. Or conduct a limited alpha with HN readers or whatever you need
to do. Also, I do get the feeling you're letting these people (and others)
hold you back a little bit. I feel where you're coming from, and I trust you
have reasons for your disappointment, but you come across as a bit passive. If
you're like me, you may have difficulty sounding out people's feelings, so you
can't tell when someone is seriously interested or when they're just being
polite to blow you off or get something for nothing. The only solution I've
found for this is to be polite but assertive about asking follow-up questions.
If someone vacillates and says 'well of course I do like it...maybe I could
help you later' just let them know you'll keep exploring other options, eg
'Sure, I get that - I guess you won't mind if I take it across the street
then, I need to move forward with this'. It's a terrible drag but that's how a
lot of people are, if you hand them something on a plate they don't appreciate
it and if you take it away they'll complain you didn't let them have a bite.

~~~
Travis
Great advice anigbrowl! I especially like the emphasis on GETTING IT IN
WRITING.

Another point of anigbrowl's I'd like to emphasize: write the first draft
yourself. Discuss transfer of IP from them to you, then write the doc
yourself. Two reasons: 1) they don't sound like they'll get around to writing
it. 2) You can anchor the agreement however you want it, and they will have to
respond to edit.

I never have understood people who ask somebody else to write up the first
draft of a contract / agreement. Yes, you will negotiate on points, but if you
are the original author, everything is anchored where YOU want it to be.

Anchoring is a VERY powerful psychological tool.

------
NoBSWebDesign
_but this sort of thing seems to keep happening to me_

Very respectfully, you strike me as the kind of person who is easily
discouraged.

Let me tell you a story about discouragement (or the absence of). When I was
in high school my parents told me the didn't have anything saved for me and
I'd have to pay for college. I spent my entire junior and senior years
applying for scholarships. There was one really big $20k scholarship in
particular though that I thought I was a shoe-in for.

Well, the notification date passed and I hadn't heard anything. So I called
and called, trying to find out what was going on. The obvious answer was
someone else had won all of the 5 scholarships they awarded. But I wouldn't
stop until I knew for sure. Finally, I found out that they had all been given
out, but that 3 students had declined (they were school-specific). These 3
were going to go back into the budget for next year. I pleaded my case with
one of the administrators, and within 24 hours, one of those awards was mine.
$20k just like that. And there were 2 more just sitting there if anyone else
would have done as I had.

When a magazine ignores your article, it's up to you to make it impossible to
ignore.

Anyway, back to your question... ask your partners to hand over the company.
If that doesn't work, buy them out. How much? Well, how long would it take you
to start over, and how much is your time worth? (i.e. (time to recreate) *
(value of your time) * (their ownership of the company) = buyout at this
point, because you don't have any realistic valuation criteria beyond that)

It might be a good idea to start something new. And don't _let_ things happen
to you, _make_ them happen.

------
byoung2
_How can I avoid this sort of failure?_

The only way to avoid failure is to stop trying. Unfortunately that is the
same way to avoid succeeding. I think you need to find less flaky people to
work with.

------
launch
Wow, this sounds remarkably similar to my situation except there is me and
just one other friend and we've been doing it a couple months less than you.

I'm going to talk with my friend this weekend and get things sorted out. The
worst case is that I will just launch the site as a minimalistic version and
then work on a separate business idea by myself.

I think the main problem is that my friend is completely non-technical. I was
relying on him to do the marketing.

As a follow up question, how do you separate duties between a technical
founder and a non-technical founder in the first few months of a startup so
that all people have equal amounts of work?

With my idea, I was prepared to invest more up-front time as I was solely
developing the website with the expectation that my partner would get things
going at the appropriate time.

I guess that is a mistake in hindsight.

This comment probably doesn't help you in any way but hopefully we can learn
something for the next time.

------
RiderOfGiraffes
Summarising, and adding my $0.02 ...

Since they want to abandon it, get them to agree _in writing_ that they are
walking away and leaving you everything. Make sure you write the agreement,
and get all parties to _sign it._ If you can afford it, and if you think they
deserve or will want it, offer them some money. If they accept money, _get a
receipt._ I believe having money in exchange makes future disputes less
likely. You made an offer, they accepted, they got money, you got the rights.

While you are doing this, get a few opinions from people who have never seen
it before. People here on HN are usually pretty straight and pretty honest.

Target limited alpha launch (not just a couple of people dropping in) for two
weeks from now. Target beta launch two weeks after that. Don't move those
deadlines, just make sure you hit them. If you can bring them closer, do it.

Launch, and listen to the feedback.

A comment about the failures: Each one you mention, the failure is that you
have not taken control. You are doing the work, but you are not driving things
through. If you are ever going to succeed in these sorts of things you must
see what needs to be done, and get it done.

Finally, you can contact me directly if you want. There are two ways. Firstly,
find a real email address for me. It's not that hard, others have done it.

Alternatively, read this page:

http (colon) //www (dot) penzba.co.uk (slash) DHMW_Challenge.txt

I'd prefer not yet to have a direct link. On there you can find instructions
on creating a public-key message for me which you can either post or,
preferrably, put in your profile. It's probably secure enough for what you
want.

If you want to do this but have trouble, reply to this comment.

On the other hand you can give up and walk away, but from what you say, you've
already done most of the work. Be methodical, make a plan, then work through
it.

------
sachinag
Dude, you've been taken advantage of. You did all the hard work; while your
friends may have brought the idea to the table, they're not invested the way
you are. Your friends are the assholes who give "business guys" (like me) a
bad name.

I can do a fabulously slick presentation in half an hour (I've charged people
to make slick presentations for them (if you can't make your own docs, contact
me - it's only $150 an hour :) ). You've done vastly more work than they have,
trust me. You should let it go and let them fend for themselves. Hopefully,
you've learned some sysadmin stuff you can apply at your next gig, but this
has been a harsh learning experience.

------
credo
>>How can I avoid this sort of failure?

It seems like all of these "failures" were related to your dependence on some
other people. Once they gave up on you, you seemed to accept the effort as a
"failure".

I have two suggestions 1\. Perhaps pick your partners a little more carefully
2\. Work on a venture that doesn't depend on other people ...or at least don't
give up immediately after your partners give up. imo suggestion-2 is the way
to go, but perhaps you should also consider why you have always been dependent
on other people for your success plans.

------
pm
I hate to be cynical, but most people are going to flake out. Many people
overcommit themselves, or just say "yes" because they thought it was a good
idea at the time. I've experienced this sort of flakiness - and done it myself
more times than I can remember.

You sound like the kind of person who prefers the social bonding that co-
founders provide, as I do too. However, sometimes you need to go it alone,
because most people won't be able to connect the dots the way you do. In most
of these situations, my motivation would peter out because there was no-one
with which I could share the success. Eventually, I sucked it up and rode on
without a co-founder, and now I'm having the time of my life.

Startups are difficult, especially by yourself. But the short-term pain is
worth it.

------
walesmd
It appears to me that you brought in 2 friends for the sake of bringing in 2
friends, not because you needed them.

One guy's job is to handle funding, of which he has yet to acquire any, and
the other guy's is to handle marketing and getting users. This really sounds
like the duties of one dedicate individual with a background in business
and/or marketing - not sure what your friend's backgrounds are.

I've been in this situation before and it comes down to a simple decision: do
you want them around any more?

If so, sit them down and tell them they need to start pulling their weight.
Maybe they lack direction and need you to provide that for them (which is
worrisome, since one of these guys is supposed to be fulfilling the CEO role
at this point).

If you want them gone, draft up some paperwork stating that they are bowing
out, they want nothing to do with the company, and you don't owe them anything
for ever and ever amen.

Just reading your situation here, it sounds as if the latter is your best
option. You are basically doing all of the work yourself it seems and dragging
2 friends along with you. Add another hour to your schedule each night for a
week and you could complete all of the work they've done the past 8 months or
hire people freelance to take care of some of that for you.

------
keeptrying
It looks to me that you have some kind of mental block over judging people or
your too quick to trust. I used to have the same problem.

In American society its frowned upon to judge people but the truth is if you
want to trust someone then you have to judge them by their actions.

Its usually the hardest to judge your friends because you've subconciously
glossed over their flaws. If you look carefully at the way someone does things
(and this can be anything) and how they behave then you'll get an idea of what
he/she's capable off. You have to be careful so you dont mis-judge people but
you do have to do it.

So dont be afraid of judging people. And always judge before you form a
relationship with them.

------
dpcan
It sounds like you constantly depend on other people too much. Have you
thought of bootstrapping and just doing everything yourself?

My favorite quote of all time is "Only victims make excuses." I think you need
to stop being a victim.

------
holygoat
Your friends are flakes. Get as much ownership as you can (all, maybe, or
perhaps just the code — it doesn't seem like there was a great deal of
formality) and go it alone. They're not helping.

------
DrewHintz
> one of my friends to handle getting funding

Why do you need funding?

------
seanc
Comes down to a simple choice, Red. You gotta get busy living or get busy
dying.

<http://www.imdb.com/title/tt0111161/>

------
taitems
Can you tell us what the startup is called? Or at least what kind of work you
guys do?

~~~
startupguy73
I don't want to do anything that might provoke a fight, and they might be
reading this.

~~~
ApolloRising
Why would it? You are not saying anything bad other than they are not
interested in it anymore.

------
noodle
better question: after a few months of full-time equivalent work, why don't
you have something you can launch? or is it not that type of company?

~~~
startupguy73
We could have launched it last month, but I don't think I could handle the
workload myself in my spare time, and they want to keep delaying our launch
until they think the site is perfect.

~~~
noodle
screw that, launch. launch it and control your workload by controlling your
marketing plan, trying to keep the number of users in check with what you can
handle. then polish it.

~~~
JCThoughtscream
Seconding this. You're not going to have a perfect site specifically because
you haven't launched. Without audience feedback, all you're doing is endlessly
second-guessing yourselves - that sort of feedback exacerbates any existing
groupthink behind the design, potentially causing it to be far less usable
than it originally was.

~~~
zemote
Third, launch then get feedback, interate quickly. I was scared when I
launched my startup, but you will realize it takes time to get users to try
your service out. We were lucky to get techcrunched before launch which led to
a bunch of signups for our beta. So we had about 2000 users on our list prior
to launching.

