
I was a $200K VC, now I’m a $0 entrepreneur – first thoughts - nycmbacoder
http://tryingtohackit.tumblr.com/
======
alexcabrera
Leaving a $200K position where you developed a network of people who's
business it is to fund companies in two of the biggest tech environments in
the country is hardly starting from the bottom.

------
asanwal
Good luck.

One alarming thing IMO in the post is the focus on getting funded vs.
validating (or even selling) a product

Funding is just an ingredient (not even required always) in the recipe. The
final product is the cake.

Bootstrap if you can -- build something people want (sorry for the trite
startup advice) and charge for it.[1]

Don't mean to be pedantic. I just find the narrative on getting funding as a
pre-req for success which has become the norm to be a bit overblown.[2]

Notes:

[1] I'm a co-founder of a bootstrapped 7-figure recurring revenue SaaS
business in NYC.

[2] 2/3 of last year's tech exits were not institutionally funded --
[http://www.cbinsights.com/blog/trends/global-tech-exits-
repo...](http://www.cbinsights.com/blog/trends/global-tech-exits-report-2013)

~~~
RyanZAG
He was a VC previously. VC generally has a very strange concept of
entrepreneurship that seems to boil down to VC being some kind of gate keeper
over who they allow to be successful by throwing money at them. It's also why
most VC companies are terrible at both advice and actually making money for
their investors.

The good VCs realize that they're just a minor part in helping an already
successful business expand rapidly. These are the kinds of VCs who end up
funding companies like WhatsApp.

------
sheetjs
A few notes regarding failures (because I think the linked quora post didn't
do justice):

\- Bill Gates and Paul Allen's first venture was Traf-O-Data, attempting to
process traffic data. They built machines as part of this. On their "demo
day", their machines didn't work. Eventually, Washington State obviated their
business and they moved on to form Microsoft

\- RH Macy failed _seven_ times before founding the biggest department store
in the world (I wish the number 7 was included in the response)

\- Akio Morita's first product was a rice cooker, which was a self-described
"memorable failure", selling less than 100 units. He then partnered with
Masaru Ibuka to form Sony

~~~
city41
Scott Adams champions "fail till you succeed" quite a bit. He's had a string
of interesting failures too (listed out at the bottom):
[http://online.wsj.com/news/articles/SB1000142405270230462610...](http://online.wsj.com/news/articles/SB10001424052702304626104579121813075903866)

~~~
bruceb
There was a guy who failed 10 times...and never made it. I don't who he is
because he didn't make it. Sometimes if you fail a bunch it really is time to
pack it up and get a steady job.

~~~
asenna
I don't think so. You never know, he could have been successful in his 12th
attempt but how could he have known if he did not try.

That's the thing about success. You know its there, you just don't know how
many tries it would take you to get there.

------
zeckalpha
> "being a pre-funded entrepreneur SUCKS"

You don't have to go for funding. You seem to be psyching yourself out. I
don't know the details, but given your previous job, well-managed expenses
should readily allow for bootstrapping.

~~~
k-mcgrady
Unless he's doing a 'get lots of users, think about money later' product. With
the money he probably has set aside bootstrapping a SAAS business of something
with a business model from day one would be easy and probably not require
funding but otherwise he'll need funding eventually. Given his previous job
and likely connections though getting some seed funding shouldn't be too hard.

~~~
zeckalpha
I'm not sold on 'get lots of users, think about money later' products. ;)

------
k-mcgrady
It's interesting seeing how difficult the author finds it being an unfunded
entrepreneur. Offers some perspective on how difficult it is for entrepreneurs
starting off with nothing. At the very least the author probably has a decent
amount of runway from working a well paid job previously. Not to mention the
connections to the VC world. I'm not trying to take away from the authors
struggles but trying to point out if it's that tough for them just imagine how
tough it is for the rest of us.

------
balls187
> When I go to parties and people ask me what I’m doing

I know I'm being a little cynical here, but you should be working on your
startup, not attending parties.

If you're going to sacrifice to do something, go all in.

I went through a similar process: I left a well paying engineering job to be a
technical co-founder at a startup, with a 6x decrease in salary.

I had exactly $30k in savings, not including retirement, but was lucky to make
an income of $24k right off the bat.

I cut my expenses to the bone--short-sold my house and moved into low-income
housing, took my clothes to a seamstress to repair, bought from second hand
stores, racked up credit card debt, did a couple side gigs to get a free gym
membership, basically everything to conserve my cash.

It was great to get my expenses down, but it was not fun having to make tough
decisions.

Ultimately, I ended up parting ways with the startup, and rejoined the
workforce as a dev, but not after whittling my savings down to nothing, and
racking up $10k in debt.

And

I would do it all again in a heartbeat, because it was one of the best
experiences of my life (also being a part of TechStars helped).

~~~
PhasmaFelis
> _I know I 'm being a little cynical here, but you should be working on your
> startup, not attending parties. If you're going to sacrifice to do
> something, go all in._

This is ridiculous. Devoting every waking moment to your job is a quick road
to burnout and permanent failure. You _need_ personal time to relax and blow
off steam, whether that's going to parties or quietly reading in your living
room.

~~~
balls187
> Devoting every waking moment to your _job_

I agree.

But a startup is more than a job. The mentality I had as an employee is much
different than what I had as a founder.

Some start-ups are like rocket ships, and they just take off and wildly
successful.

More often than not, most startups don't have that amazing trajectory right
off the bat. My personal belief is that taking that extra hour to perfect a
feature, or refine a pitch, or do customer outreach, or test your product, is
what separates the rest of the startups--ones that make it to the next level,
with those that don't.

There is some element of luck and skill involved, but it's that championship
drive that is required.

Do you need time to ensure you don't crash and burn-yeah, I'm totally with
that. Perhaps the poster's way to let off steam is to go to parties, which
seems doubtful--though I suspect he probably doesn't really go to a lot of
parties, and that it was more of a figure of speech.

------
RealGeek
> _I feel VERY uncomfortable about not being the [insert respectable job title
> at respectable company here], and now am a pre-funded entrepreneur._

> _TLDR: being a pre-funded entrepreneur SUCKS in a lot of ways, but I’m
> pretty sure if I ever “make it”_

This guy needs to get his head out of the funding bubble. He sounds like the
only goal and metric of success for his startup is to get funding. Getting
funding won't make you successful; running a startup with funding that isn't
growing sucks even more. In fact it will escalate the pressure and your
work/life balance may get worse.

------
btbuildem
Seeing how he has (presumably) an extensive network from his VC days, and
(presumably) a decent enough cash runway from having just left a well-paying
career.. I would hesitate to call this "starting at the bottom".

Still.. good luck. Coming from that background it might be a bucket-of-cold-
water awakening of what it actually takes to get a startup off the ground.

------
larrys
This is the type of post that appears on HN from time to time that reminds me
of the days in the 50's and 60's when college students apparently would
compete to write to Dear Abby with a story believable enough to get published.
[1]

HN has absolutely nothing to go on to show that this isn't completely made up
fiction and not worth the time to comment on anymore than if someone wrote
"hey I wonder what it would be like if a VC left a 200k job and decided to do
a startup".

Separately if this really was a former VC [2] earning 200k would seem that the
publicity value of actually giving your real name would be well worth the hit
on your ego.

[1] Sorry can't find a link to support because this is from memory of way back
(not that way back I'm not that old..)

[2] Hey look it could be but it wouldn't surprise me at all to hear that this
is complete fiction.

------
wpietri
Despite myself, I'm impressed. I'm lucky that I'm averse to the trappings of
success. For somebody who enjoys that to walk away has got to be hard. And I
expect that there will be a lot of humbling experiences ahead. I look forward
to hearing what happens.

One minor nit that I mention because it's a pointer to a broad problem in the
industry. The writer refers to themself as "a pre-funded entrepreneur". A lot
of people act as if professional investor funding is the only option. As
somebody who has started businesses both with and without investor money, I
strongly encourage entrepreneurs to at least keep an open mind. Be a "pre-
revenue entrepreneur" or a "pre-profit entrepreneur". A culture of treating
investment as a success proxy is useful for VCs, but dangerous for
entrepreneurs.

------
zbruhnke
I read this and had a mix of emotions.

First I kind of felt sorry for the guy, then I quickly realized there are much
worse perdicaments to be in.

I was living in Louisiana as a college dropout who had sold one company and
(fairly easily) making about 200k/year between one full time job and some side
work.

In Louisiana that is good money, like REALLY good money, I could've easily
lived for a very long time and saved a lot on that, my mortgage there is only
about 1k month with all the utilities paid too.

But several months ago, I quit my job, stopped consulting and moved across the
country to CA to work on my next startup.

after about 5 months I started to get very nervous, my accounts were seemingly
dwindling and reveue still seemed a ways off for the startup.

So naturally we started looking for funding only coming to realize noone wants
to fund a startup simply because they need the money.

Then I realized something far more important.

I have skills. I consistently made very good money before. I was capable of
this again. I put a few feelers out and quickly got to help build out an
awesome new product for a really great guy with deep connections.

Fast forward a few months and our little startup now has strong revenues,
things are looking up on several fronts and that little consulting gig I took
let me earn several thousand dollars, pay off bills and build a great
relationship with someone who is sure to be a very successful first time
entrepreneur (he's already had a successful career in finance).

All that to say if this guy was making 200k/year before chances are he has a
good skill or set of skills and he should be looking to that to dig him out of
this hole not to investors for funding for what sounds like a failing
endeavor.

Most people aren't as fortunate as I was or as it sounds like this guy is.
Many people in a similar situation to mine would not have had the skillset or
network to pull of what I was able to and they would have likely had to get a
regular job somewhere or move in with friends etc. When you have a skillset
that allows you to generate large amounts of income your life just is not that
hard.

Sorry for the rant, but someone should tell this guy to get over himself just
a bit. Whether he believes it or not, he's a pretty lucky guy

~~~
balls187
> In Louisiana that is good money, like REALLY good money

200k is really good money everywhere.

But yeah, with the cost of living in LA, 200k/yr REALLY goes a long way.

------
tzm
He seems to be a victim of his own pattern recognition. This can be a
paralyzing effect.

------
dsugarman
you will likely never view this time as 'the best time' you have ever had,
maybe the most motivated. With all the urgency we had the whole time trying to
build our company, it wasn't until the bank account was actually hitting 0
that we finally did what was necessary to get to profitability. The lesson we
learned was that anything that requires time to build is not really possible
as a first time entrepreneur, you need to find something that will require the
least effort to get traction. I would strongly focus on getting revenues
rather than getting funding.

~~~
taf2
definitely not good times IMO... the one good thing I can say about the times
before being self sustaining... you don't forget, so everyday I remember just
how bad it was is a huge motivating factor to keep it the way it is now -
better.

------
johnyzee
> if I ever “make it”, I’ll look back on these days with fondness as the best
> time I ever had

Even if you fail you will look back at these days as some of the best times
you ever had.

------
lindig
Good luck! Is this a stealth project because the service or product wasn't
mentioned? If not, I would suggest to use the exposure on HN to get some
feedback.

------
deleted_account
"I’m writing this because there’s a lot of widely read blogs from people who
have had amazing success, but very few from people like myself, who are
starting from the bottom."

$200K a year? That's the new definition of "starting from the bottom?"

~~~
jitnut
Guess he lost all of it and now back to zero.

~~~
k-mcgrady
I read that as his yearly salary not savings he'd lost.

------
jitnut
Welcome to the other side of the table!

------
francoismathieu
Why no name?

------
downandout
About the only reason he would need to "know where all the free WiFi spots in
the city are" is if he is homeless or living in a weekly motel that has no
wifi. If that is the case, then he has no business trying to be an
entrepreneur right now. A recent scientific study on successful people (I
don't have the link handy) concluded that _" success boils down to serially
avoiding catastrophic failure while routinely absorbing manageable damage."_

So, he has either A) fallen on extremely hard times, in which case he should
go take a job, even if only for a few months while he builds up enough money
for Wifi at home and at least a month-to-month apartment or B) is being
overdramatic. In this case, I'm guessing it's B. That's bad, because it
discourages entrepreneurship when people mistake difficulty in starting any
business for poor planning or a flair for the dramatic on the part of a
specific individual.

~~~
nostromo
> he is homeless or living in a weekly motel that has no wifi

Yikes, you guys can be so harsh.

Some people don't like to work at home all the time.

~~~
downandout
The post implies that he _must_ know where the wifi is and that his money is
dwindling down to nothing. I have a problem with it because there are lots of
people on HN thinking "maybe I can start a business" and stuff like this is
needlessly discouraging. Further, if he is successful, he will have shown a
wrong and very dangerous approach to starting a business. Going "all in" on
something as failure prone as a new business is something no one should do
unless they simply have no choice.

~~~
dwightgunning
The only thing the author really shares is that they've quit their job, they
work from cafes, and they know how much runway they have.

Nowhere do they say they plans to work from the cafe forever or the plan is to
keep going until the bank account actually reaches zero. And if that is the
plan, so what? The reality is there's always risk and there's no right/wrong
way to start and grow a successful company.

What is important is that they're chasing something and documenting the
experience from the very beginning so that others can learn from it. That's
encouraging and deserves some credit.

