I am not a big fan of Truemors, but I really enjoyed reading about what he spent and the things he did to get it off of the ground.
He seems patronizing: his entire post reads like a satire, i.e., "Look, ma, I made a social networking site, too, just like the ones all the cool kids are visiting these days".
Also, he seems to enjoy mocking the lower costs inherent in Web 2.0 by exaggerating how cheaply he built the whole thing.
That may not be his intention, but that's certainly how it comes across.
Any responsible investor, either angel or VC, will want to have some sense about that, even if revenues and profits "come later".
YC gets a lot of criticism in that regard, but to their credit, they do ask applicants how they intend to make money with their project.
If he can get 260K page views, even a 0.5% clickthru @ only $0.10 an ad is $130. Not great, but if you can do it every day you've got a site that's pulling in $50K in revenue a year. Not bad, but could be something to explore.
I totally agree with you that you need to know where your business is going to go and if you want to get real funding you'd better have a business plan, but if you're running a $12K test, why not just make sure you think there's a model and then test it?
Guy's own blog proves that would have been his best course of action--as the publicity he got was free and would have been so regardless of what language he used or who created his logo.
My friends will see a private beta, and then I'd like to start looking for some funding. Will I need to be incorporated before that point?
The main reason to incorporate or LLC is to protect yourself from legal liability. If someone sues you, you want to protect your personal assets from being part of that lawsuit. If you're not even going to be live, then you may not have anything to worry about.
If anything, he could've saved an extra $1000 at least, giving me a bit more hope as I start my venture.
I don't understand this part (either). First of all, 55 domains is way overkill. Maybe some of the country-coded TLDs are worth it if you're really going to do, say, a German-language Truemors.
Ok, so even then, 55 x $6.95 =~ $385. (GoDaddy does $6.95 domains with discount codes. There are scores of discount codes out there. Use CHILL3, for instance.) I can understand being a little lazy, but $700 lazy? Even if you're rich, 700 bucks is 700 bucks.
If it was me: F the country codes. Register .com, .org, .net, .us, .info, .biz. And you're done -- in fact, you're beyond done. You don't really need that crap at all. You need some SEO instead, perhaps.
The only reason Truemors is getting so much coverage is that its Guys site.
Too bad it's worthless. If he actually made something new and/or innovative, his celebrity would actually be put to good use.
Well, just because you're a celebrity doesn't mean you can't fail. You just fail bigger.
As for the technology, we've seen how cheap and reproducible that is. News.yc, Reddit, Digg, Netscape, and dozens of other sites have technology that probably beats that of Truemors. So the company isn't worth buying for that.
Some companies get bought for their employees. Well, Guy's "1.5" employees, if he's talking about a full-timer and part-timer other than himself, aren't visionaries, they're just people who can turn around one of Guy's ideas. Come to think of it, that makes them better potential hires for a big company than most headstrong, visionary startuppers.
So Guy just spent $12k making himself feel good. By doing so, he demonstrated how detached he is from the real world -- which, psychologically speaking, is a fine way to live. If you're like Guy and you can afford to blow $12,000 doing it.
Why?? I have yet to completely understand this. PG, in one of his essays, also says that you should go and pay an expensive lawyer rather than use an incoporating service. Why?
Is there something The Company Corporation is doing wrong that a high-price lawyer would do right? Maybe I don't understand something, but all you're doing is filing some standard legal documents, right?
What is there to do so wrong? $4,824.14? Really?
IANAL obviously. I wish lawyers hung out here. Does anyone have any insight?
Wow! That's good to know, thx. The buyers didn't have a problem with the incorporation details? Did the issue come up at all?