This article does a wonderful job explaing why moonlighting is a poor path for people to start new companies.
But we don't have to reason this one through - we just look out into the world and check.
All in all, it does look grim. Most of the successful software companies do seem to have taken a big plunge at some point. Consulting companies don't count, but consulting companies that have morphed into product companies might.
Can anyone think of a few successful companies that have started this way? Or, if not successful companies, personal applications that someone managed to sell for a lot of dough?
Joelonsoftware's fogbugz might be a good candidate, as well as the 37signals apps. I think that delicious was started as a personal project by an employee with a full-time job. None of these are the giant, smash successes you read about in the business section of the mainstream press, but they can be still be remarkably profitable quiet successes.
What spawned this post was a lot of the email I get from Go BIG members talking about wanting to pursue their idea, but they don't want to take any risk to do it.
I used the job example as the most common issue that people tried to circumvent, but I think you can moonlight in some cases just fine.
There is risk and sacrifice in moonlighting, too. I think people have unrealistic expectations as to what starting a company means though.
This is probably the most controversial topic possible here. There's nothing that could offend people more than the idea that deep down they might not really have the determination they think they have.
It's so easy to fool yourself into thinking you can have your cake and eat it too. How many people get into the upper-middle class lifestyle of a programmer and then are willing to go back to living like a poor college student? Very few. So moonlighting becomes a way of trying without taking the plunge.
Someone might say about quitting to do a startup: "Yeah..maybe you can't diet without getting your stomach stapled, but I can."
Eating a healthy diet and exercising might be similar. It's something that tons of people want, but so few are able to actually sustain over the long-term. I think a lot more people would successfully exercise and eat healthy if they didn't have day jobs. If they had plenty of extra time to go to the gym and cook meals. I think the same thing is true for doing successful startups, but to a much greater extent since they require so much more effort and time.
True, lower the risk, lower the reward if it pays off. However, I think starting a business beside a job is a good way for people who want to start something small. Sure, they're not going to create the next Facebook part time in their garage. But they might build a nice lifestyle business that gives them quality of life.
There are also people in my position who have to start something big while moonlighting. I make 35k a year, so after car payments and living expenses (not credit card debt though, thankfully) there's simply no way to save up fast. I'm saving, sure, but at this rate it'd be a year before I could quit to spend 3-6 months on our startup. Godda start now.
That's.. certainly one way to do it. I'm debating that, but it's another thing when the chance of you failing affects someone else (for example, if you have a family). Technically you can't 'fail' at a startup, you just quit working on it, so how long do I invade their life? I couldn't bear to ask Emily's father to support me for a year or more.. It just feels morally wrong, especially when he's already 20 years in home debt and is supporting three children and a wife.
Does it make me a non-entrepreneur to worry about morally wrong things? I don't know.
Nope. Entrepreneurship and ethics go together. Chances are you can make more than 35k working as consultant or some odd jobs rather than working for someone else. That could be your first step. There are lots of people who would love to know what you know. Put a simple web page and offer consulting services and go to Odesk, Craiglist. Soon you will have a better income and more time for your startup.
What a bunch of bullshit. This is at best stupid business-book pith, and at worst completely irresponsible advice. The parts about using your personal cash, spending kids college fund, blowing through your retirement account are particularly egregious. The founders of the most successful companies in Silicon Valley sure didn't risk their own money building their empires. If you're starting a (failed) nightclub in Cleveland, maybe it is a different story.
I for one agree with the author's point. I live in SV, working on a seed-funded start-up, and yes, it is a lot of personal sacrifice and risk. And, yes, a lot of founders risked their own money, careers and family relationships building their companies. Read "Founders At Work" for some examples.
I definitely would not risk my family or my retirement account, but I do know people who did and succeeded (and people who failed too, obviously).
I think his point is that companies that can't get funded usually won't be successful, because there has to be something wrong with them to not get funded. Only someone who lives in the Valley and sees how easy it is for someone reasonably connected to get funded could have this attitude.
This isn't always true but there's at least some truth there.
This is "Hacker News" , formerly "Startup News", not "Small Business Bad Advice News". Your post doesn't contain any real content, it is just SEO spam for your website.
Stuff like this makes my brain hurt. Ok, so you wrote a post that essentially yells at people, good job. What value does this add? what problem have you solved here? Let's keep hacker news to submissions that are relatively content rich and engaging.
But we don't have to reason this one through - we just look out into the world and check.
All in all, it does look grim. Most of the successful software companies do seem to have taken a big plunge at some point. Consulting companies don't count, but consulting companies that have morphed into product companies might.
Can anyone think of a few successful companies that have started this way? Or, if not successful companies, personal applications that someone managed to sell for a lot of dough?
Joelonsoftware's fogbugz might be a good candidate, as well as the 37signals apps. I think that delicious was started as a personal project by an employee with a full-time job. None of these are the giant, smash successes you read about in the business section of the mainstream press, but they can be still be remarkably profitable quiet successes.