Joel Gascoigne

A short while ago I wrote about one of the ways I think people could bootstrap a startup from zero funds. I called it “working in waves”. Of course, there are more ways than one to get a startup off the ground with no funds. Today I want to share with you my thoughts on building a startup “on the side” and I’d love to hear what you think or any experiences you’ve had.

On the side?

One of the issues with working on a startup is that you are very often moving from a world where you are rewarded immediately for your work to a world where the reward is delayed. The problem, therefore, is having funds in order to get by while you build something up.

One way to have enough funds to get by while you build up your startup is to build your startup “on the side”, in other words whilst you are doing other work. I am currently experiencing this first hand and I have realised that doing things in this way also brings about some other benefits, and of course there are a few challenges if you try doing things this way too.

Great reasons to build your startup “on the side”

Constraints make you focus

When you’re doing 40 hours a week of paid work, you really have to make sure that the few hours you spend moving your startup forward that week count. In my experience this is a very good thing. Now that I am working “on the side” I am much more effective per hour than when I had stretches of multiple full days to work on my startup whilst using the “working in waves” method.

Forced patience

Patience is not often a word which is used to describe what is needed in a startup. However, I have come to the realisation that at the early stages of a startup you need to be obsessively working on getting customer feedback. What has worked for me is adjusting something, and then reaching out for more feedback and then analysing the current situation. Working full-time means that without realising it you are forced to wait long enough to get some feedback before you pivot your idea again too soon.

Questioning what’s necessary for version 1

When you have a long runway of full days and weeks to build your startup, it’s easy to think “we need to launch with that” or “it won’t work without this”. When you’re working on your startup full-time, this might add a few weeks onto how quickly you can get your MVP out. Do the same when you’re working “on the side” and it’ll take you months longer. Working “on the side” really forces you to question what needs to be included in that first version.

Challenges when building your startup “on the side”

Potential burnout

In my experience, your todo list for your startup never ends and even when you think up an idea that you think is so small that it can be done in a week, it takes 7 and after you get it out there you have a flood of other thoughts for what to add to it. It’s easy to work long hours and sleep can really suffer. It’s a constant battle.

Am I going too slow?

When you’re working on paid work you’re often thinking about your startup, and you’re often thinking that you need to be working non-stop. Most of the advice out there says we should be. On top of that, let yourself succumb to the myth that you can be killed by your competition and you’re in for a tough ride. In the early days of my latest venture I got around this by making sure I did at least one thing to move my startup forward a little, no matter how small.

What do you think?

I am now happier working on my startup “on the side” than I was when “working in waves”. I certainly don’t doubt the advantages of an accelerator program such as YCombinator but when you’ve made your decision to bootstrap without funding and you don’t yet have a business making you money in a scalable way, I think the best way is to attempt to build up something to ramen profitability as your first venture. That’s what I’m doing, and then maybe after that I will go for the home run.

Do you have an experience of building something on the side, or are you considering doing it? I’d love to hear from you in the comments.

Photo credit: Marlon Bunday

I’ve spent the last year and a half after graduating from the University of Warwick juggling working on startups and working as a contract web developer. I’d like to share some of my reflections on how to bootstrap a startup from zero funds. This time I’d like to talk about what I’m going to describe as “working in waves”.

Waves?

When you think about launching a startup, it is easy to think about all the reasons why you can’t do it now. Of course, many say that what makes an entrepreneur is having these fears and doing it anyway. One of these may well be funds. You think you need a certain amount before you can start.

One way to have enough funds is to work full-time (or intensely) for a certain period of time, and then work full-time (most likely more than full-time!) on your startup idea. I call this method “working in waves”.

Why work in waves?

Working in waves may be an attractive idea because it allows you to focus fully on your idea for a significant period of time based on how much you decide to save. You can work out your expected burn rate before you jump into the wave, so you know when you’re going to run out of funds. This gives you a significant amount of pressure to deliver during the wave. Full focus combined with pressure to deliver must mean you’ll succeed, right?

If you’re lucky, it takes just one wave

The ideal scenario is that you save up a certain amount of funds and then you get to work on your startup, and everything goes to plan. You start generating revenue to reach ramen profitability or you get investment before your funds run out.

I don’t know about you, but after some experience of startups I’ve learned to make as few assumptions as possible and to test assumptions rigorously. Therefore, I think that it is very unlikely that you will “make it” in just one wave. I’ve been there and failed. Steve Blank often talks about this:

Unless you were incredibly lucky most of your assumptions are wrong. What happens next is painful, predictable, avoidable, yet built into to every startup business plan.

The problem with working in waves

The key issue with working in waves is that when you’re building a startup, in my experience, it inevitably takes longer than you expect and that means that you run out of time.

Running out of funds or even just heading towards running out of funds is very disruptive for a startup. It affects your productivity, your judgement and your motivation. You know that soon you’ll have to find some work in order to save up again for another wave. It also means that you are moving forward with improving your product at a slower pace, and this can affect how your users view your commitment. I therefore wonder whether “working in waves” is perhaps one of the less good ways to bootstrap a startup.

Other ways to fund your startup

Having experienced “working in waves” and also experienced the “on the side” method of funding a startup which I will talk about some other time, I have been pondering whether there are any other methods. This has lead me to think increasingly about ramen profitability, and what a difference it would make to the mindset whilst working on a startup. With the survival aspect taken care of, I assume it would make a huge difference. I hope to be lucky enough to share with you just how much of a difference that makes sometime.

What are your thoughts about or experiences of funding an idea? I’d love to hear from you.

Photo credit: silverxraven