9 ms·

Others do it because it's cheaper than providing full-time salary+benefits. Average people don't really have the resources or connections to open a company.

manigandham 9y ago
What resources or "connections" do you need? Thinking you need all these things before you can start is the biggest obstacle to actually starting.
- sokoloff 9y ago
  Realistically, you need a couple thousand dollars at an absolute barest minimum to open a company and strike out on your own. Incorporation paperwork and filings, even for an LLC in an inexpensive state will be a few hundred, with an Inc generally more. Annual filing fees run $800 minimum in my state; that's if you do all the calculations and paperwork yourself. Then, you need adequate capitalization for the company (to avoid it being regarded as under-capitalized should the question of piercing the corporate veil ever come up). This must be used for working capital for inventory, WIP, raw materials, utilities, salary/living expenses, perhaps rent or transportation and needs to cover you between the time you start and when you are cashflow positive. You may need a license or permit from the town/city/AHJ to operate. Telling someone living paycheck to paycheck to "just go start a company" is fairly unrealistic I think.
  - mmphosis 9y ago
    I had vaguely heard that phrase "piercing the corporate veil" but had to look it up: https://en.wikipedia.org/wiki/Piercing_the_corporate_veil https://en.wikipedia.org/wiki/Piercing_the_corporate_veil A factor for courts to consider: Significant undercapitalization of the business entity (capitalization requirements vary based on industry, location, and specific company circumstances)
- s73v3r_ 9y ago
  "What resources or "connections" do you need?" Money, for one. Time for two.
  - manigandham 9y ago
    We all have exactly the same amount of time every day. How you spend it is up to you. You can choose differently, especially if you're on HN discussing it in the first place.
    - s73v3r_ 9y ago
      Someone who's working two jobs would disagree with you.
      - manigandham 9y ago
        Disagree with what? That there are 24 hours in a day? They choose to spend that time working 2 jobs. I've done the same in the past. I've decided between buying dinner or getting gas to drive to work to earn enough to cover the commute in the first place. Eventually you make decisions to get you out of that life and into a better one. There's luck involved sure, but I absolutely reject any excuses as if it's completely out of your control.
        FranzFerdiNaN 9y ago
        I highly doubt you did those things you claim, because if you did you wouldn't say people "choose" to work two jobs and that it's just a matter of "deciding" to stop being poor.
        manigandham 9y ago
        You don't think choices matter in making your life better? This is just as sad as thinking that things can also change overnight. No you don't just stop being poor, you plan and get yourself out of it, over a decade if that's what it takes. Either way it's still up to you.
- kirkules 9y ago
  This is nonsense. You have to know how to open a company, to have an idea for what it will do, have some way of building your product initially, etc. This knowledge (or the time to find it out on one's own) is itself a resource. Being able to take the risks inherent in opening a company is a resource that your average person might not have for many reasons, including needing immediate returns to support dependents or satisfy immediate and important expenses.
sametmax 9y ago
There is more to it than that. And what's more, knowing things theoretically is very different that having to take a decision while you are exhausted, trying to take a decision before a big deadline, in the commute between work and the family, while your balance sheet is worrying you and you have social pressure from your workers, investors and colleagues. Also knowing they all will be affected by whatever you choose to do in many different ways, short and long term. That's why living the experience is important. It gives you perspective on the decision process, which is more than just numbers.

manigandham 9y ago

What resources or "connections" do you need? Thinking you need all these things before you can start is the biggest obstacle to actually starting.

sokoloff 9y ago
Realistically, you need a couple thousand dollars at an absolute barest minimum to open a company and strike out on your own. Incorporation paperwork and filings, even for an LLC in an inexpensive state will be a few hundred, with an Inc generally more. Annual filing fees run $800 minimum in my state; that's if you do all the calculations and paperwork yourself. Then, you need adequate capitalization for the company (to avoid it being regarded as under-capitalized should the question of piercing the corporate veil ever come up). This must be used for working capital for inventory, WIP, raw materials, utilities, salary/living expenses, perhaps rent or transportation and needs to cover you between the time you start and when you are cashflow positive. You may need a license or permit from the town/city/AHJ to operate. Telling someone living paycheck to paycheck to "just go start a company" is fairly unrealistic I think.
- mmphosis 9y ago
  I had vaguely heard that phrase "piercing the corporate veil" but had to look it up: https://en.wikipedia.org/wiki/Piercing_the_corporate_veil https://en.wikipedia.org/wiki/Piercing_the_corporate_veil A factor for courts to consider: Significant undercapitalization of the business entity (capitalization requirements vary based on industry, location, and specific company circumstances)
s73v3r_ 9y ago
"What resources or "connections" do you need?" Money, for one. Time for two.
- manigandham 9y ago
  We all have exactly the same amount of time every day. How you spend it is up to you. You can choose differently, especially if you're on HN discussing it in the first place.
  - s73v3r_ 9y ago
    Someone who's working two jobs would disagree with you.
    - manigandham 9y ago
      Disagree with what? That there are 24 hours in a day? They choose to spend that time working 2 jobs. I've done the same in the past. I've decided between buying dinner or getting gas to drive to work to earn enough to cover the commute in the first place. Eventually you make decisions to get you out of that life and into a better one. There's luck involved sure, but I absolutely reject any excuses as if it's completely out of your control.
      - FranzFerdiNaN 9y ago
        I highly doubt you did those things you claim, because if you did you wouldn't say people "choose" to work two jobs and that it's just a matter of "deciding" to stop being poor.
        manigandham 9y ago
        You don't think choices matter in making your life better? This is just as sad as thinking that things can also change overnight. No you don't just stop being poor, you plan and get yourself out of it, over a decade if that's what it takes. Either way it's still up to you.
kirkules 9y ago
This is nonsense. You have to know how to open a company, to have an idea for what it will do, have some way of building your product initially, etc. This knowledge (or the time to find it out on one's own) is itself a resource. Being able to take the risks inherent in opening a company is a resource that your average person might not have for many reasons, including needing immediate returns to support dependents or satisfy immediate and important expenses.

sametmax 9y ago

There is more to it than that. And what's more, knowing things theoretically is very different that having to take a decision while you are exhausted, trying to take a decision before a big deadline, in the commute between work and the family, while your balance sheet is worrying you and you have social pressure from your workers, investors and colleagues. Also knowing they all will be affected by whatever you choose to do in many different ways, short and long term. That's why living the experience is important. It gives you perspective on the decision process, which is more than just numbers.