5 ms·

Simple: capex and economies of scale. Suppose that I have an idea for a widget which market research indicates could sell for $20/, but probably not $50/. I c

Simple: capex and economies of scale. Suppose that I have an idea for a widget which market research indicates could sell for $20/, but probably not $50/. I can hit the $50/ target with small contract runs, which would cost about as much as a down payment on a house. Or I can make it in volume for less than $10/, but I need a large minimum order, space, equipment, logistics. Now we're looking at 7-8 figures. If you aren't independently wealthy, neither option is really feasible, and the former option will almost certainly end in tears if you try to stretch and bootstrap with your own money.

Domenic_S 3y ago
If you're really sure, you do that first run and lose money, then show a bank/investor the explosive popularity and get money for manufacturing at scale. Relatively speaking it's close to the easiest type of funding you can get.
- deleted 3y ago
  [deleted]
brigadier132 3y ago
> I can hit the $50/ target with small contract runs, which would cost about as much as a down payment on a house. I wasn't thinking of this from the perspective of a hardware startup but a software startup which doesn't require either of those things. I should qualify my original post with that. You don't need to be independently wealthy to launch a software business on your own provided you have the ability to build it yourself.
- groby_b 3y ago
  Kind reminder that starting a software business still requires you to, you know, live and stuff :) Even if you can build it all by yourself, for most people runway is limited by savings. And that means that with a few exceptions, it's hard to stretch beyond a couple of months (or maybe one-two years) before you need to think about shutting down. If you can get to profit before that, awesome, your business might be a good idea. (You'll still have depleted a good chunk of your savings, and it's not like the world comes with profit guarantees) Investment buys runway, opex, and scale. Some businesses need that, some don't. Software work reduces the opex load (for many attempts), but scale and runway might still be necessary.
  - s1artibartfast 3y ago
    You can often found it as you go from a primary job and or a spouse's job. I have a friend who drops about 100K into his startup a year hoping for a big exit. Pretty much all startups or small businesses involve risk. Your other putting in time or money or both. The Only Exception is if you find deep pocket feces that are willing to pay you a good salary to work on your own project, which is especially rare
    - boondoggle16 3y ago
      If someone has 100k to drop on a startup annually, I'm sorry, but they are totally out of touch with normal people. That is not normal.
      - s1artibartfast 3y ago
        That depends on what you mean by "having it to drop" . That's less than a median income in San Francisco. If you put 100% of your income into a startup, are you out of touch or do you just have skin in the game? I don't think it's particularly in touch to dismiss someone who works 50 hours a week to make an income and then Works another 50 hours a week on a startup that spends that income
        ke88y 3y ago
        > That's less than a median income in San Francisco. If you put 100% of your income into a startup, are you out of touch or do you just have skin in the game? If your trust fund pays for rent and living expenses in San Francisco, and you don't even think of it as abnormal that your ENTIRE INCOME can be allocated to business bets, then yes -- you are indeed wildly out of touch.
        adrianN 3y ago
        Nobody works 100 hours a week.
        3y ago

Domenic_S 3y ago

If you're really sure, you do that first run and lose money, then show a bank/investor the explosive popularity and get money for manufacturing at scale. Relatively speaking it's close to the easiest type of funding you can get.

deleted 3y ago
[deleted]

brigadier132 3y ago

> I can hit the $50/ target with small contract runs, which would cost about as much as a down payment on a house. I wasn't thinking of this from the perspective of a hardware startup but a software startup which doesn't require either of those things. I should qualify my original post with that. You don't need to be independently wealthy to launch a software business on your own provided you have the ability to build it yourself.

groby_b 3y ago
Kind reminder that starting a software business still requires you to, you know, live and stuff :) Even if you can build it all by yourself, for most people runway is limited by savings. And that means that with a few exceptions, it's hard to stretch beyond a couple of months (or maybe one-two years) before you need to think about shutting down. If you can get to profit before that, awesome, your business might be a good idea. (You'll still have depleted a good chunk of your savings, and it's not like the world comes with profit guarantees) Investment buys runway, opex, and scale. Some businesses need that, some don't. Software work reduces the opex load (for many attempts), but scale and runway might still be necessary.
- s1artibartfast 3y ago
  You can often found it as you go from a primary job and or a spouse's job. I have a friend who drops about 100K into his startup a year hoping for a big exit. Pretty much all startups or small businesses involve risk. Your other putting in time or money or both. The Only Exception is if you find deep pocket feces that are willing to pay you a good salary to work on your own project, which is especially rare
  - boondoggle16 3y ago
    If someone has 100k to drop on a startup annually, I'm sorry, but they are totally out of touch with normal people. That is not normal.
    - s1artibartfast 3y ago
      That depends on what you mean by "having it to drop" . That's less than a median income in San Francisco. If you put 100% of your income into a startup, are you out of touch or do you just have skin in the game? I don't think it's particularly in touch to dismiss someone who works 50 hours a week to make an income and then Works another 50 hours a week on a startup that spends that income
      - ke88y 3y ago
        > That's less than a median income in San Francisco. If you put 100% of your income into a startup, are you out of touch or do you just have skin in the game? If your trust fund pays for rent and living expenses in San Francisco, and you don't even think of it as abnormal that your ENTIRE INCOME can be allocated to business bets, then yes -- you are indeed wildly out of touch.
      - adrianN 3y ago
        Nobody works 100 hours a week.
        3y ago