How much money would you be willing to spend from your own savings to start a business?
Are you the kind of person who believes in your dream enough to burn through most of your savings on it?
For millionaires, this might not be a big deal, but what about people with a typical 9β5 job? I see how much a solid marketing campaign costs on just one platform (often the monthly expense is equal to at least a full yearβs salary).
The day before yesterday, a friend told me he and his wife are closing their restaurant, which they opened just six months ago. They had taken a loan for it, which makes it even worse.
How much of your own financial reserve would you be willing to spend before giving up?
[I think that I would go with $40,000.] π π
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if you believe in the idea , i would suggest to go all in.
@munmun_desai1Β yeah, but it should be done reasonably :D
I could only when I'm convinced that idea have a potential to become something great and also that business got validation from the market. But anyway I won't bet all my financial reserve on this π .
@ivan_apedoΒ Only a fool would bet the whole financial reserve :D
I need to set aside some money for my living expenses and to manage riskβperhaps about a third of my savings.
@charlene_zh1Β That's the reason why I want more money: allocate for living, allocate for fun, allocate for running the business, allocate for risks.
I'd say this depends on what you're spending that money on, when (what stage), and what your signals are. So, if you come out strong and start dropping cash (because right now you have it) and miscalculate the actual runway you need, you're in for a rough ride. Double your runway, triple it.
As example, I get asked for tips by people looking to start a services practice, since that's what I've spent most of my career doing. Almost every time, they start with proudly showing me their brand, logo, website, asking about an LLC, etc. That's where I drop the bomb (not really, lol), this is lovely, but none of it matters if you don't have your first client and haven't really thought through your ideal customer, what they need, your pricing ...and that stuff is basically free. Every dollar you spend, if you really need to spend it, should be directly tied to getting your first customer(s). If you're not getting bites, go back to the drawing board, repeat until you do. All the rest is next phase. I say that not from 'on high', but from having been there and not done that.
Obviously, this changes a bit with SaaS or other tangible product, but the principle is the same; you invest small, iteratively, and in direct proportion to revenue. I'm back building after many years, so I'm mostly drawing from what I know well, which is services. So, YMMV ...possible wildly. ...in my opinion ...allegedly. π
@dorothy_m_danforthΒ What service do you want to bring to the market? π
@busmark_w_nikaΒ Hey! Thanks for asking. :) Love the minimalist phone concept. I deleted all my socials except LinkedIn when I started building.
Well, I've spent 18 years doing innovation strategy for corporations. I help them figure out the value of new products when the market shifts. Right now the job market isn't just down, it's restructuring. I've been hearing from colleagues with 10, 20+ years experience out of work, sending resumes into the void, and having no idea why they're struggling all of a sudden after years of success.
So, I built a platform that does for individuals what I do for billion-dollar companies, reveal their strategic value in an uncertain market. It offers clarity, a plan, and tools to help them better tell their professional story.
Early days, but I'm quite passionate about it. What stage are you at with minimalist phone?
@dorothy_m_danforthΒ Thank you, Dorothy. What do you mean by "restructuring"? I suppose that it is because of AI, or?
When it comes to mp βΒ we are expanding to iOS from Android, so more work is related to technical stuff and development. :)
@busmark_w_nikaΒ Yes, exactly, AI and it's ripple effects. So restructuring that impacts the number of jobs available in certain fields and also what skills will be needed in those jobs.
This is a tricky question when I built Spaculus Software what really helped me was learning the difference between spending and investing.. At first every dollar felt like a risk but later I realized it was a signal. the money I put in wasnβt just capital it was proof that I believed before anyone else did. Sometimes that belief costs more than you plan but without it nothing real ever starts..
If I put my 15+ years of experience in just a few lines I would say this: the real cost isnβt the money you spend itβs the comfort you give up. You donβt invest savings you invest your certainty and once thatβs gone only belief keeps you moving. That's what i said @busmark_w_nika :-)
@ravi_mansuriyaΒ Wow, I have never looked at these circumstances this way. Thank you for your fresh view :)
I think it depends on how validated the idea is. If Iβve seen real traction or paying users, Iβd be okay investing maybe 30β40% of my savings. But if itβs still early and unproven, Iβd rather test lean with minimal spend before going all in.