There are an ungodly amount of resources out there that says when doing a startup, you should raise money from either friends, family or fools. For the 10 years I’ve been trying to execute that statement, I was only able to do it twice. Unfortunately the amounts I raised were too low to help reduce any risks and ultimately the startup didn’t really go anywhere.
No, this post does not have the silver bullet to the FFF problem. However, if you do have FFF’s that like your idea but are on the fence, we did find two services that may help you push em over the edge.
The first service we found is Virgin Money. Virgin Money draws up legal contracts that adds a business/legal element to loans between friends and family. For about $200, your fools can get some assurance that they will get money back based on the terms of the loan. Yes, with this service, you can’t just make up random empty promises - on the bright side, you also can’t make up ridiculous rates of return in certain states that forbids it.
The second service we just saw is another startup promoting social savings. Smarty Pig promotes savings and allows your friends and family to help you reach your goal. I would elaborate further but they already have an awesome video intro on their home page that explains the service; (something we should probably do for our web site.)
While we are unable to help you find new rich friends, hopefully the two services above will crack your existing rich and risky friends who like your current business idea. On the flip side, if you know anyone who has more money than sense and like cars, feel free to refer them our way! We could use the help!
AlphaLab in Pittsburgh has now joined yCombinator and TechStars as a startup launch program. (We really need one of these in Atlanta!) AlphaLab’s deal is slightly better than TechStars since you receive $25,000 for only 3% equity in the company. TechStars takes 5% equity in your company for $15,000 and yCombinator gives you $15,000 for about 6% if you have 2 founders.
From a pure money standpoint AlphaLab has the best deal. Similar to the other programs, your startup will also receive services, advisers and office space in Pittsburgh, Pennsylvania. Having had a high school friend launch a successful web business from Pittsburgh, it does seem like the city is suitable for these kinds of incubators. However, the program does expect you to stay in Pitt past the six month build period - which isn’t very accommodating for startups who have already established themselves elsewhere. Overall, the location is probably the biggest drawback unless you’re a college student.
The deadline for the Summer/Fall program is March 31st. Program starts on June 2nd.
I got a tip from
Andrew Hyde, most recently famous for
VC Wear - clothes for VC’s about another business competition that’s currently accepting applicants.
TechStars.org is a different kind of business competition that doesn’t focus as much on the prize money as much as education and networking. On the surface, the deal is:
- a summer in Boulder, CO
- 40 educational dinners/seminars
- $5,000 per founder (up to $15,000) in seed money
- a hip incubator work area
…in exchange for 5% of your company.
Below the surface, there are priceless networking opportunities and coaching that exists to help you succeed - all of which seem like a great deal if you can spend a summer in Colorado.
There’s only about 22 days left for 2008’s program if you’re interesting in applying for this opportunity. If your loved ones won’t mind you taking a 3 month journey to find yourself, this program is worth checking out.
To help with product adoption, one of the things we’ve been thinking about is creating online tutorials for non-savvy internet users. Even though we try to make our service easy to use and intuitive, I’m sure some people will still have issues finding things on their first try. To help minimize the number of calls for troubleshooting, online demos (if done right), will be a huge time saver!
While I’m sure there are a number of screen capturing tools out there that can capture mouse movements and help create videos, the thought of creating and syncing audio and video in one shot seem pretty daunting; at least for me who hasn’t done it before. Luckily, a compromise between the two extremes exist in Slide Share.
SlideShare.net allows you to post your pdf’s, Power Points and some other formats to create slide shows on the web. The slides can then be embedded onto a blog or page similar to YouTube videos. You can also create slide shows with sound which is exactly what we needed. For an example, check out the slide below.
I just saw this website on KillerStartups.com and it seems to promote itself as the network for entrepreneurs and investors. One thing I like about it is that it’s easy to use and it’s free for the needy.
I never understood why other entrepreneur/investor networks charge entrepreneurs, who are the poor ones in the scenario. Granted, when you let the flood gates open, there are bound to be tons of crap mixed in with the good ideas, but at least it’ll help you build up critical mass on one side vs. none at all.
If you are looking for outside funding and aren’t afraid to publicize your idea, I’d give this site a visit. If you have already posted your idea on there, I’d be curious to hear what kind of feedback you’ve been getting as well.
