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The Business Fuckup Thread.
#26

The Business Fuckup Thread.

Quote: (12-25-2014 07:49 PM)monster Wrote:  

Quote: (12-25-2014 07:24 PM)BostonBMW Wrote:  

Not getting the seller to sign the P&S ASAP after the offer was accepted. The delay ended up working in his favor as he ended finding another buyer.

This happened last month. Still kicking myself for letting the Sellers RE agent talk me into the delay. From now on, offer accepted = get the P&S signed.

There are PLENTY more, but this one has me salted.

What kind of property was it? Do you have RE experience?

It was a 5 Unit Building. I have some RE experience. This situation was very different. Besides me, the sellers agent lost the most (commission, effort) because the seller was a real scumbag and pretty much stopped talking with his own agent as well.

Live and learn.
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#27

The Business Fuckup Thread.

Spending around 40k on web developers that delivered me an unusable product. It got me motivated to learn it all myself. And the project will be launched again within the next 6 months.

God'll prolly have me on some real strict shit
No sleeping all day, no getting my dick licked

The Original Emotional Alpha
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#28

The Business Fuckup Thread.

The big takeaway for me from this thread & my own experience is most of us have lost a lot of money to firms/people who never completed the project or did a shitty job.

The thing to do I think when possible is to negotiate progress payments that are paid only after completion of different stages of the project. And to rule with an iron fist so that if one stage is not completed to your satisfaction ditch the subcontractor and find someone new.

This goes for web development, real estate, and anything really.
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#29

The Business Fuckup Thread.

I started a T-Shirt business one time. The idea was, the fraternities and sororities went INSANE over custom printed t-shirts and blew anywhere from 9 to 15 dollars a shirt, on orders of potentially hundreds. This was just people I knew, not to mention school clubs in general, other schools- the opportunity to scale up was immense. Well, I got elected T-shirt chairman of my own fraternity, and in dealing with the process I discovered you either had to pay big bucks for professional art, or save a little money and get shirts you may or may not actually like. Production times were also horrible, dudes never got back to you- $$$ opportunity.

I researched an alternative printing process by which I could rapidly produce prototypes- do you like this shirt better in a blue, or a green? Cost also happened to be lower for this process than silk screen printing, where cost scales by colors used. This printable transfer process could produce full-color designs up to 11"x17" (the size of the transfers). I did a lot of mockups and found that 95% of shirt designs conformed to this printing footprint already, or easily could. Frats and sororities ALWAYS wanted about 30 colors in their design, and were notoriously fickle with their decisions concerning the look of the shirts- warning sign number fucking one.

I jumped in and saved my drug money for a whole semester, and combined with a scholarship I "re-purposed," bought a heat press, a special continuous ink system printer, pigment and sublimation inks, and printable transfers- my dad threw in a cutting machine. All around, start-up capital was around $3k. I planned to do a low-volume tester run for my own boys at cost- 3 fucking dollars a shirt. I could easily have charged five and still saved them bank. Well, at three dollars a shirt I couldn't invest in the best quality of blanks (shirts to print on), and although I had approval from chapter leadership (also my best friend at the time), the agreement was repudiated by my friend when the chapter swayed the other direction on the shirts, and I was hung out to dry for materials, labor, design work, etc. Another friend of mine (actually my current roommate, funny story) had felt slighted because he was now the tshirt chair and he never saw nor approved the shirts He was gathering support against the shirts BEFORE ANYONE EVER SAW THEM the whole time!

My business flopped because I ran out of cash, couldn't float the operation anymore, had maxed out any reasonable lines of credit (mostly family), and already suffered from a poor product reputation. That was my first failure in bootstrapping.

Takeaways?
- Tacit agreements are more like pleasant dreams than contracts. Sure it felt good, and you know that it happened, but can you prove it? GET EVERYTHING IN WRITING.
- People in positions of minor authority or decision making capability are infinitely more likely to sweat small, otherwise inconsequential details. Small people with small minds have small problems.
- Once you've calculated exactly the amount of start-up capital you need for a business venture, double it. Hell, triple it. Your business should be able to run from 6 months to 2 years earning absolutely no net income, depending on the industry and market (horizontal, vertical, local, shoestring, etc).
- Business and friendship are best left mutually exclusive. They tend to end up being that way, regardless of your intentions. With the chapter officer, I chose to keep things strictly business from that point forward. My friend the tshirt chair? Still my friend, still the tshirt chair. Oil and water.
- Local pull is essential to bootstrapping a business; have a rolodex of clients, products, markets you want to hit before you spend your first dollar. Hell, get contracts. But the further from home base you can START your clientele, the less likely friends/family/etc are to assume you're not serious and they don't really need to pay you.
-Quality is FAR more important than cost. The client will hardly remember that you saved them a few bucks (excluding other startups, non profits, mom n pops, etc), but they will ALWAYS remember if you deliver stellar quality service that exceeds their expectations, and likewise if you don't.

I have tried bootstrapping 4 times, with 4 failures. If you'd like to hear my other stories I can post them in this thread as well. Just remember... I'll fail 100 times before you fail once, but I only need to succeed once.
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#30

The Business Fuckup Thread.

^^Yes I'm interested in those other stories
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#31

The Business Fuckup Thread.

Quote: (12-26-2014 02:12 AM)PIV Wrote:  

-Quality is FAR more important than cost. The client will hardly remember that you saved them a few bucks (excluding other startups, non profits, mom n pops, etc), but they will ALWAYS remember if you deliver stellar quality service that exceeds their expectations, and likewise if you don't.

I agree. And I think that's a good way to screen new customers. If they're just concerned about cost they're not worth your effort or time to pursue and followup on.
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#32

The Business Fuckup Thread.

Quote: (12-18-2014 11:34 PM)YMG Wrote:  

-

VET YOUR BUSINESS PARTNERS, AVOID SOCIOPATHS

INTEGRITY IS EVERYTHING

IF YOU WANT A PARTNER, START LOOKING BEFORE YOU NEED ONE


ENCOURAGE THE EVIL, VET THE CHARACTER

Bravo. I recently found my possible CTO. Met him through a friend at a xmas party for the company they work for. I learned he was sick of the corporate grind, and wanted to take some time off and travel South America. But he said he wanted to work on a project while he was doing it.

I told him to start a small business, maybe even just be a freelancer for a while and see if he enjoys the traveling lifestyle. He then told me that he's always wanted to start businesses and do his own thing instead of corporate grind, but he wasn't creative enough to get any decent ideas.

Everything seemed genuine. My friend, who is a very stand up guy, vouched for him. So I pitched him an old business idea that has been dead for quite some time. The same one I wrote about earlier, dumped a bunch of cash into a development team that didn't give me a usable product.

I had already planned on relaunching at some point, it' s a hell of an idea with the potential to make a lot of money while also positively influencing peoples lives. He loved the idea and we have been talking since. He's already been throwing down code to get started and has valuable business advice as well, for example he talked me out of doing a fast and dirty beta launch in favor of waiting longer and publishing a nicely polished product.

I hope it works out, because I have tons of ideas but only beginner programming skills. I would love to have a competent CTO behind me so I can focus more on the business side of things.

God'll prolly have me on some real strict shit
No sleeping all day, no getting my dick licked

The Original Emotional Alpha
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#33

The Business Fuckup Thread.

But he said he wanted to work on a project while he was doing it.

This is a very good sign. This is someone proactive and able to think independently and launch projects on his own. That's a solid start.

I told him to start a small business, maybe even just be a freelancer for a while and see if he enjoys the traveling lifestyle. He then told me that he's always wanted to start businesses and do his own thing instead of corporate grind, but he wasn't creative enough to get any decent ideas.


This is also good - you can complement his skill sets.

I'm the Kirk to my CTO, who is a Spock type. You should spend some time figuring out his relative strengths/weaknesses as well as your own.

One random thing that has really helped me in terms of figuring this out is taking several Meyers-Briggs tests (just to see if they produced the same result). I got the same result multiple times - ENFJ.

My CTO cofounder got INTJ, which is almost a perfect fit. We've been working together for about 3 years so it was always clear that we were a good fit but it was interesting to see an analysis.

Everything seemed genuine. My friend, who is a very stand up guy, vouched for him.


That's very good. I did not get a reference for my CTO and it took about 6 months of trial and error collaborating on a few small projects for us to really get the hang of working together. If he is coming recommended and seems like a trustworthy person then you are probably in good hands.

He's already been throwing down code to get started and has valuable business advice as well, for example he talked me out of doing a fast and dirty beta launch in favor of waiting longer and publishing a nicely polished product.


That's great news. He's action oriented and already putting in some leg work. That's the other half of the equation after the integrity part, is figuring out if the person will actually do any work and if they are competent at said work.

I've worked with skilled people who were lazy as shit and I've worked with incompetent people who were hard workers. In both situations we ended up with failed projects.

Not sure if I necessarily agree with waiting for a nicely polished product, though. Is it possible for you to hand pick about 50 initial beta users to get some feedback?

It's possible that the nature of your product won't necessarily allow this to happen.

The fallback for this is - is there a way to do this without the use of technology?

Let's say that you are beta testing the idea for Airbnb. Those guys initially had a website with basically a contact form (I think) whereby people could rent an air bed and also get breakfast. The occasion was that there was some design conference in SF and hotels were overbooked, so they took advantage of their spare capacity.

Low tech and low cost but an effective means of vetting their user demographics. As we all know, they eventually spread to becoming "the ebay of spaces" and took off like a rocket.

As such, I would suggest that you find creative low cost and low tech ways to begin building an audience and vetting and testing them. Also try to actually get money from them, in the same way that the Airbnb guys did before they had a juggernaut platform/app up.

This is a strong way to both test your initial audience, do some great guerrilla marketing and spread the word, and also potentially get some cash through the door. That cash makes a big difference in the early days both from an income POV but also for morale - knowing that people will hand you cash for something that is basically an idea.

On that note - I don't know if your idea is conducive to crowdfunding but that's an avenue to consider if you guys are down with that.

Finally - something simple that you can do today is to throw up a landing page using http://www.launchrock.co for the beta launch. The sooner you begin building a mailing list, the sooner you can begin talking to interested prospective users and seeing what sorts of things they want.

You can create a launchRock page for the idea under a different name without divulging details about yourself, and then posting a link to it on your RVF signature.

Then when guys sign up to what they think is a good idea for an app, you can get in touch with them with an anonymous email like antitraceRVF@gmail and do some private anonymous one-on-one rap sessions with them.

So let's say that your idea was Airbnb. You could put something in your signature like:

"Tired of staying at expensive hotels or crappy hostels? Sign up for an invitation to PoshLofts, a revolutionary peer-to-peer apartment sharing platform"

Something like that would appeal to a lot of RVF users and you could get a shit ton of information from guys that sign up and give you some good intel on what sort of product they would want to see.



I hope it works out, because I have tons of ideas but only beginner programming skills. I would love to have a competent CTO behind me so I can focus more on the business side of things.

It's very good that you have some hacking skills. Your CTO is probably quietly glad that you have some level of programming skills because it shows that you are serious about technical stuff and can speak his language, to a degree.

It sounds like the two of you are a good match.

To keep him interested and to prove your value with tangible results, I would start figuring out how to immediately begin doing some user recruitment and testing.

Throwing up a launchrock page and getting 100 signups by the end of January, for user feedback and surveying, would be a strong start.

My two cents.

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#34

The Business Fuckup Thread.

Quote: (12-27-2014 09:22 AM)AntiTrace Wrote:  

I had already planned on relaunching at some point, it' s a hell of an idea with the potential to make a lot of money while also positively influencing peoples lives. He loved the idea and we have been talking since. He's already been throwing down code to get started and has valuable business advice as well, for example he talked me out of doing a fast and dirty beta launch in favor of waiting longer and publishing a nicely polished product.

Heads up:






Technical people have a very strong tendency to just jump in and start writing code. As the businessman, you have to stop them and ensure the market is tested first. It may sound a great idea to you, and he may enjoy doing what he's best at - coding, but if the market disagrees with you you'll have wasted all that time for nothing.

Another good example is AppSumo. He market tested his idea with a $60 test, received a positive signal back, and then dived in.
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#35

The Business Fuckup Thread.

@YMG excellent analysis, it gives me some more confidence going forward.

@Fenix and YMG. One the market analysis, I believe I have enough proof to go forward. Long story short, when I first had this idea years ago I put sent out 100 messages to friends on facebook. I got 20 to sign up and had nothing more than than a three page wordpress site. They brought in just under 1,000 in sales in a month (the length of my test), they all expressed interest in a more polished idea.

I think a beta launch with under 100 users would be a great idea, an invite only deal with people that I have met face to face through local clubs and organizations. . I'm very familiar with the MVP theory and its effectiveness, I've read the cash strapped entrepreneurs start up pack [Image: idea.gif]. I think he misunderstands my idea for a quick and dirty launch, thinking it would be a public release.

Regardless I'm glad to meet him and really excited about getting this idea back outta the closet. It has showed great potential and can actually add value to users and the community as a whole.

God'll prolly have me on some real strict shit
No sleeping all day, no getting my dick licked

The Original Emotional Alpha
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#36

The Business Fuckup Thread.

About getting burnt for web development by hiring subpar workers, which seems like a common ocurrence - this might seem obvious, but what about their track records? If you're dealing with freelancers on websites like Elance, just choose someone with a long, positive track record. If none of the applicants have one, contact the ones who do directly, by selecting the people with the best reviews. Also try to read freelancer forums to find out what the actual prices for good work are, common frauds, fraudulent companies, best players in the business etc.

Tip: Try to choose someone who has good reviews from an equal playing field, ie. an environment where it's hard to get more positive reviews than you should. The last site developer I chose had a lot of positive reviews on their website, stemming from the fact that they had a high output and were asking for positive reviews quite aggressively. That wouldn't work as well in a more controlled environment like Elance, Upwork etc., which is based on averages rather than whatever the contractor would like to use as promo material.
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#37

The Business Fuckup Thread.

^ To some extent you have to be able to gauge the quality yourself I think. Reviews are just relying on other people's opinions to gauge the quality, which is OK as a minimum, but it's not the strongest way.

Often the best businessmen already know a lot about the components of their business, and are then delegating out due to their time limitations & growth desire. For example, Bill Gates started developing his software systems himself, so when his business started to grow, he was highly qualified to screen for good employees. Elon Musk knows about all the science involved in the products he is making too - so he can easily tell if a potential employee is qualified.

The more you know about web development yourself, the more difficult it will be to get burnt by hiring subpar web developers. You'll be able to detect it in their work after they've billed 10 hours and you can terminate the relationship with only a minor loss.
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#38

The Business Fuckup Thread.

Quote: (12-18-2014 08:52 AM)ball dont lie Wrote:  

For the past few years my best friend has been one of the biggest marijuana growers in a state in the USA. 2nd biggest grow in that state. I have the money to join him but havent because Im scared. My life is not bad, Ive grown used to it and while I work quite a bit 8 months a year, 3-4 months a year I chill and travel. While saving 25-35k US a year.

I think I made a mistake not going there before. This summer he wants me to go but my boss is trying to keep me here in China with all sorts of enticements. I can see myself staying again. Seems like a huge mistake but Im a low key person and afraid of moving there, starting a warehouse grow, learning the trade (but with total 100% help from him and his wife) spending maybe 20-30k start up. But could make double-triple that if things go right, just the first year.

Ive been in China for 10 years and its hard to leave my apartment and life. I have doubt, "what if I fail".

I grew up in Mary Jane country. If you can't see discussing this online might be a bad idea, I highly suggest you stay far away from this industry, and I don't care what state he's in.

Beyond All Seas

"The individual has always had to struggle to keep from being overwhelmed by the tribe.
To be your own man is a hard business. If you try it, you'll be lonely often, and sometimes
frightened. But no price is too high to pay for the privilege of owning yourself." - Kipling
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#39

The Business Fuckup Thread.

Started my business back in February. My biggest mistake was when I was working the Oil rigs I never applied for higher lines of credits.

1.Before you quit your job to start your company, apply for higher lines of credit, higher limit credit cards, etc. as much as you can your going to need it.
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