How do you keep your personal financials afloat when you’re at $0 revenue?

[cbrooks624]

Just like most first time founders, I thought I was Steve Jobs and decided to go full in my startup dream. I had only 4 months of savings and some unemployment help (thankfully I was laid off when I was about to quit). The first dream failed miserably around beginning of December. I spent about a month looking for another idea. Once I found one, I realized that it also wasn’t gonna work. I’m now out of ideas and co-founders, but I learned a lot. I need to talk to more customers, learn their pain points, calculate TAM and etc.

The problem is that I only have about 1.5 months left. I can’t find any part-time that’s work taking on. Most only pay ($10-$15/hr). I have pretty extensive background in energy systems, but consulting in that area also doesn’t pay much it seems like (unless you commit to 6-months/30 hours a week jobs). Meanwhile, I’m getting messages from recruiters for full time jobs paying $200k+. Do I go back to the workforce for a while? If not, how do you keep the dream alive?

PS: I also have 40k in student loans left

 

[mike7377]

@cbrooks624

Meanwhile, I’m getting messages from recruiters for full time jobs paying $200k+.

This is your answer. You're clearly in love with the idea of being an entrepreneur/founder, but you don't really have an opportunity and your personal financial situation puts you in a disadvantageous position.

 

[ps8v9]

@mike7377 I agree with this take. It’s extremely difficult to make good business decisions when you have this amount of heat from your personal finances. I would recommend taking a job to put away money for a while until you have enough in the bank that you feel you could withstand a few years without an income if necessary

 

[fiddleleaffig]

@ps8v9 Agreed.

It takes most startups 7-10 years to become successful.

If you want to make money on the side then take the job and learn to do consulting for yourself.

I built up a decent consulting business of $10-12k per month before bootstrapping a startup.

 

[odangdude]

@mike7377 Pragmatically, I also agree with this. Take the $200k job, live by your bootstraps knowing that you want to quit in 1-2 years to take another stab at it and have 1-2 years' worth of savings. In the meantime, make sure you spend some time brushing up on areas that you might've felt you came up short on in your startup and also keep trying ideas on the side so you have something ready to go to.

 

[lanacoco]

@cbrooks624 My solution to this problem was to take the hit to my personal life and work full time 9-5 and full time on my startup 6-12 m-f and usually 2 6 hours sessions sat and Sunday on the startup. Still haven’t gotten to revenue yet, it certainly takes dedication and commitment to go this route. It has been brutal but I give myself a week off from the startup each quarter and a weekend off a month.

 

[cbrooks624]

@lanacoco Im not really concern with a hit on the personal life (that I already expected). My concern is the productivity due to context switching from job and startup. I’m really pushing for a fully remote job if I go that route, even if it means taking a big cut from my paycheck so I don’t have to waste time commuting. But it’s increasingly harder to find fully remote anymore seems like

 

[thevoiceoftruth]

@cbrooks624 You are right about trying to find remote if at all possible so you don’t waste time commuting. But if you do commute it’s not the end of the world. Just put on an audio book or podcast such as “the cold start problem” or “Tim Ferris’s”. As long as you are learning and could use it in your next endeavor it’s still beneficial.

Regarding context switching, personally I’m in the opposite boat. Doing development in a very slow moving field which requires reading lots of documents is BORING. As soon as I’m done with work I switch gears and work on my own projects where I can be a bad ass. Without going into useless detail, I’m using 20k in used server hardware to replicate what cost companies 300k and it gives me an opportunity to have “big d*ck” energy.

So for me at least, having the suck that is work gives me the motivation to peruse what I genuinely care about. Without the job I both wouldn’t have been able to afford all this hardware over the last two years and I would have gotten burnt out on my project because working on the same thing all the time wears you down.

I would say get the best paying job you can, moonlight on your own projects, if one takes off you can quit at a moments notice. Money gives you options, you don’t always have to spend it, but it gives you the flexibility to get more done.

Just remember there are three types of capital, monetary, relationship and knowledge. You can often exchange one type for the other, but you ALWAYS want to ensure that one of them is growing month over month.

 

[aleks_p]

@cbrooks624 Don't worry about it. You don't have a problem to solve yet.

Take a full time (on site or remote, doesn't matter), think about or observe problems, moonlight to validate the problem (your lesson should have been to kill your idea faster), and once you're sure take the leap again.

You may even find a co-founder where you work, I did 2x, so on site might be even better.

 

[glorfindel8]

@cbrooks624 Go back and get a full time job, and during that time pay down your debts, save money, and make a list of all the problems and how painful they are during your work so that you'll be loaded up on ideas.

I have been fortunate and have managed to save up a few million... My co-founder is in the same situation.
This gave us a huge advantage in that we could live off investment income and spend the $30k or so we needed to hit significant revenue.

Now we have over a million ARR and co.pany is growing at 40% and is cash flow positive.

 

[cbrooks624]

@glorfindel8 Thanks for the advice. I think with a full time job I’ll be able to talk to people more, but this time I’m a way that I’m learning what their problems are. Being a founder can be very isolating, specially without a little bit of social life due to being so financially strapped

 

[mercylam521]

@glorfindel8

How do you keep your personal financials afloat when you’re at $0 revenue?

You're my hero today! Wish more people understood this path

 

[tennyson1]

@cbrooks624 another one who is starting up for the sake of being a startup? You don’t start a startup to find a problem to solve. you encounter a problem figure out you know how to solve it and then do a startup

 

[cbrooks624]

@tennyson1 Learned it the hard way. Just had to give it a try

 

[tennyson1]

@cbrooks624 your money to lose

don't worry this is not the stupidest thing you will ever do. there is a long life ahead... we all do stupid things.

 

[wt15]

@tennyson1 Who elses money would he have lost?

 

[tennyson1]

@wt15 Well I told it was his money to lose, so he has all the right in the world to do with it whatever he wants. So just his own.

if he borrowed money to play, it is again his money but he would get left with a debt to repay.

 

[wt15]

@tennyson1 Well thats a lot more positive then I thought you intended. Thanks for the clarification.

 

[tennyson1]

@wt15 english is not my native language so I get it my thoughts might come out the way it was not intended...

 

[teutonicmark]

@cbrooks624 I basically live with my parents lol