setting up a business - advices?

[Asher]

his prof r teh smartt4st

[Kidlicious]

Originally posted by Pekka
Can't I get a degree? I AM getting a degree. Just not in business.

So you have no advices then? OK I think it's obvious you don't.

Well make friends with some people getting a degree in business, preferably accounting, or at least smart people.

[Pekka]

I needed business advices, not networking advices

[Kidlicious]

btw, Trump's father was the genious. Donald is just another dumb rich kid who can't live up.

Pekka,

Networking is good business advice.

[Pekka]

Ok, thanks.

Now, some more advices!

[Kidlicious]

Start with a written business plan. That way you can show people what you are talking about, and they can help you more.

[Pekka]

That's something I need to do. It also helps to see downfalls and fix them when you're doing it.

[Cort Haus]

'IT consultancy and training' is about as vague as its possible to get, Pekka, so what exactly is the product?

If you want a programmer, I presume you mean to develop something. If there is a demand for something, there's a good chance that someone else has already developed something. The first thing you need to do is to see what is out there.

If you are developing from scratch, I expect you won't need anyone else but a programmer for the first year or so, depending on what you are developing.

Ultimately the minimum you need for a software house is a programmer, a trainer, a support person, an implementer (might also be the trainer) and a sales/marketing operation (might be one person, maybe two).

Major customers are unlikely to buy unproven products. I've been involved with getting a new product off the ground from within a small but established outfit, and the hardest thing is getting the first two happy customers as reference sites.

I don't know about raising capital, but there's your biggest problem if youre not stinking rich. Anyone who lends you the money will insist on controlling you, and you'll always be answerable to them.

[Pekka]

Cort Haus, the product is service, and it's a secret thus far.

"If you want a programmer, I presume you mean to develop something."

Not true.

"If there is a demand for something, there's a good chance that someone else has already developed something. The first thing you need to do is to see what is out there."

I said consulting and possibly educating. I meant it

And I said it's a service so I don't know why you insist making it a software production type of thing.....

It is vague, I know, but consulting should be enough information .. ?

But YES, it needs money, mostly to build image, and hire the few people at first and creating A-class persentation material and fishing for customers.

But it's a service.

[Cort Haus]

Well, playing "guess the non-developmental role of the programmer" is not my cup of tea, so I'll leave it there.

'Consulting' is precisely zero information. It's basically just another word for 'service'. You might as well be offering blow-jobs for all I can tell.

[Pekka]

thanks for the advice. Please don't bother posting in this thread anymore.

[Kontiki]

It's nearly impossible to answer your questions without seeing a full business plan, and even then one can only give general advice. There's no rule about how many or what type of people you need to run a business, and without knowing exactly what you are going to be doing, no way of telling how much start-up capital you'd need, what types of expertise might be valuable nor what your long-term growth prospects or hiring goals should be.

In short, there's no magic formula that works for all types of businesses. They're all unique calculations based on a number of factors, none of which you seem willing to share. It also depends upon the the structure of the business and the people involved - eg. is this a sole proprietorship, partnership or corporation? Are people working with you willing to take financial risks in hopes of bigger future payouts (more likely in a partnership, or heavily incentivized salary structure), or are they going to want a fixed salary?

The only general advice I could seriously give is run as lean an operation as you can and expand only when it makes sense to do so. It's quite unlikely that you'd need a dedicated HR person right out of the gate, for example.

[Flubber]

Pekka--


I just saw Kontiki's comments and while I agree, I did try to give some general advice

If this is a serious business

1. Consult a smart lawyer/accountant early to get things set up properly. That usually includes incorporation, shareholder agreements-- A little money now can avoid big problems later


2. If you find someone that is perfect for one of your key roles, consider really tying them into the fate of the venture by issuing them a share of the profits-- Make it a long term incentive plan so that such things only come to fruition if they stay a certain number of years

3. If its as new as you say, marketing will be the key. If there is a way to provide this service for free or on a trial basis without killing its profitability afterward, consider doing that. The best service in the world is no good if no one knows about it.

4. Have someone else write your business plan, unless the incomprehensible and runon nature of some of your posts is a function of your English and not your general writing style

5 . This is like a job search in some ways so follow the advice there and avoid the people that can say NO but have no power to say YES. If you research your potential clients well enough, you should be able to direct market to the people that would actually benefit and bypass all the people who only raise roadblocks

[atomant]

couple of things... write a business plan, include a marketing plan. No point you having the best the product/service, if no one knows about it.

Second point, prepare detailed financial projections, set your salaries costs etc etc. Then work out if you business is viable or merely a good idea.

If you decide it is a good idea, a standard rule of thumb is always aim for a clear and net profit, there is no other business measure (IMHO)

And, as thatcher said (I think), if you watch the pennies, the pounds will look after themselves

[Urban Ranger]

Since I have no idea what your business is like:

1. Locate your gifted programmer first. Try to get him buy into your vision - instead of paying him salary make him one of the founders.

2. After you have the person set up a limited company. Get an outside lawyer to write the documents so you won't run into future arguments.

3. Once you have a company your partner can start hacking away, and you go out and find some clients.

4. Don't spend money on anything you don't need. If you don't need an office, don't get one. You don't need a secretary or a receptionist full time. You only need to get services from one of them "office services" companies. Things like that.

5. What are your long term plans like? Sell the company in a few years, just like many of those dotcom companies? Eyeing an IPO? Something else?

6. You don't need a business plan other than a cold, hard, look at the financial situation. Check your cash flow. Increase expenditure by 25%. Look at your estimation of time to break even. Increase it by 50%. If your company is still viable after these adjustments, you may have something.