Archive - tech RSS Feed

Review: YC New York City (NYC) Event – tl;dr: it was great!

Tl;dr

Highlights:

  • Paul Buchheit digs cult leaders as founders =) (the single best comment in the event.)
  • PG talks about NYC and the startup community here
  • Lots of Papa Johns and Domino’s pizza was available.
  • Amazing people make up the NYC startup community.
  • Alexis Ohanian is actually super tall and I am a relative midget in comparison lol.
  • Young hipster kid was a dick.

Tonight on September 26th, 2011, was the first YC New York City Event where Paul Graham (“PG”) and company began to truly make a presence in NYC.  The event had almost the whole team around where everyone was excited to mean and speak to the incubator that has made startups popular again through their successful mentorships of a number of startups such as Dropbox and AirBnB.

This was the first time I’ve met the team or any of their startups and I have to say that I was truly impressed by the people.  It’s no wonder why they stress that teams are the single greatest factor in their decision to fund a startup.  The people who spoke  were either charismatic cult leaders, quiet hard-workers, or some other interest combination.

The best part of the event was that YC understands that the importance of the event isn’t to preach us to death but to allow us to meet each other (our fellow NYC founders) as well as the YC team.  PG claims that Silicon Valley’s ability to create successful startups is based on the people in the city.  There are so many amazing people in the Valley that it is inevitable that you’ll meet other founders, VCs or opportunities to take your startup to the next level.  PG stayed true to his words by planning the event around 1 to 2 hours of networking before and after the YC presentations by PG and the gang.

I honestly think that hearing their insights was a worthwhile night because it comes directly from the horse’s mouth.  They deal with startups on a daily basis and speak from experience, but the greatest part for me was meeting the other NYC founders.  Everyone was doing awesome things that were really amazing that made me embarrassed of my projects.

But, there were also drawbacks (the problem wasn’t with YC). The event was filled with startup founders and people with aspirations to do a startup, but there were also people that were assholes.  I sat next to a couple of douches who that of themselves as the best thing on earth, since cool aide.  In particular was a kid who must’ve still been in college because he was holding a programming textbook on C.  But, he was shitting on a bunch of the YC presenters because he thought that they were lame.  He’s a dick that is going to be unavoidable at these events because he’s a hipster that’s more interested in the lifestyle than reality.

Overall, it was an awesome event that I was thankful to be invited to and they said that they’re looking to do more in NYC.  I really hope they do because it gives our community an opportunity to get together and meet each other. =D

I Want the 2011 Downturn to Double Dip – It Makes Real Startups Rich

In 2008, I was fired from my job because of the economic downturn.  The recent panic and sudden fear that’s stricken everyone reminds me of how I felt when I lost my job and the depression I personally felt.

Losing my job felt like a personal failure and I went through a pretty rough patch.  I clearly remember staying in bed hiding under the covers with my ps3 and call of duty 4 for a month depressed (and smelly) because I was so ashamed.  Getting fired left like I was being told that my value as a person didn’t justify the crappy salary that I was getting ($62k).

After getting fired I had found out that the firm was laying off employees hired at my “class” or pool because we entered into the company at a period where everyone received starting salaries higher than they wanted to pay (buyers remorse).  So, they were firing our class in order to rehire a larger incoming class or pool at a lower starting wage.  They were cycling the labor pool.

In retrospect, getting fired and going through the last economic downturn in 2008 was probably the best thing that ever happened to me.  I was always going to start a company and I was always going to leave the firm in the long run, but I was caught up working 90-hour weeks and trapped in the office political bullshit.

I forgot myself.

I spent a good month wallowing in self-pity and my family really saved me from myself.  I ended up opening my own firm (terrified that no one would come).  But, people did come and I slowly became profitable.  The first year I earned about $30k (Definitely not f*ck you money), but I was proud of what I accomplished.

So, honestly I hope that the 2011 economic downturn double dips.

I hope that this downturn fucking shatters the general population because I’ve learned from personal experience that real opportunities come during these coming days.  The fear drives away the meek and cuts the bullshit because no one has time to care about appearances or the superficial anymore – it becomes a race to real profits and success.  There’s $15 trillion dollars in the economy and depressions or recessions don’t matter because you just need a piece of it.  The last time this happened I started a successful company that I still own and I’m going to do it again with a startup this time with my partner.

This is not the time to fold because we’re hearing stories of VCs tightening their purse strings and angels disappearing.  This is the time for you to hit puberty and for your brass balls to drop

Successful companies are formed during the hard times because those companies are positioning themselves for the future.  I fully plan to be a company that positions my startup for the turnaround that’ll come in 20XX.

How My Eventual Technical Co-Founder Told Me: “Fuck You, Pay Me”

Disclosure:  I am not a technical founder or a developer.  I have a “business” background in tax accounting and sales.  I have zero intention of becoming a developer.

Tl;dr

  1. Asked friends -> friends are lazy.
  2. Asked Pakistani guy -> Pakistani guy was from Pakistan…
  3. Met Chris -> Paid Chris
  4. Chris became my partner.

I’ve been interested in getting into the New York City startup community for quite a while, but I needed a developer like every other aspiring non-technical founder.  Last year, I began searching for options to either find a technical cofounder or outsource the development.

Friends:

I initially began talking to my circle of friends which included a good number of developers because KPMG has an entire department of developer’s in its back office in Montvale, NJ.  I was sent there to develop the business logic for their tax product that was behind schedule and over budget.  While saving that project from Armageddon I worked with a number of talented people, but quickly realized that these people were “lifers.”

Lifers are people that typify the unmotivated and the office politics bullshit.  Thus, these developers had the skills I wanted, but also had the complete mentality I was looking to avoid.

Pakistan:

I considered on outsourcing the development to Pakistan because it’s obviously – dirt cheap.  I had a lead on a developer in Pakistan from Noah Kagan, who was gracious enough to help me find the technical help I needed.

He was fair and upfront about the quality of Pakistani developers in general, but suggested that it was a great way to get a beta or demo product to market.  The Pakistani development company quoted me a $10 dollar an hour billing rate and expected the project to run approximately 180 to 200 hours for a total cost of $2,000 dollars or less.

I had negotiated everything and obtained a quote, but there was an uncomfortable feeling in my gut that kept saying that this guy wasn’t the right choice.  I agonized on whether to just pull the trigger and take a chance to see if he’d produce anything usable.  Ultimately, I decided against it because I wanted quality over quantity.  As a professional service provider, I’m very aware that you get what you pay for and I wanted quality, so I decided I was going to pay for quality.

New Work City:

I had stumbled my way through another month looking for the technical talent that I needed.  As a person that has zero technical expertise, I was honestly terrified to hire anyone because you just don’t know enough to be sure if the person you’re hiring is providing you a quality product.  Trust was the main issue that I was having.  At the end of the day, I was looking for a developer I could trust to not screw me over.

I ended up going to a New Work City meetup where they were having a movie night showing “Sneakers” on a random night.  I met Chris at the meetup who’d been a previous technical cofounder and we were able to relate because of our similar backgrounds.  I later found out that Chris moved from California and had just arrived in NYC two days, so it was a really serendipitous for us to happen to meet.

I ended up hiring Chris because I felt like I could trust him.

While we discussed my project, Chris was really helpful in providing me the technical insight of where my pain points would be and what the best choices for my web app were.  I trusted Chris so I was comfortable with any suggestion he made as long as it fulfilled the ultimate goal.  (Very important for later)  Essentially, I told Chris what I needed the application to achieve and I left the rest to him to decide in regards to functions, features, programming languages and etc. all things that I don’t care about.

Chris and I agreed on a price that was more than five-figures or more than 500% more than the Pakistani quotation.  But, I was more than happy to pay this amount because I knew that I was buying quality and peace of mind.  It never makes sense to half-ass your way to the top or to reproduce the wheel.  I was always of the belief that you should do it right the first time.

Fast-forward a month later…

Chris and I became partners.  While discussing and working on our project, Chris told me that he moved to NYC pretty suddenly because he caught the startup bug and felt that it was something that couldn’t wait.  After working with me, he saw that I was pretty good at handling my business and that I wasn’t another one of the three-blind-mice trying to find the cheese.

I had 5 to 10 paying customers or users waiting on the product to be finished, so the product was cash-flow positive from day one.  The price point for the product on the low-end began at $100 dollars a month, so it was a profitable SaaS product.  Also, I started a company about a year before I met Chris that was generating $40,000 dollars in net profit that I still own.

Thus, Chris offered me a simple proposition.  We both had our ideas and he’d be willing to work together as partners on our ideas.

I stumbled upon a co-founder.

Chris later told me that he decided to work with me because of a few reasons:

  1. Like Mike Monteiro, Chris said “Fuck you, Pay me” and I paid.  (Obviously, he didn’t really saying fuck you lol.)  He quoted a price and we negotiated, but I didn’t disrespect him by asking for a 60% discount.  I was realistic and told him what my budget was and he worked with me.  More importantly, I paid him 50% upfront to show that I was serious and the rest over the next month.  Nothing talks like cash money.
  2. I respected his expertise.  I didn’t give him bullshit and I trusted him to make the right decisions for my product.  Technical founders or developers all hate, when people question their decisions and nit-pick at every detail because it’s a waste of time.
  3. I had experience creating and running a profitable company by myself.
  4. I’m a tax accountant by trade, so I clearly had the business background and I’d like to think that I’m pretty awesome at my work.
  5. I already sold my product.  Don’t tell people you’re an awesome salesman – just sell.  ABC, always be closing.

Podcast – Ep 2 – Incorporations Actionable Steps

This is the second episode of the “Non-Technical Startup Founder Podcast.”  I’m continuing with the topic of incorporations because I wanted to give specific steps that anyone could follow to self-incorporate their business without having to pay insanely overpriced fees to legalzoom.com or incorporate.com.
.
I’m hoping that this podcast will be helpful to startups with technical founders or co-founders that lack the business experience or background.  This could be the imaginary “business guy or founder” that your startup may be lacking.  Also, this podcast will be document my personal experience into starting and running my own startup from the ground up.
.
.
Download
[download id="2" format="1" autop="false"]

Incorporation Process
C Corporations and S Corporations (Same Filing Process)

Note: Name must have Inc, Company, Co, Corp., Corporation and etc.

Limited Liability Companies and Limited Liability Partnerships

  • Partnership Agreement
  • Operating Agreement
  • LLC Membership Certificate

Note: Name must have Ltd., LLC, LLP, and etc.

All Incorporations require a registered agent for the state to correspond with in regards to the company.

Common pitfalls:

  • Section 83(b) tax election with the IRS.
  • Section 351 capitalization rules (how to fund a new corporation without paying additional taxes)
  • Issued shares or stock does not correspond to the Articles of Incorporation.
  • Improper allocation of profits and losses from LLCs and LLPs.
  • Fees paid to incorporate or organize are tax deductible.
  • Startup costs are also deductible. (Ex: research expenses and etc.)

Podcast – Ep 1 – Incorporation

This the beginning of my podcast.  I’m going to walk through topics that should matter to every entrepreneur or startup founder.  I’ve just begun my own startup in the SEO and blog industries.  I’m really excited and scared at the same time because I have no idea what this is going to lead to, but I figured I could provide an interesting viewpoint through the process.
.
My podcast is called the “Non-Technical Startup Founder Podcast.”
.
Download
[download id="1" format="1" autop="false"]

This first podcast is a walk-through for any would-be entrepreneur into the first steps of starting a business.  Incorporating is an important step in starting a company that most people make haphazardly without understanding the potential benefits and realistic costs.
.
Why are you incorporating?
.
  • Do you have significant profits or net income?
  • Do you have a liability risk?
  • Are you expecting funding?
  • Is there any real immediate tangible benefit?
  • Do you feel stupid yet?

Which legal entity will you use?

  • S Corporation vs. Limited Liability Company
  • C Corporations vs. Limited Liability Company

Where should you incorporate?

  • Delaware
  • Nevada
  • South Dakota

How do you incorporate?

  • Do you need an attorney or an accountant?
  • Where to find stock or standard legal documents?
  • State government websites?
  • Check and confirm state incorporation fees?
  • Check and confirm incorporation maintenance fees?

Final words.

  • Be aware of stealth taxes, franchise taxes and etc.
  • Understand the annual and quarterly corporate filings
  • Respect the legal formalities

Best Practices

Trust but verify – Winston Churchill
Do it yourself, but check with a professional!

Why blog.

Everyone should blog. Blogging is great because it is and does so many things simultaneously. A blog will make someone a better writer obviously, but more importantly it makes you a better communicator with a greater understanding of whatever you’re writing about. Also, blogging is like a secondary brain that holds all of your ideas forever in the perfect image without forgetting any of the details. This is why I’m writing in this blog that no one will ever read.

(Actually, I’d be pretty embarrassed if anyone I know reads this. It’s awkward and very unnerving when people you know personally are able to read into your personal thoughts. When a stranger reads our thoughts, its as if you’re still anonymous even if they know who you are.)

An example of when my blog saved me:
I’ve written a bunch of blog posts that I’ve reused a crap load of times for different reasons. It will take me anywhere from an hour to a few days to write a blog post depending on the topic while underground in the subway. But, doing this saved me from having to waste time in rewriting the entire essay, article or post later on.

Firstly, I had a much better idea about the topic because I wrote the blog post. I always think I know what I’m talking about until I actually try to do it. Writing the blog post makes your check yourself and you quickly realize how little we know.

Secondly, by investing the honest effort and time initially into writing the blog post, I avoided having to do it repeatedly in the future. I could simply pull it off the web and I’d be done. This saves shhtloads of time.

Lastly, a blog is great because it organizes everything. By using tags, categories and other forms of search keys we can effectively find anything we’ve learned or wrote about as fast as you can click the search button.

Blogging is something that you should do for yourself first and if others find your perspective worthwhile then it’s always awesome to be appreciated.

Thank God for the Jailbreak!

Thanks to Comex and the Dev Team, the iPhone 4 is jailbroken!  An unjailbroken iPhone is the biggest piece of crap that I’ve ever purchased.  It’s barely fit to be a paper weight!  But, I’ve learned a few valuable lessons.

  1. Don’t be an ass (Yes, apple.  You are useless).  Businesses that try to control their customers or clients are going to be hated.  This is inevitably going to get you screwed.
  2. You’ll never know what your product is capable of until your clients, customers or users get their hands on it.  I’m positive that apple couldn’t (or just didn’t want to) imagine the possibilities that the iPhone could produce.  Thus, the lesson learned is that you should let your users – use the product.
  3. The iPhone’s success isn’t a product of the “iPhone.”  The iPhone’s hardware is essentially the same as any Android smart phone.  The main difference being that the Android phone is allowed to swap memory and batteries.  The user base makes the difference between the two products.  The users behind the iPhone is what made the iPhone great.

Seriously, thank god for the jailbreak…