Lecture Notes: How to Start a Technical Startup

Key Requirements for Starting a Startup

• Co-founders: 2 to 4, with at least 50% being engineers.
• Financial Backup: Each co-founder should have enough savings for a year of living frugally.
• Commitment: All must quit their jobs.
• No Initial Idea Needed: The team and readiness are more crucial initially.

Idea Generation

• Brainstorm with Team: Start discussions before solidifying an idea.
• Personal Problem Solving: Preferable to solve problems known well by the founders.
• Daily/Weekly Problems Focus: More frequent issues (e.g., transportation) are more viable than infrequent ones (e.g., car sales).

Market Research

• Conduct an hour of research to see if billions are being made in the market.
• Use competitor products to understand the market.

Legal Considerations

• Incorporation in the US: Necessary for US fundraising; simple process through Clearkey.com for $250.

Minimum Viable Product (MVP)

• Common Mistake: Delaying launch; aim to launch within two months.
• Importance of Launch: No value until launched; start with getting products to users.

Growth Strategy

• Key Metric: Growth is the primary focus for investors, over team or past experience.
• Experimentation: Use ads cautiously, focus on consumer sharing and B2B reference customers.
• Built-in Sharing: Usage should naturally lead to sharing, not just an added feature.

Public Relations (PR)

• DIY Approach: Early PR work can be done without hiring expensive firms.
• Relationship Building: Approach PR like business development; get warm introductions and provide real news.

Fundraising Tactics

• Create Independence: Avoid needing money to attract investors.
• Schedule Tightly: Arrange investor meetings within a short timeframe to create momentum.
• Demonstrate Growth: Growth attracts investors more than any other factor.
• Investor Strategy: Engage potential customers as early investors.

Operations Management

• Spending Control: Biggest challenge is overspending; cut back on expenses wherever possible.
• Expense Awareness: Know and manage monthly expenses diligently.

Hiring Practices

• Increase Talent: Each hire should elevate the average talent of the company.
• Smart Hiring: Hire individuals smarter than current team members.
• Transparency: Be clear about stock options and salary with potential hires.
• Hire Slowly: Focus on quality over quantity; small teams can achieve significant milestones.

Closing Thoughts

• Progress with Minimal Team: Successful startups often start with a small, strong founding team.
• Focus on Growth and Efficiency: Growth and efficient use of resources are key to attracting investment and long-term success.