10 LESSONS I LEARNED FROM
STARTING COMPANIES IN
DOWNTURNS
Francine Hardaway
BIL, February 2009
IT DOESN’T MAKE ANY
DIFFERENCE
  No one lends to startups anyway


 Focus and you won’t notice
DOWNTURNS CAN BE GOOD
  They force you to be clever


 They teach you to do more with less

 Over funding often kills c...
YOU DON’T NEED TO OWN PEOPLE
    Don’t hire


       You’re going to hire incorrectly anyway
       Partner and outsource
DON’T RENT SPACE
  You don’t need it


 Bring the work to the people, not the people to
  the work
FORGET FUNDING
  You won’t get it anyway, and you will waste a lot

  of precious time looking for it
 Downturn in VC

...
TURN DOWN MONEY
  Draconian terms for startups


 Loss of control

 Exit of the founder with boot in his butt
YOU NEED LAWYERS
  Ycombinator has outsourced its documents


 Document everything

 Run the docs by a lawyer when you ...
GET AN IMMEDIATE CUSTOMER
  And make that customer pay


 If you can’t, re-examine whether you actually
  have a product...
QUIT AND CHANGE YOUR MODEL
  Seth Godin’s “Dip”


 If you can’t get any traction, there’s a time when
  you should stop
...
ONLY PROTECT YOUR IP IF IT
MATTERS
  This is a discussion for an attorney.


 An IP attorney, not your mom’s divorce law...
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10 Lessons I Learned from Starting Companies in Downturns

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I've been there, done that, and this presentation is designed to re-set expectations of founders.

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10 Lessons I Learned from Starting Companies in Downturns

  1. 1. 10 LESSONS I LEARNED FROM STARTING COMPANIES IN DOWNTURNS Francine Hardaway BIL, February 2009
  2. 2. IT DOESN’T MAKE ANY DIFFERENCE No one lends to startups anyway   Focus and you won’t notice
  3. 3. DOWNTURNS CAN BE GOOD They force you to be clever   They teach you to do more with less  Over funding often kills companies
  4. 4. YOU DON’T NEED TO OWN PEOPLE Don’t hire  You’re going to hire incorrectly anyway Partner and outsource
  5. 5. DON’T RENT SPACE You don’t need it   Bring the work to the people, not the people to the work
  6. 6. FORGET FUNDING You won’t get it anyway, and you will waste a lot  of precious time looking for it  Downturn in VC  Frightened angels  Diminished discretionary spending for the rich
  7. 7. TURN DOWN MONEY Draconian terms for startups   Loss of control  Exit of the founder with boot in his butt
  8. 8. YOU NEED LAWYERS Ycombinator has outsourced its documents   Document everything  Run the docs by a lawyer when you are finished  Set your company up to be big
  9. 9. GET AN IMMEDIATE CUSTOMER And make that customer pay   If you can’t, re-examine whether you actually have a product anyone wants
  10. 10. QUIT AND CHANGE YOUR MODEL Seth Godin’s “Dip”   If you can’t get any traction, there’s a time when you should stop  Not after they have foreclosed on your home
  11. 11. ONLY PROTECT YOUR IP IF IT MATTERS This is a discussion for an attorney.   An IP attorney, not your mom’s divorce lawyer
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