Saving the startup from burning up
/The Problem
The biggest worry for any software startup owner is
Will I burn up my funds before I can get my products launched?
And this should, indeed, be her biggest worry. Great ideas are good, but if you cannot launch and get users, great ideas die out badly. It is absolutely essential to get something out quickly, get user feedback and pivot to the next step. If you can't then there is a very good chance that your startup will just "burn up".
A great article is around expected burn rates (in US) and what you should aim for is Burn rates: How much? by Fred Wilson. Here is a rule of thumb about burn rates from there:
...multiply the number of people on the team by $10k to get the monthly burn. That is not the number you pay an employee. That is the "fully burdended" cost of a person including rent and other related costs.
And this was 2011. The figures are much higher these days for sure.
A Solution
A great solution to this burn up before launch problem is to use a development partner who can lower the costs of production. By having developers in low cost countries such as Bangladesh, Cambodia, Nepal, etc. it is possible to lower the costs without compromising on quality.
We are old hands in this start up and burn up drama. When we started in 2004 our first project was to help a silicon valley start up save themselves by finishing and launching a product they have been trying to build before they ran out of money. We made their remaining funds run a long way and got the product out within 6 months within budget. With that as our initiation, it is no wonder that we have helped more than 20 startups get their products out on their angel funding. Once the 1.0 product is out a start up can breath easy and see how user adoption and feedback is. Based on that they can decide to seek more funding or in the happy cases start making money!
For us, as a software company that thrives on ideas and innovation, working with the startups is the biggest fun. This gives us the chance to work on new technology, challenge ourselves with difficult technical hurdles and deadlines.
We are so confident on getting the first versions out with angel funded startups that we are offering startups looking for dev partners in the CeBIT 2016 a "Launch under 10K Euro" offer.
