“Sounds good, but… how are you going to make money?”
If you’ve ever pitched your business, asked for funding or applied to a startup contest, you’ve heard this question more than once. And unless you’re making millions in revenues there is a fair chance you don’t have a good answer to it.
Nothing to worry about! Startups are businesses in constant search of a business model, so take your time. However, it’s good that you realize it and plan for constant change from the very beginning. For my company, Filmaster, it took us 3.5 years to get to the working model followed by the first significant deal.
Last week I attended Google For Entrepreneurs event in Wroclaw where I had a fireside chat on stage with Asier Rios about my career as an entrepreneur. I think I let Asier down as instead of bragging about how great Filmaster.TV is doing, I focused on my (multiple) early mistakes in running a startup, the biggest one being: not going through an incubator. The conversation inspired this post.
I did not even consider starting my first company in an incubator. Giving away some 5-10% of the firm for some ridiculous(ly small) amount of money seemed foolish to me. I chose the bootstrap path. That was the single worst decision I made and here is why.