Category: Q & A

Simple answer: if you can get profitable with outsourcing alone, and have no designs on being the "next big thing™", then there's never a need to bring things in-house.

Where the in-house team excels, and why it is so tightly linked to the term "startup", is in making fast adjustments and/or progress on the product, and eventually in being able to do the same with the team. Practically doing either seems both (a) easier to accomplish with everyone being local to the same area, and (b) to require a LARGE amount of funding – that's where the investors come in.

If you never need outside investment, then you never really "need" an in-house developer team. At the smallest end of the scale, you can think of a successful wordpress blog or etsy store – all the software/infrastructure is effectively "outsourced", but money is coming in. And in some cases, these bloggers/craftspeople get noticed, and get book deals/shows/hired by brands/etc.

In summary, outsource at least until you have something to show off, if that's your only option. If you don't at LEAST have a crappy prototype to show these days, then the good devs aren't going to care much to join up for equity, and you don't want to pay them what they'd need to take you seriously as a 9-to-5 employee.

How far can outsourced development take a startup?

You'd need to supply more details about the bank – You're Dutch, but your bank need not be.

Add to that what others have mentioned in the answers/answer comments: a bank is a really bad source of funding for an early stage startup… At least in terms of a cash loan. Some banks do venture investing on their own, which would definitely change the answer a bit.

If you're just after cash, however, you'd do MUCH better working on your social and pitching skills, and pursuing local/European angel investors with your idea, preferably with a somewhat-working prototype in hand, or at least a very convincing powerpoint and eyes filled with lightning. For a primer on this, I highly recommend reading "The Game" – startup founders and pickup artists are basically one and the same, at least when in pitch/recruit mode. 😉

Alternately, joining an incubator program that injects cash in exchange for startup equity might be the right path for you. Instant access to mentors, as well as program admins who genuinely want to succeed because they own a piece of you.

Aside from incubators, there are also several different governmental programs that offer cash to startup-crazed founders in exchange for spicing up their local tech scene… Off the top of my head, startupchile.org has a fairly popular offering, comparatively relaxed standards (vs. a YC, FI, Techstars, etc), and doesn't take a cut of the company. That's $40K in cash, right there.

Overall, I'd say don't get so laser focused on a dollar amount, or where it comes from. Give away half the equity if you have to, because owning 100% of nothing is… nothing! Just get out there, start building it, and see what happens. Course correct. Tear it up and start over. All stuff you can at least START moving forward with without spending a dime (Amazon will host your site for free until it gets traffic, and if you get enough traffic to PAY for AWS, you probably have enough traction to start talking to investors, if the idea itself is interesting).

Good luck to you!

I am a Dutch student. I want to start an internet business. How hard is it for me to get a loan from the bank to start it?

The biggest obstacle to having anyone steal your idea is sheer laziness. For cofounders, it'll be worse than that – they already know roughly how much work is involved, and already have a team of dedicated souls to execute it. The worst possible mistake at this point would be to try and replicate all that on their own, or with a new team (who would, perhaps, also know on some level that they're working with/for someone willing to steal another's ideas, bad scene…)

Practically speaking, it's much more likely that your team will hang together through product launch, and then have a falling out over a funding round issue, exit offer, or disagreement over how long to hang in without revenue before trying a pivot.

In the meantime, get your nose back on the grindstone, build whatever it is, and launch the damn thing.

At the idea to prototype stage of product development, how can you make sure that none of your co-founders run off with your idea and implement it alone?

I still see plenty of issues with overlapping .co and .com domains… If the main reason you're considering .co is that the .com is taken… Well, either have a targeted/niche service where people will either find you via another means (mobile app, facebook, backlink, search, etc), OR think up a better name and grab the .com. 

The idea that all the good names are taken is propagated primarily by people with no imagination. 😉 Seriously, though, any benefit you would get from the shorter/concise name is basically killed by .com/.co confusion, it's very similar to grabbing the .net when the .com is taken – you're just instantly losing traffic.

Worry a little less on the perfect domain name, and more on making a product SO GOOD that you get funded well enough to buy the .com you wanted in the first place.

Is it a good or bad idea to use a .co domain to launch a startup?

Unless you are an app, or a country/language-specific service/site, I'd still recommend using .com over anything else.

That said, there is a group of firm believers who seem to feel that .co domains are getting a little extra SEO love for some reason…

Still, given the recent potential for problems with ".ly" domains now that Libya is experiencing non-technical issues that may lead to routing/DNS outages for the whole TLD… It might be wise to make sure Montenegro and Colombia aren't having any political issues before committing long-term.

Which domain is better for a startup: .co or .me?