Jacob Baytelman

Building software since 1998

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What a startup needs

How a startup starts and what is necessary for that - let us have a look at it from the very beginning, the birth of the idea. For now your are the only 1 person, the founder, the author of the idea. As a rule, apart from nurturing the idea you are busy with a bunch of other chores, you go to work, take kids to kindergarten and so on. And also, as a rule, you do not have enough money to give up you day job and get down to your own startup. You can allocate approximately 1-2 hours a day on developing your idea. What do you need in the first place?

Accellerator? Mentors? Technopark? Office? Software developers? No, all this is too expensive and too early to think of. You need... Starbucks. Or a similar venue where there is
- no music,
- no much noice,
- no meddling waiters,
- a power socket and wi-fi
- a private space to think, read, work, have a meeting and so on.
And all of this you can get for a price of a good coffee, including the coffee.

Starbucks is the "third place", not home and not work. What is it worth for? Starbucks is the base of infrastructure that allows startups to grow. Any coffee house can be a "starbucks", no matter what their sign says, it is important that they have the same style of service and provide the power supply, wi-fi, the cup of coffee that make it possible the sit there even for half a day quietly and do your own business.

As a fresh startup founder you need to flee home and office and concentrate on the idea in privacy. You want to google your competitors, sketch out drafts, schemes, basics - formalize the idea on paper, prepare a presentation. Nobody has to interfere. Clearly, at this point you will not rent an office, not even a coworking space. That's why you need Starbucks.

When the idea is formed, it is time to look for partners and critics. The process is always the same: you tell people about the idea, get feedback, work on mistakes, invite the most adequate critics to become your partners. You still have neither time nor money, you are still deeply sunk in your day job and home routine, so meetings and presentations take place... Where? Right, at Starbucks.

Let us go on. Cofounders are finally found. The idea is formed. It is time to implement it. You start working on the business plan for creating a minimal viable product and count money which is still not there. Let us make it simple and assume that you have a purely software startup, no manufacturing. In this case the biggest chunk of your expenses goes on payroll and office rent.

But there is no money. Or too little money. In any case you try to skimp. Offices are expensive. Small offices are cheaper, coworking may be even cheaper, but anyway you cannot afford it. Anyway, the first home of you startup will be small and cramped. It will be packed by coders and who seem to like it quiet. You have to make 100500 phone calls a day, discuss, present, sell, talk, talk, talk much and loudly. Also quite often you are not in a hurry to inform you employees about the things you discuss. So you are pushed out of your own office and spend more than all the workday in the nearest Starbucks.

When one of the coders does not meet your expectations, you look for a replacement. Where can you conduct an interview with a candidate? You will not take him to the office, you should not give the employees food for doubts and unproductive thoughts. Starbucks comes handy again.

It is easier with investors, they don't visit startups, you visit them. And here comes 1 of 1000, the one ready to invest and the one you are happy with. A visit to your office, all coders are working hard, the investor appreciates your austerity and thriftiness, (your modest desk in the corner rather than a luxurious office). When you want to have a confidential talk with the investors you will invite them to Starbucks next door.

Months pass by, your startup grows stronger, sales start and you get that long cherished traction. The marketing department finds its place in your organizational chart. Very loud guys and gals with a sexy British accent invade this department. They are constantly presentating, calling, skyping, talking, which works by the way, you see the sales grow. The coders in the next room wear earphones. You continue living in Starbucks both because it is already a habit and because it is convenient. You have "your" table here, everybody - barista, cleaning lady and customers know your name. Amazingly, there are almost no "random" customers here.

You attend a big event in London. You are not ready to present your product yet, but there are several preliminary meetings with potential investors, clients and partners. Where will you have those meetings? Open Google maps and look for the nearest Starbucks. Lifehack: take a smart assistant to this event. His or her task will be to occupy a table at Starbucks before the event starts and drink there coffee all day long. You meet people at the event and invite them out for a talk, to Starbucks, where you have a table ready. A nice little thing.

I can give you a dozen more examples of Starbucks use aimed at developing a startup, but I hope you get the point. Startup is about maximal efficiency and flexibility with minimal costs.

Good luck!

P.S. Because startup is about the efficiency and flexibility with minimal costs, there are two important aspects: cost of life and accessible airports (to get to such "world centres" as London, New York, San Francisco). No doubts, London, New York, San Francisco, Tel Aviv have an ideal infrastructure for startup development. Ideal though very expensive. But if the founder lives and runs the startup somewhere in the backwoods, the budget will be considerably modest (even considering regular flights to the "centre" on the other side of the pond). Which is a competitive advantage, as long as this "backwoods" has Starbucks, airports and an acceptable level of comfort:).

J.Baytelman February, 2018