Before I launched FamiliesGo! I spent the better part of a year talking to people, reading articles and blogs, and taking classes on starting and running a business. I heard a lot of the same advice over and over. Sometimes I immediately understood how the information applied to my business. At other times, I believed that the guidance was probably good but didn't know how to act on it. And there was advice I immediately wrote off as irrelevant.
I admit now, though, most of the advice turned out to be right—even some of the seemingly irrelevant stuff. Maybe I should feel silly or naïve for not recognizing that immediately, but I don't. I probably couldn't have responded to a lot of the advice at the time I got it. And taking that time—as the business concept simultaneously evolved—allowed me to make better decisions.
Here are some of the nuggets of wisdom I got early on that I should have taken to heart right away.
1. You need a partner
Several people told me that it's vital to have different points of view and expertise to draw on and that what I'm trying to accomplish is too much to do single-handedly. I would need a partner, they said, and I would have to compensate said partner with equity. Like a lot of entrepreneurs, I'm bootstrapping FamiliesGo! I seriously doubted I could persuade someone to join my promising but small, under-funded start-up on the basis of delayed gratification.
Then I went to The New York Times Travel Show, where a woman was giving out information about the CARES harness, a clever travel product that let's you safely buckle your toddler into an airplane seat without schlepping a bulky car seat. I have one. I love it and I told the woman so. I also gave her my card. A week later she emailed me and proposed an affiliate relationship that could bring modest revenue (yes, money!) to FamilesGo! We played phone tag for a few weeks but never connected because I was too busy trying to get the content together for my site launch while also working to pay the bills.
If only I had partner to handle marketing and sales that might not have happened. Ooooooh! My first a-ha moment.
I began asking around in April, and advertising on various start-up and parenting community sites about a position for an equity partner in a family-friendly start-up. I already got quite a few replies, primarily from other parents, who are able to appreciate the business idea and are also in a position to take a chance on it. I'm now talking with one woman in particular who I'm very excited about and I hope we'll be able to work together.
2. You don't want to be a sole proprietor
People told me I should register FamiliesGo! as a 'limited partnership' rather than a 'sole proprietor'. They told me the latter would be confining in the longer term because it doesn't allow someone to expand ownership to include partners or investors. But since it's quick and cheap—I wouldn't need a lawyer, a lot of paperwork, or more billable hours from my accountant at tax time to do so—I opted to move in that direction.
Then, earlier this year, I asked a family member for a small sum of seed money and he asked for a small piece of equity in exchange. And, of course, I began looking for a partner, to whom I plan to offer equity.
And there is my second a-ha moment. Had I actually gotten around to filing as a sole proprietor I would have had to go through the extra cost and bureaucratic hassle of converting it to an LLP. (Luckily this wasn't a top priority).
Now, I've got the paperwork sitting on my desk to file with the state of New York for FamiliesGo! LLP.
3. You need a lawyer
Come on, I don't need a lawyer, I thought at first. My entire start-up budget barely hits five figures so how can I justify the four figures a lawyer charges to do anything? And anyway, how much legal stuff can a tiny website have?
Well, a lot, even in less than a year. My future partner and I will have to draw up a partnership agreement and we'll need to file a partnership structure with the state. Since I plan to gather personal information such as e-mails on my website a privacy statement is important. And many travel websites post disclaimers about their content, lest some tidbit of information on the site be out of date and wreak havoc on someone's vacation plans.
And there we go: my third and latest a-ha moment.
Anyone know a good yet inexpensive lawyer?