David S. Rose, the serial entrepreneur and chairman emeritus of the New York Angels, an angel investment group, has funneled tens of millions of dollars into 120 startups to date. Still, he feels that founders continue to lack some of the most basic resources to help them launch their businesses: Inexpensive legal advice for incorporating with the Internal Revenue Service; guidance for splitting equity among founders and employees; or software to manage a capitalization table, to name a few.
"Most entrepreneurs have not a clue as to what to do in the beginning," Rose tells Inc. "Even making small mistakes up front can be really challenging," he warns.
To that end, on Wednesday, Rose is launching an extension of his existing business--called Gust Launch--aimed at helping entrepreneurs startup seamlessly. For $99 a month, Gust's new platform will offer legal services to help you incorporate, as well as guidance for splitting equity, raising funding, managing a cap table, hiring employees and more.
Prior to Wednesday's launch, the New York City-based Gust has assisted founders by connecting startups to angel investment groups, funds and accelerators on its platform. The company has attracted more than 500,000 startups, and claims to be adding 10,000 new businesses per month.
Gust Launch, by contrast, attempts to become more of a tool or partner for entrepreneurs. It's the product of several years of development and millions of dollars in spending, says Rose, who noted further that it's a condensed version of everything he has learned in a simple, easy-to-use platform.
"The theory is that we can come out with a solution that can make it so rational and logical for anyone to start a company, and we can make a little bit of margin at scale," Rose explains.
Gust works with partners such as Simplexity, an accounting firm, and Xero, which makes software for small and mid-sized businesses. (Gust pays them a discounted fee to access their programs.) The product has been in beta for the past several months, and Rose anticipates on-boarding around 1,000 new clients per month through Gust Launch, or roughly 10,000 by this time next year.
To be sure, Gust Launch is not the only service of its kind in the market--though it may be the most integrated. DIY startups including LegalZoom, StartupDocuments and Clerky offer inexpensive services to help entrepreneurs file paperwork with the IRS, for instance. (The costs are comparable: Startup Documents charges one-time fee of $300 to incorporate.)
With Gust Launch, Rose insists, you get much more than the equivalent of an in-house lawyer: "It's a SAAS platform for running a business," he says. Over time, you can pay ($99 or $199 a month) for additional resources, such as drop-in CFO, or the equivalent of a physical bookkeeper.
Although some venture capital firms already offer similar resources to their portfolio companies, many welcome the new tool. "I have an informal 'Nihal's Startup Package' email that I have been sending to entrepreneurs ad hoc that includes a small fraction of what Gust seems to be providing," says Nihal Mehta, a founding general partner at New York-based Eniac Ventures."Gust also enables the entrepreneur to keep costs down with lawyers and do things the right way, so they don't need to be dramatically cleaned up at their first institutional round--which we often have to do," he adds.
Rose says that the launch of the newest platform has been a long-time coming, and the endgame for his now 50-person team. While he refused to disclose revenues to date, he notes that it's in the "seven figures" (in other words, at least 10 million) and growing. If he succeeds in adding 10,000 new clients, who agree to pay $99 per month, Gust will be doing an additional $1 million in monthly sales.