Micro-Startups for Fun and Profit
Society puts a lot of ideas in your head about what a "startup" is supposed to be like. Raise venture capital money, hire a team of developers and sprint to build and grow a product to justify all of the money investors trusted you with.
This allows you to really quickly scale and create a meaningful product, but it's inherently risky. Don't hit the numbers you need to and you're team might have to face layoffs at best.
I LOVE startups too, don't get me wrong. I've worked exclusively for startups throughout my career as a software engineer.
But I think the micro-startup doesn't get enough attention.
What is a Micro-Startup
A micro-startup is a specific kind of startup that is often bootstrapped and built with incredibly few resources. Usually just a single maker or a small team and no funding of any kind.
I LOVE micro-startups even more than regular startups. To me, they reflect the "American Dream" and allow anyone to become successful in what they are passionate about.
What are the benefits of a micro-startup?
Bootstrapping means it's really your startup
Raising a ton of VC money is great, but it comes at a cost. First, you give away equity in your company but that isn't a big deal. The real cost is the fact that now you have investors who expect your company to grow and meet certain milestones around it's performance.
Bootstrapping on the other hand, means rather than bringing investors onto the team you keep your team small and nimble such that you don't need funding in the first place. Additionally, you don't have to report to investors or worry about presenting progress to the board.
Fewer costs and less risk
Another huge benefit to bootstrapping is the fact that you can usually sustain periods of low or no profit for a very long time.
If your burn rate is zero, you'll never run of funding.
This means no layoffs, no worrying about raising the next round, and no stress if your business isn't growing at the pace you were expecting.
How to Start a Micro-Startup
Now we're getting into the good stuff. You understand what a micro-startup is and the benefits of building a company in this non-conventional way. Let's talk about how to get started.
First, you need to set your expectations.
It's going to be a LOT of work and you need to be able to dedicate enough time to get things off the ground without expecting to make any income.
The benefit of a micro-startup though is the flexibility and the ability to approach is like a side-project. Work when you want too. Make time for it before or after your regular 9 to 5 job.
Next make sure you pick an idea or project that you are truly passionate about.
I've tried many ideas that seemed promising, but after a few weeks lost motivation because I wasn't really interested in the specific solution I was building or the niche topic I was working in.
The Business Idea
Your business will need to solve a problem and deliver value of some kind. Try to think about problems that you face and write down possible ways to solve them. If you can create a solution to a problem someone wants to get rid of, they'll pay you to get rid of it for them. They'll pay you for your solution.
I have a few resources that might help you out too.
If you're really early in the idea brainstorming process, I laid out a post that goes into different types of business ideas and lists 40+ ideas you can consider and start right now.
Evaluating Your Idea
When you think you have an idea that's good enough to pursue, I advise you to spend some time evaluating it thoroughly. You don't want to invest months into a new business before making sure it makes sense and can be profitable.
Think carefully about whether your solution fixes a pain point that is so annoying that people will throw money at it to get rid of it. I wrote a post on idea validation that may help you out.
Building Your MVP
When you know you have a solid idea and are excited to buy the domain name and get started developing the product, please consider the scope and your time investment.
It's critical that you build a Minimum Viable Product before attempting to build the full product you have in mind.
You can dive deeper into MVP development with this post if interested.
Launching Your MVP
The last step is to share your product with the world. You don't want to overemphasize your launch, but it is an important step in the cycle. Our goal from launch is not to onboard a thousand customer and be profitable from day one. No.
We want to get our product in front of people so they can give us feedback.
We use our launch as a strategy to test our MVP and our product's hypothetical solution with real people. As a result we really want to focus on getting their feedback and improving the product more than trying to squeeze profit out of our first version or prototype.
Ultimately our launch doesn't even matter. Do you remember the day Google launched? Or Amazon or any other large company?
The best businesses are built around great products and you should launch many times to continually improve your product.
Here's a list of places I typically share new products I launch. Also, don't be afraid of sharing things early or even while some things don't work.
From this point on you'll be getting a ton of feedback in one way or another. If you launch and nobody signs up, you need to improve your messaging, copy, and make your product's value clear. Even then, if people still aren't interested this is good feedback and we can iterate and improve our product so that it does provide more value.
Another tip I'll give you is, don't blindly serve your customer. If they keep asking for a faster horse, it's because they don't know what a car is yet. You are the problem solver and it's your responsibility to interpret the problems people have and create solutions that they couldn't come up with themselves.
I love talking about startups, product development, and engineering. Follow me on Twitter and hit me up with questions!