Ask HN: Does this idea make any sense?
Hi there, I would like to get your perspective on this idea, does it make sense?, I happen to think dev shops are broken, and this may be a better approach, let me know your thoughts?
It'd take years for any winning bets to pay off and I don't know how you'd pay your employees.
If it is the same four people across all companies, and their fully loaded cost is 200k (not a lot in the valley, but plenty in many other places), then that works out as 32k for a 5% stake. Compare that to Y Combinator's 125k for 7%.
If you accept that you can't run 20 startups with four people, no matter how much Club-Mate you feed them, then you could try staffing each position at 25%, and be paying 200k for that 5%. Not so hot, but maybe still good enough?
They'd have to be really simple projects, though, if I'm expected to bang out 20 of 'em a year.
Most of the time I ended up with one of two kinds of founder:
1) Very price senstive with a lack of investment mindset. With that kind of budget they would have been better off investing in themselves to either: a) Learn to code or develop some other valuable skills. b) Build a profitable service business.
2) Very busy running another business without the time to do the work of finding customers. They would have been better off either: a) Focusing on growing their current service business. b) Creating a non-software product such as a course, book, templates or a newsletter.
In general non-developers need to be prepared to invest at least an order of magnitude more than that. Any less and it's unlikely they'll take it seriously enough to succeed.
This is assuming you are aiming at clients with North American/European levels of purchasing power.
1) the pay for the technical tesm is in a country where you can pay sub $25k/yr (which is most countries on the planet but rules out North America or most of Europe). Because there won’t be enough money to pay much more.
2) So long as all these projects are technically simple. Don’t be an incubator for new ideas. Make CRUD apps for orgs that want to replace a spreadsheet instead.
But as some kind of incubator or operating in EU/US? No.
Especially since you need a few generalists who should work with minimal oversight (and indeed provide one).
The wording implies that a project gets its own team, but this is an assumption.
Also, that pricing sounds insane for a 4 people team. You're probably not looking for engagements that last more than a month, but even with that I don't know how you can make decent income to pay the team.
I think these ideas can be creative, but I feel bad for those who can't do the math for themselves and also build the team/contractors that would likely make them successful in the long run.
More and more "startups" are just disguised digital agencies.
1: Value creation --> pro it creates low entrey --> con You need to get in --> Overal I don´t think it´s a smart move to let people decide if something is going to valueble when they are not the valid expert in a certain domain --> This video explains it = https://youtu.be/8ZHLCDCPo_U?t=2253
2: Economical --> pro basicly everyone can start --> con everyone can start --> Overal i think it´s hard to overcome bias. The best way to outperform thoughts and words of bias is to look at actions over time.
3: short term vs long term --> pro it´s intresting in downturn markets for singles now --> con but singles can build easier faster even in downturn markets. --> Overal
= I think internal motivation and timing are key.
The single biggest reason why start-ups succeed | Bill Gross https://youtu.be/bNpx7gpSqbY?t=324
What issues do you have with dev shops? How does this solve those issues? How do you even know if this solves the issues, there is literally no information?
What tech stack do they work with? If I have my own engineers how do I know what you are going to offload to them?
Your initial ideas need constant iteration as you interact with reality to see what works.
A team that will leave in a few months for the next thing have no incentive for iteration or great execution - both which are needed to interact with reality to find something that works.
Either the founder is going to pay way too much/get too little, or pay too little/get too much these services.
Not to mention the incentives for bad behavior are enormous.
I don't expect good resources to be available for $333 per month anywhere.