Trials and Tribulations of Starting a Startup

how to start a company

whether it be an indie game development, a startup with a tech product, this is Yan's experience on how to get it off the ground.

money is not the most important issue

• as long as you have enough to invest initially into it
• there are always people who are willing to invest

japan has a lot of "armchair" angel investors who very easily part with money, mainly because companies who earn more than 40 mil yen a year have to pay 50% tax to the government. So either they lose money to the government and never see it ever again, or they can invest in startups and possibly see a return on their investment. if they don't, its fair game because they would not see that money ever again anyway.

passion and clear idea of you and your co-founders' contributions is the most important

the co-founders talk

talk about

• what should the plan be if the company goes this way, or goes that way
• what is the plan for the next year, two years / five years.
• expose your finances, how much can each person invest
• share what each and every co-founder brings to the table, meaning what exactly do you do, and what does he/she do, and make sure what you think he/she does aligns with what you assume to be true. don't assume things, make it crystal clear what each person can bring to the table.
• find out what you and your co-founders agree on and disagree on. you have to all agree on the important things (things that will make or break the relationship)
• find out how your skillsets can work together
• it's like a marriage, with the joy, despair, and everything
• co-founders need to get to know each other's friends and family
• ask shameless questions

the purpose of the co founder is to be able to rely on them, so be able to pick up their slack when things are down, to be able to cry to each other. to be able to say something and they know exactly what you mean.

the business pitch

when preparing for pitching to investors, the gist is:

1. calculate what your startup will be able to make in a year, based on current conditions
   • what your current revenue stream is
   • how you make it
2. split that income by 100, to get the price of your equity. 1% equity of your company costs ??? much
3. assume you get an investment of X amount of money
4. what can your startup now do, with this additional amount of money?
5. calculate what your startup will be able to make in a year based on your new plan
6. split that new income by 100, so that WITH INVESTMENT, IN ONE YEAR, the 1% of your company could potentially grow from ??? much to ????? much.
7. point number 6 is the one you sell to investors.

TLDR: convince investors your plan to make use of their money and how it can be used to make more money PS: in japan it's much easier because investors invest in things that they like. (the investing culture is still new)

-ref: google "questions co-founders have to ask each other" or "co founder relationship questions"

when starting out as a small company

the right hires make all the difference

the right hire is a very flexible person. he / she can be given any random thing and be able to figure out how to do it.

key traits

• highly adaptable
• able to take anything thrown as him/her
• passionate, meaning able to go the extra mile to do things for the company

getting the team to execute on the idea with an aligned vision is also important

• as not aligning will cause a lot of wasted time and resources.
• a shared vision is important as it reduces the number of iterations required to get things done

background

Yan started with 50,000 USD saved up from her finance job before, with another 50,000 USD from Kani, as money used to start code chrysalis. From the first email, they met at least once a week for serious talks from october 2016 to jan 2nd 2017, and exchanged emails even more frequently. the entire purpose of the 3 months is to understand how each of the co-founders fit into the whole puzzle, as well as gauge how much each person believes in the idea, and how each person imagines the idea will expand.

Yan initially got into programming (from her finance job) with the express purpose of getting good at coding in order to start a company. she gave herself two years to learn it all up.

It helps that both Yan and Kani have extra thick skin. They are never afraid to embarass themselves. This is defined as the ability to, at any moment's notice, stand up in front of a crowd and give an elevator pitch about their product.