Principles of partnership in the startup MyClasses.org - the story beckoning to the Dominican Republic
In this post, I will tell the real story about how four people ( expat-prankish, Muscovite, limitchik and clumsy bear ) agreed on the principles of partnership, fixed these agreements by simple email and, trusting each other, for 9 months of geographically-distributed work approached his dream of independence. Personally, I had this dream a long time ago, but it was finally formulated after reading Tim Ferris' Four-Hour Work Week: the idea that it was necessary to create a product, and not just work for wages, became simply intrusive.
A little background. Three years ago, I put an end to my previous biennial self-sustaining, but weakly growing project and started registering domains for a new one: MyClasses.org is a network of local directories ( city ​​level ) about various courses and lessons. The sites organize the process of communication between schools, teachers and students. A sort of mix Yellow pages + CMS + CRM + Feedback / Review + Social network. Local-global scale.
I registered domains a lot, enthusiastically and constantly. Domineering, not in the true sense of the word, - my weakness - an idea appeared and bang! - urgently need to register a domain! Then the excitement passes, and there is an understanding that there is neither strength, nor time, nor sufficient prospects. But domains remain. Sometimes they were able to be sold ( 3 times on request, I never put up for sale myself, the best deal is $ 2,200, only $ 3,000 - you will not get rich ). But this time it was not so.
')
The next gamble bribed a whole range of favorable factors:
In general, I thought about a week, I made a decision and registered the first hundred domains, giving myself a promise that until this project reaches such a level that I can live well (ies > € 4,000 ) for profit I will not take ideas, and this one will not give up. And I kept this promise ( and still hold ).
It took me 2 years, € 50.000 + personal investment ( of which € 15K is not a loan yet ), a divorce and an incredible amount of evenings, nights and weekends to:
It is on the last paragraph that I want to stop and tell in more detail.
I visit Russia quite often and periodically told my programmer friends about the project and offered to join - initially under fairly good conditions ( like 30% - I don’t remember exactly ). The reaction was: “in principle, perhaps interesting, but now, such a load, let's try sometime ...” - well, in general, you understand - no one really wanted to risk it or could not for one reason or another. . This is normal - all people are different, and our life is different.
It is very difficult to find a co-founder at the very early stage of the project development - at the level of the idea and the construction of the prototype. But if in your heart you are a real startupshik, this should not scare you, upset and stop. After all, everything has its pros and cons. The sooner partners join in - the greater the share they receive and the sooner everyone will start to make a profit. The later, the more you stay. The most important thing is that at the time of the merger everyone is happy - everyone gets what he wants. People refuse to enter into a partnership, but you really need? You need to understand what they need and work to ensure that you have the opportunity to offer it. Trite, but as it is.
In my case, it was required to show that:
That's what I did - focused on increasing attendance and profit. Somewhere at the expense of functionality and usability. But here it was not necessary to specifically choose - it was necessary to somehow break free from the vicious circle.
And when the revenue passed for € 1K per month and the project went into operational self-sufficiency, three of my Moscow friends immediately had a real interest. The question arose - on what principles to organize a partnership? The problem was that the circumstances did not allow the guys to quit their current job and go entirely into a new project. Accordingly, no one could guarantee how much time and energy he would be able to devote, which means it was not very clear how to distribute the shares. In addition, we all worked remotely ( from home ), and this also imposes its own specifics. I wanted to work out such an approach so that everyone would be calm and comfortable.
I thought a little and a rather obvious decision came to me. So.
We presume that the value of each partner is about the same. The current partner’s fair share is assessed as if it worked for 1 year full time ( 8 hours, 5 times a week ) - for example, X%. The share_for_hour = X% / 48 work per week / 5 days per week / 8 hours per day is calculated . Set the cut-off point, after which the fraction does not grow. We originally had 1 year, but recently extended another 3 months.
Some reviewers of the article became interested in - how exactly did I determine the magnitude of this X? I will say right away - there were no calculations. I thought half the night, and in the morning I went into the shower and listened to my feelings for about ten minutes - which figure, taking into account the funds already invested, will be fair and just. Such that interested partners and I did not mind giving. I will not say the exact value - I got in the range of 7-15% per person. The offer was accepted by all without trade, and it turns out that I guessed right. You may have a completely different figure.
Well, then everything is simple. Every week, the guys provide a report on the hours worked and at the end of the month a total of the earned share is summed up. Of course, such an approach for remote work requires honesty and a certain level of trust. But if this is not, then is there any sense in partnership? I trust the guys with the word regarding the entered hours, and they took my word for me that I will draw up a share in the company for them after a year of work - that is what worked.
One of the reviewers, also a startupshacker, asked an interesting question whether the time of separation was discussed - in case any of the partners decide to stop working on the project. I can say - yes, it was discussed. It's simple: worked - earned. The share accrued for hours remains forever. But we also had a subjective-premium option charge ( 3% of the project’s share was stretched over a year in general ) with the possibility of redemption 3 months after the charge. We agreed that if a person decides to stop working together, he is deprived of the option to buy back options that have not yet been bought back. The interest accrued over the hours and options already bought back remain in the possession of the partner ( with the possibility of selling to any person ).
As a result, this scheme has proven itself very well: everyone works as much as they can and things move very well. At the moment, the variation in earned shares is a little less than twice - and no offense! Recently, after almost a year of working on this principle, I invited another developer into the partnership. True, its annual rate-share is already Y%, which is a third lower than the initial X% - and this suits everyone, because the risks are different.
How well does the scheme work, is our team and at what stage is the project?
In general, despite a slight decline in the last month, we believe in the project, our team and bet that we will succeed. The question with the Dominican Republic came up and decided in one day - literally last Friday. And this week we are already buying tickets. And I, as the founder, are insanely happy with how things are going. I hope my story will give you a little more strength and confidence if you are still only at the early stage of your startup.
It should be noted that all this could not be realized without the support ( both moral and material ) of my closest friends. The whole world may not understand you, but you need at least one person who will say at any moment “you will succeed” and will transfer a thousand euro to your account when you have a cash gap. I know - they will read - thank you so much!
And also, I almost forgot to write, we really need a very good one, no, I would even say - cool, layout designer . Just such a two-stationer. Because our work is the sea, the project is rapidly growing / changing, but the design, usability and layout have a little “limp”. If you are exactly the person who can draw beautifully, and then competently and quickly put together ( JQuery ) so that it is convenient to use it, and even, ideally, you can write the text in English / Spanish and you want to be in three winter months in the Caribbean, send me a few words about yourself and a link to your portfolio in a “lichku” or by email. And maybe we will work together and you will become a part of something very big! Girls / boys - both genders are very welcome!
We are also considering the option of attracting investment . But we are not interested in just money. What we really need is a partner-investor who could help with marketing and, perhaps, with progress in specific areas. Collaboration is possible in specific categories or cities / countries.
If a respected Habr considers our story interesting and does not bury my karma in the negative, perhaps we will tell in more detail about the development of the project and how we arranged a test trip to “work” in Dominican Republic. In the future, we have a grand plan - to work together in many warm corners of our planet where there is sun, wind and waves: Thailand, Mauritius, Vietnam, Cape Verde ... And as a result, settle down somewhere like New Zealand.
I am pleased to answer the questions that arise. Unfortunately, the account on Habré from our entire company is available only for me so that all the answers will be on my behalf.
Thank you for reading to the end my very first article about our startup and all the success in your endeavors!
UPDATE May 11, 2012 : We are recruiting staff ! We have opened 3 positions:
Salaries are competitive, work until October in an office in Moscow, then for 6 months in the Dominican Republic. Working with us is interesting and fun! See how it was:
About how to get to us here: http://www.petamatic.com/ru/dream-jobs.html
A little background. Three years ago, I put an end to my previous biennial self-sustaining, but weakly growing project and started registering domains for a new one: MyClasses.org is a network of local directories ( city ​​level ) about various courses and lessons. The sites organize the process of communication between schools, teachers and students. A sort of mix Yellow pages + CMS + CRM + Feedback / Review + Social network. Local-global scale.
I registered domains a lot, enthusiastically and constantly. Domineering, not in the true sense of the word, - my weakness - an idea appeared and bang! - urgently need to register a domain! Then the excitement passes, and there is an understanding that there is neither strength, nor time, nor sufficient prospects. But domains remain. Sometimes they were able to be sold ( 3 times on request, I never put up for sale myself, the best deal is $ 2,200, only $ 3,000 - you will not get rich ). But this time it was not so.
')
The next gamble bribed a whole range of favorable factors:
- Many different domains were required to translate the idea and promotion.
In addition to the domain level, cities were planned to unite by category: dance, fitness, yoga, handicraft, martial arts, etc. etc. At last I could direct my hobby and one can say painful passion to a useful course, moreover systematically. Many of my friends ( read almost all ) thought the idea was crazy and twisted a finger at their heads. It took two years to hear from these same people: “I must admit the idea turned out to be ingenious.” I will not hide - it was very nice. Looking back, I can say - undoubtedly my hobby gave me an experience that was very useful. - The project seemed ( at that time ) quite simple
Despite the fact that I have more than 15 years of experience in IT in various positions ( mainly software developer ), I initially thought that I would be able to raise the project during the year, working in the evenings and weekends - how wrong I was! - The project was based on the principle of user generated content
I know this is a very old term and probably not very fashionable now. But I'm not so young anymore! And the principle that the content of the site will be created by the users themselves, I still really like it. Yes, but why I’m justifying myself - because you read it on Habré - an excellent example of the success of this approach with proper implementation. - The project was indirectly connected with my main hobbies - dances, kitesurfing, languages
My previous experience has shown that I personally cannot work with a soul on a project whose idea is not close to me. But if I can imagine myself in the place of users of my site, service or product, then it becomes much more interesting! - Most importantly, the project was scalable!
Once the subtracted phrase " Tide raises all boats " firmly stuck in my head and since then I have consciously searched for a product that would simultaneously satisfy two seemingly incompatible qualities: it was niche and, at the same time, all-encompassing. Yes, while still so that the market was not busy. And I found it. When I read Nassim Toleb's The Black Swan, I finally confirmed that I was on the right track. - The project integrates well with social networks ( Facebook / Twitter )
As a rule, people who seek or promote courses do not hide this, but on the contrary - try to involve as many friends as possible. After all, the more people come, for example, to dance lessons, the merrier! And we are working to ensure that everyone can easily talk about their hobbies. - The project allows you to continue to organize work on the principle of the Virgin
I am a big fan of Richard Branson and I like the organizational structure of the Virgin group of companies - there is a common brand and parent company that is co-owner of subsidiaries, often owning less than 50%. Despite the fact that wage labor has the right to exist without it, I am for “self-withdrawal” and, whenever possible / expediency, for motivating people through equity participation. A person working for a share and an employee are completely different people. And when you try to build a big business, without partners, it seems to me, you can not do.
The problem is that in a large company, minority shareholders do not feel a strong and direct dependence of total and personal profits on the results of their labor. Therefore, I consider it much more effective to break a company into related, but partially independent, payout units that will have a direct correlation with the success they have achieved.
In general, I thought about a week, I made a decision and registered the first hundred domains, giving myself a promise that until this project reaches such a level that I can live well (ies > € 4,000 ) for profit I will not take ideas, and this one will not give up. And I kept this promise ( and still hold ).
It took me 2 years, € 50.000 + personal investment ( of which € 15K is not a loan yet ), a divorce and an incredible amount of evenings, nights and weekends to:
- Register 2.300+ domains and configure them to work with Google Apps
- Buy more than 10 premium domains, with an average price of $ 2,000 each ( for example ChicagoClasses.com )
- Develop the basis of the engine in Python under Google AppEngine ( with a reserve for scalability when we become super popular )
- Order from Turbomilk design and logo s
- Bring the project to self-sufficiency and stable growth of attendance / profit of 10% per month
- Register a company in Ireland ( where I worked for Dell )
- Find partners and develop a equity participation scheme.
It is on the last paragraph that I want to stop and tell in more detail.
I visit Russia quite often and periodically told my programmer friends about the project and offered to join - initially under fairly good conditions ( like 30% - I don’t remember exactly ). The reaction was: “in principle, perhaps interesting, but now, such a load, let's try sometime ...” - well, in general, you understand - no one really wanted to risk it or could not for one reason or another. . This is normal - all people are different, and our life is different.
It is very difficult to find a co-founder at the very early stage of the project development - at the level of the idea and the construction of the prototype. But if in your heart you are a real startupshik, this should not scare you, upset and stop. After all, everything has its pros and cons. The sooner partners join in - the greater the share they receive and the sooner everyone will start to make a profit. The later, the more you stay. The most important thing is that at the time of the merger everyone is happy - everyone gets what he wants. People refuse to enter into a partnership, but you really need? You need to understand what they need and work to ensure that you have the opportunity to offer it. Trite, but as it is.
In my case, it was required to show that:
- The right strategy was chosen.
- The project can make money ( it does not pay off yet, but it already earns and grows )
That's what I did - focused on increasing attendance and profit. Somewhere at the expense of functionality and usability. But here it was not necessary to specifically choose - it was necessary to somehow break free from the vicious circle.
And when the revenue passed for € 1K per month and the project went into operational self-sufficiency, three of my Moscow friends immediately had a real interest. The question arose - on what principles to organize a partnership? The problem was that the circumstances did not allow the guys to quit their current job and go entirely into a new project. Accordingly, no one could guarantee how much time and energy he would be able to devote, which means it was not very clear how to distribute the shares. In addition, we all worked remotely ( from home ), and this also imposes its own specifics. I wanted to work out such an approach so that everyone would be calm and comfortable.
I thought a little and a rather obvious decision came to me. So.
Principles of obtaining a share of new partners in our startup
We presume that the value of each partner is about the same. The current partner’s fair share is assessed as if it worked for 1 year full time ( 8 hours, 5 times a week ) - for example, X%. The share_for_hour = X% / 48 work per week / 5 days per week / 8 hours per day is calculated . Set the cut-off point, after which the fraction does not grow. We originally had 1 year, but recently extended another 3 months.
Some reviewers of the article became interested in - how exactly did I determine the magnitude of this X? I will say right away - there were no calculations. I thought half the night, and in the morning I went into the shower and listened to my feelings for about ten minutes - which figure, taking into account the funds already invested, will be fair and just. Such that interested partners and I did not mind giving. I will not say the exact value - I got in the range of 7-15% per person. The offer was accepted by all without trade, and it turns out that I guessed right. You may have a completely different figure.
Well, then everything is simple. Every week, the guys provide a report on the hours worked and at the end of the month a total of the earned share is summed up. Of course, such an approach for remote work requires honesty and a certain level of trust. But if this is not, then is there any sense in partnership? I trust the guys with the word regarding the entered hours, and they took my word for me that I will draw up a share in the company for them after a year of work - that is what worked.
One of the reviewers, also a startupshacker, asked an interesting question whether the time of separation was discussed - in case any of the partners decide to stop working on the project. I can say - yes, it was discussed. It's simple: worked - earned. The share accrued for hours remains forever. But we also had a subjective-premium option charge ( 3% of the project’s share was stretched over a year in general ) with the possibility of redemption 3 months after the charge. We agreed that if a person decides to stop working together, he is deprived of the option to buy back options that have not yet been bought back. The interest accrued over the hours and options already bought back remain in the possession of the partner ( with the possibility of selling to any person ).
As a result, this scheme has proven itself very well: everyone works as much as they can and things move very well. At the moment, the variation in earned shares is a little less than twice - and no offense! Recently, after almost a year of working on this principle, I invited another developer into the partnership. True, its annual rate-share is already Y%, which is a third lower than the initial X% - and this suits everyone, because the risks are different.
How well does the scheme work, is our team and at what stage is the project?
- Revenues increased to € 5,000 per month + CAD 1.000 in the Canadian sector ( which is issued as a separate enterprise in partnership with a Canadian investor )
- Six months ago, I quit Dell, spitting on a possible-future reduction with a compensation package and began working on the full-time project (the reduction did not happen )
- The average number of hours worked by partners is 30 per week. This is a lot, considering that they also have the main work.
- Since November, two partners quit their main job, move out of their rented apartments in Moscow, sell recently purchased cars and move to Ireland for 2 months to work on the project to the maximum.
- In mid-January, the third partner quits, rents out his “odnushku” to Domodedovo, sells the car, and the four of us ( plus the friend of one of the partners ) leave for the Dominican Republic for 3 months to: a) work effectively in one office at a distance of direct visibility and audibility - Skype and different time zones are somewhat tired; b) to have some fun! - ride kites / windsurfers, dance salsa / bachata, learn Spanish and communicate more with people.
In general, despite a slight decline in the last month, we believe in the project, our team and bet that we will succeed. The question with the Dominican Republic came up and decided in one day - literally last Friday. And this week we are already buying tickets. And I, as the founder, are insanely happy with how things are going. I hope my story will give you a little more strength and confidence if you are still only at the early stage of your startup.
It should be noted that all this could not be realized without the support ( both moral and material ) of my closest friends. The whole world may not understand you, but you need at least one person who will say at any moment “you will succeed” and will transfer a thousand euro to your account when you have a cash gap. I know - they will read - thank you so much!
And also, I almost forgot to write, we really need a very good one, no, I would even say - cool, layout designer . Just such a two-stationer. Because our work is the sea, the project is rapidly growing / changing, but the design, usability and layout have a little “limp”. If you are exactly the person who can draw beautifully, and then competently and quickly put together ( JQuery ) so that it is convenient to use it, and even, ideally, you can write the text in English / Spanish and you want to be in three winter months in the Caribbean, send me a few words about yourself and a link to your portfolio in a “lichku” or by email. And maybe we will work together and you will become a part of something very big! Girls / boys - both genders are very welcome!
We are also considering the option of attracting investment . But we are not interested in just money. What we really need is a partner-investor who could help with marketing and, perhaps, with progress in specific areas. Collaboration is possible in specific categories or cities / countries.
If a respected Habr considers our story interesting and does not bury my karma in the negative, perhaps we will tell in more detail about the development of the project and how we arranged a test trip to “work” in Dominican Republic. In the future, we have a grand plan - to work together in many warm corners of our planet where there is sun, wind and waves: Thailand, Mauritius, Vietnam, Cape Verde ... And as a result, settle down somewhere like New Zealand.
I am pleased to answer the questions that arise. Unfortunately, the account on Habré from our entire company is available only for me so that all the answers will be on my behalf.
Thank you for reading to the end my very first article about our startup and all the success in your endeavors!
UPDATE May 11, 2012 : We are recruiting staff ! We have opened 3 positions:
- Python / Django developer
- Front-end developer (jQuery, HTML, CSS, etc)
- iOS / Android apps developer
Salaries are competitive, work until October in an office in Moscow, then for 6 months in the Dominican Republic. Working with us is interesting and fun! See how it was:
About how to get to us here: http://www.petamatic.com/ru/dream-jobs.html
Source: https://habr.com/ru/post/129561/
All Articles