185 karma · joined February 24, 2011
Contact me at balaji [at] zingfin.com
Second, the article itself accepts - " because the two labour markets are structured differently, it is actually hard to compare like with like."
That means the headline is pointless as it is contradicted by the sentence above.
However, if you get a lot lower pay than what you get in a bigco, you need to talk frank with your founders. More than the revenue and lack of funding, it is the Zero active users that concerns me. Momentum is the key in a startup and you guys seem to have lost it. When you are in a hole, stop digging.
At a startup, the entrepreneurs could do build a million different things and I found it sometimes hard to curtail both my ideas and those of the other founders. For instance, in one of the months we toyed with 20 different technologies as each day some developer would come and say "why not we use platform Y & API from X to do Z?" then everybody would just start chasing all the APIs and build a simple prototype (that will get forgotten after the next day's idea). That is an extreme case, but you get the point.
Once you have focus and determination, the rest usually falls into place.
As another Microsoftie who quit Redmond for startup world at the same stage, I would advice you to consider the following:
1. Is the work they do at the startup quite exciting and promising?
2. Are the founders great people to work with?
3. Do the founders and the investors have a lot of connections?
4. Is there some press coverage around the startup?
5. Do love working at a startup? Do you plan to start one in the future?
6. What is the scope for learning at the startup vs. learning at MSFT?
I found that after a couple of years, there were less things to learn at MSFT and was entering a plateau. In the long run the marginal money matters less than an opportunity to showcase your full potentials and get the right contacts. YMMV.
If the skills demanded are fairly common (Wordpress development or basic level php knowledge) then it is not hard to get quality guys at low prices. I have myself done a few product management tasks in these sites for about $25-30/hr - mostly running marketing campaigns, taking care of product launches and building websites.
In summary, I would say you can get a decent product manager freelancer for $30-40/hr if you are not building a complex product and not require a lot of learning curve to understand the product.
That is working good so far. It is also easy to maintain, I have WP_MU setup and can update a large number of sites in parallel.
But, then I got a little better at identifying the right set of clients and now the I set rate at $33/hr and most of it in hourly contracts that are guaranteed payment. I also take fixed price contracts from clients with whom I have existing relationship. Many guys I know are charging $60/hr and having a good practice.
The thing in the initial phase you come across a lot of noise and as you find out the 1-2 good clients from the 10 shabby ones, you get repeat business from them.
The difference between freelance marketplaces and direct sales is that in the former the clients have a real need, while in the latter the we have to convince the potential leads of the need to have a good website with proper attention to typography, speed and ux.
a) create news and get free PR (press loves such eye-popping numbers)
b) get higher valuation numbers that will motivate the employees more (they have the stock options after all)
c) get more powerful/influential shareholders who will help clear the hurdles in the company's way
This is not exactly how capitalism is supposed to work - capital has to be used judiciously to build future growth.
Service business can be grueling and your projects can quickly turn into nightmares if not planned well. The small businesses who want the websites from us can be very vague in what they want, and might not appreciate some of the great stuff that we do (like getting the Pagespeed score above 90) while appreciating lame stuff like those landing page flash intros.
In the initial phase (first 3 months) take more well defined tasks that can have less margins, but can help you appreciate the hardships in the business. As you mature, you can take up more complex projects that can give pretty fat margins.
We don't stop creating because we are consuming more. It is other way round. We are consuming more because we are afraid of creating.
This would filter out all the usual suspects Facebook, Twitter, 37 signals, while keeping Path, Instagram and all the YC funded companies. It would also cut out the new neighborhood bookstore, most service businesses and that sweet home business. Also it would cut out companies that have already reached $1-2bn in valuation (as they cannot realistically grow to become $100bn companies in 5 years).
For SaaS startups our offerings like creating an effective landing page that is connected to mailchip for double opt-in, managing inhouse development with project management, keeping track of marketing & sales with CRM tools will be useful.
And then once the product is done launching the startup with affordable PR tools, improving their site's search rankings, tracking with right analytics tools can also be done.
Outsourcing is not an all or nothing deal. The startup could outsource server setup to us, do their product and as they get time slowly take charge.
A lot of startups have very limited time to get their idea executed and make it a real success. One of the founders might quit, the team might run out of funding or a big competitor might make your product offering unnecessary. This makes the first few months really critical.
Setting up your server with the right web server, installing wordpress & configuring other tools, keeping the packages updated take a lot of time and those few extra weeks can be the difference. What we do is help the startup get going and your team could take control of the stuff over the course of time as you get comfortable with the components.
For SaaS startups our offerings like creating an effective landing page that is connected to mailchip for double opt-in, managing inhouse development with project management, keeping track of marketing & sales with CRM tools will be useful.
And then once the product is done launching the startup with affordable PR tools, improving their site's search rankings, tracking with right analytics tools can also be done.