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Intro to Entrepreneurship, Fundraising & Incorporation

Resource compiled by Michelle Zaffino

M.S. Information Science, Author, Founder, Front End Dev

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What is Entrepreneurship?

"Entrepreneurship is much broader than the creation of a new business venture. At its core, it is a mindset – a way of thinking and acting. It is about imagining new ways to solve problems and create value."

Bruce Bachenheimer, clinical professor of management and executive director of the Entrepreneurship Lab at Pace University.

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Why Be An Entrepreneur?

  • Create solutions to unmet market needs.
  • Solve problems you are passionate about.
  • Build a business aligned with your interests.
  • Make the best use of your background, experiences and skills.
  • Leverage your network and connections.
  • Be in control of your time.
  • Be your own boss.

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San Francisco is one of the best places in the world to be an entrepreneur.

Once you learn to code, you can build prototypes of your own products.

Your Competitive Advantage

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Entrepreneurs Are Motivated By Problems

  • Identify a problem in the world that needs fixing.
  • Believe your product will improve people's lives and that you are the person who can fix this problem for them.
  • Entrepreneurs must have:
    • A keen understanding of the problem and the people impacted by the problem.
    • Enthusiasm & passion for their solution.
    • Perseverance to see it become a product / service.

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How to Build A Product

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I Can Solve A Problem — Now What?

  • Sketch out a Minimum Viable Product (MVP)
    • What are the most fundamental features of your product / service?
    • Decide on a feasible business model for your MVP
    • There are many ways to earn revenue.
  • Be ready to approach users with testing questions
    • Ask questions to get answers that tell you how to improve the product.
  • Iterate on user feedback and improve the product before development.

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Sketch out a Minimum Viable Product (MVP)

  • Describe the Product in:
    • 5 Words.
    • 2 Sentences.
  • Create simple wireframes (hand sketches).
  • Create high-fidelity wireframes
    • Popular tools are Omnigraffle, Balsamiq or Mockingbird.

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Decide on a feasible business model for your MVP

  • Common business models for startup products / services.
    • B2B - Business to Business.
    • B2C - Business to Consumer.
    • Subscription (monthly, quarterly, annually).
    • Ad revenue.
    • Community platform.
    • Affiliate.

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Be ready to approach users with testing questions

  • Simply hand a user your prototype and observe how they use it. Stay silent during this process.
    • Are they looking for features you don’t have?
    • Are they confused by your product?
    • Do users commonly get stuck at a certain spot?
  • Create sample user testing questions
    • “What do you wish this product could do?”.
    • “What does this product do that is not useful to you?”.
  • Keep iterating! Your product is never “done” — it can always be improved.

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Remember: Keep It Lean

  • Building a product too early is a common mistake.
    • Save yourself costly development time.
    • User testing with lo-fi prototypes allows you to test assumptions and iterate inexpensively.
      • Make a low-cost mock-up on Wordpress.
      • Code a front-end-only prototype.
  • Avoid releasing an app or website without users lined up.
    • You don’t want your app languishing un-downloaded.
    • You don’t want to spend hundreds of hours coding if no one is ultimately going to use your website.

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Fundraising & Incorporation

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Fundraising

  • In order to raise funds, you need:
    • A working prototype.
    • A business model.
    • A business plan.
    • Revenue or signed letters of intent (LOI) from customers.
    • A pitch deck.
    • A landing page with a signup form at your URL.
    • Profiles on AngelList, Crunchbase, LinkedIn.

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Fundraising

  • Reach out to angel investors and seed funds - they are early-stage investors.
    • Target investors who invest in products similar to yours.
    • Target investors who invest in women and/or people of color.
    • Send them your pitch deck and a brief intro email.
    • Ask for a brief meeting to discuss your business.
  • VCs typically invest in companies that will go public.

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Incorporation

  • You’ll need to incorporate as a legal business before or during fundraising.
  • You should hire a lawyer to help you with this.
    • Entity structure: LLC? S-corp? C-corp? Non-profit?.
    • Ownership shares.
    • Entity name.
    • State of incorporation.
    • Tax considerations.
  • Along with a lawyer, your investors can also guide you through the incorporation process.

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Questions about Entrepreneurship?

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More Entrepreneurial Resources

NASDAQ Entrepreneurial Center in San Francisco.

Tech Entrepreneurship classes on Coursera.

Business Model Canvas

FactoryX, Lean Startup Circle and other lean method labs.

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More Entrepreneurial Resources

Videos by Steve Blank.

Lynda.com training videos available for free with your SF Public Library card.

Books on entrepreneurship written by Women.

Pitch Deck ideas from famous startups.

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More Entrepreneurial Resources: Books

Four Steps to the Epiphany by Steve Blank.

Women Who Don’t Wait In Line by Reshma Saujani.

Think and Grow Rich by Napoleon Hill.

Lean In by Sheryl Sandberg.

The Divine Law of Compensation by Marianne Williamson.

Do the Work by Steven Pressfield.