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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."

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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.

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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

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NASDAQ Entrepreneurial Center in San Francisco.

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Tech Entrepreneurship classes on Coursera.

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Business Model Canvas

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FactoryX, Lean Startup Circle and other lean method labs.

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More Entrepreneurial Resources

Videos by Steve Blank.

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

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Books on entrepreneurship written by Women.

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Pitch Deck ideas from famous startups.

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More Entrepreneurial Resources: Books

Four Steps to the Epiphany by Steve Blank.

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

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Think and Grow Rich by Napoleon Hill.

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Lean In by Sheryl Sandberg.

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The Divine Law of Compensation by Marianne Williamson.

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Do the Work by Steven Pressfield.