Archive for category Darden
I was recently asked if I would recommend that college or MBA students try and launch a venture while they are in school or just graduating.
First let me say that the school itself will tend to provide a ton of FREE resources. It could be anything from professors to office space. Aside from these, here are four more reasons the earlier you do it the easier it is:
- While you probably don’t have a lot of money you also typically have no real financial obligations, no mortgages, you can probably go back home and live if you need to. You may have student loans but if you are “self employed” or make under a certain amount most banks will allow you to claim hardship and postpone payments for a long time (I actually did this for the first year after Darden).
- When you start a company there is a good chance you will fail. As you age you tend to take on more responsibility, wife, kids, etc. When you are young if you/your company fails you can bounce back and the only person you really effect is yourself.
- The longer you are at a corporate job the less likely you are to start your own thing. You get comfortable with a paycheck and typically as you age you become more risk averse.
- Entrepreneurship is a great story & learning experience. If you do fail, having an entrepreneurial endeavor on your resume is amazing. You will have learned more than most of your peers would at the entry level position. I truly believe it will make you a much more attractive candidate for any position.
OK everyone, Just a quick message to let everyone know that scrubadoo.com is officially live! Like always I have been crazy busy getting everything correct and finished. I will start writing regularly again as soon as we get things more stable.
In the meantime tell your friends about the site. You can give anyone the discount code Family&Friends (no spaces) and they will get 10% off their first purchase.
Check the site out and send messages giving me feedback!
I am proud to say that we have completed the ScrubSquared team. There are now 7 of us working on making scrubadoo.com and scrubraisers a success. We consist of three mba graduates, 1 current mba student, 1 undergraduate, and 2 law students. So far so good.
In the short two week time we have been together I am already impressed with the ability and diligence of everyone on the team. My roll continues to evolve and has become much more managerial than ever before.
As scrubadoo.com has yet to launch we are using a project based work style. There is not a lot of repetitive day to day functionings of the company thus everyone is working on largely independant projects. This has worked extremely well so far. So far I have found two keys to making this strategy work.
- The first is keeping everyone up to date on everyone elses work. We have had a few instances of some overlap so we are still trying to get better at this. Currently we have weekly progress updates that everyone is involved in which has provided a great brainstorming opportunity for each of the project leads. On top of this I try and keep everyone on target and when there some synergies between projects I need to make sure I get the two people together.
- The second challenge is making sure everyone understands and has the same vision and mission. If everyone is working towards different goals we will get nowhere fast. There are a lot of ways to do things and we need to make sure everyone is doing things the ScrubSquared way. I think that this may be the most important part of my roll as manager.
On a side not I recently joined a website called thinkentrepreneurship. It is a very new website but I think it has a ton of potential. I think that anyone interested in entrepreneurship will be able to benefit from it. The more people that join the better the resource it will become.
I have written several times about how many resources are out there for entrepreneurs. This is especially true in any place like Darden and the University of Virginia. Here we are lucky enough to have both people with significant experience in entrepreneurship and several young entrepreneurs we can learn from and share ideas with.
A few benefits I have received from my network already include banking help, free legal work, and help in recruiting and selecting interns. Today I had a great opportunity to sit down with Rick White, a CPA, who I was introduced to by Philippe Sommer, the Director of Entrepreneurship Programs at Darden’s Batten Institute.
Rick and I had a phone conversation about a month back and agreed to meet closer to the launch of scrubadoo.com. We spent about an hour talking about the company and, more importantly, the things I need to be thinking about now, that will make our books and tax statements easier to handle in the future. I wanted to relay a few key points that anyone else working on a start up may find useful.
1. Make sure you have a thorough operating agreement (everyone I talk to emphasizes this).
2. You are responsible for paying taxes, sales and income, in any state that your company has “nexus” in. Every state differs slightly in what defines “nexus” but there is a loose rule to follow it is defined by property, employees, or sales. (Remember this is loose and I am not an accountant).
- Property - If you own or rent property in a state that you operate from you will likely have nexus in that state.
- Employees – Any state that you have employees in likely qualifies you for nexus in that state. What is defined as an “employee” can vary greatly state to state. These days states are doing everything they can to define this term loosely so they can create revenue.
- Sales – Any state that you sell from, i.e. have a storefront, qualifies you for nexus. In the case of e-commerce your “storefront” is the state in which your servers are located.
3. If you hire people on a contract (1099) basis, which we will likely do, make sure they sign the appropriate tax paperwork prior to issuing their check. We, like many small businesses, will utilize the 1099 as a way to avoid payroll issues that can be expensive and time consuming. There will be a point when we need steady full-time help and at that time we will move to the more traditional payroll system.
4. Any start-up costs a company has prior to the time that they are physically ready to bring in revenue can be capitalized.
5. QuickBooks is a solid program for any small company. We use QuickBooks Pro, mostly because the inventory features are superior to the free version. If you don’t have inventory I think you can get away with the free version of QuickBooks.
Rick also went through what will happen at tax time and what we would need to provide an accountant, the costs associated with it, and what we can start doing now to be ready for it. He answered all of my questions, was a huge help, and did it pro bono for the first meeting. If you are interested in talking with him I don’t think he would mind an email at email@example.com.
Aside from the accounting advice just remember that it isn’t enough to have a network. You need to take advantage of that network. Don’t be afraid to ask for help and you may be surprised at how willing people are.
Internships are a funny thing at business school. You are pushed and pressured both directly and indirectly to get a position with major firm that recruits on campus. Darden is getting better at offering alternative options with several programs they offer but it is still a corporate world. Oddly enough the down economy has forced Darden to focus on non-traditional internship opportunities to ensure that the majority of the rising second year students have a position for the summer.
We decided to try and take advantage of the down economy and bring on a few interns for the summer. At first we did not have any money to offer Darden students but we feel we offered the ability to really get your hands dirty and learn some cool stuff about starting and running a business. We received resumes from two interested parties for the initial unpaid internship opportunity. We thought one had signed on, unfortunately he received a paid offer he couldn’t turn down and left us two days ago. Yesterday we found out that we were going to receive backing from Darden in the form of a stipend for anyone that interns with us. Somewhat ironic, but there are still many Darden 1st years that are looking for a position and we hope to bring one on in the near future.
We have also interviewed students from the undergraduate school of business here at UVA and we hope to bring one on by Monday. It is easier to attract an undergrad than a grad student with “experience” as your primary offering. We hope we can teach them a few things while they help us launch scrubadoo.com and grow scrubraisers.com to new schools.
On top of these two positions we have also contacted the Law School of UVA with a part time offering for any 1L or 2L for the summer. We hope they can help double check the organization of the company to make sure we haven’t forgotten anything. We also think they can help us with contracts and research in the proper ways to do things as we move forward.
We hope to have three interns this summer, only the Darden student will be paid via the subsidy Darden offers us.
There have been two real challenges to this point. The first is attracting people without being able to offer a salary. This has made us a “back-up” option and we have already lost one intern that we thought we could count on. The second issue is making sure everyone takes us seriously. We are only 6 months old. I have been able to mitigate this by assuring people this is what I am doing for my livelihood.
The moral of this post is that there are a ton of talented people out there right now that are looking for experience. If you are starting a company and live in an area with a university it is well worth a few emails to try and bring on some very talented inexpensive help. I am looking forward to the challenge of managing people this summer and realize that this will certainly bring its challenges.
I anticipate that these will be some of the challenges:
Motivating unpaid employees.
Understanding the abilities and strengths of each employee.
Making sure they are getting enough out of the position.
Allowing them to work at their pace and realize that everyone will be at different ability levels.
I am sure there will be many many more and I will try and keep you updated on everything I learn as I go through it.