Ask HN: Can a startup be bootstrapped collaboratively by a group of people?

[twilight]

Can a start-up be founded not by 2-3 people who know each other in advance but by a group of random people as in case of community supported Open-Source projects?

The advantage of the latter I see is the fact you don't have to care about other people's background, experience, whatever as long as they bring enough value in a form of contribution. No need for vesting and cliffs. You contribute something, you get X shares.

A Github like platform for collaborative bootstrapping of start-ups could be created. Unlike the founderdating services that marry off multiple founders into each other so they can create something together, in this model founders are married into ideas/projects directly.

In your opinion how viable is this model?

[jeffmould]

IANAL and this based completely on my own opinion, but no.

While in theory it sounds good. It has huge holes that would need to be covered, and by the time you start covering those holes you have gone back to the reason you need things like vesting and cliffs in the first place.

How do you determine what the contribution itself is worth in terms of shares? How do you handle dilution? How do you handle co-founder disagreements? What happens if an early contributor leaves after a month? What happens to their shares? What happens if the company needs to take funding? How do you handle stock grants? The list of questions goes on and on, and by the time you account for all the questions, paid an attorney to address them all, you might as well have just created a traditional company.

The different with open-source is there is no "expectation" of financial gain from contributing. Once you start mixing a financial aspect you will have individuals with different goals and intentions. That's a bad mix in my opinion.

[galistoca]

While I would say nothing is impossible, there are certain challenges that are very hard to overcome.

You probably need to look into history to learn what happens. You don't even need to look that far back. There was a company called Assembly http://www.theverge.com/2014/11/21/7258667/assembly-collabor... They shut down.

In my opinion creating these decentralized organizations is not that hard but they will never be able to win against centralized competitors who have clear incentive to win. Only time this approach can win is when there's no money involved since the re is no personal "incentive" to motivate the centralized organizations.

[twilight]

>> In my opinion creating these decentralized organizations is not that hard but they will never be able to win against centralized competitors who have clear incentive to win.

Why not? Cannot decentralized organizations also have incentive to win?

[wayclever]

When you ask 'how viable is this model?' There are muliple contexts...1. product/market fit, 2. Technical 3. Financial, and others. Contact me and we can discuss off line. [e-mail]

[douglance]

Leadership is important. There's a reason that all successful businesses follow certain structures and processes.

[sharemywin]

This kinda goes to what I was mentioning with long term vision and focus. I don't think anyone wants to work their ass off for the idea guy. I think it needs to be a community of doers not dreamers. It doesn't need to be super hierarchical or exclusive, but talk is cheap.

[twilight]

Have you participated in Open-Source projects? There is leadership: a few (2-3) the most active contributors. The thing is it's easier to find them if the project is Open-Source. And contributors can make sure in advance they like the project. E.g. I started contributing to someone else's project with lots of stars on GH. And after some period of time became its maintainer and the second leader. If I had to go through interviews first and all that stuff that hiring requires, I would never be there.

[wayclever]

What problems does the idea solve?

[sharemywin]

I think there are lot of people that can contribute part time to a venture but don't want or can't contribute from a full time perspective.

[sharemywin]

some questions I can think of in the space:

1. How are decision made? Can you appeal?

2. Is it a seniority based system or a lowest bid type system? or both?

3. How are the day to day things taken care of? customer support, etc. paid out?

4. Legal framework? International laws?

5. can shares be bought and sold?

6. focus and long term goals?

btw, my contact info is in my profile if any one is interested in moving forward.

[twilight]

Good questions. I cannot answer 2-4 yet. As for the (1) I think it should be a collective decision making (voting) where weight of your vote depends on the number of shares you have. And why not to create a form of arbitrage so it is possible for contributors to appeal if there is a need to. As for the selling and buying shares (5), I think it is a good idea. But I'm dead sure it complicates everything from the legal point of view even more. And thus it's not a priority number one. And in the last part, focus and long term goals from whose point of view do you mean exactly?

P.S.: I'll absolutely get in touch with you.

[sharemywin]

Also, I think assembly failed for a couple of reasons. 1. not enough respect for the marketing side of things. 2. free labor only gets you so far need actual cash to be contributed. 3. equity plan needs laid out early so people don't feel like equity is going to be hoarded. 4. 3. needs to be more like a holacracy and a benefits corporation.

[twilight]

Exactly my thoughts. BTW assembly was an intermediary that provided you a platform and handled some stuff in exchange for 10% of projects' revenue. Do you think this platform should have such a role? Can it be just an agent. So, there are many intermediary companies that charge whatever % they want for the benefits and services they find reasonable and many projects. Projects choose their intermediaries and intermediaries choose projects. There is a competition in these groups. The platform gets % of intermediary's %. What do you think?