Many of the old traditions of a start up enterprise don’t apply anymore. The level of communication supplied by emails, internet and smart phones make it so that many companies don’t need to follow the old rules of how to get a company going.
A lot of companies are able to do a “rolling start” these days – or what we term a “Rolling Start-up”. In the past, you typically had to hire some permanent staff and get office space to provide the air of stability, but in actuality, you are assuming overhead and costs which actually makes you more unstable.
With technology today, many people work from home and are available as contract/part-time employees. Companies can get things “rolling” without having to make the commitment to permanent staff or facilities – minimizing overhead and capital costs, thus improving stability. Contract employees are also more willing to wait to get paid, then those you hire permanently.
Unfortunately, even though it wants to stay light, a start-up still needs to find the skills required to get the company “rolling” in the right direction. Often finding the right mix of people and skills can be challenging, if not impossible.
A perfect example of this is a company Finance Matters works with – Vampt Beverage Corp. here in the Okanagan (www.vampt.com). It was able to attract no less than 20 industry professionals to its team without having to make any long-term commitments or pay any huge salaries. (Everything from CEO’s to CFO’s, Sales and Operations). The company was willing to offer incentives such as equity ownership at the ground floor and was able to get the rolling start it needed to get things off the ground. It has been operating for over a year without having to worry about finding office space. Only once Vampt got funded and commercialization was just over the horizon, did it have to make a commitment to full-time employees. Vampt has been able to make its fund raising dollars stretch longer and is able to put more into developing its products, rather than wearing the overhead of a traditional company.
We at Finance Matters work with a number of other clients doing a similar “rolling start-up” and I am sure there are many stories like this out then and welcome any comments and opinions (be kind, this is my first blog).