I was recently asked to contribute 500 words of advice for an upcoming book on starting a web development company.
In truth, I was completely stumped on what to say. There's a certain permanence to a book that I find vaguely unsettling. After all, the 3rd edition of Agile Web Development with Rails was obsolete before it shipped yesterday. How sad is that?
I went with the only thing people will still be dealing with in 30 years, which is people.
Even if your first days as a business are free-wheeling and informal, you owe it to your future self to make good decisions early on. Partnerships are incredibly difficult and often do not end well; if you have the vision, then do not be afraid to be a leader. That said, start small and only hire people when it is absolutely necessary. Hire on personality first and always check out their online presence. Better yet, ask trusted friends for leads and introductions. We like to hire musicians as they are generally creative, interesting and well-rounded. Keep in mind that people do not start out as experts… sometimes you meet someone with raw talent that needs to be nurtured. Be that mentor to the right people and part ways with people that are not fitting in.
The team you assemble will decide whether you are competent or legendary. Make sure that every addition is smarter than you or has a talent you do not have. A’s hire A’s, but B’s hire C’s. Cultivating those “rock star” talents — the top 0.1% — is your goal. These individuals are not just faster with less supervision: prodigies will think of solutions that the average person would not come up with no matter how much time you give them.
Avoid “off-shore” development at all costs. Any money that you save is offset by delays, misunderstandings, and incompetence. You cannot outsource genius.
Be respectful, kind, and listen more than you speak — especially when you disagree. Lead by example and own your mistakes. Solicit feedback and reward those who believe in you.
Incorporate early and hire a bookkeeper part-time to keep your expenses and financial information straight. Just because you can fill out your own incorporation documents does not mean that you should! You will also need an accountant, as they will save you more in taxes than they cost to hire. You did set aside money for corporate taxes and kept all of your receipts, right?
Be frugal and minimalist in your acquisitions, but spend money on good laptops and comfortable chairs (your shovel and cart).
Get a business line of credit. Try to spend money that you earn instead of money that you invest or borrow. Avoid venture capital if at all possible! It’s more trouble than it’s worth.
While your technology is important, there is no such thing as the perfect tool for every job. The smartest minds are generally enthusiastic about open source software, and not just because it’s free. Unspace decided early that we wanted to be the Ruby on Rails “A-Team,” and that was the best decision we ever made. However, you should ask your developers what they want to use. If you make it clear that they can make (and take responsibility for) technology choices, then you will foster a passionate, happy environment.
Encourage your team to eat well, exercise, and get eight hours of sleep every night — but do not be their mother.
Finally, be bold! Act first, take risks, and (if necessary) apologize later.