Darren Herman

I am going to start this posting out with a quick anecdote. Around 10pm last night, I was talking over IM with a founder of one of the companies I am actively advising and she has her mind spinning about a new project that she wants to actively and quickly get off the ground. This posting won’t go into whether or not the idea is good, or whether or not she should be focusing on her own current project at it’s infancy phase, but will talk about her mindset about how she was going to market with her idea.

Essentially, she wanted to have the website built quickly by someone she knew, and release it as soon as possible as she had a need for the application. She then mentioned to me a few things about fundraising and so forth – all around this particular new venture.

I quickly applied the brakes. It was almost as if we were driving 100 miles per hour and I pulled the e-brake (emergency brake for those non-car enthusiasts). The conversation quickly went from a fair amount of agreement to a considerable amount of disagreement. My thoughts about this subject are as follows:

1. You do not have a business if you just have a website. I have a blog that gets traffic (albeit not much), but it’s not my business.
2. A business must have a financial/business model around it. The for-profit sector, the majority of businesses, all look to make money. Launching a site blindly without any financials is not just a bad idea, but irresponsible.
3. The operational side of launching a business is time intensive and laborious (filing paperwork, insurance, staffing, etc) and must be done before launch. I personally hate this part, but hey – it must get done.
4. Funding – its one thing to build a website by yourself or employ your cousin/aunt but what happens when the website takes off and you need to pull the resources together and scale it? Who is going to pay for that? Who is going to pay for the filing fees to the government for business formation? Insurance? Liabilities? Where is the money coming from?

The web cuts down the time to market for many businesses. If you’re launching a web-only venture, you can technically be online in a few hours (if you put up a landing page) but make sure before you launch to the world, you have all your ducks aligned. Not only does it make your job easier, but also allows potential partners (business development, funding, sales, etc) to work with you more efficiently.