Raising Money:
* Phase 1: Once you have a mature idea, raise $100,000 from friends and family to build a prototype
* Phase 2: Prototype complete, raise $1 million and launch an alpha into the market.
* Phase 3: Once you have some traction, raise $5 to $10 million to scale up.
Phase 1 Expenses (1st $100,000):
* Founders: $30,000/year
* Engineering 1st hires: $30,000-50,000/year
* Office: $400/cube/month
* Tech: $10,000
* Legal: Deferred payments for 0.50 – 0.75% of company
Phase 2 Expenses (seed round):
* Salaries: $50,000 – $90,000/year ($450,000/year for 5 people)
* Overhead: +20% ($100,000/year)
* Legal: $25,000 + $2,000/month ($50,000/year)
Phase 3 Expenses (Series A)
* Salaries + Overhead: $200,000/year/person
* COGS: many one-time expenses add up to about $150,000/month
* Legal: $10,000-$50,000/month