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Ramen profitable- startup makes just enough to pay the founders’ living expenses.

-Paul Graham

 

The famed Y Combinator spinoff hackernews has generated more buzz than usual for their recent article Ramen profitability. The link to the article can be found here.

As someone who has built a “ramen profitable” business (SnoHassle.com, a bicycle storage service provider) I would like to shine some light on the entrepreneur’s perspective of the phrase and what it’s like to be a struggling college student on a noodle-like budget and how to build something that is not wildly but at least somewhat profitable.

snohassle

Create Value For Others

The only way people will pay you for anything you do is if you add value to their lives or organization. This premise permits entrepreneurship to exist in our society. If you can find a problem that can help even a dozen people then it is reasonable that people will pay for that problem to be solved.

Who Do You Need?

The common story of the against all odds entrepreneur is essentially a myth. The talent and minds of many are required to build anything worth having. SnoHassle would not be possible if it weren’t for the great Innovation LLC and RD at ISR. The input and ideas generated by these people allowed the service to be created quickly and effectively with no flaws. With all of this in mind it is important that you find out who you need to make your idea work

Rapid Prototyping

Business, design, and engineering. These are the golden areas required for prototyping and product development. It is necessary to be proficient at all three, good at two, and the best at one. If you can’t read code or design a reasonable graphic yourself there is no way you can have others do it for you.

Trough of Sorrows

One of my favorite videos of a startup story is Brian Chesky at his startup school speech.

Very briefly near the end of the second video he mentions what is called a trough of sorrows. The trough of sorrows tends to be this moment in time when you are experiencing little growth and there appears to be less potential to the idea than you imagined. Creating a profitable business at a small scale feels a little better than this trough of sorrows. If you are lucky enough to find someone else willing to help you in the process then it feels alot less lonely but profitability and success are not necessarily the same thing.

If you take anything out of this post then I hope it is the following. Making your first dollar is really hard. Entrepreneurship is for those with little regard for more and much interest in change. Ramen profitability is only a test of will. Can you see yourself broke for several years working on something that may not pay off for half a decade if not longer? As a founder your life is less Jay-Z and more starving artist.

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