The Art of “Invest less, Get more”

I just came across an article from TIME.

How do you get started? All that’s required is a great idea for a product that will fill a need in the 21st century. These days you’d do best if your idea either makes people money or saves them money.

The term ramen profitable was coined by Paul Graham, a Silicon Valley start-up investor, essayist and muse to LILO entrepreneurs. It means that your start-up is self-sustaining and can eke out enough profit to keep you alive on instant noodles while your business gains traction.

I love this term LILOs, for “a little in, a lot out.” With economic crisis, VC are less willing to invest in high risk start up. Nonetheless some entrepreneurs turn to find cheaper developers through or  It’s getting cheaper and cheaper to start a company :

  • hardware cost less, servers are affordable
  • cheap developers in rising countries are available
  • open source technology are free, no high licence fee

For me the new wave of entrepreneurs who will go through the crisis are the ones who can monetize instantly their projects. I think getting a load crap of users then selling ads/their personal info is not a business model. Rather it should be ‘freemium’ : free to register, pay for additional services (WordPress, Flickr …). Think of it a decade ago Jeff Bezos needed 300k$ to launch Amazon.  Now one lonely guy can run plentyoffish and generate revenues. Here is a VC’s view on Open Source

Guy Kawasaki on Startups using Open Source