Today, someone asked me “how to start an Internet company.”  This has happened a few times before — everyone thinks that the hard part is the work: setting up an entity, doing accounting, filing taxes, setting up a website.  Well, it’s really not.  I mean, there are books, books, and more books on that stuff — you’ll figure it out.  Or, if you’re lucky/smart enough to have some seed money (or if you just hate to read), you can hire people to do those things for you.  The work is really not the hard part.

So, what is the hard part?  Well, it’s getting clarity.  Defining your vision.  Setting a goal.  Answering questions like: what do you want to build over the next 5 years?  What should it look like at that point?  Everything else comes from that vision.

    For example, the business model questions: How do I make money?  What am I selling?  How profitable is it?

    Funding & finance: What’s my budget to start this thing?  When should I be making money?

    Customers, brand, marketing: Who is my customer?  Why do they want to buy from me vs. someone else?  What do I offer that’s different/exciting/enticing?  How do they find out about me?

    Suppliers: Where do I get what I’m selling?  What’s the nature of our relationship?

    Technology: Who builds and runs the website?  Where is it hosted?

    Operations: Who ships the orders, handles customer service, and pays the bills?

    Administrative: LLC, S-corp, or C-corp?  Should I buy Quickbooks?  Who files taxes?

The details for all of these things are really determined by what you’re trying to do in the first place.  If you’re selling old sporting goods from your garage on eBay in your spare time, then the work involved is drastically different than if you want to BE the next eBay.

And, if you have a partner, it’s even more important to get this all straight in the beginning.  If you don’t, then you risk destroying that relationship.  You both (or all) need to understand what you’re getting yourselves into from the beginning.  Again, I’m not talking about the work — you’ll figure that out.  It’s the goal, the vision, the path: where do you want to go?  I’m not saying you’ll get there, but if you don’t have a clear idea of the target, then you’ll just be thrashing around, hoping to stay afloat, and the current will carry you some place you might not like very much.

So, if you want to start something, here’s my first question: What do you want to build?  Or, alternatively: What do you want to do with the next 5 years of your life?  Because that’s really what it is.  That is, unless you’re selling used sporting goods in your spare time on eBay.