The Goal: Setting up a Software Company

[Alessandros]

So the fundamental idea is to program something useful and then selling it via the Internet. I want to do this alone, without employees or partners. Probably I can think about employees/partners in a later stage of the development. Possible steps are the following:

1. Doing market research to define exactly the programme to be developed. My recent idea is something in the area of mathematics/science/engineering.

2. Programming it. This could be done with Python and/or C/C++. I also take Java into consideration, but there could be problems, because it is not really a free programming language for proprietary programs.

3. Simultaneously doing some learning about programming and the necessary topics for my application.

4. Programming the necessary landing page in the Internet, also simultaneously with some learning about how to do it with CSS/JS/HTML. This is not the most difficult part of all. And I need something like a shop-system for selling my program.

5. Setting up the corporate structure. In the moment I am thinking I need a holding company (a Limited) and an operating company (also as a Limited). And I have to decide where I do it. Germany (my country) has quite high taxes and regulations, so it is not necessarily fun here. But I don't know much about the conditions in other countries.

6. Really going online then and running the business. Probably this needs some marketing, but time will tell.

 

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[Tau Ceti]

Doing market research to define exactly the programme to be developed. My recent idea is something in the area of mathematics/science/engineering.

Are there competitors on the market? Do you know who your customer ideal is?

My advice is, start with something very small, 1 or 2 features and that's it. Then make your features 10 times better than the competition.

Programming it. This could be done with Python and/or C/C++. I also take Java into consideration, but there could be problems, because it is not really a free programming language for proprietary programs.

The tech stack doesn't matter. Your users won't care. Pick what you know best and what's easiest/fastest to learn.

Programming the necessary landing page in the Internet, also simultaneously with some learning about how to do it with CSS/JS/HTML. This is not the most difficult part of all. And I need something like a shop-system for selling my program.

You can set up a landing page with Framer or Webflow without knowing how to code, then use Stripe to get paid. Should take you 1 day roughly.

Setting up the corporate structure. In the moment I am thinking I need a holding company (a Limited) and an operating company (also as a Limited). And I have to decide where I do it. Germany (my country) has quite high taxes and regulations, so it is not necessarily fun here. But I don't know much about the conditions in other countries.

You don't a need corporate structure. You don't have a business yet. Start with a sole proprietorship. That's what I am doing now.

When you start bringing in 10K or 20K per month, then move to Hungary or Bulgaria and create your company there. As long as you spend 180 days there you become a fiscal resident. Corporate tax rates in these countries are quite low.

No need to attach your self to Germany unless you have a very good reason to do so.

At your current stage, the name of the game is to get your app out in the world in less than 1 month so you can get feedback and improve it if it takes off or kill it if it goes nowhere. Don't spend 6 months working on something in the dark without having any users. If you do, you will waste your time.

You may think that you know what the market wants but truly you don't. The market will tell you. Make sure to listen.

Good luck.

 

[Tau Ceti]

I forgot to add a few more things.

Don't make a cheap product. Products that cost very little attract the bottom of the barrel in terms of customers. They will never be happy and they will always complain.

Charge something like 30 or 50 euros/dollars a month. You ll get better customers and you will be able to reach ramen profitability much faster.

If you are going to do free trials, make sure to ask for a CC upfront. No CC = no trial. Free users won't pay your bills and 99% of free users will never ever become paid users.

Finally in terms of coding, don't write tests or over-engineer. There is no point in that at this stage.
Just get the thing out there and fix bugs as they are reported. When you reach 5K or 10K MRR then you can start investing in automated tests and so on.