Let’s say you have an idea for a startup. How do you begin the process of finding cofounders and employees, creating a corporation, handing investors, growing the company, etc.? There are lots of details about building a startyp that are usually a mystery to the newly initiated founder. Usually you have to learn this stuff on the job, making mistakes along the way.
But not anymore. Last night I saw a 45 minute presentation by Mint CEO Aaron Patzer at a startup competition event called Juice Pitcher on the Microsoft campus. The event, which is put on by TheFunded and Vator.tv, put a handful of new startups on stage to show their stuff and compete for a top prize. Between pitches, Patzer took the stage and told the story of Mint, in detail. His company just sold for $170 million to Intuit.
Patzer takes the audience (and now you) from the beginning of Mint, and gives some incredibly useful device. He talks about the early days of Mint, where he lived on $30,000/yr and hired engineers at just a little more salary by offering them significant equity. He also says that, as a rule of thumb, every engineer in a pre-revenue startup adds $500,000 in valuation. Every business guy lowers the valuation by $250,000, he half jokingly quipped. In its earliest days, Mint was burning $150,000/year, he says, for 2 founders and 1 engineer/contractor.
Patzer also spoke about financial modeling, keeping costs low throughout the life cycle of the company, and Mint’s revenue model. He also gives suggested goals and milestones for each successive funding round. One interesting fact – today Mint, which is free, generates $30/year/user from various offers and value added services.
There are lots of additional details, including, for example, various hidden costs in financings (mostly legal).
If you are a startup founder, you’ll want to bookmark this and refer back to it. It’s absolute gold.
Update: The full powerpoint presentation is here.
A lot of people would of paid thousands for this sought of information
*quickly buys http://www.HowT...artAStartup.com from godaddy*
Damm it’s taken. There goes the dream.
Its regged long back!
THE VIDEO DOES NOT WORK!
Working video: http://vator.tv...e-mints-numbers
Startups that don’t know how to get to raise money have thousands to pay for advice on how to raise money?
“and gives some incredibly useful device”
I used to date a girl who would appreciate that.
Those of us who attended the Founder Institute got to see this presentation (Aaron gave this to a group of us a few months ago) and many more from great tech icons such as Michael Arrington, Jason Calacanis, Phil Kaplan, Munjal Shah, and many others. I would highly recommend it if you are looking into founding a startup, and want more content like the video above.
http://www.foun...erinstitute.com
Great stuff.
I had the opportunity to hear Patzer give a similar talk in Cincinnati about 4 months ago. Of course, that was before the $170 million.
Bookmarked.
This is a great post! But what i really wanna know is once you have the business up, how do you get reviewed by Techcrunch? If you can write a post about the steps, on that. Your likes and dislikes, what you look for in a start up ect..I believe that would be very valuable.
I just shot an email off to Arrington one day, he liked the idea, so he assigned one of his writers to it cover the launch. Simple as that.
Cool, what was the turn around time when you did that?
there seems to be some audio problem with the video. YouTube says it’s still processing so it may work itself out. If not, I’ll reupload tomorrow and change the embed code.
Thanks for that confirmation, I felt like I was going crazy.
loved this video, thanks!
Is it just me, or is the audio/video out of sync in the video?
Vator.tv is a hotspot for talent.
The video is in slo-mo.
Mikey, get this fixed ASAP
Looking forward to watching this.
yeah, i’ve re-uploaded it, waiting for it to process.
Great thanks!
Audio/video are still out of sync and video is still in slow-mo.
That was a great talk. Very inspiring…
Is there any way for you to get hold of that presentation and put it up here?
Thanks Michael. He’s an inspiration really…
Uh, the video is out of sync, choppy audio etc. Cant even listen to it…
Solutions?
Woops, nm
Just seen the other comments
Fantastic – thanks for sharing. Audio/Video out of sync so will keep eye out for updated version.
Just view the original http://vator.tv...e-mints-numbers
Very inspirational post and video for all aspiring entrepreneurs. Bookmarking it!
Thanks Techcrunch for Sharing!
very cool, nice presentation. great distraction while burning the midnight oil over here on the east coast
That was a great presentation, actually helps me think about how I handle my presentations at local universities. 30K seems pretty tight but our team has been working on prototypes as a second job pretty much for free so we expect to jump right into 80K during phase 2.
Smart guy…. hope his product is not killed by the lazy folks at intuit … what companies like intuit needs is young team like aaron’s to reinvent, but his team would need to deal with folks who are slower to move .. the challenge lies in how can the mint team members comingle and work and less tanglible intuit staff…
Never, know aaron might land up becoming the ceo of intuit soon
thanks for the original link Joe!
this video is really jacked up what gives?
Thanks for this post Michael. I have launched many websites over the last few years and always failed to get the word out to a critical mass. Finally I enrolled myself in a B-school and started the ctrl+alt+startup blog to try and attempt to launch my latest project. I’m documenting it along the way for others in my situation to follow.
zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz
Aaron
Do us all a favor…
Please RIP Quicken Desktop … This is hands down one of the most complex and lousy products that I ever laid my hands on ….
Every year they mess it up more…
I was one of the beta testers for the latest release and it SUCKS more than the older one and even more complex and kludgy …
Rehire young and fresh minds to rethink the quicken desktop experience .. please
Mike,
typo:
building a startyp”"
replace y with u in startup.
If some how video starts to work, then this will be a great post.
video is still acting screwy, Its probably getting a lot of views as well as processing. I’ll just give it some time while I read other articles and come back to watch it in an hour or something.
Amazing article btw, Thank you for posting this.
great stuff.
I thoroughly enjoyed watching this presentation.
Inspiring and Informative.
I watched the video here: http://blog.eth...patzers-keynote
Doesn’t the “engineer +500K, MBA -250K” mantra comes from Guy Kawasaki? Maybe Guy took it from Aaron, or they both took it from yet someone else, but I heard this first over at Guy’s blog.
Noticed a couple of typos:
Patzer takes the audience (and now you) from the beginning of Mint, and gives some incredibly useful device (should be advice)
And..
ts of details about building a startyp (should be startup).
Great stuff, can’t wait to see the video. Mint.com is a personal favorite of mine because it offers a great user experience. I had my girlfriend sign up on Mint.com and she didn’t have a single question for me in terms of “how do I do this” or “how can I get here”. She was done with the entire setup in less than 10mins. Now that is a site designed good!
Just curious, why didn’t they come out with a Mint for small businesses?
That’s what my friends over at Indinero are working on.
A ‘-$250K business guy’ should bring sales.
Maybe for Mint sales was not important as it was a free service, but for most companies you need sales.
If you can’t make revenue having the best product in the world thanks to the engineers, then you will not sustain.
A start-up with a few engineers and no sales guy is doomed.
Good point. However, I think Mint had a “freemium” business model.
Actually Mint has a “get bought for 170M” business model.
Nice Mike, thanks for sharing that. I’d really like to see Techcrunch report more on this type of stuff.
Last time I checked, Mint didn’t support Canadian banks, which is why I don’t use it.
Has anything changed?
Daalu!! (thank you in Igbo language). Absolutely useful!
thx for reposting the fixed video!
@Arrington: How long do you give him until he starts his next one?
until the earn out expires. two years is standard.
Patzer told me he is “well incented to stay at Intuit for three years and I don’t have any definitive plans for after that.” http://vator.tv/n/b0b
Seemed mildly excited (which I think is the height of his capacity for emotional expression) to be running Intuit’s entire personal finance division.
Sorry to break the trend of “good work” and “excellent posts” but what value does mint actually offer? I dont use it, so this statement may be ignorant, but I do use online banking and pay all my bills through my bank/cc website. Now a site comes and wants to replace my banks website and says “… have saved people over 300 million dollars?” by selling them ads? Plzzzzzz.
This is why there is a recession in America, as Micheal Moore puts, we have to go back to the days of the edisons, here is an engineer doing personal finance like that is a frontier to be conquered when there are many more important things like enhancing life of batteries, better renewable energy sources and more improved basic research. Instead of putting the knowledge and efforts into this area, this dude is being celebrated because he sold a company for 170 million, just that wall street robbers where being celebrated for making boat loads of money while tanking the economy.
For one, those of you hoping to be like him, especially foreigners, he went to duke and then unto princeton for a phd, so just coming from the blues, you would be unable to walk the same path. That aside, it is high time we started celebrating things worth celebrating, I know techcrunch was created to inform people on raising capital, but not to become and irrelevant site, it should also pick winners and not just winners because they raised money but winners because they actually create something useful and tech doesn’t have to only be IT, it could be a myriad of things to make life easier.
Go use it first.
You really need to use it before you post a comment like that. It doesn’t replace your bank’s website… that’s not the point at all. The value-add is that it takes information from all of your financial accounts – bank, investment, mortgage, student loan, credit card, etc – and combines them into a single view of your financial health. You can track net worth over time, track your adherence to a budget (and quickly identify spending categories where you are in excess of your budget), and generally get a handle on how and where you’re spending your money. And all of it is online, free, and easy to use!
My comments:
1. I have successfully used a spreadsheet for years with fantastic results for the budgeting/saving/networth tracking/improvements. The key here is not the tool(mint or spreadsheet) but the personal discipline.
2. In a few years, maybe 10 or maybe more, when – i don’t know, but this ‘convoluted economics’ as i call it, will disappear. Its you as a customer who eventually pays for the ad revenue to mint.com or google or any number of 3rd parties. The ‘affiliate’ lottery of current-days as is exploited here, can’t be the basis of any sustainable business which has to create real value to survive.
3. Exit plan beautifully executed – 170mn in revenues/profit was a long shot !!
“I dont use it, so this statement may be ignorant…”
Yep, stopped reading. Thanks!
I enjoy the news here, but would find it far less distracting if you guys did a quick spell check before posting stuff: ‘and gives some incredibly useful device.’ and ’startyp’.
Where did Mint find that first guy for $1K/mo?
I am assuming he was working prior to developing his idea – could be a mix of building up the product/team while working and then going full time on it using his savings.
Just a guess, I don’t actually know.
Thanks MA you finally posted something worth reading. You should do that more often – good stuff.
Where’s the video from the guy that maxed out 10 credit cards and emptied his parents life savings..
and failed in his startup..
wonder what his speach would be like?
TC wouldn’t have enough space to show those…
Great article. I will be using these tools to build my own site.
Thanks techcrunch for posting this!
Great info.
By the way, just curious, Was Mint’s revenue model lead generation?
Michael, excellent post, I love this kind of informative info on people who have been there and done it. Thanks!
thanks for the link. Inspiring and very helping to keep the hope alive!
That was neat Aaron. Thanks!
Neat .. Very good !
Very inspiring!
This was excellent. It’s nice to hear a success story but nicer still to hear the step-by-step planning with specific financial – salaries, costs, valuations. All very practical and useful.
Was the video removed???
very good insight
I resent the -$250k for each business person LOL. I curse the fact that I was born without a single engineering or coding gene. Fortunately (or unfortunately?) I do have a knack for writing and marketing. I would submit that “build it and they will come” doesn’t work as well as “research, position, build it, market it, sell it” does. Solid strategic business and marketing planning is crucial to the success of any start up.