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What kind of business should I open?

DamianAlamousDamianAlamous Registered User regular
edited March 2007 in Games and Technology
So me and a friend have played around with the idea of opening our own business for some time now, but have never really been serious about it. This is mainly due to the lack of any sort of funds. Till now.

Long story short, his parents came into a large amount of money. This amount is in the millions. And they have agreed to give us approximately $200,000 to start our business.

Now here is the question. What kind of business should we open? We would prefer it be something technology or game related. We've played with the idea of indie game store or gaming LAN/internet cafe type setup, or perhaps a custom computer shop.

We are looking for something enjoyable, but also profitable. We are in the Houston area, so we have a lot of people in the area.

Any ideas or suggestions? Perhaps prior experience?

"If automobiles had followed the same development cycle as the computer, a Rolls-Royce would today cost $100, get a million miles per gallon, and explode once a year, killing everyone inside." --Robert Cringley
DamianAlamous on

Posts

  • ShimShamShimSham Registered User regular
    edited March 2007
    Have you gone to school, like.. for business or anything like that before? Because if not, it could wind up being a MUCH bigger risk than starting a business already is.

    ShimSham on
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  • Lucky CynicLucky Cynic Registered User regular
    edited March 2007
    I think custom computers is a nitch thats fairly underserved. Make a few model computers. A gaming, Super gaming, budget gaming, home entertainment, and super low budget and you should be set. I do this whenever someone wants a new computer from a long list of bookmarks of things on newegg. It works great, especially when you have a base template to start from.

    EDIT: All this of course is assuming that you know what your doing, of course.

    Lucky Cynic on
  • DamianAlamousDamianAlamous Registered User regular
    edited March 2007
    His degree is in communications, and my expertise is in computers, but both our families have started and run successful businesses for many years, so growing up around that we have a pretty good idea of what it takes. Plus, our families have agreed to help us in the beginning.

    DamianAlamous on
    "If automobiles had followed the same development cycle as the computer, a Rolls-Royce would today cost $100, get a million miles per gallon, and explode once a year, killing everyone inside." --Robert Cringley
  • FreddyDFreddyD Registered User regular
    edited March 2007
    Why limit yourself to just one of those? Start a LAN that builds custom computers, buys and sells used games (the profit margin on new games is terrible), and has big screens with Xbox 360s and PS3s for people to play.

    FreddyD on
  • Garlic BreadGarlic Bread i'm a bitch i'm a bitch i'm a bitch i'm a Registered User, Disagreeable regular
    edited March 2007
    It's generally not a good idea to open a business when you don't even know what your business is

    Garlic Bread on
  • mntorankusumntorankusu I'm not sure how to use this thing.... Registered User regular
    edited March 2007
    I've always wanted to open an arcade.

    Once I win the lottery and can afford to lose gobs of money.

    mntorankusu on
  • graizurgraizur __BANNED USERS regular
    edited March 2007
    Really odd coincidence

    Have you read the last couple of comics? Check out the Olympus thread 5 or 6 threads down. You seem to have shown up right on time. Niiice.

    graizur on
  • Houk the NamebringerHouk the Namebringer Nipples The EchidnaRegistered User regular
    edited March 2007
    open a game development studio. why the hell not, right?

    Houk the Namebringer on
  • MJMJ Registered User regular
    edited March 2007
    In the news recently didn't the big city ink a deal with Earthlink to distribute wifi over the city?

    This may be a problem in a few years if you decide to open a Lan or Internet Cafe. You will have to have a strong hook to bring people to your place rather than the hundreds of other resturants around the city that will soon turn into Cafe's as well.

    I wouldn't go that route.

    MJ on
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  • ThreepioThreepio New Westminster, BCRegistered User regular
    edited March 2007
    Everybody needs Hookers and Blow.

    Threepio on
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  • ZombiemamboZombiemambo Registered User regular
    edited March 2007
    graizur wrote: »
    Really odd coincidence

    Have you read the last couple of comics? Check out the Olympus thread 5 or 6 threads down. You seem to have shown up right on time. Niiice.

    Oh Lord it's graizur

    Zombiemambo on
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  • DamianAlamousDamianAlamous Registered User regular
    edited March 2007
    I hadn't thought about the wifi issue, but that is a good point. So what about a game store? Would it survive? We've thought about both doing an independent or perhaps a franchise such as www.playntrade.com.

    DamianAlamous on
    "If automobiles had followed the same development cycle as the computer, a Rolls-Royce would today cost $100, get a million miles per gallon, and explode once a year, killing everyone inside." --Robert Cringley
  • FireflashFireflash Montreal, QCRegistered User regular
    edited March 2007
    We can't really answer you on this... YOU need to study the market around your town and find out what kind of buisness would work. What would be your target demographic, what kind of similar buisness are already available where you live, etc.

    Fireflash on
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  • SaniusSanius Registered User regular
    edited March 2007
    Fireflash is right. Send a detailed survey about the business around town if you can. You don't want to start the business and find out the people with money are 80 years old.

    Sanius on
  • imbalancedimbalanced Registered User regular
    edited March 2007
    Two words: Printing. Press. If you have enough printing options, everybody needs something printed sooner or later. Flyers, banners, magazines, newspapers, t-shirts. It's not a business that will make you millions, unless of course later down the line you decide to make your own content, but then you'd already be vertically integrated and not need any help from third party vendors. Win-win.

    imbalanced on
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  • LunkerLunker Registered User regular
    edited March 2007
    Keith wrote: »
    It's generally not a good idea to open a business when you don't even know what your business is
    I think this is a likely candidate for Truest Statement Ever Written on the Internet.

    Lunker on
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  • TuomaTuoma Registered User regular
    edited March 2007
    Think something up, talk to investors/bankers about getting financial help for it.

    If they go for it, you know you might be on to something. Then tell them to go away and start the business with your own money.

    Tuoma on
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  • Kewop DecamKewop Decam Registered User regular
    edited March 2007
    Houk wrote: »
    open a game development studio. why the hell not, right?

    I like this idea, except that publishing games is the real reason everyone doesn't do this.

    Kewop Decam on
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  • jclastjclast Registered User regular
    edited March 2007
    Houk wrote: »
    open a game development studio. why the hell not, right?

    I like this idea, except that publishing games is the real reason everyone doesn't do this.

    So open a small publishing house instead?

    jclast on
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  • LeitnerLeitner Registered User regular
    edited March 2007
    Your business will certainly fail. Use that money to go into property instead.

    Leitner on
  • Kewop DecamKewop Decam Registered User regular
    edited March 2007
    jclast wrote: »
    Houk wrote: »
    open a game development studio. why the hell not, right?

    I like this idea, except that publishing games is the real reason everyone doesn't do this.

    So open a small publishing house instead?


    Yea, but how many small devs make good games these days that aren't already contracted with someone big already?

    Kewop Decam on
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  • Doc HollidayDoc Holliday Registered User regular
    edited March 2007
    Become an investor, and invest in my business! We have the start, over 2000 customers, but lack the funding to take it full time. You have the money and no ideas. It's a perfect match!

    Seriously, just find a financial adviser and save the money until you're 100% sure you know what you want to do. Starting a business is a huge, huge deal. If neither of you are business majors or have any business ownership experience, perhaps taking some courses or reading some books on starting a business (accounting, bookkeeping, advertising, creating a solid business plan, market research, licenses that must be obtained to open a storefront, partnership contracts so you and your friend don't sue each other when you wind up hating each other, which will happen, by the way, patent and trademark filing, incorporating your company as a separate entity so your ass doesn't get sued to oblivion when an angry customer has a good lawyer, finding a good lawyer to represent you, and more!)

    Owning and operating your own business requires passion and an obscene amount of time and money. It's a trip, but it's not for everybody. If you're not even sure what you want to do, then it's a recipe for disaster. I hope you're not expected to pay back this $200,000.

    Doc Holliday on
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  • LewiePLewieP Registered User regular
    edited March 2007
    I shall be sending you a legnthy PM later on today.

    I am a business student at Durham University, and I have a proposition for you.

    LewieP on
  • Zen VulgarityZen Vulgarity What a lovely day for tea Secret British ThreadRegistered User regular
    edited March 2007
    Good God man. A lot of my old business professors would have slapped you.

    Getting the capital can sometimes be the easiest thing in the world- so's blowing it all away. Look, I'd love to give you an idea to start your own business, but you need to do your research. Heavily. In a lot of markets and start dreaming of some of your own. The thing that's the driving force in a lot of successful businesses is vision and determination.

    Zen Vulgarity on
  • RainbowDespairRainbowDespair Registered User regular
    edited March 2007
    Houk wrote: »
    open a game development studio. why the hell not, right?

    That's what I would do if I had an extra $200,000 to start a business. Grab a couple of my friends so that we could keep salaries low while we're getting started and start making cheap fun games for low requirement PC systems or something like XBLA.

    RainbowDespair on
  • DietarySupplementDietarySupplement Still not approved by the FDA Dublin, OHRegistered User regular
    edited March 2007
    SC wrote: »
    Your business will certainly fail. Use that money to go into property instead.

    I second this. Not because I'm trying to be a jerk, either. You obviously have no idea what to do with the money; on the other hand there are millions of people out there with numerous ideas but no capital.

    To me it sounds like a massive waste of $200k. I mean, rich people can spend the money they earn however they want (and they oft-times do, colorfully), and I'm no class warrior, but if you're out to spend $200k for the sake of spending it, do the right thing, and give it away to charity or something. Or, should you not want that, how about doing your own venture capital? There's lots of lawyers involved, and it's tedious and either feast or famine on your returns, but I hear it's a nice way to earn a living.

    But yeah, "Good with computers" + Communications major = armageddon.
    imbalanced wrote: »
    ... unless of course later down the line you decide to make your own content, but then you'd already be vertically integrated and not need any help from third party vendors. Win-win.

    I don't know about veritcal, but how's about some horizontal alignment? :winky:

    DietarySupplement on
  • cloudeaglecloudeagle Registered User regular
    edited March 2007
    I agree with Doc... it's much more sensible and less risky to just invest the money rather than plop it into a business.

    If you insist on opening a business, pick a business that you're absolutely, positively passionate about, or it'll eat you alive. And then do your research. Do a SHITTON of research. You could have an absolutely fantastic idea, but it might turn out that someone's done that already, or the population of your city doesn't really care about what you're doing, or any of a number of things.

    You mentioned opening a game store. Keep in mind that, as much as it sucks, EBStop has a stranglehold on the business. The ONLY way a game store can survive nowadays is if it does something (preferably multiple things) that EBStop can't. You'd have to offer lower prices/better trade-in values, impeccably clean, well-organized shelves, fantastic customer service, maybe game tournaments, etc. And all that, while cool, will eat into profits.

    Here I should mention that you should NOT open a business that offers a crusade for grumpy internet people. "My game store will never, ever gut new games!" Yeah, that's great, but the majority of people (i.e. folks who don't post here) don't give a shit, and all your effort won't inherently translate into $. Making something cool for enthusiasts is one thing, but you've got to offer things that appeal to as wide an audience as possible.

    A LAN center is also a bad idea. Stop and think: what could you possibly offer that someone couldn't get by not paying an hourly fee and just dragging their rig to a LAN party, or just playing in their own home? You'd have to create a virtual playground to get people out there, and again, that takes a lot of effort and money. The failure rate for LAN gaming businesses is pretty damn high.

    Long story short, if you're not willing to sink tons and tons of money, work long, hard, shitty hours, and be willing to deal with the fact that you might fail anyway, don't open a business. Think mutual funds.

    cloudeagle on
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  • Brodo FagginsBrodo Faggins Registered User regular
    edited March 2007
    What was that statistic? 97% of small businesses fail in the first 3 years? My friends and I started a Geek Squad-type business, and it died within three months.

    Just giving you some caution.

    Brodo Faggins on
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  • precisionkprecisionk Registered User regular
    edited March 2007
    If you don't have a solid business plan, research and at least a year of planning, you may as well burn all that money because that is what will happen.


    I highly suggest you talk with a financial planner and after having an idea your interested, have them help you write up a business plan etc.

    Anyone can start a business, but very few get past the first year.

    precisionk on
  • misbehavinmisbehavin Registered User regular
    edited March 2007
    This is an epically bad idea. You don't just start a business, dude. I mean, yes, you can do that, but the odds are seriously stacked against you to begin with (most small businesses fail quickly), not to mention the extra odds of not even knowing exactly what you really want to do.

    You should wait until inspiration strikes... Wait for the "Eureka!" moment, and then start your business. In the meantime, put the $200,000 into mutual funds and protected investments, so when the time is right, you'll have even more money to get going with.

    OR, you could give it to me so I could get started on my dream, and I'll let you in on a significant cut of the profits! :)

    misbehavin on
  • misbehavinmisbehavin Registered User regular
    edited March 2007
    Also, I should mention that I have started 2 businesses in my life. One was when I was 17, and it went until within 8 months. I lost a LOT of my own money (my parents did NOT come into money, so I spent my own hard-earned and saved cash, and it all went by-by), so I learned a lot.

    My second one is still going strong, 2 years later. But I'm still cautious, due to lessons learned from my first endeavor (in case you're curious, they are similar in concept, very different in tactic and business model). I have a tremendous amount invested, and I'm letting the business grow organically and stably rather than quick and loose, which was what brought down the first try.

    Go slow, be CERTAIN what you want to do, and know EXACTLY how to go about doing it... And even then, be cautious and don't play fast-and-loose. It may seem like a good plan, and IF it miraculously works out, you'll seem a genius, by 99% of people who do this fail miserably and painfully.

    misbehavin on
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