Need financing for your start-up … join the Kernel!

Let’s say you have this great idea. You’re tired of working for the “Man.” You know deep down in you’re an entrepreneur. And you’re willing to put in the long hours and embrace austerity as your best friend. And the last thing you want to do is commit to an office space, spend your creative time in your space bedroom or become such a regular at local coffee shop that the seat in the corner has your imprint on it.

But you, and countless numbers of other fledgling young business owners are all staring at one seemingly insurmountable obstacle. You need funding. Not a lot, just enough to take of things barter or a good “arm twist” of one of your friends can’t take care of.

Banks aren’t going be any help. Banks don’t understand start-ups. They have no idea how value your project if you don’t have collateral backing it up. Banks need something to repossess. Venture capitalists want an investment they can sell off down the road for profit. They’re not interested in operating profit … especially from a $20,000 investment.

Normally, you would go to Uncle Charlie. But Uncle Charlie spent a day too long in Vegas. As they say “What happens in Vegas, stays in Vegas” … including Uncle Charlie’s money.

What do you do? You join the Kernel!

The Kernel is essentially a co-working facility. But it’s way more than that. It’s an incubator that grows the future of your community.

Imagine …

  • A place you could go to interact with other entrepreneurs, all in various stages of start-up development. Your project would be independent, but you would be open for collaboration or just general input from your Kernel mates.
  • The Kernel contains all the physical common facilities you would need to launch and operate a small business: reception, common space (kitchen, bathrooms, etc.), digital reproduction equipment (variable data printing), etc.
  • The Kernel would also provide intangible services such as accounting, legal and other needed administrative functions. The HUB could even provide sales through a rep(s) that would do crossover sales for you and your other Kernel mates.
  • Funding for the Kernel would be provided by Seedsmen or investors. The Seedsmen would provide capital to operate the facilities and also any other expenses needed by the Kernel mates. Capital however need not be money, it could services (barter). For example, an attorney could invest in the Kernel via their legal services. The same thing could be for web design, accounting and even basic administrative labor. The goal of the Kernel is resource maximization.
  • The Seedsmen would invest in the Kernel as a whole, not just in one start-up. This way their risk could be spread over several projects – much the way venture capital firms work. Individual start-up Kernel mates can also invest in the HUB through their services provided to other Kernel mates. It would also be in the best interest of the Seedsmen to go out and recruit attractive new start-ups to join their HUB. How much share each “cog” has in the HUB as a whole, as well as how much share the HUB has in each start-up would have to be determined.

There you have it … a new age barter co-op start-up incubator.

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If you like this post please feel free to Tweet away. I can be found on Twitter at @clayforsberg.

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2 thoughts on “Need financing for your start-up … join the Kernel!

  1. I know of such a thing! I’m not sure how it has progressed as it has matured, but a little over 20 years ago, when I was at UT, I worked on a project with a company working out of the Austin Technology Incubator (ATI), which provided these types of services. I haven’t perused their website, but just got the link for you to check it out for possible benefit (contacts, or maybe a model to find or start elsewhere). http://www.ati.utexas.edu/index.html

    FYI – I came to your blog via LinkedIn group reference to your Groupon article.

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