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Rob Simopoulos
Updated: 5 hours ago
How to build a startup in Maine, from concept to capital
By Rob Simopoulos, Defendify
Have you ever heard yourself or someone else say, “I had that business idea! If only I had started it, I could have been successful?” Many people have great ideas, but only those who take action and build something from them become true entrepreneurs.
The idea doesn’t have to be groundbreaking or involve cutting-edge technology to succeed. Even the simplest business concept can grow into a profitable venture with the right effort and execution.
Challenges are inevitable when building a startup, from finding the right business partner and securing funding to creating a solid business plan and adapting to unforeseen obstacles. However, with the right approach, success is possible — and there’s no better place to build a startup than Maine.
Going solo vs. with a partner
Deciding whether to bring on a business partner is a crucial choice when starting out. Your partner will typically share ownership, be involved in all key decision-making, and participate in financial returns.
One advantage of having a partner is gaining access to skills and expertise beyond your own without the upfront cost of hiring an employee. For example, if you're strong in sales and marketing but lack technical knowledge, a partner with that expertise can fill the gap.
Additionally, a partner can help shoulder the immense workload of building a company.
However, partnerships come with risks. If the relationship deteriorates, separating can be costly, often involving buyouts, legal fees and the challenge of finding a replacement for their role.
Financial projections
Running out of money is one of the leading causes of startup failure. Research shows that approximately 38% of startups fail due to cash shortages or an inability to raise capital.
To avoid this, creating detailed financial projections before launching your business is crucial. Estimate your monthly sales goals, the expenses required to achieve them (such as sales and marketing costs), and all other operational costs — down to the smallest details like office supplies. The more precise your projections, the better prepared you'll.
While ambitious goals are great, expect challenges and delays along the way. Take a flexible approach by modeling conservative, moderate and aggressive financial scenarios to navigate uncertainties effectively. Once you start, analyze your performance against those models every month and adjust accordingly.
Raising capital
Most startups will need capital to get off the ground. Unless you’re a founder with a successful startup exit under your belt, securing traditional venture capital before launching is unlikely.
Instead, you’ll likely need to rely on personal savings or funding from friends and family to get started. Keep in mind that if you can fund your startup yourself or through its cash flow, you’ll retain full ownership of your equity.
Fortunately, Maine offers several funding opportunities for startups. The Maine Technology Institute, for example, helps companies turn ideas into revenue-generating businesses via grants, development loans and direct investments.
Maine is also home to a strong network of angel investors — individuals who invest their personal capital in promising startups. The Finance Authority of Maine supports these investments through its seed capital tax credit program, offering a 40% tax credit to investors who fund approved startups.
Once you’ve launched your product and generated revenue, you may consider equity investments from organizations like the Maine Venture Fund and CEI. These groups have helped accelerate the growth of many of the state’s leading startups.
Build it in Maine
Maine’s startup community is among the best in the country, with incubators emerging across the state, including the Roux Institute at Northeastern University in Portland and Dirigo Labs in Waterville.
Organizations like Startup Maine host regular meetups and an annual event, providing invaluable support for aspiring founders and connecting those interested in working in startups. There are also specialized law firms that help startups navigate legal challenges from inception through funding rounds.
Most importantly, Maine’s startup ecosystem is built on a culture of support and collaboration. Founders are eager to help each other — reach out for a coffee chat about your startup idea, and chances are, they’ll make time to share their insights.
So, are you going to build the next Maine startup?
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