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[crazy canuck]

Following up on what Ed said, the big thing is to limit your risk as much as possible ie dont give all you own as collateral.  That is going to pretty much rule out the banks as funding sources.

[Jacob]

Oh yeah, I'm not putting my own shit on the line. No way. Maybe putting in a few grand here and there, but that's it.

There are basically two possible models:

1) Get a few people to work for free in return for a stake to get a minimum viable product to market, market it cheaply and hope it generates actual revenue for further expansion.
2) Same as 1) except that it's less focused on revenue and more on having an appealing product which combined with a good business case will attract venture capital. On the upside, there're a lot of people looking to get into the market I'm working in so it's not that long a shot (I have three separate leads for potential VC without even really looking for it at this point).

Right now my main "work for free" guy is out of the country for a few weeks, so I can work on a bunch of the rest of the stuff. Once I have something more coherent, I'll probably want to run it by you in person if you're amenable, since you know smart business people and stuff....

[Malthus]

Hire Raz.

I don't think a startup could survive the inevitable lawsuit when Raz maims one of his co-workers.

Employees who have had their noses bitten off will lack social lives and thus work harder. 

[Barrister]

Following up on what Ed said, the big thing is to limit your risk as much as possible ie dont give all you own as collateral.  That is going to pretty much rule out the banks as funding sources.

Yes, yes it does.  The first thing the bank will do is insist on personal guarantees.

[Jacob]

Yes, yes it does.  The first thing the bank will do is insist on personal guarantees.

You don't start a company with bank money unless you're connected to the banking elite in a country with opaque regulations (i.e. China).