So you have a great idea for a startup. That’s the easy part.
Then comes mountains of paperwork, expensive legal matters, finding co-founders and building a team. That's before you can even get to building an actual prototype of your product.
Rohit Patel wants to help.
His day job is working as a data scientist at Facebook, but he's dedicating his spare time to streamlining the startup process through his own startup (of course) called Ataeum.
During the pandemic, Patel found himself with extra time on his hands and decided to launch his own startup focused on interior design but quickly discovered myriad obstacles. It can be tough road even for people who have gone through the process before. Patel was also still working full-time at Facebook, so add on the additional barrier of time constraints. When looking for help, he found precious few resources for navigating the tricky legal issues and business challenges of turning an idea to reality.
“Being in the center of Silicon Valley and not having any support for an entrepreneur like me was surprising. So I sort of mulled it over a little bit and decided, OK, we need to create this. This needs to exist. And that was kind of the beginning of it," Patel said.
So, with Facebook's blessing, he and four fellow co-founders started Ataeum last year and publicly launched the platform in September.
They now have a team of five part-timers with a handful of contractors helping to build out the technology. Ataeum is a legal technology startup that provides what could be described as startups-as-a-service — an all-in-one platform that includes the tools necessary to write a business plan, build a team, manage expenses and handle legal filings.
Equity splitting is also managed and reassessed weekly to hold people accountable for the amount of sweat they put in — a process they call “smart vesting.”
The feature is an attempt to reward founders and collaborators for the hours they log while also removing the emotional risk of resenting other team members for vesting shares while slacking off.
"Here we're trying to solve for that. Because if I'm not doing anything for a certain period of time — one week or two weeks or four weeks — I won't be vesting that. I won't feel bad about it and my co-founders won't feel bad about it," Patel said.
Here's the basic model: Users can start a project idea (think a draft for a company) for free and Ataeum helps guide founders through the initial questions to answer.
"It will have guidance for what should you be thinking about? What is the problem you're trying to solve? What is the value proposition? What is the go to market plan? What is the monetization plan?" Patel said. "It could take a person a week or two to go through everything and answer all the questions."
Next you have to think about the actual product.
"The goal of that flow is to get you to take that idea, put it on paper and have a very concrete understanding of what your minimum viable product is going to be. That's what you're gonna build to test if your idea works or not," Patel said.
Created in collaboration with legal experts, the platform also allows founders create and sign NDAs with potential new teammates who have signed onto the platform as available collaborators.
Startups are only charged fees once things become more serious. At that point, they become a joint venture with Ateaum and can start onboarding new collaborators, structure ownership stakes and create accountability frameworks.
Legal contracts are automatically generated and intellectual property is held in escrow until a startup incorporates. While the platform is not a financial institution, it will help startups manage their budgets and receipts.
Ataeum currently offers an "early bird" discounted flat rate of $199 to launch a joint venture. It will then take a 1.99% stake in the future commercial entity. When you're ready to incorporate, Ataeum will charge a flat $999 to file and check all legal documents. At that point, smart vesting ends and intellectual property gets transferred back to the newly formed corporation.
According to Patel, those costs pale in comparison to what it would cost to hire an attorney. Ataeum might have to increase fees at some point in order to be profitable itself, but Patel insists on keeping the company's price-points low as part of his mission to remove barriers to entry for startup founders.
"The fee isn't nearly enough to make us profitable," Patel said. And "it would be ironic if we had a fee of $10,000 to use this. So I think the only way to get around this is to take an equity stake in the company. So if the companies succeed, we will succeed. But if they don't, we essentially don't."
To date, Patel and his co-founders have bootstrapped their operation and haven’t yet sought any outside funding, although that may be an option in the future.
"We are trying to do it in a way that we expect Ataeum startups to. We want to be the role model," Patel said.
The platform currently has more than 100 collaborators and nearly a dozen early-stage projects — a couple of which have already graduated into the venture stage. The streamlined process and accountability measures could appeal to seasoned founders, but Patel also hopes Ataeum will help entrepreneurial college students, Silicon Valley outsiders and part-time dabblers like himself who don’t know how to get started.
“We want to enable them. And sure, our failure rates are going to be much higher than the failure rates of startups on other platforms. We know that,” Patel said. “But if someone has an idea, they should have an option right now.”
