Ok, let say. I have created a web based application, registered a domain name, and hosted it on the Internet. Can I say it's a one man startup?
If not, then: What will it be if I just host my app on the Internet (not signing any legal documents)?
Any advantages or disadvantages?
I have created a web based application, registered a domain name, andNo, it is a dude with a website, not a business so not a startup.
hosted it on the Internet. Can I say it's a one man startup?
Do you have a busines license? Registered as a business?
If not - it is not a startup. It may be a startup in foundation, but you can not write an invoice as business.
The moment you register as a business - it is a startup.
What will it be if I just host my app on the Internet (not signing anyIn most cases: An illegal business. Same like opening a restaurant without proper paperwork.
Any advantages or disadvantages?Well, except the fines the government may hit you with?
You should get a business license, by whatever means that is done in your jurisdiction, if you ever want to write an invoice.
I think its not important how you call it... but look at this definition:
http://en.wikipedia.org/wiki/Startup_company Can you see yourself there?
Basically I would say everything which has the intention to make "business" and just has started to try out its service or research the market is a start up. The term is very unclear for me and badly defined.
If you are just hosting for "fun", call yourself a webmaster. If you do a market research and think about how you can make some money with your app, call your self a startup. The term is not tied to any legal documents.
In addition to what Christian said above, the answer is:
The reason is, if you ever might have to take money, or hire someone, you're going to really want that.
Do note that this isn't legal advice, just common sense based upon issues that I've seen.
Startup is a usefully ambiguous term, spanning everything from back bedroom side projects to teams spending tens of millions. It has no legal definition - if anything it's just a mindset.
So by all means be a startup without a legal entity other than yourself!
However, when you start offering services to customers, especially if they're paying you, you may want to think about how you both protect yourself and reassure them. Most web businesses at least need some kind of Terms and Conditions statement - you can find off-the-peg sources, hire a lawyer or take a controlled risk by researching similar offerings and being your own lawyer.
And in the success case, sooner or later you're likely to want the protection of limited liability, in case it all goes pear-shaped - or in case you want to take in investment.
Even five years ago I felt very uneasy about offering services without most or all of this foundation in place. But in today's environment, with fast development and deployment, and just about every tricky thing you can imagine being available through an API out there in the wide and wonderful world, some of the best startups seem to be starting out as 'fun and value' personal projects with minimum clutter.