I've worked at bootstrapped companies where we were always squeaking by every month fighting to become profitable. But at least you are in control of your own destiny. Nobody can force you to shut down as long as everybody wants to keep hanging in.
Unlike this is the ticking time bomb you have on your back the moment you take on investment. It's now do-or-die and when the money runs out you pretty much have no choice but to liquidate - often the decision isn't even yours to make.
This article mainly applies only to the later. It is exciting when you get a big investor check but it's not the only way. I always encourage friends to think about investments that way - rather than just a free bag of cash!
Amen. Yeah it's exciting to get a big investor check. You know what's way more exciting? Being profitable.
I occasionally get approached to help seed startups whose entire plan depends on a) getting funded and b) getting acquired. I enquire about a path to profitability and the answer frequently reveals a token effort. The CACs are unrealistic, market penetration estimates are hopelessly optimistic, etc. The entire play is acquisition or death.
Being profitable is hard work. Much more fun to play the startup game, throw some wild parties, and be acquired than building a real business making real money.
Unlike this is the ticking time bomb you have on your back the moment you take on investment. It's now do-or-die and when the money runs out you pretty much have no choice but to liquidate - often the decision isn't even yours to make.
This article mainly applies only to the later. It is exciting when you get a big investor check but it's not the only way. I always encourage friends to think about investments that way - rather than just a free bag of cash!