Consumer startups that said no to investor money
1–10 of 45 posts
Re: Consumer startups that said no to investor money
#2I imagine the investors were happy too if they went from 500k to 20m.
Re: Consumer startups that said no to investor money
#3My most recent company has been built w/o outside fundimg. 10/10
Rasing money takes a lot of energy.
Re: Consumer startups that said no to investor money
#4I think this is a great thing. The VC influence has caused product quality to slip a lot, the customer needs to be ignored, and has focused on preferring engineering to rush things. That's a long-term focus on undermining the economy. (Being quick to build something, and only being quick isn't a feature)
Re: Consumer startups that said no to investor money
#5I'm not surprised. The default for starting a startup seems to be that you need VC funding because you need to monopolize as fast as possible and having extra cash will allow you to get there sooner than if you were to bootstrap.
What we're seeing is that growth is able to happen in spite of the frothy VC environment, not because of it. So if it is possible, then why would you have to seek funding? If you think getting VC money is good because you should get VC funding (or because getting some will get you press in TechCrunch) then you're thinking about it all wrong.
You should seek VC money if you need the money (with a very serious definition of "need"). If you don't, why would you:
* Have a boss (outside of your customers)
* Give up a board seat
* Give up control of your company (and possibly eventually a majority of that control)
If you need enough money that doing the above 3 things is less painful than basically your business dying, then yes, you should seek funding. Actually I want to emphasize the "less painful" part. Don't read this as "if your business will die otherwise, seek funding."
Sometimes you should let a business die. If family is important to you and raising VC money and working even harder to keep someone else happy will possibly end your marriage, and ending your marriage is more painful than keeping this startup alive, you should probably let the startup die.
And that's okay!
What matters is you seek VC money for a very specific reason, and it is vital for you and your business for the right reasons.
Re: Consumer startups that said no to investor money
#6I was sad to see Tuft and Needle get acquired by Serta. I bought 3 TN mattresses from their post here, and I love them. I vociferously recommended them to anyone I know. I really doubt their quality will continue to be maintained now that they are in the grips of Serta, but I guess next time I am in the need for a mattress in about 10 years, I'll check.
Re: Consumer startups that said no to investor money
#7I'm not surprised. The default for starting a startup seems to be that you need VC funding because you need to monopolize as fast as possible and having extra cash will allow you to get there sooner than if you were to bootstrap. What we're seeing is that growth is able to happen in spite of the frothy VC environment, not because of it. So if it is possible, then why would you have to seek funding? If you think getti…
Do you believe it's worth taking on investors to bring in people that have both connections and input that will be helpful for growing your product?
Re: Consumer startups that said no to investor money
#8I'm not surprised. The default for starting a startup seems to be that you need VC funding because you need to monopolize as fast as possible and having extra cash will allow you to get there sooner than if you were to bootstrap. What we're seeing is that growth is able to happen in spite of the frothy VC environment, not because of it. So if it is possible, then why would you have to seek funding? If you think getti…
Do you believe it's worth taking on investors to bring in people that have both connections and input that will be helpful for growing your product?
Get a business coach and extensively network - or just focus on product market fit and the connections will come. I guarantee you that will be far cheaper than the millions of dollars worth of equity you would be giving up.
I agree with the parent, raise VC money only if you absolutely need money.
Re: Consumer startups that said no to investor money
#9I'm not surprised. The default for starting a startup seems to be that you need VC funding because you need to monopolize as fast as possible and having extra cash will allow you to get there sooner than if you were to bootstrap. What we're seeing is that growth is able to happen in spite of the frothy VC environment, not because of it. So if it is possible, then why would you have to seek funding? If you think getti…
Do you believe it's worth taking on investors to bring in people that have both connections and input that will be helpful for growing your product?
You can bring in advisors - they have connections and can provide input without requiring they give you cash and in exchange they will take significantly less equity.
Re: Consumer startups that said no to investor money
#10I took VC for my last company. I'm choosing not to do it this time around. What I'm working on has at least a planned ten year horizon at the outset, hopefully it extends beyond that (the cost is so low to do it, I can stay in it perpetually without concern, and have decided the end goal is worth it). It requires long-term planning and thinking, there will be no exit pursued. Venture capital is a mediocre option in that environment, they almost always need an exit (there are some prominent angels that will stay in long-term, be sure to filter for that upfront). Most venture capitalists will burn your corporate house down or drive you into a wall at 120mph in the pursuit of their homerun, whereas I'm willing to eat my time in the pursuit of getting where I want to go with it. If it takes years to get it right, that's ok. The other reason: I won't allow liquidity preferences, VC gets to ride in the same boat as every other share owner (or not at all). The last VC I took on met those terms, it's very difficult to find however.
If there's one thing all start-ups should conspire to abolish, it's liquidity preferences. Somewhere along the line, they all decided that putting their capital at risk in exchange for a potentially large return, wasn't a good enough arrangement. At that point they stopped being real investors and became financial engineers looking to play the angles to remove risk from their position and shift their risk to everyone else. You don't need venture capital that bad, such that shooting yourself in the face is the only way to go. Just say no.