Camera+ turned down acquisition offers and says no to VC money
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Re: Camera+ turned down acquisition offers and says no to VC money
#2This whole scene reminds me so much of the record business of yore.
The bit about VCs swooping in with just enough money to keep you alive and not really giving much of a rip about your creative endeavors and as soon as it looks like you might not be a million dollar baby dropping you like a hot potato.
"punk and indie developers". I really like that.
Re: Camera+ turned down acquisition offers and says no to VC money
#3if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
Re: Camera+ turned down acquisition offers and says no to VC money
#4if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
Could not have said it better myself. It kind of makes me like a product more.
Re: Camera+ turned down acquisition offers and says no to VC money
#5if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
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Re: Camera+ turned down acquisition offers and says no to VC money
#6if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
We seldom acknowledge it but I think the truth of the matter is that a lot of people become entrepreneurs because they want the recognition, the fame and the status.
As silly as it is, taking VC money gives you that in a way that is much harder to achieve with actual tangible success. You might be killing it with your product but carefully explaining your company metrics to someone over dinner is seldom more impactful than saying you took $10M from Andreeson-Horrowitz.
This is not entirely unreasonable as most people realise they are unable to judge the success or otherwise of early stage companies (even VCs struggle). Telling someone you were invested in by a great VC tells them that someone who knows their stuff things you're great. It's a marquee endorsement.
If you'd asked me whether I wanted the status I'd have always said yes. At the same time though I never acknowledged it in my life-calculations. I always wondered why I gambled on a big outcome when I knew a smaller outcome would (financially speaking) make me very, very happy. I doubt there are many people who can point to the happiness bump from the second $30M.
Acknowledging that recognition was one of my goals made it all of a sudden easier to rationalise decisions that, while optimal for my investors were actually totally sub-optimal for my personal financial utility. One of those decisions may well be having investors in the first place.
Re: Camera+ turned down acquisition offers and says no to VC money
#7if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
If there's a big player that might jump into your space with a bigger marketing budget, and you know how to use money to accelerate your growth before that happens, it makes sense to take money.
Re: Camera+ turned down acquisition offers and says no to VC money
#8This whole scene reminds me so much of the record business of yore. The bit about VCs swooping in with just enough money to keep you alive and not really giving much of a rip about your creative endeavors and as soon as it looks like you might not be a million dollar baby dropping you like a hot potato. "punk and indie developers". I really like that.
That's great. I am going to use that instead of bootstrapped from now. It also fits the kind of music we listen to.
Re: Camera+ turned down acquisition offers and says no to VC money
#9if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
To some, I think it's like getting into an elite school - with similar effect.
You're paying out quite a bit of your company, in most cases, and getting some capital in return. But what you're also buying into with your equity is a large network of alumni and connections.
In addition, just like how some (silly, IMO) companies hire Ivy League grads because they've passed someone else's rigorous selection process, getting funded by an A-list VC proves to some that your company has chops. So for many founders, trading equity for VC investment is also a hedge for the future - a glowing resume item useful for driving business or acquisition at this or the next venture.
Personally, I think the more early-stage-successful companies stand on their own merit rather than buying into the "old boy's" VC club, the better. I think more weight has been placed on VC selection than is reasonable of late, both in M+A and the tech media. The more successful companies buck this trend, the more likely non-VC companies are to get considered for acquisition down the road, and the more likely said companies are to be able to drum up press for an IPO, as well.
Re: Camera+ turned down acquisition offers and says no to VC money
#10if you have a product thats selling so well, is growing organically, and is already build...why would you ever consider outside funding?
We seldom acknowledge it but I think the truth of the matter is that a lot of people become entrepreneurs because they want the recognition, the fame and the status. As silly as it is, taking VC money gives you that in a way that is much harder to achieve with actual tangible success. You might be killing it with your product but carefully explaining your company metrics to someone over dinner is seldom more impactfu…
This is a really interesting point. To give an example, one of my friends in that scene thinks that 37signals is probably "not doing that well." I can only guess this is because they aren't raising tons of VC and having their name plastered all over TC.