The 2013 Startup
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The 2013 Startup
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Re: The 2013 Startup
#2How do you define seed investor here? Most people need some sort of startup capital beyond the accelerator, as most companies don't get to profitability quickly enough. Also, I think this ignores B2B cases where you can't so easily build a highly stripped down product, but need to hit some quality threshold for businesses to pay. And that takes time.
Re: The 2013 Startup
#3like the point of view. Will be interesting to see if some prominent founders say "no" like some said no to large but not large enough acquisitions in the past.
Re: The 2013 Startup
#4I hope this is the case.
Any founders feel they fit this bill in NYC? If so, would like to meet with you and talk shop. We're almost at 60K users on a "project".
Email is dmitri [at] backspac.es
Re: The 2013 Startup
#5How do you define seed investor here? Most people need some sort of startup capital beyond the accelerator, as most companies don't get to profitability quickly enough. Also, I think this ignores B2B cases where you can't so easily build a highly stripped down product, but need to hit some quality threshold for businesses to pay. And that takes time.
Indeed, I'm defining seed investor largely in the context of a "seed round"...which these days seems to be anywhere btwn 500k - 1.2M. There are some 2013 startups that take a bit of friends and family money to pay for rent / food, and this largely comes down to the founder's personal / financial situation. Also yes, many of the cases I'm thinking of here are consumer focused companies.
Re: The 2013 Startup
#6Very interesting. I feel that I'm part of this cohort (unexpectantly) since recently launching startuprocketlauncher.com in 2013 ... essentially starting making $$ after day 2 and receiving tons of signups from little marketing efforts. I'm not necessarily say NO to investors but since I can market, develop and acquire users myself with a bit of profit, I prefer to work at a pace I'm comfortable with. Its best I believe to experiment without any pressure and development the business model creatively to a point where, if needed, investors can jump onboard with something less risky with a thriving community to take it to the next level.
Re: The 2013 Startup
#7For the sake of argument, how is this different from self funding? Ramen profitable isn't profitable, and not taking seed is just preventing you from paying yourself.
Re: The 2013 Startup
#8My limited experience says this is right on.
One of my best friends has been working on a startup for about two years now, focused on a B2B vertical where he has experience. It's gone well, and he's gained a handful of customers who are all very loyal to his product.
He's turned down outside investment the whole time, because he didn't have a growth strategy that required capital. He saw investment as a liability, taking a portion of his flexibility and tying him to a strategy he hadn't yet tested.
Now, he's looking for funding to grow quickly, and to hire some marketing folk. Ironically, while he had people asking to invest a few months ago, now he's having trouble finding the right fit. He's heard "you're just a little bigger than the companies we normally deal with" from every corner.
I know he's not alone in this. I hope the startup world quickly adapts to this change, and develops a facility to deal with tiny bootstrapped companies that are past the "I have an idea!" stage, but need outside expertise and a workable plan to scale.
Re: The 2013 Startup
#9This is my company Drifty (http://drifty.co/). We make make HTML5 dev tools Codiqa and Jetstrap.
In 2012 my best friend and I bootstrapped the company while working full time (we just charged for our products). We made enough to go full time later that year and we employ one person and are hiring more.
We are actually in TechStars right now (score one for great value-add seed investors), but we are saying "no" to extra money beyond that. Why? We think bootstrapping it fits who we are and what we want this company to become.
Does that mean we are a "lifestyle" business? I don't see it that way. We are still insanely motivated and have high aspirations for this company, but we don't think throwing tons of cash in it will have the best result for us, our happiness, our customers, or our long-term sustainability.
We go back and forth every day about raising, but we have a lot of support not to right now, so we'll see what happens.
Re: The 2013 Startup
#10I'm stoked to read these opening phrases:
"...The founding team is very small, often one technical person. In some cases ... hacking something together because she needs this thing to exist ... They are slowly and deliberately building small communities or early customers. Some are even making money. In fact, a few of these startups are profitable (in the ramen sense)."
...because they read exactly like a case-study for what I've been experiencing with my project[0] over the past 12 months, and have found very hard to explain to people.
It's really nice to have a rosy outlook beyond "Hey that's neat, now you can go do a real startup!"
[0] Open Exchange Rates (https://openexchangerates.org)