Many startup founders mostly believe that they need to create an idea, build an MVP and then get investor funding or earlier if they are lucky.
Well if you are serious about running a business and really want spent 5-10 years delivering on your mission then you may want to know the downsides of taking money and the benefits of avoiding them. It doesn't apply to all, but as a wise founder you should have a complete picture.
According to Nick Hatter Co-Founder & CEO at FDBK London, United Kingdom he explains why he no longer talking to investors about investment.
Here’s why:
Because as an early-stage startup, the power dynamics are messed up, and deal terms can be extremely unfair*.
Because fundraising takes me away from our most important stakeholders: our customers and users.
Because VCs say they “invest in great teams” but a lot of them really mean “we invest in great metrics”.
Because I would rather get to a point where we don’t have to rely on investor capital to operate, especially in these troubled times.
Because it’s far more satisfying to have paying happy customers than investment leads which may end up not going anywhere.
Because having lots of happy customers and not needing investment actually makes it *more* likely that we will raise investment.
Because getting traction and customers de-risks investment and makes it more likely we will give investors an ROI (yes, I actually care about delivering a return).
Because becoming the hottest new thing with lots of traction will make it more likely investors end up chasing us to invest because they don’t want to miss the boat.
What's your thoughts on that? Do you think it's a complete list of reason? Do you agree or disagree and why? Share yours in the comments below, I'll respond.
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