

Why You Should Find Product-Market Fit Before Sniffing Around For Venture Money - harryzhang
http://www.fastcolabs.com/3014841/why-you-should-find-product-market-fit-before-sniffing-around-for-venture-money

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skolos
"The next time a VC ignores your success converting potential clients and only
wants to discuss how you plan to drive traffic then I suggest you find another
VC."

Thank you Andy Rachleff for this. I was worried that we are doing something
wrong. Unfortunately from our experience it is not only VC's who just looking
at growth, but many angels as well.

Even YC and other accelerators are all about growth now. Before we submitted
our application for YC this summer we got some alumni feedback. The main theme
was: "YC is all about growth, why didn't you grow much over this year?"

We talked to some investors and same thing - "what about your growth?".

We are consumer web company with huge addressable market (>50b) trying to
create new type of product. We spent a year iterating to make sure that our
customers love what we offer. We measure this by repeat business. Our
iteration cycle is about 2 weeks - if we tweak something, we need about 2
weeks to see if there is change in repeat business. For our complex product it
took a lot of time to figure out main features.

We figured out what works and have our prototype website serving our
customers. We have revenue and repeat customers - some stick with us for a
year now. We thought this would be good time to get into an accelerator to tie
loose ends before we step on growth pedal. But it looks like you either have
to be already in growth stage or one of 0.01% ("... super young, well-
connected, Stanford CS or EE, worked at Facebook early..." [1]) to get
interest from accelerators these days. I don't blame them - there are so many
applicants that they have pool to pick 0.01% and growth.

What surprised me was that no one ever asked us if we figured out value
proposition and what we need to do to get to the growth stage. So far we
funded our company from our savings, but it looks like we'll need about 3 more
months of runtime before we can cover our cost and start investing in growth.
Instead of some smart investor getting good deal on pre-growth company, I
lined up a consulting gig that will bridge our runtime, even though it will
distract me from getting ready to growth stage.

[1] [http://www.bothsidesofthetable.com/2013/07/16/ring-the-
freak...](http://www.bothsidesofthetable.com/2013/07/16/ring-the-freaking-
cash-register/)

