

Chasing the Money: Stop Trying to Raise. Start Trying to Sell - coglethorpe
http://blog.stevebarsh.com/barsh_bits/2009/05/chasing-the-money-stop-trying-to-raise-start-trying-to-sell.html

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spolsky
Yes! I like this.

One problem, from the VC's perspective, is that if the startup starts selling
successfully, they may not NEED VC.

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jasonlbaptiste
A lot of people forget VC is a growth mechanism. It depends on someone's
plans. Maybe you don't want to be a big 100 million dollar company that has to
play the "VC Exit" game. Then sure, you don't need to raise money. You didn't
at fog creek, and you're killing it.

Some people like to play the "VC Exit" game and raise the money to grow a
company to potentially become huge. Sure they could still grow with their own
revenues, but a 6 million infusion will sure make it happen a lot faster.

Most of this everyone already knows. Just a lot of entrepreneurs out there
that want to raise money when a) they havent done the simple things they
should have or b) for validation and because tEh Bl0gz instill this need to
raise VC to succeed.

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anigbrowl
Awesome advice. I'll just tell the landlord, supermarket, phone company, and
other suppliers that I'm trying to sell my product before I've raised money
and they should be proud of supporting a venture whose founding members and
first hires are all willing to work for fresh air.

Sorry for the snark, but I'm in a position like this just now. I am in fact
working for nothing at present and stretching out a small personal windfall in
order to do it. I'm lucky and grateful to have the freedom to do that. We're
not a tech startup so our needs are a bit different from grab laptop, update
SDK, churn out code - but even so, unless you happen to have deep pockets it
takes time and money for any business to make its first sales (which in our
case are b2b and thus not free for the customer). I could not and would not do
this if I had kids or if Mrs Browl didn't have a good job that allows me to
risk my time participating in this venture I'm working for.

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jlees
Aye exactly, the linked post is great advice, but if you can't pay your
company run rate (i.e. you can't pay your own rent!) then you have two
options: raise money or get a job/other source of income and keep going part-
time.

"Raise money" can include selling, but if you're still developing the product,
what do you sell? Not everyone can conjure weeks' or even months' worth of
living expenses out of the air while the product gets done.

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rjurney
You have a third option, and its build a product you can afford to bootstrap.

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alain94040
Great advice. Don't let the headline prevent you from reading the actual blog
entry. It walks you through a real-life dialogue. You can't escape its
mechanical precision: you will be forced down the path of thinking "what an
idiot I am of going after VCs now".

This blog post is the difference between teaching the theory ("I understand
the argument") and experiencing it ("now I get it").

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FiveFiftyOne
I've often wondered about the sanity of using VC funding as a metric for
measuring the success of a start up. If your business is simply developing
tech to raise funding, then you're existing in a vacuum. Abraham Lincoln would
have made a create start up founder:

"Labor is prior to, and independent of, capital. Capital is only the fruit of
labor, and could never have existed if labor had not first existed. Labor is
the superior of capital, and deserves much the higher consideration. Capital
has its rights, which are as worthy of protection as any other rights."

"The penniless beginner in the world," he once explained, "labors for wages
awhile, saves a surplus with which to buy tools or land, for himself; then
labors on his own account another while, and at length hires another new
beginner to help him." This steady, gradual advance, Lincoln insisted, is "the
prosperous system, which opens the way for all — gives hope to all, and
energy, and progress, and improvement of condition to all."

Sage words.

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abalashov
I think a comment below really hit it on the head: "If you spend the same
amount of effort chasing paying customers, as you do chasing VCs, you'll be
able to pay all your bills and then some with your revenue."

I know some folks who spend years of their life (and more than that, in terms
of its physiological and nervous impact, probably) chasing funding. If they
just bothered to make small sales and steadily grow revenues - ideally, bt not
necessarily recurring - during this period, they wouldn't need funding. And if
they wanted it, they could get it on infinitely better terms, not because the
VCs really care about how cash flow-positive they are (it's the marketability
potential that impacts the valuation on exit in an acquisition, not concrete
P/L--that matters more in IPO, which is really not practical for the moment),
but because they really are in the position of not actually needing it to
survive.

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_pius
This is one of the best VC blog posts I've read in a while.

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rjurney
Click around. All the stuff from this guy is gold.

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terpua
A great read indeed. I recommend Steve Blank's book for further reading on
getting _and_ developing customers: The Four Steps to the Epiphany -
<http://www.cafepress.com/kandsranch.58024175>

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edw519
pg says "Make Something People Want"

I'd go one step further, "Make Something People are Asking For"

If you're making something people want, but don't yet know they want, you
might be tempted to raise investment first.

If you're making something people are already asking for, you won't have much
time for VCs. You'll be too busy fulfilling the customers who are knocking
your doors down.

Sometimes it's nice to see someone say something that oughta go without
saying.

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anamax
> I'd go one step further, "Make Something People are Asking For"

How about "Make something people want to pay for".

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paul9290
The east coast Internet entrepreneurial road vs the west coast. The latter is
much tougher!

