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Getting Funded with Venture Capital: Why It May Not Be Such a Good Idea

Getting Funded with Venture Capital: Why It May Not Be Such a Good Idea | Online Business Models | Scoop.it

"You are more than three times as likely to crash your startup as you are to ring the NASDAQ opening bell."

Robin Good's insight:



Rachel Chalmers illustrates five key reasons why it may not be such a great idea to get your startup funded by venture capital.


These include: 


  1. Not getting a fair hearing

  2. Rising capital means losing the YOU and giving in to financial interests as the primary drivers

  3. The majority of VC funded companies will not ever generate any venture success

  4. You are not going to have full control anymore

  5. Venture math is a harsh mistress 


Key advice: VCs are optimizing for a very specific outcome (making a large as possible profit fast). Share that alignment, or don’t take their money.


Chances to convert a startup into a VC-funded success, are not very high, if you look at the numbers. But worse than that, is what you have to endure and give up to achieve that goal.


Useful. 7/10



Full article: http://modelviewculture.com/pieces/five-reasons-not-to-raise-venture-capital 

Reading time:  7 mins.


See also: http://www.masternewmedia.org/bootstrapping-startups-guide/ 







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From Failure To Failure: Small Startups Need To Be Searching For Repeatable and Scalable Business Models [Video]

From Failure To Failure: Small Startups Need To Be Searching For Repeatable and Scalable Business Models [Video] | Online Business Models | Scoop.it

Robin Good: As the author of The Startup Owner's Manual, Steve Blank is someone who has been experimenting, studying and analyzing startups for many years and who has a comprehensive vision of what it takes to be a successful startup and wher emost new digital companies fail.


In his own words a "startup" is "a temporary organization designed to search for a repetable and scalable business model".


In this excellent video interview by GigaOM Chris Albert, the focus is on the state of startups and entrepreneurship.


From the original article: "When Steve Blank talks about entrepreneurship, people listen.


...Blank co-founded the CRM software company E.piphany and the video game business Rocket Science.


His current gigs as an entrepreneurship professor at Stanford, UC Berkeley and Columbia give him a unique insight that combines a historical perspective with a look at the next generation of entrepreneurs.


Key takeaways:


1) Startups are not smaller versions of big companies, so don’t try to be like them


2) Startups are about searching for a business model, not executing a business plan


3) Contrary to the myth, Steve Jobs interacted with consumers more than you think


4) Amazon has been hugely important to the boom in startups


5) Today’s students have a “wonderful entrepreneurial arrogance”


Insightful. 9/10


Watch the video interview in full here: http://gigaom.com/2012/05/11/steve-blank-on-small-startups-big-execution-and-steve-jobs/ 

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