7 ms·

Fundraising Mistakes Founders Make

132 points by rickharrison 13y ago

webwright 13y ago
To me, one of the biggies is raising too early. To Sam's point, you want a competitive environment. To get that you want to obviously be a good investment to as many investors as possible. If you don't have some combination of an amazing v1 product, a traction graph that's moving in the right direction, credible investors already on board, a big/timely market, or a top 5% team, you're almost certainly fundraising too early... And you should do whatever you can to get one or more of the above. See: http://andrewchen.co/2011/06/21/video-the-anatomy-of-a-fundable-startup-by-naval-ravikant-of-angellist/# http://andrewchen.co/2011/06/21/video-the-anatomy-of-a-funda... (note: salesmanship can trump all of the above)
- DenisM 13y ago
  It's sort of silly though - founders already take risk with years of their life going nowhere, why should they also bear the entirety of the financial risk? Isn't the purpose of early stage investment to validate the idea? And by contrast late-stage investment is to grow the validated idea? It feels like these days everyone wants to invest only in validated ideas. It just feels suboptimal that hardly anyone ever wants to finance the actual validation... Am I missing something?
  - ddt 13y ago
    The "graph moving in the right direction" doesn't have to be impressive in absolute terms. If I can prove that I have 100 paying, engaged customers this week, 50 last week, 25 the week before, etc. I've proved that the idea resonates with a market, and its growing. Note that this is still early stage. You have to be able to prove some indication of longterm value though.
    - jkarneges 13y ago
      If you have paying customers with consistent growth then you are well past idea stage. I think DenisM's point is that founders often need to be somewhat wealthy on their own in order to create a product in the first place. This doesn't seem like an optimal division of responsibilities.
  - gailees 13y ago
    Marc Andreessen kind of touches on this in Why Software is Eating The World: http://online.wsj.com/news/articles/SB10001424053111903480904576512250915629460 http://online.wsj.com/news/articles/SB1000142405311190348090... The barriers to entry for startups have gone down, and thus there's higher quality startups competing for the same funding. As development becomes cheaper, easier, quicker we are just going to see the bar go up for early stage investment because investors will have more and better options.
  - crapshoot101 13y ago
    Be that as it may, why is this true just for founders? Ie, we sometimes forget the echo chamber we live in around here - ie, no one owes anyone a "fundraising" opportunity. Early stage investment is absolutely about validation, but does that mean anyone who's interested should be able to raise money for it? If it was your own money, wouldn't you do everything you could to minimize the risk for a given upside profile?
  - prostoalex 13y ago
    Validation for pure-play software is cheap in today's markets. Work-two-years-for-a-large-company-to-save-up-some-cash-to-bootstrap cheap.
- ballard 13y ago
  Founders have to have enough credibility to find customers and a business model to seek out profit, or it seems like a risky proposition no amount of selling can overcome.
- ballard 13y ago
  Yeah, getting a working prototype and alpha users before even thinking about angel or VC. Later, the right amount of validation will speak for itself and reduce friction. That is if investment would win a race-to-market. Otherwise, plan to get to market as quick as you can on with the team and money you have.
michaelochurch 13y ago
Beware, though, that saying things like “our round is closing really fast” when you have no offers usually backfires. Investors talk and will call your bluff. True, but this sort of investor collusion is unethical and only (possibly) legal because private stock isn't regulated in the way that publicly traded stock is. In fact, the whole and only purpose of the VC-funded economy is to take stock strategies that were made illegal 30-100+ years ago and apply them to fast-growing, private, volatile tech stocks. Shit like this is why most of us who are paying attention hate VC, and why the U.S. has gone from admiring Silicon Valley to vilifying it (and justly so; the ethics in Wall Street are way better than those in the VC-funded world.) That this kind of scumbag collusion is tolerated is just unconscionable. Investors are supposed to be competitors, but they compare notes so much as to function as a cartel.
- cwilson 13y ago
  Just because it's unethical doesn't mean a founder who is fundraising should ignore it. It's happening regardless of your feelings on the subject. This doesn't mean I don't agree with you, but sometimes you have to play the game.
- spacehome 13y ago
  Michael, Would you mind clarifying what strategies VCs execute that would be illegal if the stocks in question were public?
- minimax 13y ago
  Collusion is a pretty big charge. If investors are upfront about the fact that they talk to each other (and, hey, it's right there in the blog post) then investor A calling up investor B to verify he has made an offer to a startup isn't collusion. It's just due diligence. I'm also unclear about the analogous situation in the public markets that you alluded to.
  - michaelochurch 13y ago
    On the public markets, using social sway or inside connections to intentionally up- or downregulate the reputation or market price of another company for personal profit (say, a pump-and-dump scheme) will put you in prison. No question about it; it's unambiguously illegal to do that. You don't get to, for example, spread negative rumors about a company and ruin its reputation because you think you should be able to buy it at a discount. Investors do the same thing, and it wrecks peoples' careers and makes it hard as hell for people to get started amid that feudalistic reputation economy. The excuse is "well, investors talk". I say: fuck that and fuck them. If Silicon Valley entrepreneurs are really going to tolerate that shit-- which only hurts them-- instead of agitating for proper laws to be written, then they're a pack of self-hating losers for not knowing how to fight for themselves.
cwilson 13y ago
This is a great compilation of wisdom passed on while participating in YC, plus lessons learned I can appreciate 1.5 years later. Well written Sam. My personal favorite on this list is to focus on what you're most passionate about during your pitch. This should drive the entire conversation. Investors do not expect you to know everything from day one. Don't go into a pitch trying to have the perfect answer for every question, focus on what you do know and can speak passionately about.
earbitscom 13y ago
I would second webright's comment about raising too early. One other mistake we made was underestimating the number of investors we needed to speak with in order to create momentum and a competitive environment. You definitely do want to raise in parallel, and in order to truly do so you should overshoot the number of people you plan to talk to so that you don't find yourself done with all of your leads and not with the full amount raised. Chase more leads than you think you'll need to.
jheriko 13y ago
No 1. by miles and miles is fundraising at all. Just saying, but nobody successful I know spends or spent any time raising funds for their company that wasn't just saving their wages. The one case I know of where they tried (after already being successful I would add) they were already doomed before going down that path ... it just took a while for it to come to fruition. Given that the only people I know who thought this was a good idea lost their business from right under their nose anyway I'm not inclined to think that in general it is a good idea. The small number of spectacular successes that came from VC capital make it seem more reasonable as a choice than it is... they also make it easier for VCs to invest and see a return because some of those spectacular success are worth a lot and more than make up for the fact that without them its just a game of losing money constantly...
- ballard 13y ago
  It's push vs pull. If you build value, investors will beat down your door.
namenotrequired 13y ago
> So don’t do obviously dumb things like talk about potential acquirers in a seed round pitch - that will suggest you’re not trying to build a really big company. Question, should one talk about potential acquirers - specifically, those you have offers from - at any point during fundraising?
- nairteashop 13y ago
  Acquisition offers are a great external validation of both your product and the market you're in. So my take is that it's a very positive thing to talk about any potential acquisition offers, as long as you stress that that's not your end game. Take for example Drew Houston turning down the acquisition offer from Jobs/Apple back in the day; probably did wonders for Dropbox's valuation in the following round (and very rightly, if so).
  - namenotrequired 13y ago
    Great point, thank you!
rjf90 13y ago
Great article, comes at a very good time for me and my company.
chollida1 13y ago
I don't know Sam, but I really like this experiment he's doing with writing. Lot's of decent articles being written a a high speed. It's almost like he's trying to replicate Paul Graham circa 2004- 2008. I haven't seen an article yet that breaks any new ground, ie he's still looking for his "blub paradox" article, but all his articles generate discussion. Just look at his article on AI from yesterday. It didn't really break any new ground in the AI conversation and it got 260+ comments.
- lmg643 13y ago
  Production counts - "80% of success is showing up." I particularly liked the opener: "Without thinking much I said ________, but having thought about that a bit more, I think it’s probably right."
- lawnchair_larry 13y ago
  Except unlike PG, he hasn't really established authority on what he is writing about (other than perhaps a confusing endorsement from PG). What are Sam's big hits? Edit: That sounds meaner than intended, but it's actually an honest question. How does this guy share a top 5 list spot with Jobs, Larry, and Sergey? How do we know we should take him at his word when he didn't learn these things be being successful doing them? I feel like I'm missing something.
  - cududa 13y ago
    He's an advisor at YC and an advisor at tons of other successful startups. Tons of successful entrepreneurs have benefitted from his advice and take what he has to say very seriously.
  - devfeed 13y ago
    But PG wasn't an established authority back when PG was writing fast. I remember reading PG in 2006, and you'd read lots of snarks on the tech forums of the time (Slashdot, Digg): who is this guy, and why should we listen to this bored washed up multi-millionaire who sold his startup to Yahoo? He hasn't done anything of note in the past 10 years! (They said the same thing about Philip Greenspun too, who was also writing at a faster clip back then). Look, at the end of the day, "established authority" is only loosely correlated with worthwhile meaning. At some point you're going to have to move past the author and evaluate the words on the page on their own merit.
adamzerner 13y ago
> It’s actually quite simple; if you have a good company, you will probably be able to raise money. IMO, investors tend to be very formulaic. Traction + social proof + impressive team etc. The formula might be a good heuristic, but I think that it misses out on some genuinely good companies. See https://medium.com/p/2ef77c6acb https://medium.com/p/2ef77c6acb
cindywu123 13y ago
i wish i had this when we were fundraising for experiment.com
awkwit 13y ago
We've been in fundraising mode for the last 6 months and some of Sam's points really shine through. In particular the valuation bit strikes close to home.
wellboy 13y ago
Normally, I find Sam's articles maybe interesting, but not that insightful. However, this one is really awesome, it pins down the dynamics happening in fundraising exactly. It actually feels a bit Paul Graham like, very good article. Especially liked the part about not being arrogant. I'm always trying to be very assertive while actually sounding really nice and likeable, it's a very important art to master.
ballard 13y ago
Business people that don't add value tend to focus on appearances than substance because it's an easier business theather to bikeshed than to show progress and interest. The upside is that anyone that's built a business before is unlikely to be fooled by clever packaging or a well-defended presentation.
yid 13y ago
> Some founders try things like carefully timing news articles, casually mentioning to one investor that they'll be having dinner with another investor, claiming their schedule is really packed except for one specific hour, and other tricks - but if you just build a good company, you generally won’t need to. (Non-italics mine) This is such wonderfully simple advice. Investors, by definition, want to make money. Build something that can, show them it will, and they will give you an investment. If you can't raise money, you're doing something wrong with the first two -- so that should show you where to focus on instead of using poorly thought out social engineering tricks.
beat 13y ago
This basic point is something I keep thinking, too… either you have your shit together, or you don't. If your fundamentals are strong, you should be able to get funding easily. If your fundamentals are weak, no amount of would-be cleverness will make funding viable. If you want to impress investors, impress your customers. Interestingly, this just falls out of something I've learned from years of developing big systems, which is that the line between success and failure is narrow, but the grounds on either side of that line are broad. So back of the envelope calculations that strongly suggest one conclusion or the other are almost always right, assuming there's nothing wrong with your analysis. Because of this, I've learned to not be pedantic about precision. Quick decisions are usually more effective than cautious ones. Maybe that's why I've set out on a path away from the enterprise and toward entrepreneurship.
tlogan 13y ago
This is great but I will offer a simplistic view how to raise money. First, you need to get "social proof". Getting accepted into Y-combinator is a very good one. Or if you already sold a company then you are golden. But if you are super smart working in large tech company such as Yahoo! for 15+ years - good luck. Especially if you are over 40. When you are 40 it is easier to convince Discovery Loan to give you 100K loan than seed round from any VC. Second, you should not have any revenue or god forbid any profit. You might think that is needed but actually revenue and profit are bad for raising money: investors will look your numbers and make projection based on these numbers. It much easier to sell "blue sky" than business with actual revenue and profit. So to raise money: 1 build "social proof", 2 make powerpoint presentation, 2 go raise money
- wh-uws 13y ago
  If you worked at large tech company for that long and didn't make enough connections, learn enough, and/or save enough money to start a startup on your own... I wouldn't invest in you either
somberi 13y ago
As someone who has found a startup, one point I would add is - Make sure you are within 50 miles of where the VC activity is. That for practical purposes means this; be based out of SFO (+Bay Area), NYC (+Boston). VCs want to fund businesses that reach all over the world, but they themselves must be reachable within an hour or two commute.
guttermaw 13y ago
why do so many of these samaltman things make fp? okay, i didn't really read this one, my time is too value-generating or something i'm asking you, not the rest of you cunts it isn't horrible, if you don't mind about.com-quality tripe
bsder 13y ago
"Not hearing no" I've never heard an investor actually say "no". They will hem, haw, delay, excuse, etc. and do everything except give a definitive "no". You just have to learn to treat "maybe" as "no" until you decide it's worth talking to them again. I'd love to have an actual "no" from an investor. It's like dating: "no" is no. "maybe" is no. "yes" is maybe until you've closed the deal.
ballard 13y ago
With actual rockstar startups not burning through cash like it's their own personal vacation from profitably and reality, the dilemma is often centered between reasonable frugality and trying too hard to seem frugal ending up penny wise-pound foolish. FWIW I'm impressed more by how little actual (non-bullshit numbers) cash and time went into something.

132 points by rickharrison 13y ago

To me, one of the biggies is raising too early. To Sam's point, you want a competitive environment. To get that you want to obviously be a good investment to as many investors as possible. If you don't have some combination of an amazing v1 product, a traction graph that's moving in the right direction, credible investors already on board, a big/timely market, or a top 5% team, you're almost certainly fundraising too early... And you should do whatever you can to get one or more of the above. See: http://andrewchen.co/2011/06/21/video-the-anatomy-of-a-fundable-startup-by-naval-ravikant-of-angellist/# http://andrewchen.co/2011/06/21/video-the-anatomy-of-a-funda... (note: salesmanship can trump all of the above)

DenisM 13y ago
It's sort of silly though - founders already take risk with years of their life going nowhere, why should they also bear the entirety of the financial risk? Isn't the purpose of early stage investment to validate the idea? And by contrast late-stage investment is to grow the validated idea? It feels like these days everyone wants to invest only in validated ideas. It just feels suboptimal that hardly anyone ever wants to finance the actual validation... Am I missing something?
- ddt 13y ago
  The "graph moving in the right direction" doesn't have to be impressive in absolute terms. If I can prove that I have 100 paying, engaged customers this week, 50 last week, 25 the week before, etc. I've proved that the idea resonates with a market, and its growing. Note that this is still early stage. You have to be able to prove some indication of longterm value though.
  - jkarneges 13y ago
    If you have paying customers with consistent growth then you are well past idea stage. I think DenisM's point is that founders often need to be somewhat wealthy on their own in order to create a product in the first place. This doesn't seem like an optimal division of responsibilities.
- gailees 13y ago
  Marc Andreessen kind of touches on this in Why Software is Eating The World: http://online.wsj.com/news/articles/SB10001424053111903480904576512250915629460 http://online.wsj.com/news/articles/SB1000142405311190348090... The barriers to entry for startups have gone down, and thus there's higher quality startups competing for the same funding. As development becomes cheaper, easier, quicker we are just going to see the bar go up for early stage investment because investors will have more and better options.
- crapshoot101 13y ago
  Be that as it may, why is this true just for founders? Ie, we sometimes forget the echo chamber we live in around here - ie, no one owes anyone a "fundraising" opportunity. Early stage investment is absolutely about validation, but does that mean anyone who's interested should be able to raise money for it? If it was your own money, wouldn't you do everything you could to minimize the risk for a given upside profile?
- prostoalex 13y ago
  Validation for pure-play software is cheap in today's markets. Work-two-years-for-a-large-company-to-save-up-some-cash-to-bootstrap cheap.
ballard 13y ago
Founders have to have enough credibility to find customers and a business model to seek out profit, or it seems like a risky proposition no amount of selling can overcome.
ballard 13y ago
Yeah, getting a working prototype and alpha users before even thinking about angel or VC. Later, the right amount of validation will speak for itself and reduce friction. That is if investment would win a race-to-market. Otherwise, plan to get to market as quick as you can on with the team and money you have.

michaelochurch 13y ago

Beware, though, that saying things like “our round is closing really fast” when you have no offers usually backfires. Investors talk and will call your bluff. True, but this sort of investor collusion is unethical and only (possibly) legal because private stock isn't regulated in the way that publicly traded stock is. In fact, the whole and only purpose of the VC-funded economy is to take stock strategies that were made illegal 30-100+ years ago and apply them to fast-growing, private, volatile tech stocks. Shit like this is why most of us who are paying attention hate VC, and why the U.S. has gone from admiring Silicon Valley to vilifying it (and justly so; the ethics in Wall Street are way better than those in the VC-funded world.) That this kind of scumbag collusion is tolerated is just unconscionable. Investors are supposed to be competitors, but they compare notes so much as to function as a cartel.

cwilson 13y ago
Just because it's unethical doesn't mean a founder who is fundraising should ignore it. It's happening regardless of your feelings on the subject. This doesn't mean I don't agree with you, but sometimes you have to play the game.
spacehome 13y ago
Michael, Would you mind clarifying what strategies VCs execute that would be illegal if the stocks in question were public?
minimax 13y ago
Collusion is a pretty big charge. If investors are upfront about the fact that they talk to each other (and, hey, it's right there in the blog post) then investor A calling up investor B to verify he has made an offer to a startup isn't collusion. It's just due diligence. I'm also unclear about the analogous situation in the public markets that you alluded to.
- michaelochurch 13y ago
  On the public markets, using social sway or inside connections to intentionally up- or downregulate the reputation or market price of another company for personal profit (say, a pump-and-dump scheme) will put you in prison. No question about it; it's unambiguously illegal to do that. You don't get to, for example, spread negative rumors about a company and ruin its reputation because you think you should be able to buy it at a discount. Investors do the same thing, and it wrecks peoples' careers and makes it hard as hell for people to get started amid that feudalistic reputation economy. The excuse is "well, investors talk". I say: fuck that and fuck them. If Silicon Valley entrepreneurs are really going to tolerate that shit-- which only hurts them-- instead of agitating for proper laws to be written, then they're a pack of self-hating losers for not knowing how to fight for themselves.

cwilson 13y ago

This is a great compilation of wisdom passed on while participating in YC, plus lessons learned I can appreciate 1.5 years later. Well written Sam. My personal favorite on this list is to focus on what you're most passionate about during your pitch. This should drive the entire conversation. Investors do not expect you to know everything from day one. Don't go into a pitch trying to have the perfect answer for every question, focus on what you do know and can speak passionately about.

earbitscom 13y ago

I would second webright's comment about raising too early. One other mistake we made was underestimating the number of investors we needed to speak with in order to create momentum and a competitive environment. You definitely do want to raise in parallel, and in order to truly do so you should overshoot the number of people you plan to talk to so that you don't find yourself done with all of your leads and not with the full amount raised. Chase more leads than you think you'll need to.

jheriko 13y ago

No 1. by miles and miles is fundraising at all. Just saying, but nobody successful I know spends or spent any time raising funds for their company that wasn't just saving their wages. The one case I know of where they tried (after already being successful I would add) they were already doomed before going down that path ... it just took a while for it to come to fruition. Given that the only people I know who thought this was a good idea lost their business from right under their nose anyway I'm not inclined to think that in general it is a good idea. The small number of spectacular successes that came from VC capital make it seem more reasonable as a choice than it is... they also make it easier for VCs to invest and see a return because some of those spectacular success are worth a lot and more than make up for the fact that without them its just a game of losing money constantly...

ballard 13y ago
It's push vs pull. If you build value, investors will beat down your door.

namenotrequired 13y ago

> So don’t do obviously dumb things like talk about potential acquirers in a seed round pitch - that will suggest you’re not trying to build a really big company. Question, should one talk about potential acquirers - specifically, those you have offers from - at any point during fundraising?

nairteashop 13y ago
Acquisition offers are a great external validation of both your product and the market you're in. So my take is that it's a very positive thing to talk about any potential acquisition offers, as long as you stress that that's not your end game. Take for example Drew Houston turning down the acquisition offer from Jobs/Apple back in the day; probably did wonders for Dropbox's valuation in the following round (and very rightly, if so).
- namenotrequired 13y ago
  Great point, thank you!

rjf90 13y ago

Great article, comes at a very good time for me and my company.

chollida1 13y ago

I don't know Sam, but I really like this experiment he's doing with writing. Lot's of decent articles being written a a high speed. It's almost like he's trying to replicate Paul Graham circa 2004- 2008. I haven't seen an article yet that breaks any new ground, ie he's still looking for his "blub paradox" article, but all his articles generate discussion. Just look at his article on AI from yesterday. It didn't really break any new ground in the AI conversation and it got 260+ comments.

lmg643 13y ago
Production counts - "80% of success is showing up." I particularly liked the opener: "Without thinking much I said ________, but having thought about that a bit more, I think it’s probably right."
lawnchair_larry 13y ago
Except unlike PG, he hasn't really established authority on what he is writing about (other than perhaps a confusing endorsement from PG). What are Sam's big hits? Edit: That sounds meaner than intended, but it's actually an honest question. How does this guy share a top 5 list spot with Jobs, Larry, and Sergey? How do we know we should take him at his word when he didn't learn these things be being successful doing them? I feel like I'm missing something.
- cududa 13y ago
  He's an advisor at YC and an advisor at tons of other successful startups. Tons of successful entrepreneurs have benefitted from his advice and take what he has to say very seriously.
- devfeed 13y ago
  But PG wasn't an established authority back when PG was writing fast. I remember reading PG in 2006, and you'd read lots of snarks on the tech forums of the time (Slashdot, Digg): who is this guy, and why should we listen to this bored washed up multi-millionaire who sold his startup to Yahoo? He hasn't done anything of note in the past 10 years! (They said the same thing about Philip Greenspun too, who was also writing at a faster clip back then). Look, at the end of the day, "established authority" is only loosely correlated with worthwhile meaning. At some point you're going to have to move past the author and evaluate the words on the page on their own merit.

adamzerner 13y ago

> It’s actually quite simple; if you have a good company, you will probably be able to raise money. IMO, investors tend to be very formulaic. Traction + social proof + impressive team etc. The formula might be a good heuristic, but I think that it misses out on some genuinely good companies. See https://medium.com/p/2ef77c6acb https://medium.com/p/2ef77c6acb

cindywu123 13y ago

i wish i had this when we were fundraising for experiment.com

awkwit 13y ago

We've been in fundraising mode for the last 6 months and some of Sam's points really shine through. In particular the valuation bit strikes close to home.

wellboy 13y ago

Normally, I find Sam's articles maybe interesting, but not that insightful. However, this one is really awesome, it pins down the dynamics happening in fundraising exactly. It actually feels a bit Paul Graham like, very good article. Especially liked the part about not being arrogant. I'm always trying to be very assertive while actually sounding really nice and likeable, it's a very important art to master.

ballard 13y ago

Business people that don't add value tend to focus on appearances than substance because it's an easier business theather to bikeshed than to show progress and interest. The upside is that anyone that's built a business before is unlikely to be fooled by clever packaging or a well-defended presentation.

yid 13y ago

> Some founders try things like carefully timing news articles, casually mentioning to one investor that they'll be having dinner with another investor, claiming their schedule is really packed except for one specific hour, and other tricks - but if you just build a good company, you generally won’t need to. (Non-italics mine) This is such wonderfully simple advice. Investors, by definition, want to make money. Build something that can, show them it will, and they will give you an investment. If you can't raise money, you're doing something wrong with the first two -- so that should show you where to focus on instead of using poorly thought out social engineering tricks.

beat 13y ago

This basic point is something I keep thinking, too… either you have your shit together, or you don't. If your fundamentals are strong, you should be able to get funding easily. If your fundamentals are weak, no amount of would-be cleverness will make funding viable. If you want to impress investors, impress your customers. Interestingly, this just falls out of something I've learned from years of developing big systems, which is that the line between success and failure is narrow, but the grounds on either side of that line are broad. So back of the envelope calculations that strongly suggest one conclusion or the other are almost always right, assuming there's nothing wrong with your analysis. Because of this, I've learned to not be pedantic about precision. Quick decisions are usually more effective than cautious ones. Maybe that's why I've set out on a path away from the enterprise and toward entrepreneurship.

tlogan 13y ago

This is great but I will offer a simplistic view how to raise money. First, you need to get "social proof". Getting accepted into Y-combinator is a very good one. Or if you already sold a company then you are golden. But if you are super smart working in large tech company such as Yahoo! for 15+ years - good luck. Especially if you are over 40. When you are 40 it is easier to convince Discovery Loan to give you 100K loan than seed round from any VC. Second, you should not have any revenue or god forbid any profit. You might think that is needed but actually revenue and profit are bad for raising money: investors will look your numbers and make projection based on these numbers. It much easier to sell "blue sky" than business with actual revenue and profit. So to raise money: 1 build "social proof", 2 make powerpoint presentation, 2 go raise money

wh-uws 13y ago
If you worked at large tech company for that long and didn't make enough connections, learn enough, and/or save enough money to start a startup on your own... I wouldn't invest in you either

somberi 13y ago

As someone who has found a startup, one point I would add is - Make sure you are within 50 miles of where the VC activity is. That for practical purposes means this; be based out of SFO (+Bay Area), NYC (+Boston). VCs want to fund businesses that reach all over the world, but they themselves must be reachable within an hour or two commute.

guttermaw 13y ago

why do so many of these samaltman things make fp? okay, i didn't really read this one, my time is too value-generating or something i'm asking you, not the rest of you cunts it isn't horrible, if you don't mind about.com-quality tripe

bsder 13y ago

"Not hearing no" I've never heard an investor actually say "no". They will hem, haw, delay, excuse, etc. and do everything except give a definitive "no". You just have to learn to treat "maybe" as "no" until you decide it's worth talking to them again. I'd love to have an actual "no" from an investor. It's like dating: "no" is no. "maybe" is no. "yes" is maybe until you've closed the deal.

ballard 13y ago

With actual rockstar startups not burning through cash like it's their own personal vacation from profitably and reality, the dilemma is often centered between reasonable frugality and trying too hard to seem frugal ending up penny wise-pound foolish. FWIW I'm impressed more by how little actual (non-bullshit numbers) cash and time went into something.