Alternative Paths to Venture Capital

Pros and Cons of Private Investors.

Navigating Own SuccessIn many entrepreneur circles venture capital is considered the “holy grail,” to commercial success. However for many entrepreneurs the reality is that they are better off funding their own business and growing at a pace that is comfortable to them.

Management Autonomy

Most entrepreneurs take personal pride in what they have already achieved and are reluctant when the time comes time to loosen their reins and adapt to new ways of thinking.   Early stage investors are radically different from inventors – they know what it takes to enter and exit a market and as such don’t want to spend precious go-to-market time tweaking and fine-tuning products.  They are eager to assume an oversight role and often immerse themselves and their colleagues into the business. In all cases they are ready to apply their own methodologies and management practices, so if an entrepreneur isn’t ready for this sort of immersion or their style – a perilous outcome is imminent.

Cultural Fit and Speed to Market

Investors want to see results quickly and if your team isn’t “on board,” and  wired for speed, you can come to have quite a problem on your hands. That means your staff needs to be able to partake in the build of a more elaborate service delivery model to effectively scale the business. Most teams are simply just not equipped with the right resources and skills to visualize a future state operating plan, staffing model, and technology leverage. This is where the new and the old teams can polarize or build magic together.

The article below describes how and why one entrepreneur decided to not seek venture capital funding.





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