The no venture capital thing is getting to be a bit much for me. Some businesses and some situations require outside money, some don't. In the hypothetical sit

The no venture capital thing is getting to be a bit much for me. Some businesses and some situations require outside money, some don't. In the hypothetical situation described where Basecamp grew as fast as Youtube or Facebook DHH says he wouldn't raise external financing. I call BS. Businesses with recurring revenues and upfront capital costs that grow fast enough will need to raise money. You need to convert the future cash flows from those customers into cash now to pay for the capital assets to serve those customer today. Sure, a single customer may net you $150 in a year and only require $15 in capital investment. Unfortunately you need to spend the 15 dollars on day one and you only make 12.50 on day one (month one). If your growing slowly you can self finance it off previous customers or a small founder investment. If your growing Youtube fast you get fucked to the tune of that 2.50 shortfall x however many million users you just signed up. The only way to do it is leverage or vc. Take your pick, your raising money.