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What's that logical fallacy where you take what someone said, twist it into something completely different and more extreme and then defeat that extreme argumen
by eloff 9y ago
What's that logical fallacy where you take what someone said, twist it into something completely different and more extreme and then defeat that extreme argument? Strawman?
What he said was "Another thing investors like" is when the investor himself puts his own money into the startup.
Well that's a no-brainer. If I were an investor, I would definitely say putting your money where your mouth is, is a positive signal. I'd specifically avoid wealthy founders who don't pony up - seems like a strong negative signal if they themselves don't want to take a risk on it!
He later says "So, unless you come from money, attended a prestigious university in the States or sold your previous startups for a lot of money, you should assume that you’re never going to raise early-stage capital." Given the statistics that he quoted, that's sound advice. The odds are strongly against you, so unless you check all the boxes that VCs look for, you're effort is likely better spent elsewhere. If you can get that hockey-stick growth going, it doesn't matter what boxes you tick or not, now you're speaking their language and have things on your terms. It's smarter to do the stackoverflow thing and take the company as far as you can before seeking investment. At the least, you'll raise much more, with less time investment, and less equity expended.
- tptacek 9y agoI think if you don't have real signals for investors to focus on, they'll look for tea leaves to read.
- eloff 9y agoAgreed, because what else do they have to go on. Best focus on getting those real signals as strong as you can. Then go talk to VCs. In my opinion VC should have nothing to do with starting a company and everything to do with accelerating the growth of a proven startup. Angel investment is a little different and has a definite role to play in allowing people to get the company to the point where it can demonstrate some traction.