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One problem with rejecting venture capital (or any other form of external capital) is that the founders (and likely the early employees) are investing in the co
by bayesian_horse 8y ago
One problem with rejecting venture capital (or any other form of external capital) is that the founders (and likely the early employees) are investing in the company, in the form of lower pay.
Which is all fine and dandy, but the founders are likely risking most of their net worth, including the potential income of some of their best years. Taking outside capital not only means growing faster, but also diversification.
- jarjoura 8y agoAnother problem this article misses is that it's quite arrogant to assume a founder has other means to build a company. Most founders are quite honestly usually young and that also means they lack capital, but would otherwise be brilliant and the perfect person/team to create the next Facebook/Uber.
- bayesian_horse 8y agoI think most startups who don't use external money try to grow from their own cash flow. Which in turn means lower payout and wages to the founders or early employees. "No VC" can also mean the founders take on loans, angel investors or friends&family.