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> There’s a vocal contingent on here that feel it’s some kind of moral failing and are mad that nobody is getting excited about their bingo card creating websit

by csa 7y ago

> There’s a vocal contingent on here that feel it’s some kind of moral failing and are mad that nobody is getting excited about their bingo card creating website. LOL. I hope this is HN /s. If so, it has several layers of humor. The guy who actually created a bingo card creation site has been fairly vocal with his stance that VC money should only be taken for rocket-ship trajectory businesses — with bingo card creation and other businesses he ran not being of that ilk. IIRC, people have tried to get him on the VC track with a different business to no avail (yet). Additionally, he (informally?) advises people who are applying to YC, and I think one point he consistently brings up with founders is whether they are sure that their business even wants to go on the VC path/trajectory. I think that’s a great question that many people don’t stop to ask due to the pejorative “lifestyle business” label (cough that might have a high chance of increasing ones net worth by millions rather than billions cough). Regardless, to confirm and reiterate your point, VCs aren’t looking for singles... their looking for home runs, and they don’t mind striking out while pursuing that goal. If you take VC money, fully expect to be pushed to those extremes.

hef19898 7y ago
Funding a company is hard. I'm bootstrapping and funding will become a key issue in the next couple of months. My preferred solution is a classical bank loan, maybe backed up by some of the available government-sponsored programs. Why? Because while I maybe could frame my business in some VC-friendly way and go out pitching it I don't want to give up more control than absolutely necessary. Also, I am perfectly fine to have a well running mid-sized business one day (if luck will have it). VCs are not, and being forced to go for 20x+ exit can only mean one huge acquisition or an IPO. Not my cup of tea. Also, every minute I pitch a VC is minute I cannot pitch actually paying customers. I get that some businesses need a lot of money to come up with a product and thus need VCs. I'm lucky to not need that amount of money and to finance the whole product development myself for the next couple of months. But I can't stop wondering if it would be possible for VCs to buolzd a portfolio of profitable, cash positive mid-sized businesses to find the more adventurous investments.
- csa 7y ago
  Assuming that this is a business that has some sort of online component (esp. payments), consider Stripe — they offer loans based on cash flow history with their service. I’m not sure what level of cash you need, but this might do the trick without giving up equity or control. Not affiliated with stripe — just a fan.
  - hef19898 7y ago
    Thanks for the tip, certainly will take a look, could be very helpful in case I sell stuff myself. Which also needs a lot more capital. Does stripe also have a B2B / invoicing functionality?
    - clintonb 7y ago
      Yes. Stripe Billing (https://stripe.com/billing https://stripe.com/billing) supports recurring invoicing (e.g. subscriptions) and non-recurring invoices.
      - hef19898 7y ago
        Cool! Will definitely have a look at it!
  - simonebrunozzi 7y ago
    The person you mentioned above, nickname patio11, happens to work for Stripe now. I am a huge fan of both him and the company.
- zackmorris 7y ago
  You bring up a really good point about backing. Banks generally don't give out loans to any kind of small business that doesn't have > $100,000 in assets and/or some indication of past profitability. Note that this represents pretty much all internet businesses. So it's not surprising that little funding is available for startups. What if angels simply got into the co-signing business? Like, why give a VC $1 million when you could co-sign $100,000 loans for 10 startups? Then write it up as 10% ownership in the company or something like on Shark Tank. Sorry I'm probably conflating terms, but we have kickstarter.com so I don't understand why we don't have something like a readily available angle fund website yet. I'm also curious about government-sponsored programs (does anyone know any?). I imaging they work somewhat like the FHA down payment grants for first-time homebuyers: https://www.bankrate.com/mortgages/first-time-homebuyer-loans-and-programs/ https://www.bankrate.com/mortgages/first-time-homebuyer-loan... https://www.fha.com/program_genesis https://www.fha.com/program_genesis If someone really wanted to stimulate the economy, I think internet startup down payment grants would go a long way towards that goal.

by csa 7y ago

hef19898 7y ago

Funding a company is hard. I'm bootstrapping and funding will become a key issue in the next couple of months. My preferred solution is a classical bank loan, maybe backed up by some of the available government-sponsored programs. Why? Because while I maybe could frame my business in some VC-friendly way and go out pitching it I don't want to give up more control than absolutely necessary. Also, I am perfectly fine to have a well running mid-sized business one day (if luck will have it). VCs are not, and being forced to go for 20x+ exit can only mean one huge acquisition or an IPO. Not my cup of tea. Also, every minute I pitch a VC is minute I cannot pitch actually paying customers. I get that some businesses need a lot of money to come up with a product and thus need VCs. I'm lucky to not need that amount of money and to finance the whole product development myself for the next couple of months. But I can't stop wondering if it would be possible for VCs to buolzd a portfolio of profitable, cash positive mid-sized businesses to find the more adventurous investments.

csa 7y ago
Assuming that this is a business that has some sort of online component (esp. payments), consider Stripe — they offer loans based on cash flow history with their service. I’m not sure what level of cash you need, but this might do the trick without giving up equity or control. Not affiliated with stripe — just a fan.
- hef19898 7y ago
  Thanks for the tip, certainly will take a look, could be very helpful in case I sell stuff myself. Which also needs a lot more capital. Does stripe also have a B2B / invoicing functionality?
  - clintonb 7y ago
    Yes. Stripe Billing (https://stripe.com/billing https://stripe.com/billing) supports recurring invoicing (e.g. subscriptions) and non-recurring invoices.
    - hef19898 7y ago
      Cool! Will definitely have a look at it!
- simonebrunozzi 7y ago
  The person you mentioned above, nickname patio11, happens to work for Stripe now. I am a huge fan of both him and the company.
zackmorris 7y ago
You bring up a really good point about backing. Banks generally don't give out loans to any kind of small business that doesn't have > $100,000 in assets and/or some indication of past profitability. Note that this represents pretty much all internet businesses. So it's not surprising that little funding is available for startups. What if angels simply got into the co-signing business? Like, why give a VC $1 million when you could co-sign $100,000 loans for 10 startups? Then write it up as 10% ownership in the company or something like on Shark Tank. Sorry I'm probably conflating terms, but we have kickstarter.com so I don't understand why we don't have something like a readily available angle fund website yet. I'm also curious about government-sponsored programs (does anyone know any?). I imaging they work somewhat like the FHA down payment grants for first-time homebuyers: https://www.bankrate.com/mortgages/first-time-homebuyer-loans-and-programs/ https://www.bankrate.com/mortgages/first-time-homebuyer-loan... https://www.fha.com/program_genesis https://www.fha.com/program_genesis If someone really wanted to stimulate the economy, I think internet startup down payment grants would go a long way towards that goal.