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Thanks for the guide, although as a founder I'd say I have mostly given up on the idea of raising money from VCs. VCs care too much about vanity, and I don't fi

Thanks for the guide, although as a founder I'd say I have mostly given up on the idea of raising money from VCs. VCs care too much about vanity, and I don't fit the mold most VCs are looking for, thus they'd never invest in someone like me despite my track record of success. These days I'm bootstrapping a couple small businesses (don't put all your eggs in one basket) and things are going well. It's tough as a solo founder, but I have a good set of friends who are cheering me on from the sidelines, and I make progress every day. I'm pretty skilled at most things, and for the areas I'm weak there's always Craigslist or Upwork. I will say that the big advantage of not taking outside investment is that I don't feel any pressure to meet other people's expectations, I really enjoy the work I'm doing, and I get to reap 100% of the rewards. Just to be clear, I intend to apply to YC again, and if a great funding opportunity came along I wouldn't say no, but I've also decided not to actively pursue VC funding anymore. For me, right now, the most sensible thing is to stay focused on building product and acquiring customers.

ProAm 7y ago
> VCs care too much about vanity, and I don't fit the mold most VCs are looking for, thus they'd never invest in someone like me despite my track record of success. It very akin to a fraternity or sorority, it's great if you fit their mold and they want you part of the club.
tptacek 7y ago
If you're not doing a business that can plausibly generate billions of dollars in the lifespan of a VC investment, you're probably not a good fit, because most of the returns in VC portfolios come from success on that scale. That's not vanity; it's just mathematics. I'm with you, in that I'd much rather finance a business on revenue than on speculative investments. But I think too many people blame VC for something that's kind of intrinsic to their business model. If you want to blame VCs for something, blame them for never giving a straight "no" answer when they know that's what their answer is, thus necessitating the dance described by the first half of this guide. That's not intrinsic to the model; that's just them being dicks.
- brenden2 7y ago
  FWIW, I'm only interested in building businesses that could potentially be very large. VCs do indeed place massive emphasis on vanity because they live and die by reputation and perception. Twitter sentiment matters a lot when you're a VC. Additionally, markets care a lot about perception of success rather than 'real' success (though you could argue they're one in the same). There are plenty of examples of companies who raise massive amounts of investor capital strictly based on hype, without necessarily having the economics to support it. The early investors can win bigly merely by cashing out before the laggards jump on the bandwagon.

ProAm 7y ago

> VCs care too much about vanity, and I don't fit the mold most VCs are looking for, thus they'd never invest in someone like me despite my track record of success. It very akin to a fraternity or sorority, it's great if you fit their mold and they want you part of the club.

tptacek 7y ago

If you're not doing a business that can plausibly generate billions of dollars in the lifespan of a VC investment, you're probably not a good fit, because most of the returns in VC portfolios come from success on that scale. That's not vanity; it's just mathematics. I'm with you, in that I'd much rather finance a business on revenue than on speculative investments. But I think too many people blame VC for something that's kind of intrinsic to their business model. If you want to blame VCs for something, blame them for never giving a straight "no" answer when they know that's what their answer is, thus necessitating the dance described by the first half of this guide. That's not intrinsic to the model; that's just them being dicks.

brenden2 7y ago
FWIW, I'm only interested in building businesses that could potentially be very large. VCs do indeed place massive emphasis on vanity because they live and die by reputation and perception. Twitter sentiment matters a lot when you're a VC. Additionally, markets care a lot about perception of success rather than 'real' success (though you could argue they're one in the same). There are plenty of examples of companies who raise massive amounts of investor capital strictly based on hype, without necessarily having the economics to support it. The early investors can win bigly merely by cashing out before the laggards jump on the bandwagon.