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I'm currently building a company in the mold described in this article (slow and steady). So a couple of firsthand observations. First, I think every business
by eldavido 6y ago
I'm currently building a company in the mold described in this article (slow and steady). So a couple of firsthand observations.
First, I think every business has a natural speed. There are some businesses that can be made to grow really fast. Others, no matter how much marketing spend/growth hacking you throw at it, just aren't going to grow quickly enough to be truly venture fundable. I've seen a lot of these businesses started and they flame out quickly when the founders raise a ton of VC, build this huge staffed-up company, end up with a cost structure their revenues can't support, then don't hit the growth numbers their funding requires. Fast forward 18 months, the company is sold for parts and everyone walks away with nothing (especially if there's a huge liquidation preference overhang). That said, I do think some types of business (esp with strong network effects) need VC.
Another major factor is whether the founders are craftspeople who enjoy making great products, or are more the kind of people who want to make as much money as quickly as possible and "exit".
I think the biggest obstacle I'm going to hit is hiring. These companies don't profile as traditional "hot" VC companies which will bring certain unique challenges around hiring. I'll figure it out.
Great article, thanks for sharing.