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To answer the last question: all companies are in competitive markets. For example - if you can get customers for your saas product at a cost of $25,000 per cus
by danielmarkbruce 5y ago
To answer the last question: all companies are in competitive markets. For example - if you can get customers for your saas product at a cost of $25,000 per customer and that customer is worth $100,000 to your business over the lifetime, and you can acquire 10,000 of them over the next 18 months - you probably should take all the money required and go get them.
If you don't, some other company with a similar product will.
To be clear though - most companies do exactly as you are saying. You just never hear much from them unless you are their target market.
- ilrwbwrkhv 5y agoRight so I totally get that. I am not against raising money when there is a clear understanding that $10 is getting me $20 in revenue so lets put a dump truck this side of the pipe and blast off. What I fail to understand is, for a lot of companies, they haven't achieved that but are raising a lot of money and showing that off as their only achievement. It should be little shameful to raise money and sell part of the company before even building a sustainable business.
- s1artibartfast 5y ago>It should be little shameful to raise money and sell part of the company before even building a sustainable business. why? VCs generally aren't interested in buying part of a currently sustainable business. They want a company that will be vastly more profitable in the future. Companies with no current revenue or sustainability have infinitely more room for growth.
- danielmarkbruce 5y agoI think if you were selling part of the company to grandmas and grandpas who were using their life savings, yeah, shame. By and large the people investing are wealthy, greedy (and I don't mean that in a bad way), savvy people. They want to get in early at a good price before it's certain, and hit a 100x on it.