4 ms·

Long story short, nothing to do with your actual business or business model or innovative technology or hand-wavy "disruption" or large addressable market size

Long story short, nothing to do with your actual business or business model or innovative technology or hand-wavy "disruption" or large addressable market size or traction or any of the other things that VCs tell the plebs matter, when in reality they only matter if you don't have anything more valuable like the above. This is how companies raise ludicrous amounts of money without ever finding product-market fit, because of the Ivy league / family / prior possibly irrelevant past history matters more.

spoonjim 4y ago
> nothing to do with your actual business or business model or innovative technology or hand-wavy "disruption" or large addressable market size or traction I would take out "traction" from this. If a company has strong traction (that looks sustainable) it will outweigh everything else.
- rexreed 4y ago
  It's hard to prove counter-examples of companies that have had significant traction but were unable to raise money, because, well they were unable to raise money. The only alternatives are those companies who have had large amounts of traction, were unable to raise money, but ended up being successful anyways by bootstrapping or finding some alternate method. But it's not generally / necessarily true that companies that have strong, sustainable traction will outweigh everything else because the counter-examples are just not obvious. Intuitively, I can imagine that there have indeed been companies that have had great / strong traction, but have no Ivy League management team, no VC connections, no real family strength, no past history of success, and none of the other things that were described above, and thus, despite their strong traction, they were unable to raise money.
  - spoonjim 4y ago
    The traction has to be able to be turned into money -- a consumer "rate the celebrity" app could have millions of users but not really be investable. But I haven't seen any cases where an investor says, "They have real traction, that can grow at venture scale and at strong economics, but I don't like the founder." It's just extremely uncommon. Usually "dislike of founder" (with all of its biases) comes when you have to put a lot of faith into the company, not where the company has already proven itself. Of course -- investors can simply be wrong about the growth potential or unit economics or sustainability of traction -- but that's different.
junofan 4y ago
It’s a seed round.
- Retr0id 4y ago
  So what?

spoonjim 4y ago

> nothing to do with your actual business or business model or innovative technology or hand-wavy "disruption" or large addressable market size or traction I would take out "traction" from this. If a company has strong traction (that looks sustainable) it will outweigh everything else.

rexreed 4y ago
It's hard to prove counter-examples of companies that have had significant traction but were unable to raise money, because, well they were unable to raise money. The only alternatives are those companies who have had large amounts of traction, were unable to raise money, but ended up being successful anyways by bootstrapping or finding some alternate method. But it's not generally / necessarily true that companies that have strong, sustainable traction will outweigh everything else because the counter-examples are just not obvious. Intuitively, I can imagine that there have indeed been companies that have had great / strong traction, but have no Ivy League management team, no VC connections, no real family strength, no past history of success, and none of the other things that were described above, and thus, despite their strong traction, they were unable to raise money.
- spoonjim 4y ago
  The traction has to be able to be turned into money -- a consumer "rate the celebrity" app could have millions of users but not really be investable. But I haven't seen any cases where an investor says, "They have real traction, that can grow at venture scale and at strong economics, but I don't like the founder." It's just extremely uncommon. Usually "dislike of founder" (with all of its biases) comes when you have to put a lot of faith into the company, not where the company has already proven itself. Of course -- investors can simply be wrong about the growth potential or unit economics or sustainability of traction -- but that's different.

junofan 4y ago

It’s a seed round.

Retr0id 4y ago
So what?