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The key question is asking if a choice aligns with your exit strategy for the business. Do you want to have a small entity for fun, or give up control to a more
by Joel_Mckay 4y ago
The key question is asking if a choice aligns with your exit strategy for the business. Do you want to have a small entity for fun, or give up control to a more competitive business management team with differing priorities.
In general, VC money always comes with strings attached, focuses on seeing an ROI within 3 years, and founders are usually pushed out of strategic roles as policy. While self-managed small firms are more vulnerable to competition from clown factories with $54m budgets to throw at risky projects. Thus, a lucrative market position usually degrades with time... regardless of either path chosen.
VC money is often a worse deal than debt-financing growth with a bank.. due to equity value siphons. They are both usually unnecessary if you are already in a profit mode.
=)