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Henry Ford on Bootstrapping, Funding, & Going Public
- jcdrepair 14y agoThis is a lesson I think a lot of Silicon Valley needs to learn. I read an article several months ago written by some 19 year old Valley kid about how Chicago could never produce a great startup because it's too practical of a city. People don't start a business without a real plan for how it's going to make money. Somehow that was a bad thing. I couldn't believe what I was reading then and I couldn't agree more with what Ford is saying here. I realize that some industries require a fair amount of capital to get started. You don't bootstrap an auto or semi-conductor company. But software? In all honesty, the millions of dollars raised by most tech startups are done with the promise that they'll get a bunch of users and then figure out how to monetize them later. That is a bad business model and one that is doomed to waste billions of dollars in cash and millions of hours of talented software developer work. If you're sitting out there with a bunch of money to invest, don't go looking for a company that needs money to stay alive and please, please stop funding what is nothing more than glorified college projects. Instead, find a company that already has customers and is profitable and needs money to expand their business. That's money well invested.