Investors Out—Collaborators In!
In the long history of humankind . . . those who have learned to collaborate and improvise most effectively have prevailed.
The last chapter ended with an explanation of how to create a business plan to present to investors. Therefore, it might seem strange that we are now saying—“Investors out.” However, this chapter's focus isn't to tell you to never bring on investors. Rather, it emphasizes the importance of knowing when it makes sense and when it doesn't, what you need to know when and if the time comes, and the importance of finding genuine collaborators—not just deep pockets.
Despite our personal preference to avoid investors, we're not always opposed to the idea of bringing them on board or going for other forms of financing. There are times in the evolution of some companies when it makes sense to secure outside money. However, this definitely isn't true for every company; we would even argue that it isn't the case for the majority of entrepreneurial ventures. Many of the most successful entrepreneurs we know have bootstrapped their way to success without ever utilizing external financing. This has been the case for most of our own companies as well.
The mistake we often see entrepreneurs make—and the issue we address in this chapter—is the idea that you must find outside money in order to start a business. If you read business magazines and blogs and follow other sources of start-up news, you'll find plenty of ...