The Best Source of Capital


Too many entrepreneurs are obsessed with investors. These kinds of founders are easy to spot—when you ask them how their businesses are going, a normal response would be something like, “Great, we just raised another round of financing!” Unless you’re in the fundraising business, raising capital is not a business milestone. You’re in business to make money, not raise capital. Fundraising is a full-time job and significant distraction when you’re trying to build a business. Of course, there are times when your business will need a significant capital infusion. But by the time you’re ready for this, investors will be chasing after you, not the other way around.

Instead of worrying about investors, focus on profitable growth as the primary way to fund your company. There are a lot of ways to do this. Instead of spending the next two years building a cutting-edge platform, what can you build in the next month or two that solves the same problem and starts generating revenue for you immediately? Is it possible to consult for the same customers now and start building strong relationships, so they’ll support your first product? Profit is the best source of capital, so focus on making money.


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