
Don't be beholden to
venture
capitalists.
Bootstrap all you
can.
10
!The Ten Roads to Riches
starting small and pouring profits back into the firm to self-finance
growth-requiring
patience plus.
It
sounds grand to "start big,"
but
be
warned: Venture capitalists know the start-
up game far
better
than you ever will.
They
fund endless deals. You'll do
one
or a few
in
your
life.
They're
not
funding your firm
for charity, but for ownership and more than their share
of
prof-
its.
They
can create a game plan, so by
your
firm's second or third
financing round, they own much more
of
your firm than you ever
imagined possible. But bootstrappers can do whatever they wish
with cash flow and needn't kowtow to outsiders' wishes.
If
you can
avoid venture capitalists, do it. (Should you decide to go the
VC
route, I needn't waste
your
time telling you how.
There
are myriad
books on it already available.)
PUBLIC
OR
PRIVATE?
Finally, do you want to build a publicly traded firm or a private one?
When
folks think
of
a
CEO,
they usually think
of
heads
of
pub-
lic firms like Bill Gates or Steve
Jobs-mega
names,
mondo
firms.
But the vast majority
of
firms are private. That's
better
in my view.
Thi
s is like choosing between outside funding or bootstrapping.
Generally, firms go public to raise
capital-selling
their souls to the
public. But like getting
VC
funding, you must wrangle with owners
besides
yourself-now
maybe millions
of
them!
Folks idealize the initial public offering (IPO),