Why you shouldn't raise money
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lalgswCommunity member
Autoplay OFF  •  2 years ago
Don't raise startup capital or venture capital money.

Why you shouldn't raise money

Startups shouldn't always raise money

Not all companies should raise money.

It seems glamorous, it gets press, but it really isn't always the right move.

Companies that raise money need to scale to billions

When you raise money, you need to return a huge multiple. You will push growth, you will explore other avenues. And if the market isn't big enough, you'll die.

If you company can make millions

A business that reaches a maximum size of $5M is fantastic! But if you raised $1M, you then need to fight to get to $100M and more. Raising money forces you to grow

You can make millions without raising money

There are many great cash flow businesses that make money. There is no shame in building a $10M business that won't raise VC money. You may make more!

Companies die because of the money they raised

When companies run out of options for growth, they take huge risks. Sometimes internationally and more. Eventually it can't reach the size it needs to

Carefully consider.

Is my business one that can be $1B? Do I want to run that kind of business? If not, then don't raise money.

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