So many startupreneurs out there are chasing the same dream as their competition – to get a proof of concept on a killer tech idea and land a mega series A financing deal with a top Silicon Valley venture capital firm.
This is the dream of virtually every tech startup founder in Silicon Valley. I’m not saying all of you aspire to pack up and move to the Bay area of San Francisco. It’s just that there’s so much of a movement going on to break out fast and get funded within the first year or two.
Getting funded has become a very dogmatic vision for startup owners.
Free money isn’t always the answer
Some of you might not be ready for funding. Others might do best to grind it out in the trenches for a bit longer.
What happened to entrepreneurs like Gary Vee, who live for the grind and find ways to create a business without throwing and endless stream of money at it? In other words, getting scrappy about how you run a business, rather than getting a bunch of funding or spending your life-savings on a startup that may not see the two or three year mark.
“It pays to be scrappy in the early days.” Gary Vee
You have to put the work in first
Most of us know Ryan Reynolds is the current holder of the Sexiest Man Alive title. Nobody on the planet thought much of him when he was Michael Bergen on Two Guys and a Girl. Do you even know of the show?
He was just a tall, goofy comedic actor then. When Blade 3 came along, he paled in comparison to costars Wesley Snipes and Jessica Biel. Now, after YEARS of toil and suffering in Tinseltown – grinding away – he’s eclipsed them both in star power and is now worth tens of millions.
Reynolds didn’t get there overnight. Yet, call it Millennial Syndrome or whatever you want, modern startup founders start thinking about who they want to hit up for money even before they get the darned business launched and up off the ground!
Stop begging for money
The whole idea of being scrappy is about being happy that you’re running a crew out of a coworking space – heck if you’re working out of your parent’s garage, that’s total BOSS in my book!
And no, you don’t need to buy a brand new company car to create the impression of wealth and success yet. Drive that Ford Taurus into the ground!
Is the business entirely self-sufficient? Is cash the only limiting factor to a profitable future? Do you have any idea what your profits will be at the end of the month – week – year?
Being scrappy will teach you things
Share a space with other startups, ask your dad if you can use his garage as company headquarters for now. Keep driving that crappy car or use Uber, until the company’s financial future is more certain.
You might very well rise to the point where you need investor money to avoid losing out on major growth opportunities for your company. The real question you need to consider is “Do I really need it?”
VCs and angels can be a godsend for a booming startup. They’ll also want a cut of profits and a significant stake in the ownership of the company. Investors will want to have a say – vito power – in all or most of the decisions you make moving forward.
Investors may be rich, but they’re scrappy when it comes to business. Once you take their money, you better be dog-damned sure you have enough financial intelligence to do the right things with that cash.
Being scrappy and forced to find unique ways to save more and spend less to get the results you want teaches you something – something that other entrepreneurs who go looking for investors too soon after launch just won’t learn.
Perhaps you don’t need the money yet?
Maybe that real-world education in using guerrilla tactics to build the business is more important for now?
Share your thoughts…
