Fri, Nov 20, 2015

The Funding Paradox

Startups live on borrowed time. While you are building your company, finding your customers and establishing your business, typically you have to deal with negative cashflow (you are paying more money than you are making).

As a founder you end up spending a considerable amount of time getting funding: Preparing pitch decks, talking to investors, following up with leads. And as important as this is — I see too many entrepreneurs getting addicted to money.

Their first thought is “How do I bring money in” as opposed to “How do I build a product that generates revenue”.

Beware this false sense of working on the “important thing”. Money is an enabler — it’s the grease which gets you from where you are today to the point where you want to be in the future. And where you want to be is to deliver a product or service to the market which is useful, loved and your customers pay for.

As glamorous as it might feel to tour the offices of Venture Capitalists — it’s not why you’re building what you’re building. Never lose sight of that.

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