Sarah Guo wrote an interesting few lines on the fact that she thinks that not all ventures should be venture backed.
What she in my opinion points out rightfully so: Long term goal alignment and personal incentives need to be in line with the companies long term health. If the goal of the founders is to create a large enough exit asap so that they can start on something else, then this is probably not the best setting for a VC-backing.
SpaceX is an exceptional case
Of course not all business can be run and funded by the founding team themselves – like Elon Musk’s SpaceX program – but don’t just raise for the sake of raising. If you do not have a long term vision on what you would like to achieve with the capital that you are trying to raise, then take a step back and try asking yourself the following question: Am I willing to go all the way and take the long way home? Even if this means investing 10 years of my life?
Your core management team needs to believe and understand the mid,- and long term perspective of your company for them to truly shine and develop the correct strategy. Generally speaking, VCs want to see that the management and founding team do not only have the vision to build the next billion $ company, but are prepared to tackle the challenges together that comes with that.
Have a look at Sarah’s article, it is worth a few minutes of your time.
Here you will find the full article Not Every Startup Should Be Venture-Backed — Medium
Article and Image Source: medium.com