Why not to take money from investors?
Have you noticed Tony Hsieh explanation Why I sold Zappos this morning? If not check out the article.
No wonder investors wants to get money back as soon as possible even at the cost of compromising core values for why they funded in the first place. Like Tony noticed urgency to get money back was overpowering Tony’s zeal for Zappos culture. Tony was forced to find solution under this pressure. Tony’s solution was to preserve culture while selling the company. As I understand selling is the word Tony is trying to avoid but, anyway its a compromise one way or other and will be interesting to see how long this arrangement will work. Meanwhile not taking investors money sounds like the way to go if you care about your vision more than anything else.
BTW start-up or corporate lesson is same. I have been involved in several projects/products in my career to say this. Bigger the project/product (resources, stakeholders etc) messier it gets to stay true to why you are doing this project/product in first place.
Jason Fried and David Heinemeier philosophy of avoiding investors money for software and service businesses where businesses do not have excessive capital needs seems like thing to remember even in businesses which have decent capital needs. Jason and David made this point several times on their blog,talk, and in their latest book REWORK. If I understand it right its all about who has control and what you care most as you are building your business. So even if business needs that kind of capital, ask money only if you are ready to either give up control or try solution like Tony is trying to see if it works.
No trackbacks yet.