Which is the Better Source for Startup Capital?
Every budding start-up comes across the same big question as its revenue starts to grow, “Is it time to seek funding from a Venture Capital Firm?” The answer may vary depending on the type of company and the economic conditions surrounding the forecasted growth of the startup. One aspect that every entrepreneur must do is evaluate whether they actually need VC funding or if they should go after the likes of an angel investor, private equity investor and maybe even a business incubator. In recent times, crowdfunding has been all the talk. After all, why would a company elect to give up a percentage of their company when they can simply give away their product to “investors”. The only reason why crowdfunding has not taken over the venture capital world is because the JOBS Act has not yet been approved. Crowdfunding and Venture Capital funding have their positives and negatives and they must be assessed before considering accepting an offer.
Self-Finance or Raise Money? A Quandary for Start-Ups
Do you try to attract outside capital early or try to push it back as much as possible with the secret hope that you may never have to surrender an equity for it?
The NY Times explores this dilemma with a look at two different start ups.
Or seed capital for that matter?
Here’s Mark Cuban on startup capital.
Watch the short video: