Danale experience: Start-up companies don't let investment fade into passion

I am a consultant to a number of startups, and I often hear the founders say: "If you start a company with easy access to money, our lives will be much better." "But the data show that 90% of successful entrepreneurs rely on their own efforts to succeed, because the cost of other people's money is often attached to conditions, and most of the additional conditions for the founder is unfavorable."

For example, Bill Gates founded Microsoft and made it grow, and Michael Dell also started a great technology company, which has not used external funds for years, but waited until it was successful enough to sell shares to ordinary shareholders. In 2013, Michael Dell privatized the company, in his words, "to unleash the enthusiasm of our team again".

Before seeking funding through crowdfunding, angel investors, VC funds, the founders need to seriously consider the ability to maintain team enthusiasm and freedom, first of all focus on innovation. If you use external funds, you will encounter the following challenges:

You will always be worried about how you can pay off this account. Many entrepreneurs never forget the moment they get their investors ' money, which means they have a debt, even if, on a legal level, the option is not a liability. As a result of investment failure, there are countless examples of broken friendships and family relationships. Usually, the price you pay is not the breakdown of the relationship, but the slow development of the startup company.

Investors want to get board seats and have the right to vote in key decisions. If you really need help and experience guidance in key decisions, it might be in your favor. But I think a small board with the right members can provide you with better guidance, and if your opinion is good enough, you can choose to ignore others ' guidance.

In case of uncertainty, predefined milestones and due dates. All entrepreneurs do not like to take on a pressure to change the world by promising to achieve some kind of innovation within a specific date. However, every investor wants to get concrete progress. Success through your own efforts will give you more flexibility in exploring creative alternatives.

In order to get rid of the budget constraints, abandon entrepreneurship. When you're spending someone else's money, they want to know how much to spend and when to spend it. Startups have no specific system for accounts payable and receivables, and investors will soon know that they can only control your finances, so they will be financially bound to you.

Transformation is no longer a positive learning, it becomes a pain. No matter how confident startups are about their solutions and markets, they are at least going through a transformation. The sooner you transition, the quicker you can get satisfaction, save time and money, but the investor needs proof, and you explain the mistakes you made before, and the pain will make you want to change.

Explain to investors that it takes time, and you don't have time. Few entrepreneurs have the patience and time to communicate with all investors and make them happy. Small investors who want to get the most up-to-date information need to call them every time they change direction, and only when your business is on the rise, the relationship with the investor will be better.

Investors are the toughest bosses you've ever met. The founders of venture capitalists will soon find themselves replaced by "seasoned" CEOs. Even experienced founders will be forced to give way in decisions and processes because of disagreement. If you spend your own money, you will not be in danger of being fired.

Of course, success through your own efforts implies that you have to do what you can, and you may need to create your own investment fund to start your own business. It also means finding a solution that attracts good team members in addition to salary, and uses an Exchange to find infrastructure or experts. It also means that you will get less money later.

On the other hand, not using external funds means that you can unleash your passion and creativity without being influenced by your investors and take full control of your destiny. Is this not the first reason to attract you to start a business?

Danale experience: Start-up companies don't let investment fade into passion