Financing Your Start-Up

Bootstrapping. Friends &amp; Family members (F&amp;F). Angels. Venture investors (VC). These are each viable - and even appropriate - ways of financing your start-up. The question is: which is right for you? There are no easy answers, to be sure. But one thing is certain; angels and venture investors look at early-stage investments through different lenses, and it is important <a href="http://www.salehandbagsbags.com"><strong>lv handbags</strong></a> for the entrepreneur to understand the distinction. Further, this is an assessment that often has to be made multiple times, as early-stage F&amp;F and angel-backed companies should or perhaps should not raise VC funding based upon a variety of factors. Choosing the wrong financing strategy can have a profound impact upon the success or failure of a start-up, and given how hard it is to be successful getting this right is hugely important and certainly worth <a href="http://www.salehandbagsbags.com"><strong>cheap dior handbags for sale</strong></a> the time to analyze, reflect upon and plan. It is absolutely critical for the entrepreneur to be brutally honest with themselves and unambiguous and candid with their potential investors. The key variables with respect to financing strategy, as I see them, are: Founder objectives and mind-set; Business potential; and Interpersonal dynamics. Some founders want a "lifestyle" business, e.g., to generate positive cash flow and to live off that cash flow indefinitely. The Web is a great place to build a lifestyle business because it scales so well and requires comparatively little ongoing investment (time, money, staffing) relative to service businesses. I'm not saying it's easy, but if you hit it right it can be fantastic. But these kinds of businesses <a href="http://www.salehandbagsbags.com"><strong>cheap gucci handbags for sale</strong></a> do not subject themselves well to external financing beyond F&amp;F, as "the exit" is not the goal. Most angels and certainly no VCs are looking for a stream of dividends over a long period of time. They want a finite time horizon within which their equity can be sold at a sharp profit; this stands in stark contrast to the lifestyle business mind-set. So bottom line, if the founder's honest assessment is that their goal is to build a business to live off of for the long-term, then bootstrapping, or perhaps taking a small amount of long-term <a href="http://www.436100.info/view.php?id=26313"><strong>Big Mens Dress Shirts |big mens dress pants |big mens shirts</strong></a> F&amp;F capital, is the way to go. Conversely, let's say the founder wants to build a business and exit in either the public or private markets. This aligns them with perspectives of both angels and VCs. So we need to dig deeper.