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The startup world is so complex and sometimes random that you can't just come up with a general rule, add "almost" and think you nailed it.

There is no general rule when it comes to investing and no "almost" is gonna change that.

Please stop thinking there are general rules to "correctly" doing a startup.




I agree with your specific point but not with the general feeling implied. I'm the first one to agree that all advice is contextual.

However, my observation there is based on the people I speak to. Many first-time founders that I speak to (in London or parts of the world other than Silicon Valley) think that funding will reduce their risk. For most, that is incorrect. Therefore, saying that in the contexts which I've observed, it's almost never good for first-time founders to raise funding seems like a fair statement, and useful to most readers in the category of first-time founders or people thinking of starting a business.


I would posit that studies of lottery winners and human psychology could help predict the behaviors and fates of founders that receive VC-funding.

Founders may have much better (self-selected) odds of success, but financial management remains a separate skill-set from product/service development and funding solicitation.

Other studies demonstrate that wealth tends to decrease empathy and influence the mind in other ways. Whatever their past history, you are dealing with a different person after they take VC funding. This goes doubly so for predicting your own behavior, given the intrinsic limits of self-awareness.

This is why I have taken a tiered approach to my own creative projects.

I started with a small Kickstarter, just enough to gauge whether people would pay for a novel. That succeeded. Even though the funding failed to cover all the production costs, the several hundred dollars in expenses after that made for a very cheap education in crowdsourcing.

For my next project, I plan to do an anthology. It requires similar skills to a novel, but involves working with many more people, more coordination, and more money. Even if I lost all of my work and had to start it from scratch, though, it would only put me out a few thousand dollars.

Only after a such few projects, each of increasing complexity, will I take on even a small-scale video game Kickstarter. By that time, though, I will have mastered all of the production skills and will only need to ramp up on each.

And the most important of those skills? I will know what to do with thousands or tens of thousands of backer dollars. That way, even a wildly successful Kickstarter (and video games are the most-funded category) will require managing perhaps only 10x more money than before, rather than 100-1000x. I will already know what I don't require to get a project out the door.


I agree completely.




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