Starting over
Starting a company is very different now. I've talked to several startups run by serial entrepreneurs and all of them are eschewing VC money. They use angels, but more importantly, they bootstrap. Companies really only need to raise cash in the early stages for three things: 1) hire more people 2) buy hardware 3) spend it on something stupid.
By using outsourced development, they should be able to control costs fairly well. No startup needs a CFO, great chairs or more than one item of clothing with the corporate name on it.
Most companies that I've seen should be able to get to revenue for less than a million, million-five, tops.
This trend has interesting implications for the venture capital industry. There's certainly lots of places for them to spend money, but they may stop seeing the sweet early stage deals. Food for thought.
Posted on February 07, 2006
