Guys, please remember investors are not your fairy godmothers.
They're not interested in slow, steady growth.
They want an EXIT.
They want your company to get acquired or go public so they can cash out their investment – and make a hefty profit.
This is how the equity game works.
So, what does this mean for you?
- Validate your exit potential. If you can't envision a clear path to an exit, whether through acquisition or IPO, then equity investment might not be the right path for you at this stage.
- Explore alternative funding options. Consider bootstrapping, loans, or grants if your business model doesn't lend itself to a high-growth exit.
- Don't get blinded by the hype. Remember, equity investment comes with strings attached. Are you prepared to give up control and potentially change your company's direction to satisfy investors?
Remember: Equity investment is not the only path to success. Don't get caught in the exit strategy trap.
Focus on building a sustainable, profitable business that serves your customers. If an exit opportunity arises naturally, then great. But don't make it your sole focus from day one.
The takeaway?
Choose your funding wisely.
Understand the expectations of equity investors, and make sure they align with your long-term goals for your company.