Do you really want to raise money?

Startups are risky. Many fail. Many do not raise capital and many do not survive. There is a lot of hype in the startup world and people tend to think that raising money is like the first badge in Pokemon that you get when you beat Brock. We can all beat Brock right? But why should we? Raising money shouldn’t be the be all and end all for all startups.

The doubt

I guess you are reading this because you are interested in entrepreneurship and new businesses. Startups are businesses. Some businesses make money and some do not. Some need to raise money and some do not. Where am I going with this, you may ask? Who knows, but let’s keep rolling with it!

Investors often ask, “How committed are you to this? How passionate are you about the idea and how far do you want to take it?”

Sure, you can practice the spiel about the team and the progress to date, but ultimately, is it right to take this money?

 As soon as you take money in, you are risking other people’s cash.

The friendships

Investments ramp everything up a gear. For one, investors will expect to be kept informed of your progress. You should already be keeping those interested in your business updated on a regular basis, but be prepared for criticism and feedback if things are not looking good. As soon as you take money in, you are risking other people’s cash.

A good angel investor will tell you that they were prepared to write off the cash as soon as they handed it over but still, they might become your friend along the way and even someone you go for beers with. You don’t want to let them down.

The pressure

Photo Credit: Firesam!

Now, chances are that if you’ve got investors, you’ve already got certain metrics in place. You probably have these metrics measured on a monthly basis and want to show them going up. We have all heard about the fabled hockey stick graph but what happens if things are not looking to go the right way? What happens if you have a month worse than the previous?

Ultimately, investors want to see your company grow. If you cannot show this then there is pressure. You may feel that you have done a bad job of leading the ship. You may feel that an investor questions your integrity on previous numbers.

You may feel a whole lot of pressure that wouldn’t be there if you didn’t take the cash.

Those f@&$*#g days

Then there are the days where you start to question yourself and the choices you made. Things aren’t easy and if you are working long ass days, expect the stress to hit you at some point.

It isn’t all bad though