“Don’t take the first offer you get.” While true, this is a very misleading statement to make to a crowd of early stage founders. It’s wrong to make early stage founders believe they will get all kinds of offers from investors. The vast majority of early stage founders will receive no offer at all. We need to be honest about the failure rate and how truly difficult it is to be an early stage founder raising capital. Despite the view in Silicon Valley that failing is healthy and even ok, the actual process of failing is stressful and very taxing both mentally and financially; there is no glory in failing.
“You need to fund the early stages of the business with a credit card or 2nd mortgage.” VC love spewing comments like this because they think it shows commitment. It does show commitment, but it’s also reckless. The failure rate of startups is exceptional, so don’t compound the failure by ruining yourself financially. VC that make comments like this should be ashamed — this advice is going to place a great financial burden on many founders that fail just so a VC can see you’re committed. This is terrible advice that will lead to financial ruin for most.
Fundraising is hard. Since the chances of fundraising success are so small at the early stage, try to build a real, self-sustaining business and don’t do anything that could impair you personally (debt) should the business fail.
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