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by t222 2395 days ago
Asking the real questions.

> That being said... why did you (or if anyone else can chip in) decide to chase funding when you didn't have a business model?

Biggest mistake IMHO. But is quite common these days. Everybody is chasing the unicorn dream.
1 comments
chrisgarand 2395 days ago
It's important to consider that most businesses that start in new areas/ try re-defining the market don't have business models, as they are too small to build a model from. Sure they can bootstrap from one idea to the next until something takes hold, but unless it's a new paradigm that is on the cusp, you're many years (think 5+) from attaining a scalable model. The funding is to be able to hire people, and iterate quickly to expand the business, and find a scalable business model. Trying to build a business model with out a pre-existing business is like trying to solve for x when the right side of the equation is missing. You'll come up with answers, but they're probably wrong once tested.
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streetcat1 2395 days ago
Startups should not create new markets. Too risky. Do what amazon/google does, just with a twist.

You dig where the gold is.

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lmeyerov 2394 days ago
That's sad and I disagree - category creation is amazing. Though indeed, I've observed that almost all VC's are indeed against this until it's been handed to them on a silver platter, despite what they may believe about themselves and their firms. So the tricky part is how to fund it over time :)
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chrisgarand 2393 days ago
They're people as well, the good ones use it as a way to test the conviction of the founding team. If they can't take a few verbal licks, why would they be able to acquire enough customers to gain traction? Not a perfect test, but it has proven to be a workable process where the ones with the most conviction always get _something_. Sometimes it's too late, and sometimes it doesn't work out. That's life.
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lmeyerov 2393 days ago
Yes, I agree -- many like to believe they are into deep tech and category creation, but even of those, most punt until a lot has been derisked. For deep tech / category creation, by the time the risk is gone, you are into growth phase. Someone like Lux Capital is on a very short list of exceptions.
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streetcat1 2392 days ago
So do category creation. Just be in the same categories that are being created by the big 4.
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