The Startup Velocity Question: What Hinders Acceleration in VC Funded Companies?

I have been running 1Mby1M since 2010. I find myself saying to entrepreneurs ad nauseam that VCs want to invest in startups that can go from zero to $100 million in revenue in 5 to 7 years.

Startups that do not have what it takes to achieve velocity should not be venture funded.

Experienced VCs, over time, have developed heuristics to gauge what constitutes a high growth venture investment thesis. 

What are the Most Common Ways Startups Destroy Themselves?

Chasing investors instead of customers is the most common way startups destroy themselves. It is a perfectly avoidable path to destruction.

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Featured Videos

Why is Peter Thiel NOT a Fan of the Lean Startup Movement?

This question was recently discussed on Quora. I wrote an answer there, which I have expanded on for this post.

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Who Makes More Money: A Bootstrapped Entrepreneur Or One Who Raises A Lot Of VC Money?

The answer is, it depends.

There are some off the charts success stories like Facebook, Google, and some others where the entrepreneurs raised huge amounts of VC money and also ended up creating huge amounts of personal wealth.

In the cases where the exits are modest, it is generally the case that peopole who bootstrap end up creating a lot more personal wealth than those who raise a lot of VC money.

Here’s a cartoon video that explains the latter case:

Cartoon: Book by Sramana Mitra and Irina Patterson. Art by Mike Varouhas.

Dealing with the Anxiety, Fear, Self-doubt And Frustration of Building a Startup

Startups are extremely difficult, so if you venture into this world, please assume that these challenges will come, no matter what. You will feel anxious, there will be moments of fear, self-doubt, frustration.

I can share a few tools from my own experience both as an entrepreneur, as well as from running the 1M/1M global virtual accelerator where we nurture and mentor numerous entrepreneurs.

First, I suggest you create a set of clear goals that you can follow step by step. This must include small milestones, small action items, and hence, opportunities to win small victories on a daily / weekly basis. This keeps you going, with a positive energy, and a sense that you are making progress.
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How to Transform a Region’s Economy

Can the success of only a few startups revitalize an entire region? And, if it can, what can local governments do to foster such game changing entrepreneurship?

Yes. Here is the example of Greg Gianforte.

On this recording he discusses what the success of his company RightNow did for Montana, where there was no technology entrepreneurship to speak of.

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Billion Dollar Unicorns: Good, Bad and Ugly

You’ve heard me and others comment on the issue of artificially bloated up Unicorns and their questionable exit paths into the public market, or even into the arms of private suiters. In this post, I want to highlight some really good Unicorns, lest you think all Unicorns are artificially bloated. And, I will also point out the at risk ones.

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Focus on Sustainable Growth, NOT Growth at All Cost

You may have read my recent piece Billion Dollar Unicorns: Box Struggles in its Public Avatar, where I discussed how this darling of the VCs is finding the public market rather unfriendly:

Their stock is trading at $13.71 with a market capitalization of $1.65 billion. It touched a high of $24.73 soon after listing in January this year. Box had listed on the exchange at $14 a share. As expected, its valuation has fallen since pre-IPO levels. Prior to listing, Box had raised $564.1 million with their last round of $150 million valuing them at $2.4 billion.

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How to Recruit Credible Advisors for your Startup

We get this question a lot. There is a chicken and an egg problem buried in it that you need to learn to navigate. In this post, I’d like to walk you through a strategy that we believe will work.

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State of the Entrepreneurship Union: The Disease Has Become an Epidemic

I have always been bullish about the spread of entrepreneurship as a global phenomenon. My organization has worked diligently towards propagating the lessons learned from successful entrepreneurs to those coming after, on a global scale. It has been thrilling to watch the world adopt entrepreneurship as a key tool for economic development.

One of my worries have always been that the Silicon Valley disease of equating entrepreneurship with venture capital financing will also spread, corrupting and misleading inexperienced entrepreneurs around the world.

Well, I am very sorry to report that the disease has, indeed, spread.

In fact, it is now an epidemic.

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Infidelity In The Digital Age

Ashley Madison, the web site that uses the tagline “Life is short, Have an Affair” is in the news for a hacking incident whereby the names and email ids of its 32 million registered users have now been exposed to the public.

The whole episode brings to focus a simple reality: large numbers of people are discontented in their relationships.

This has always been true, from the beginning of time. That it is still true should not come as a surprise to anyone.

In this digital age, there are convenient ways to explore various levels of extramarital intimacy. Ashley Madison and its competitors have simply tried to cater to that need in human beings. The “customer need” is amply validated by the site’s very large number of registered users. That they have failed to provide a solution that they promised – a private match-making service – is really what will potentially kill the company at this point, not their inability to identify a widely felt consumer need.
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