Question

You mentioned you would have raised less during your seed round if you could do it again. What trade-offs do you evaluate when thinking about when raising?

  • Is owning 50% of a 10M ARR company better than owning 5% of an 100M ARR company?
  • Have VC add-on services actually been useful?
  • Does taking investment change the things you prioritise?
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maccaw's avatar
a year ago

The tradeoffs are clear: risk/reward. Raise too much and you get too diluted, raise too little and you may not have enough money to show progress to get to the next round. Often your valuation is a little aspirational and you grow into it.

Is owning 50% of a 10M ARR company better than owning 5% of an 100M ARR company?
It depends on your goals in life. If you want to fast track your learning & personal growth than start a venture-backed business. If you want a chill time run a lifestyle business. Both are fine choices.

Have VC add-on services actually been useful?
Generally, they are vastly overstated. Assume value-neutral to value-negative. Some of our investors are the exception, but they're rare.

Does taking investment change the things you prioritise?
Of course - growth :)

3 points

This question is part of an AMA with Alex MacCaw.

View entire AMA with Alex MacCaw.
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