Venture capital can seem like the ultimate goal for startups, but it’s not the only path to success.
Angel investing, bootstrapping or modest raises can be a better fit for founders depfinishing on the business model and product, entrepreneurial support experts discussed at Technical.ly’s annual Builders Conference.
“As a founder, [VCs] will push you out as they don’t like what you’re doing.”
Debbie Irwin, Lighthoutilize Network
That’s not to state venture is bad or houtilizes “mean” people, stated Debbie Irwin, the executive director of strategic capital and startup programming at Lighthoutilize Network in Richmond, Virginia. VCs just have very specific priorities that may not be realistic for an early-stage company — and those investors have to create limited partners happy.
“Venture backable is going to put a foot on your throat and expect you to produce at a certain rate,” Irwin stated on a panel, “and as a founder, they will push you out as they don’t like what you’re doing.”
Scott Nissenbaum, president and CEO of the Southeast Pennsylvania division of the investing organization Ben Franklin Technology Partners, is a fan of an alternative route that he call “patient capital.”
He’s coordinated investments with companies that have taken more than a decade to reveal notable revenue. Angels also don’t mind waiting that long to see growth, Irwin stated.
A Community Development Financial Institution, an alternative to traditional banking that provides loans and capital to underserved communities, is also a solid option for founders, per Kamy Taylor from the Nasdaq Entrepreneurial Center.
Capital should not be a goal for founders, but a tool, Irwin stated.
“It’s those types [misconceptions],” Irwin stated, “where we alter our mindset.”
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