Friday, August 3, 2012

VC Whisperer Thought #2 - Don't Get Ahead Of Yourself

I often hear first-time entrepreneurs have grand plans for their business. They want to raise thousands or millions of dollars, buy assets, and set up offices. This is a waste of money. For the love of god, please don't spend one penny more than what is absolutely necessary to acquire a customer or validate your product or business model in some way.

The hurdle that has to be overcome with any business is getting to profitability - generating enough revenue so that you aren't losing money. Your chance of success goes way up if this bar is set very low.

While this sounds simple enough, so many entrepreneurs get lost in their vision or their dream, that they lose sight of this simple rule.

Don't get ahead of yourself. 
Don't spend a dime unless you absolutely have to, or until a customer is paying you. 

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