Excerpt from a great post on TechCrunch by Meebo CEO Seth Sternberg. Among other things, he argues that it’s critical to have a great founding team, and that your team should get a product up and running before raising capital. Keep in mind this is about tech, and may not be quite as easy to do in other industries, but directionally the points are spot-on:
“At the exact moment you had your idea, ten other people had the exact same idea. There was just something in the environment that made it the right time for folks to think that one up. The race has already begun! Who’s going to execute first? Who’s going to execute best? If you want to waste nine months trying to raise VC money for that idea, great. But six months in, you’re gonna cry when you see someone else put out that same product you’re pitching me right now. Like I said, forget everything else and just get your product out the door. Now.
Inevitably, the excuses begin: I need to hire people to build the product. I don’t know any developers. I need money for the servers. I want to get that last promotion at my current company first!
Here’s the rub: in consumer internet (and often enterprise), if your founding team doesn’t have the chops to get a prototype of your product out and in the hands of a blogger to test and write about, you might as well save yourself a lot of pain – you’re not going anywhere. Need proof? Just look at some of the most successful tech companies in the last decade: eBay, YouTube, Sun, Oracle, Apple, Cisco, Facebook, Yahoo!, and Google. All of them share a couple common traits: they launched before taking outside investment, and they were able to do it because they had a set of founders with the skills to build the initial version of the product themselves. Only eBay was founded by a single individual – the rest were team efforts.
Read the full article here.