The Overlooked Middle Path: Raise Modest Capital, Retain Control
Summary
A lesser-known approach for startups involves raising modest capital under $1M while retaining most equity, offering an optimal balance of potential returns, time to exit, and minimal financial risk compared to VC funding or bootstrapping.
Key Points
- A middle path exists for startups between seeking venture capital and bootstrapping, involving raising a small amount of capital (less than $1M) while retaining most equity.
- This middle path provides an optimal combination of return size, time to return, and minimal financial risk for founders.
- Founders should understand their values, desired outcomes, and what they are willing to sacrifice when choosing a financing route.