Back in 2007, I wrote a post titled, An Early Stage Entrepreneurs Guide to New York City. At that point in my career, I was a founder of a venture backed (Intel Capital, NBC Universal, Morgenthaler, etc) in-game advertising company called IGA Worldwide and was part of the nascent NYC tech ecosystem. I used to hold darrenSalon‘s (remember those?), brunches, and other gatherings of likeminded entrepreneurs. Heck, the NY Tech Meetup was still 12 of us sitting around a table.
Across my feed this morning came a tweet by Steve Schlafman, a principal at venture firm RRE about a new presentation he created called The Guide to NYC Tech. I’ve seen many presentations over the years about who/what/when/where/why is happening in NYC but this is one of the most comprehensive presentations. If you have a spare 15 minutes, you should certainly check it out.
Having been part of the different waves of entrepreneurship in NYC, I can honestly say that while other waves have been just as innovative and exciting, this wave feels like there is the most substance and staying power. There are ad dollars to support the publishers, there is bandwidth to make video + streaming a reality, there is comfort in purchasing online, and organizations are opening up to digital disruption. I am super excited to be part of the ecosystem and will continue to do what I can to support #nyctech.
Do you believe that Venture Capital is the holy grail of entrepreneurship? If you do, you may be an entrepreneur for all the wrong reasons. Venture Capital is an enabler for different aspects to a business such as growth but at the end of the day, your product or service should be more important than landing venture capital.
The reason why I’m writing this post is that I meet with many entrepreneurs who are under the spell that raising venture capital automatically validates your business and almost guarantees that you will succeed. If you raise $10M in venture capital, it gives $10M reasons why you will not succeed; the odds are against you. The stakes are higher, every decision becomes riskier. You have $10M to spend and we all know how easy it is to spend money.
Venture capital is sexy. It’s like being able to drive a Ferrari. Being a member of FerrariChat.com, and actively involved in exotic car events around Westchester County, I can tell you that there are many owners of these cars who have no business driving them. It takes a certain type of person to be able to control these exotic vehicles, just look at all the Ferrari Enzo crashes. People who have $1M to spend on these gorgeous cars get behind the wheel, have no business driving them, and crash them within 36 hours of owning them. However, it is sexy to drive these cars…
Venture capital is much the same. Your goal as an entrepreneur is not to raise venture capital, but to build a sustainable business around a product and/or service. If you can do that without raising venture capital, all the power to you. Why give up equity when you do not have to? I’ve personally been on both sides of the fence and have had positive and negative experiences. It takes a gifted leader to balance a board of venture capitalists and ultimately, generating enough of a business to substantiate venture investment.
To all the burgeoning entrepreneurs out there, don’t think that raising capital is the end-all and be-all. If you can do it yourself, go right ahead. If you need to raise capital, be cautious and make sure you’re ready. Build traction and focus. Raising capital gives you minor validation to your business (someone believes in you to invest) but doesn’t guarantee success and should not be the holy grail of entrepreneurship.
I’d like to round up a great group of entrepreneurs and media folks and get together one last time for 2006. Ideally, the group will be a round table to discuss what are the trends going into 2007 and WHY. We all can forecast trends (pull things out of thin air), but I’d like to talk about WHY we expect these trends to occur.
I’d personally like to host this at Le Pain Quotidien on 77th between 2 & 3rd Ave (Subway: 6) on Wednesday, December 27 at 3:30pm EST. The get-together will have 1 hour of formal discussion and then a schmooze fest. Feel free to spread the word but please RSVP by leaving a comment on this blog. Since I’ll be hosting (coffees, teas, pastries), I’d like to know how many folks will be coming… also, no egos please as ideally there will be serial, parallel, and brand spankin new entrepreneurs and I’d like there to be a level playing field for all to participate. Online folks and offline folks welcome!
Again, please leave a comment on this blog if you plan on attending…