The main idea of my post “Cash is king” and the previous one “The Metaphore of the tub” was that cash is the most important thing in startups. Although I confirm the general validity of the post, I would like to expect on the idea “cash is king” and make some exceptions.
I have known some entrepreneurs so focussed on raising funds for their project, that they forget everything else. They believe that if they get enough funding all their problems will be over. They think that their products will be finished on time, they may hire a top salesman, the startup will sell a lot, etc. Sometimes this focus on procuring funding, hides other startup problems, which the entrepreneur does not see or does not want to face. The startup will not get everything else only with money. It requires a proper management and achieving the other challenges mentioned above.
A startup is much more than the money that makes it works. The management team, having the right products, the choice of business model, the revenue generation, selling and profiting are all very important.
At the beginning of my career I advised an entrepreneur to chase money for his IT startup, forgetting other priorities. I realized I didn’t leave enough time for the entrepreneur to sell. Please, don’t make the same mistake. Selling and collecting payments is the best way to get cash.
So, the best entrepreneurs are those who know how to successfully combine the search for funding with business development. They are professionals who at the same time are selling their products in the market, as well as selling their business plan to investors. If you know guys like this and you have the chance, please give them support. It will be worth it!
Formulation of the pill:
– Time to get funding
– Time to management
– Time to sell (and to collect!)