Like at a breakfast buffet, startup founders face a dilemma: Which VC to work with? Is now the right time to take the money? What kind of deal should we try to strike? Often the draw of quick cash from a VC is too alluring, and it’s hard to turn down a bird in the hand when a startup founder wants to move their company forward. This leads to founders taking VC offers before thoroughly thinking things through.
Startups lucky enough to fall in with a good VC find the support they need to make their way in the tech world, but too often, founders find taking the money was a mistake – selling their ideas, technology, and even ideals for a greenback mess of pottage. With money comes all sorts of strings; some investors will raid startups’ intellectual property, require them to go to market too early, or impose limitations on what to develop.