There is lots of talk about VC’s being the bringers of doom for startups, self-fulfilling prophecies and money falling off the planet.
My brief take on it is that things have changed. Not terribly much, but terribly. We’ve gone from a growing market to a not growing very much at all market.
What does that mean?
Things are going to be a bit harder now.
* Raising money – not much loose cash around and VC’s can be pickier.
* Getting sales – less investment for growth. However, if your product is about reducing risk or reducing costs and the return is clear and short, then you may find it a good market. That being said, most budgets are tightened which , makes things harder.
* Hiring good people – when optimism is down, people are less likely to take risks on your band of merry startupers and come with you on a perilous journey.
* Being optimistic – it is one of the roles of the entrepreneur and it’s now harder. It’s easier to sing when theirs a choir.
Welcome to the job. If it was easy, then everyone would be doing it and you wouldn’t be earning your millions.
Plus, it takes a few years to build a good business, so be patient, focus on creating value, try to turn that into revenue, keep costs low and by the time your hitting third gear, we’ll be coming out of the bottom of this and you’ll be ready to grow.
If you’re a startup who hasn’t hit your goals and doesn’t have serious traction/revenue, then you’re probably not going to make it. You should have focused more and made hay while the sun shone, because it really did shine.
That being said, consumers are still online. They are still clicking on things, buying things, paying for software, reading blogs. Companies still want to reach these consumers, communicate globally and have a happier workforce. There are still cathedrals to be built here.
So, all the four things I mentioned above that are harder now (money, sales, team, optimism) are all in your hands. They are all doable. Someone will do them in the next three years. The difference is not going to be the GDP of USA, the FTSE or the exchange rate. It’s going to be hard-fought, persistent, brutally focused luck.