You Don’t Need Funding to Be Successful
Joshua Davidson wrote this article
How much funding do you think Chop Dawg has received since our formation in 2009? To give you a bit of background on us, for those who aren’t aware – we have grown from a team of one to over twenty individuals in six years. We have over one hundred and fifty-five clients, world-wide. We have been featured on countless news media outlets, websites, and blogs such as Mashable, MSNBC, NBC, Fox, ABC, Technically, Examiner, and Elite Daily. We have had over half a million people follow us on social media who are engaging with us daily.
Are you ready for the answer?
The answer is $0.00.
We have received zero dollars from investors and outside venture capitalists since our company began. Every dollar was originally bootstrapped by us, and our operations have grown by reinvesting our yearly profits strategically, year after year. Many individuals call us a success. However, even more individuals consider raising money a victory, the only viable way to being defined a success, and we are here to prove that logic wrong.
One of the biggest hurdles that we have seen in recent months is the idea that raising money is, somehow, a victory for a company. Part of this is due to just how hard it is to raise money. We tell our clients all of the time, it is harder than it seems to raise money, and it most certainly will take you more time than you are estimating. It is nearly always the case. The thing is, due to these factors, I often find that startups and companies in general celebrate when they raise money, shouting from the roof-tops, being congratulated for miles and miles in the valley. It’s time to put an end to this. Businesses are not built on raised money. They are built on profits, growth, and customers. If your goal is to build a company to raise money, you are better off getting the hell out of business. Furthermore, raising money is where the hard stuff should truly begin. You now have investors to appease, a return of investment strategy in place, and high growth ready to go. How exactly is raising money a success?
Please do not let the above comments confuse you, or make you think I believe that raising money is not critical. Listen, we are not naïve in the slightest. You need to raise money in many different situations. For example for those who do not have the fortunes to bootstrap on their own. Or if you need additional funding to scale quickly. Another reason to raise funds would be if you are trying to get into a market before a competitor. These are just a few of many different examples. With that said, often times, entrepreneurs become weak. They want to raise money for the wrong reason. Most of these times, it is due to one factor and one factor alone – ego. You’re comparing yourself to something that is often times incomparable.
The honest truth here is that for whatever reason, most entrepreneurs get into this game for the wrong purpose. Fund raising is like hitting a home run in baseball, you did something incredibly impactful to the ballgame, but your goal is to win the game by scoring the most runs (points), not by hitting an individual home run. You are able to grow your company the same way those before you have done so for hundreds of years.
One such method is the lean startup method. Paraphrasing to the best of my best ability (but you can buy the book to learn more about the thought-process here), build something yourself, bootstrap with the amount of money that you can afford to lose, or provide what is called sweat equity to a team for them to join you early on as co-founders to help get your product off the ground. Build a business model early on that will be monetized. From there, make revenue. Use the revenue after expenses, aka the profit, to reinvest back in your company. Continue the cycle for growth. Does this process seem somehow familiar? It should. It is because it works, and for a lot of individuals, they want to pretend this route doesn’t exist because it takes hard work.
I honestly do believe that one of the reasons individuals seek funding is because they are cowards. If they do not raise funding, they can always chalk it up to many factors such as investors just did not like me, it wasn’t my time, or the economic factors did not play in my favor. It is time to break the cold hard truth here. Perhaps the reason most individuals do not raise money is because their idea stinks and potential investors do not believe they can be the type of entrepreneur to succeed. It is easier to place blame on others than ourselves. Real entrepreneurs take the risk. They put their money where their mouth is, they work their butt off, and they are willing to put everything on the line because they confidently believe that they will be successful with whatever it is that they are trying to do. This isn’t meant to be a motivational spiel but instead, I am just stating the facts.
You can be successful without an investor. You can be successful with an investor. Don’t let not having an investor stop you. Websites exist in this day and age to help you, no matter what the financial and/or economic factors are that you face. Sign up for Founders Dating or AngelList. Network your tail off. Learn how to code, how to design. Hustle every minute that you can. Figure out if raising investment funds is the way to go. Pitch to family and friends. You will surprise yourself, and odds are, surprise others, if you realize you do not need to do what everyone else is doing to be successful.
I can promise you from my own experience, you can end up in just as good of a situation, if not better, by doing it on your own.