Why Too Much Capital is Bad

from the give-me-less-money-please dept

Guy Kawasaki wrote the following article for Business 2.0 explaining why raising too much capital has dangerous consequences. For the most part I think I agree with him. The one additional reason I'd add is that it makes startups act like big companies. Half the reasons startups are successful (okay plus or minus a few percentage points) is they figure out how to do something in a different way than the big company. Often that comes from not having all the resources, and having to be innovative and creative to come up with a new way of doing business. Money makes it much easier to do things the old way. On the other hand though, no money makes doing anything pretty difficult. Fine line...

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