Quote:
Originally Posted by the urban politician
^ Plus, too many younger people give too much importance to VC, forgetting that it is a small fraction of vehicles by which company growth is fueled.
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I think we're gone over this before, but tons of companies in history relied on an initial round or two of funding to help get off the ground. Microsoft, Intel, Apple, Compaq, Amazon, Google, Facebook, etc - they all needed initial rounds of funding. Obviously they have to do the leg work, but very few companies in tech, at least really successful ones, have not needed to take in a few rounds of funding first.
* Hewlett Packard - $538 in 1938
* Microsoft - $1M from Technology Venture Investors in 1981
* Intel - $2.5M from Arthur Rock
* Apple - $250K from Mike Markkula in 1977
* Amazon - $8M from Kleiner, Perkins, Caufield and Byers in 1995
* Compaq - $1.5M from Ben Rosen and Sevin Rosen Funds in 1982
* eBay - $6.7M from Benchmark Capital in 1997
* Facebook - $500K from Peter Thiel in 2004 and then $12.7M from Accel Partners in 2005
* Google - $100K from Andy Bechtolsheim in 1998 and then $25M from Kleier, Perkins, Caufield, and Byers in 1999
Obviously you don't necessarily need funding and there's a TON more work other than getting funding, but securing funding has been vital to success for companies you probably didn't even think took initial funding (i.e. Intel). I'm sorry, but without some initial investment , we'd probably not have an Apple computer. Do you seriously think a small handful of guys could have mass produced those computers in their early product days? No - Mike Markkula knew that which is why he invested in them. Even Intel and Microsoft relied on initial funding to get off the ground.
So from a perspective of needing, you don't necessarily need it as there's tons of companies who didn't need it either (most of them were founded longer ago), but to downplay the potential importance of the role that VC has still had in many companies that have been successful for awhile is a bit ignorant.