any entrepreneur able to build a prototype can get an idea funded
Except this is not true and I don't know where people are getting this idea. Maybe it's just SV or YC that has money but Angels and VC's in D.C. and NY at least are looking for solid traction before even bringing up the word term sheet.
At a recent Cooley pitch event a friend of mine who is already revenue positive came up from Ohio to pitch his startup. He told me not a single investor had followed up with him about a term sheet despite multiple discussions after the pitch. Another friend in CO is in the same boat, being revenue positive but with no interest from angels or anyone else.
I think stating that anyone can get money is a dangerous thing to say because it gives the wrong impression about availability of dollars. That post about things being frothy is so insanely different than the reality here on the east coast that it's staggering and totally unbelievable (not saying that I don't believe it by the way).
Agreed. I don't know the world where investors are throwing $1.5M at you, and you somehow had the option to raise twice that. Most of us can't even raise the first $1.5M. These are first world problems.
To be more precise, these are first world YCombinator problems :). Unless there is something great cooking behind the scenes, raising $3MM in seed is not really a piece of cake.
I'm based in the UK just outside of London and also raised an eyebrow when I read the "frothy" statement. Frothy eh? That's not what my interactions have taught me. Investors want to see a clear idea, ideally already well executed and underway and a line of sight to profitability that requires their £'s and perhaps their experience to boot.
This is as opposed to having some vague "It's like Facebook for nymphomaniac Eskimos" concept that it seems anybody in SV is capable of getting funding for.
We spoke with a couple of investors about my start up and ultimately concluded that we would bootstrap as frankly there are too many time wasters out there...
The author probably meant to say that's it's way way way more easier to get seed funding than ever before (besides probably the pre-dotcom burst era).
Secondly besides a prototype you also need a little amount of validation in the form of paying customers or small loyal user base and a good amount of connections to pull of that funding.
Where? More specifically, where is it easily available in the quantities and for the types of pre-revenue startups discussed by the OP? In my experience, most startups have a tough time raising that first seed round, let alone doubling down on that round.
There are tons of YC clone type things popping up all over the place. Maybe you guys don't remember the dot com days, but it is significantly easier to get funded these days, and you can do so much more with less.
That said, of course "anyone can get funded" is not true and probably a bit hurtful to some who are trying and aren't managing.
Except this is not true and I don't know where people are getting this idea. Maybe it's just SV or YC that has money but Angels and VC's in D.C. and NY at least are looking for solid traction before even bringing up the word term sheet.
At a recent Cooley pitch event a friend of mine who is already revenue positive came up from Ohio to pitch his startup. He told me not a single investor had followed up with him about a term sheet despite multiple discussions after the pitch. Another friend in CO is in the same boat, being revenue positive but with no interest from angels or anyone else.
I think stating that anyone can get money is a dangerous thing to say because it gives the wrong impression about availability of dollars. That post about things being frothy is so insanely different than the reality here on the east coast that it's staggering and totally unbelievable (not saying that I don't believe it by the way).